The Election Changed the Landscape. It Shouldn't Change Your Plan

Post-election market volatility, AI data centers, Anthropic and what this week's changes could mean for long-term investors  

We have been following the markets closely and keeping clients informed as events have unfolded around the election. This week gave us quite a bit more to think about.  

On Thursday, November 5, the S&P 500 fell 4.4% while the Nasdaq Composite declined 5.5% . Nvidia fell about 9%, and the iShares Semiconductor ETF declined roughly 12% .  

Those are big moves .  

But I don't think the election itself completely explains them.  

Instead, I see three stories converging: financial-market positioning magnifying post-election volatility, voters beginning to push back against some of the physical demands of the AI and data-center buildout, and investors reconsidering how much they should pay today for extraordinary growth expected far into the future.  

For long-term investors, my bigger takeaway is simpler:  

Elections can change the economic and investment landscape. They shouldn't automatically change your financial plan.  

Let's look at what happened and why I think that distinction matters.  

Why did markets become so volatile after the election?  

Markets entered the election with some unusual positioning.  

In October, Reuters reported that volatility-control strategies had pushed their equity exposure to the 98th percentile of observations since 2010 . Barclays estimated that even a relatively modest rise in volatility could potentially force more than $100 billion of equity selling .  

That's important because some investment strategies don't simply make a judgment about whether stocks are cheap or expensive. They systematically adjust risk as volatility changes.  

When volatility is low, they can increase exposure. When volatility suddenly rises, they may be forced to reduce it.  

And this wasn't the only source of pressure.  

The Wall Street Journal reported a JPMorgan estimate that leveraged ETFs sold more than $60 billion of equity exposure during the week. Reuters also reported that technology-focused long-short hedge funds lost more than 4% on Thursday, based on Goldman Sachs estimates, as risk reduction spread through the investment industry.  

That can create a feedback loop.  

Prices fall. Volatility increases. Certain strategies reduce exposure. The resulting selling creates still more volatility.  

This doesn't mean these investment products caused the entire decline. Concerns about AI spending, valuations, policy and individual company outlooks were involved too.  

But financial positioning can amplify a market move beyond the change in the underlying economic fundamentals.  

That's worth remembering whenever markets suddenly move several percentage points in a day.  

What did the election tell us about AI and data centers?  

This may actually be the more important long-term story.  

Artificial intelligence sounds like a digital technology, but supporting AI requires an enormous amount of very physical infrastructure:  

• Land  

• Data centers  

• Electricity  

• Transmission capacity  

• Cooling  

• Water  

• Capital  

That infrastructure is increasingly becoming a political and community issue.  

Ballotpedia tracked at least 50 data-center-related ballot measures across 13 states in 2026 , including 41 measures on the November 3 ballot. As of November 4, voters had decided 47 measures. In 46 cases, the result favored greater limits on data-center development, either by approving restrictions or requirements or by rejecting proposals intended to facilitate development.  

The measures varied considerably, so I wouldn't describe them all as simply anti-AI.  

But they tell us something important.  

Communities are beginning to ask questions about the real-world consequences of America's AI infrastructure expansion.  

Earlier CBS News/YouGov polling identified concerns about the effects of data centers on electricity, water, the environment and local utility costs.  

Those concerns showed up around the election.  

CBS News exit polling found that AI data centers were a major factor for more than half of voters . Opposition to having a new data center built locally also crossed political lines, and in the selected states examined, opposition extended across urban, suburban and rural communities.  

For investors, I think this changes the AI conversation.  

For the first phase of the AI boom, the major question was:  

How quickly can artificial intelligence grow?  

The next phase may increasingly ask:  

How quickly can we build the physical infrastructure necessary to support that growth, who pays for it, and how much development will communities accept?  

Software can scale extraordinarily quickly.  

Power generation, transmission lines and water systems cannot .  

How fast is Anthropic growing, and can that pace continue?  

Anthropic's anticipated IPO gives us an unusually clear look at just how quickly the AI industry has been expanding and why investors are beginning to reassess AI valuations.  

The growth numbers are remarkable.  

Anthropic reported approximately $17 billion of third-quarter revenue, up 47% from the previous quarter . That followed an extraordinary 144% sequential increase in the second quarter .  

Think about that for a moment.  

This isn't a company struggling to grow.  

It is a company growing so rapidly that investors now have to confront a very different question:  

How long is it reasonable to assume growth of this magnitude can continue?  

Trees don't grow to the sky.  

It doesn't mean a healthy tree stops growing. It means that as the tree gets taller, continuing to grow at the same percentage rate becomes increasingly difficult.  

That's an important distinction in the Anthropic story.  

Revenue didn't shrink. It grew another 47% in a single quarter.  

What declined was the rate of growth compared with the extraordinary 144% sequential increase in the previous quarter.  

And supporting this growth requires extraordinary amounts of capital.  

Anthropic disclosed approximately $895.4 billion of multiyear computing and infrastructure purchase and lease commitments . It also reported a $567 million operating loss for the third quarter after posting a $974 million operating profit in the previous quarter.  

So the question for investors is evolving.  

It isn't simply:  

Can AI companies grow extraordinarily quickly?  

Some clearly can.  

The more difficult questions are:  

How long can those growth rates persist? How much capital will be required to support them? And what should investors pay today for growth that may inevitably moderate tomorrow?  

Is a lower Anthropic IPO valuation actually bad news?  

Not necessarily.  

This is where the potential Anthropic IPO gets particularly interesting.  

Reuters reported that some current and prospective investors were considering a valuation around $1.5 trillion , down from earlier expectations around $2 trillion . Following the technology selloff, CNBC reported that some investors expected the valuation below $1.5 trillion , with one suggesting $1 trillion to $1.25 trillion might be more realistic.  

Importantly, these are investor expectations, not an official IPO price or formal repricing by Anthropic.  

There's a big difference between a company's business deteriorating and investors becoming more realistic about how much they're willing to pay for its future.  

Morningstar, citing PitchBook analysis , estimated that a $2 trillion valuation would represent nearly 31 times Anthropic's July annualized revenue run rate . Supporting that valuation would require continued growth, improving margins, customer stability and productive use of the extraordinary amount of computing capacity being contracted.  

That's why lower expectations aren't inherently bad for investors.  

If an investment is priced assuming nearly everything goes right, even excellent results can disappoint.  

A lower starting valuation creates a lower hurdle.  

But that doesn't necessarily mean we've reached the end of the adjustment.  

Investors still need answers to some enormous questions:  

• How much AI infrastructure will ultimately be needed?  

• How quickly can it realistically be built?  

• How will it be financed?  

• How much revenue will all that capacity eventually produce?  

• What return will ultimately be earned on that capital?  

We don't know those answers yet.  

Is today's AI boom similar to the railroad expansion?  

This is where my own perspective comes in .  

I continue to think we're somewhere in the middle of something resembling America's railroad expansion of the 19th century.  

Railroads transformed the country.  

They connected cities, lowered transportation costs, opened markets, increased productivity and made businesses possible that previously could not exist.  

They also attracted tremendous amounts of speculative capital.  

Some railroads were built where they weren't needed. Some companies were poorly financed. Investors overpaid for projected future growth. Companies failed and investors lost money.  

But none of that meant railroads weren't transformational.  

The railroad boom could be economically transformative and financially speculative at the same time.  

I think AI can be too.  

AI can transform the economy and individual AI investments can become overvalued.  

Data centers can be necessary and too much capital can chase their development too quickly.  

Some companies can ultimately fail and the technology itself can become dramatically more important.  

Those aren't contradictions.  

They may simply be what a technological revolution looks like while we're living through it.  

Should an election change your financial plan?  

This is the part of the conversation I think matters most.  

People understandably have strong opinions about politics.  

You may be thinking about taxes and economic policy. Someone else may be worried about the environment. Others may be focused on social policies, artificial intelligence, privacy, inequality or the wealth gap.  

Those aren't trivial concerns.  

They affect how we feel about the direction of our country and the future we're leaving to our children and grandchildren.  

Elections matter, too.  

Our democratic process will never produce an outcome that everyone considers perfect. But over the long term, it gives people the ability to influence the country's direction. Communities debating the benefits and costs of data-center development are one example of that process happening at the local level.  

But investors have to make an important distinction:  

How you feel about an election isn't necessarily the same thing as what you should do with your money because of it.  

Presidents change.  

Congress changes .  

Tax laws change.  

Regulations change.  

Technology changes .  

Markets certainly change.  

Hopefully the things that matter most to you don't change nearly as often.  

Your family.  

Your independence.  

Your retirement.  

The people and causes you want to help.  

The experiences you want to have.  

The security and flexibility you want your resources to provide.  

That's your plan.  

Not mine. Not Wall Street's. And certainly not Washington's.  

Our role at Heintz Wealth Management is to help you understand how changes in the financial, political and economic landscape may affect the choices available to you.  

You decide where you want to go.  

Your portfolio isn't the destination. It is one of the resources helping you get there.  

Financial planning isn't about correctly forecasting every election, Federal Reserve decision, market correction or technological breakthrough.  

It's about positioning your resources so you can continue moving toward the life you want, knowing we can't predict all of them.  

What should long-term investors take away from the post-election market?  

I wouldn't interpret this week's decline as proof that the AI boom has ended.  

I also wouldn't dismiss it by saying nothing has changed.  

Something has changed.  

Investors are beginning to assign a more visible price to issues that were easier to overlook while markets were rising:  

• Leverage and crowded positioning within financial markets  

• Electricity, water and infrastructure constraints  

• Public acceptance of rapid data-center development  

• The tremendous capital required for the AI infrastructure buildout  

• The amount of future growth already reflected in technology valuations  

Those are legitimate questions.  

There will probably be more adjustments as this technology develops.  

And that brings me back to the comparison I find most useful:  

The railroad boom wasn't ultimately wrong about railroads. It was frequently wrong about which railroads would win, how quickly they would become profitable and what investors should pay for them along the way.  

AI may ultimately tell us a similar story.  

We may not be watching the end of the AI buildout.  

We may still be somewhere in the middle of laying the tracks.  

And through the elections, corrections, rallies and technological changes that come along the way, your objective shouldn't be to successfully predict every turn.  

It's to understand what has changed, adjust when appropriate , and keep your financial resources focused on the life you want to live.  

Sources and Disclosure  

Market information and research referenced in this commentary include reporting and analysis from Associated Press , Reuters , The Wall Street Journal , Ballotpedia , CBS News , CNBC , Morningstar and PitchBook .  

A note about AI: This article was prepared with the assistance of artificial intelligence for research, fact-checking , organization and editing. The observations, investment perspective and conclusions are Bud Heintz's , including the comparison of today's AI infrastructure expansion to America's railroad buildout and the central planning perspective that political and market changes can alter the landscape without changing the long-term purpose of a client's financial plan.  

Sources and quantitative claims were reviewed against published reporting before publication.  

This commentary is provided for informational and educational purposes only and should not be considered individualized investment, tax or legal advice