We are less than a week away from what could be the most important midterm election in recent memory. Certainly, I think this is the most important election that I can remember. I think it’s much more important than the midterm election of 1994, and that election turned out to be hugely important.

If I may get a bit political here, I think that after nearly two years of what essentially amounts to one-party rule, the American people are ready for a change. I also think that the need for a change in Congress to an opposition party is something that the American people have embraced, and certainly the pre-election polls suggest that Republicans have a very good chance of regaining control of the House of Representatives, if not also the Senate.

Now, regardless of which political party you belong to or where in the political spectrum your views are, there’s no denying that the political makeup in the Congress and the White House have implications for the market. I actually think that one of the reasons why we’ve seen such a big spike higher in stocks recently is due to the perception that Republicans will regain control of at least the House of Representatives.

One true precept about the market and politics is that Wall Street loves gridlock. Another way of putting it is that the less that gets done, the better it is for Wall Street. Now, you may think this isn’t how things should work, but what “ought to be” and “what is” are two very different things on Wall Street.

This simple notion brings me to today’s admonition, and that is to get out and cast your vote in favor of your money. Moreover, I say that if you want to vote in favor of your money, then you should cast a vote for divided government.

I think that if we do get a divided government in the next Congress, it will mean an opening of the capital floodgates for companies and for many investors. Companies are likely to start spending some of the cash they’ve accumulated during the past year or so, and investors are likely to come back into stocks, just based on the perception that there will be more obstacles to any big, new federal programs.

Keep in mind that we already know that stocks tend to perform better during certain times in a presidential cycle. Our research shows that during the first and/or second year after a presidential election, markets are most apt to make notable corrections. Certainly we’ve seen that right after President Obama took office. Data from the Stock Trader’s Almanac confirm this theory, stating that, “In the last eleven midterm election years, bear markets began or were in progress nine times.”

Interestingly, the Stock Trader’s Almanac data also show, “Since 1914, the Dow has gained 50% on average from its midterm election year low to its subsequent high in the following pre-election year.” This is the key statistic for us, as we already may have seen this midterm election year low.

Finally, whichever way you decide to vote next week, make sure you exercise your civic privilege and make your choice. Our system is far from perfect, but it’s just about the best system that’s ever been created. So, don’t just be a spectator in America -- be a player!