Confused about all this presidential election mess? You’re not alone! I’ll give you the straight scoop on how this really happens. You can decide the morality issues of it all for yourself. Suffice it to say, this isn’t our forefathers country any longer.

Step 1: The Kickoff of the Primaries. What actually are primaries? Primaries are preliminary elections that narrow the choices of candidates for the final presidential vote. Although voters choose whom they would like to see in the Presidency, their vote is diluted through the use of delegates.

Everyone really wants to know the answer to this next question… What the heck are Delegates?

Step 2: The Delegates are “everyday citizens,”(yeah, right) associated with political parties. Candidates who win from state to state earn a certain number of delegates, who are then required to vote for that particular candidate at the party convention, where the final presidential nominee is chosen. The number of delegates to be awarded the winning candidate in each party depends on the regulations of each state. Each are obviously different.

Some states use the Winner-Take-All method, where the losing primary candidate receives no delegates, even if he lost the race in that state by ONE percentage point.

Other states use a “Proportional” system awarded on the percentage of votes each candidate earned. Most delegates (varying by state) sign a pledge that they will vote at the party convention for the candidate they represent.

Step 3: Caucuses are less formal primaries, and developed in highly rural states. Voters attend regional state meetings where representatives of the candidates stump before voters, meaning they make speeches and try to sell the people on their candidates. Traditionally in days of old, voters would vote by standing behind the representative of their choice. Today, ballots are used – caucuses are generally less secretive and more public than formal primaries. The votes count in the same way as those from primaries and delegates are awarded to winning candidates.

The primaries were actually a 20th century invention, and weren’t really all bad. Before the turn of the century, voters had no say in whom would be a political party’s representative for the presidential race. Party “bosses” were the ones who determined who would lead up the party. Gradually, states adopted the primary system, in order to encourage more direct public influence in the voting process, but delegates were never required to vote for the candidate they represented. Well into the mid-20th century, delegates’ votes were bartered at the conventions among party bosses, rendering the public vote pointless.

And then, there was Watergate. As the scandal broke out into a frenzy, Americans became disenchanted with the insulated party politics and demanded a more “open system.” Interestingly enough, the constitution had no guidelines for the direction of primaries, leaving the particulars up to the political parties. So, the major political parties have developed a primary system that supports their interests, but is also sensitive to voters. In essence, the popular vote in primaries and caucuses only guarantees which candidates will most likely carry the nomination for their particular party. But everything can change at the party conventions.

Step 4: Party Conventions are a forum where power brokers would barter potential votes of delegates in return for favors. As technology has progressed, the conventions are more open – televised, mediaized, videoed, etc. As a result, vote “buying” has decreased a little bit, but not by much. At least, in front of the cameras more, and harder to hide. But as most of us know, politics is a dirty and dishonest business. Often times, politicians are referred to as “ugly actors who couldn’t make it in Hollywood.” I suppose that depends on who you ask!

Ultimately, today’s party conventions are mainly a formal display of which candidate won the right to represent the party in the presidential elections. Officially, delegates assemble at the convention to cast their votes. For the first vote, most delegates will vote for whom they represent, according to the pledge they took. Customarily after the first vote, the one candidate who is “overwhelmingly chosen” in the public vote, is usually the one chosen in the delegate vote, and becomes “the official presidential nominee.” But this isn’t always the case.

Sometimes, the popular vote is very close. Due to the delegate systems that differ state by state, things can change. The first delegate vote might not yield a Clear Majority. In this case, a second delegate vote will be taken. During the second vote, the delegates are now allowed to vote their conscience, meaning they are not bound to vote for the candidate whom they officially represent. Such conscience voting can dramatically alter the nomination process granting the party mantle to the candidate that did not receive the most popular votes.

Some of the time, party convention votes tends to reflect the public’s choice, but with so much media and heavy selling of both parties so heavily funded, this is beginning to change. All established parties (Republican, Democrat, Green, Reform, Independent, etc.) may hold conventions, but the two major parties – Republican and Democrat – obviously receive the most press coverage due to the power they hold. It’s not fair, but it has become the way it is because big business refuses to change it.

Step 5: Campaigning. After the presidential nominees for each party have been selected, the campaigning begins. Nominees traverse the countryside, selling their platform and trying to convince voters to elect them as President. Your television is taken over by this orderal for the better part of a year, this making a person want to hit their head against a thick wall and commit suicide!

During this period, debates are held to bring the candidates together to discuss relevant issues (if you can call it that). Various organizations come in and sponsor these debates.

The “sponsoring organization” chooses who is invited to participate in debates, but the rules governing the debate are hashed out among participating candidates. There is no law stipulating that candidates must do a certain number of debates. The candidates are free to choose to debate. If a candidate is far ahead in the polls, he may choose to do one debate for good measure, but not a second to avoid any disasters on public television, which could hurt his candidacy.

Election Day is always held on the first Tuesday, after the first Monday in November. The ballot is supposed to contain every candidate from every party, plus candidates for local state elections (although it doesn’t always happen that way). Voters, in some states, are restricted to choose only candidates in their party during the primaries, the final election is completely open.

Voters (if they can stomach it) vote for whom they prefer to see as the President. But wait… there’s yet another “fly in the ointment.” Our vote is now diluted even more with… you guessed it! The wonderful Electoral College, of course.

Step 6: The Electoral College – The epitome of “fairness.” Much like delegates, electors are chosen within each state to elect the president and vice-president. The number of electors for each state is equal to the number of representatives a state has in both houses of Congress.

How did the college come to be? Here it is: The Founding Fathers invented the Electoral College at a time when our country did not have a strong National Consensus. Back then, the majority of Americans were illiterate farmers who lived in remote areas. The chances were high that regional third parties would unreasonably split the votes. If a candidate gained a majority in the Electoral College, it was viewed as the equivalent of a National Consensus. (Sadly, many Americans still can’t read, but they can listen to the media and their friends and family).

The truth? Today we no longer need the Electoral College, but skewed politics and limitless corruption and greed continue to keep it in place.

The Big Question: Does this water down my vote as an American? The Answer is Yes. You bet it does. This is why voter apathy continues to grow each year, and why Americans continue to feel powerless over their government. Simply stated, the popular vote is not how a president is elected. It’s all boils down to the political “pull” of the Electoral College.

You may have heard about the presidential cycle in stocks.

Or maybe you haven’t. If not, here it is in a nutshell: Stocks do their best in the third year of the four-year presidential term-that is, in the year preceding the next presidential election year.

Since 2007 is the third year of the current presidential cycle-the next election will be in 2008-let’s see whether there’s any truth to the presidential cycle, or if it is just an urban myth.

Various studies have been done on the phenomenon, covering different time periods and using different indexes as proxies for ”the market.” All of the studies are in agreement. The presidential cycle is not a myth. Stocks, in fact, have historically done their best in the third year of the election cycle. They have been doing so for decades, it doesn’t matter what index you look at, and the data is not even close.

In fact, the data supports recurring trends for each year of the four-year presidential election cycle.

Here is some data. One study used the S&P 500 and the time period from 1952 to 2003. The results were that the average annual total return for the market has been about 6 percent in year one of the presidential cycle (that is, the first post-election year), 8 percent in year two, 23 percent in year three (the pre-election year), and 11 percent in year four. Returns from the most recently completed cycle just about matched those numbers: year three (2003) produced a gain (in the S&P) of 26 percent and year four (2004) produced 9 percent.

Another study covered the years 1889 through 2005, also using the S&P 500 (and its predecessors) as the proxy for the market. Its conclusions were that returns were about 3 percent in year one, 3 percent in year two, 11 percent in year three, and 8 percent in year four.

The same study also looked at the data from another angle, measuring the percentage of years that the market was up for the year. The result: The market was up in 57 percent of year one’s, 55 percent of year two’s, 79 percent of year three’s, and 73 percent of year four’s.

Other studies support the strong-year-three indicator: Since 1945, the S&P has gained an average of 18 percent in the third years of election cycles, compared with an average of 9 percent in all years. Year three has not had a down year since 1939. And so on.

Clearly, there is a pattern. Does this make sense, or is it a mere a statistical accident? Do political considerations affect the stock market?

Sure it makes sense. The leading theory is that in the first year or two of a president’s term, economic sacrifices are made. Painful decisions come early, such as fighting inflation, cutting back spending, and even starting wars. New priorities are introduced, fresh ideas abound. But by the third year of its hold on the White House, the incumbent administration emphasizes economic stimuli to gain favor for the coming election campaign.

Congress-no matter which party holds the White House-wants the same thing: to gain favor for the upcoming election. Presidential election years have the biggest stakes of any national election: All of the House’s seats are in play, along with a third of the Senate’s seats, and of course the presidency itself is up for grabs. Whether the Democrats or Republicans currently control the White House, each party wants to win it. So Congress wants to juice the economy too.

In essence, year three is the “setup” year for both parties to hit next year’s campaign trail with their best arguments in place. The incumbent party wants voters go to the polls with jobs and a feeling of economic well being. The party out of power wants to have an economic record that they can argue is even stronger than the incumbent party’s.

Will the cycle repeat itself in 2007? Well, we’ve had the capture of both houses of Congress by the Democrats, who will set the congressional agenda for the next two years. But the White House is still controlled by the Republicans. Does that equate to uncertainty, which is historically felt to be an enemy of a rising market? Or does it just mean stalemate, which is not usually felt to be a bad thing for the market?

Only time will tell. But in the absence of a compelling negative event on the horizon (I don’t see one), or compelling negative current data (as you might have if the market were wildly overvalued, which it is not), the long-time pattern very strongly suggests that 2007 will be a good year for the stock market. After all, the historical data itself covers election cycles in which there were all kinds of economic conditions and every combination of party control of the White House and Congress. The clear pattern of strong returns in year three has emerged from all those varying conditions.