We are not sure if the equity markets are fully aware of this (or maybe they don't care), but the Democrats now, according to the USA Today, not only have an excellent shot at taking the House, but the chances that they could capture the Senate moved to 50-50 based on polls taken in six key states (Maryland, Rhode Island, Tennessee, New Jersey, Missouri and Virginia). Charlie Cook of the venerable Cook Political Report is quoted as saying that "Cleary, we've seen momentum shift away from the Republicans and toward the Democrats". Imagine how this shift could intensify if gasoline prices move back up or the Dow fails to sustain its record level between now and November 7th. Tax hikes, protectionist, pro-labor populist policies favoring the proletariat at the expense of the capitalist, the war on terrorism and lots more are at stake ... since this will also set the tone for the presidential elections in '08.