This headline on Reuters, “Investors welcome US election gridlock” makes no sense. Stock markets are supposed to hate uncertainty, yet as the US election is about as close as it could get (and therefore the result is disputed by Donald Trump who doesn’t want all the votes counted, just the ones for him) equities have staged a big rally that takes them back to where they were about three weeks ago (and the S&P sits around 1% below its all-time high).

It is particularly surprising because the UK also joined France and Germany in lockdown this week, even as analysts flagged the certain hit to corporate earnings that will result from nationwide restrictions, and odds of a double-dip recession in Europe have risen. Even domestically-focused companies, those most impacted by lockdown such as pubs and buses, rallied quite strongly.

All this comes without much recent good news about the imminent release of a vaccine (Donald Trump was too distracted to worry about providing his usual stock market support) and as US infections surged past 100,000 in a day. Without further action, America is on course for 1 million new infections per week.

Obviously few people have seen the trailer for Michael Bay’s new film Songbird, which paints a vision of America in 2023 where the virus has mutated and is still out of control, having caused the death of millions of people and the country’s financial ruin. Fictional, we hope.

Wednesday saw tech stocks and safe havens rally in unison. True, the big names have strong balance sheets so are unlikely to go bust any time soon, but their high valuations leave investors at serious risk of capital loss if there is a re-rating one day. Perhaps that will only happen if regulators who are threatening to split them up actually turn words into action. Don’t hold your breath.

The fact that Amazon, Google and Facebook all dominate their respective markets illustrates how powerful companies can get and how weak anti-trust laws (anti-competition) have been during the past couple of decades. And the pandemic has been great for big tech companies that have benefited from lockdowns that shift work online, forcing companies to buy more laptops and more cloud storage, whilst consumers keep buying iPhones and streaming subscriptions funded indirectly by government handouts.

This is not like past recessions where companies and consumers cut back spending, this time most people are relatively flush with cash because governments have been extremely generous with taxpayers’ money.

All eyes are on now on the next round of fiscal stimulus, especially in America. Private sector employers were supposed to have added 600,000 new jobs in October according to forecasters but the actual amount was a considerably lower 365,000 according to ADP this week.

The pace of recovery has slowed significantly and ironically this is seen as positive for stocks as it potentially increases the size of any new free money program.

People have become addicted to financial stimulus, politicians know it boosts their popularity and any kind of responsible fiscal behaviour went out of the window a long time ago. One can only wonder when, or if, the younger generation will ever be galvanised into protesting about the way their future is being stolen from them-more spending and debt now means greater costs later.

By adding to the deficit today, we are literally borrowing from their future. The younger generation is already burdened by high education costs, high housing costs, a deteriorating environment and growing inequality. Whilst Greta Thunberg has highlighted how the current generation has a duty to pass on a cleaner world, someone needs to stand up and do the same for government spending and corporate fiscal responsibility. Otherwise the kids risk inheriting the mother of all financial crises one day, thanks to their parents and grandparents, namely us.