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In addition, the markets response it could be that investors were quite happy with continuity. Despite a lot of gloomy talk - about rising oil and petrol prices, and the slow pick-up in employment as the economy has grown - the American economy is not in a bad way. Growth is pretty strong. Inflation is low, though showing some signs of rising. Unemployment, at 5.5%, is a little lower than when Bill Clinton was re-elected in 1996.

Corporate profits have risen by 75% over the past three years and profit margins are approaching their highest in three decades, according to Silvercrest Asset Management. Bond defaults are low. Small and mid-sized companies are in better shape than they have been in four years, says James Hance, vice-chairman of Bank of America. For the first time in years, there are signs that these companies' bank deposits are beginning to fall. This might be a sign that demand for commercial and industrial loans, which has stagnated in the past few years, is about to increase.

However, by no means is everything rosy for the stockmarket, which has had a curious year. Although the economy has been doing decently and profits for the companies making up the S&P 500 are likely to be 20% higher this year than last, on the eve of the election share prices stood roughly where they had on January 1st, having surrendered all the gains they had made earlier in the year. Maybe uncertainty about the election had something to do with this.

The Cloud Around The Silver Lining
Looking ahead, the sinking dollar will also add to inflationary pressures. Household savings are low: if these have to rise, then consumers will spend less. Corporate earnings are still growing strongly, but the pace is fading. Profit growth of 10% next year, which many analysts expect, sounds brisk but is only half this year's rate; the year after, it may be slower still. If the job market is tightening at last, then this will push up wage costs. Worse, America has a huge government budget deficit that can only be reduced by extraordinary economic growth, higher taxes or spending cuts.

This caution about the economy is visible in the yields on Treasury bonds. Despite the Bush victory, possibly meaning more government borrowing than a Kerry presidency, the latest, jobs report and the upward path that the Fed appears to be setting for short-term interest rates, the ten-year note still yields a mere 4.2%. Though this spells good news for borrowers, it may also signal that bond markets are not positive about growth.

In Summary
After the markets' brief burst of post-election euphoria, they will have to look ahead to what Mr Bush might do in his second term. Several initiatives he intends to pursue will have a direct impact on the public markets, notably the creation of some form of individual retirement accounts in place of Social Security and a broad revision of the tax code. None of this will be easy nor perhaps even feasible. Making it all a bit more difficult will be the likelihood that Alan Greenspan, chairman of the Federal Reserve, will finally retire at the end of his term in two years. The name of his replacement may mean as much to the markets as did the American people's verdict on November 2nd.