The election of a vibrant young president with an overwhelming majority sends the best possible message to the rest of the world — and could be a signal to get back into equities.

President-elect Barack Obama’s victory has kindled the beginnings of hope and belief, which will generate the confidence essential for recovery.

Make no mistake, though, the recession will still blight 2009. Millions will be thrown out of work. Big companies will go bust.

However, American voters are already telling themselves that, if they can catapult Obama into office, they can surely beat the economic gloom.

I am certainly not saying share prices will go no lower. There will be grim days, particularly in the strange limbo of the next 10 weeks before Obama is inaugurated. Wednesday’s plunge showed what can and will happen.

Don’t worry at this stage about the most promising sectors. The new administration is expected to favour healthcare, energy and large-scale construction companies, but there is a long way to go before that translates into corporate profits.

Traditionally, the third year of a new US president is best for stock markets. If you are willing to take a view of that length, think about investing in well-run UK companies with a strong American presence, such as Unilever, BP or British American Tobacco.

If you prefer to spread your risk by going for funds with a US bias, though, I like those run by Fidelity and Gartmore because they have strong connections in America.

0% finance

THE Bank of England’s dramatic 1.5-point cut in its key base rate to 3% raises the strong possibility that the Bank will at least flirt with going to zero — but does it matter?

We are in the extraordinary situation where Mervyn King, the Bank governor, is dancing to his own jazzy tune in one corner of the room while all the commercial banks continue their own stately minuet at the other end.

King can do what he likes, but unless the other banks pass on his cuts they are a complete waste of time — although good news for savers, who are being spared the impoverishment that should be heading their way.

The London stock market clearly believes that the banks will cut their loan rates, as share prices stabilised on the news of the rate cut, only for them to fall again on Thursday amid worries about how bad the recession will be, before rising on Friday.

Individual savers and borrowers are largely locked in to whatever deal they signed up to. Fixed is fixed, trackers will — up to a point — track and variable rates will be at the mercy of the banks.

If you don’t like your loan deal, switching is going to be difficult, to put it mildly. Your existing lender will probably be happy to see the back of you and rare will be the bank that wants to take you on.

Savers can move more freely, but shopping around is going to be more vital than ever. And, after the Iceland experience, any temptingly high offers must be tempered by thoughts of how long that bank is going to be around.

King is clearly trying to embarrass the banks into taking action, and any thoughts of encouraging savers are taking second place to keeping the checkouts busy.

Facing the music

ONE of the less publicised virtues of building societies is staying in touch with their members, who are also their customers. This is something banks are not good at, rarely encouraging face-to-face meetings with customers unless they want to sell products.

However, the chief executives of Norwich & Peterborough, Yorkshire and about a dozen other societies regularly tour the country to hold meetings near their branches.

Banks would doubtless dismiss such gestures as a waste of shareholders’ money, as normally no more than a couple of dozen hard-core anoraks turn up. However, these are not normal times, and I hear that attendance has shot up lately to more than 100 a time. And guess what the obligatory Q&A session is all about? That’s right: is my money safe?

This is not a straightforward matter, as a surprising number of building- society savers keep more than £100,000, and in some cases well over £1m, in one account.

That is far in excess of the £50,000 government limit on compensation if a deposit-taker goes bust.

Not so long ago it would have been virtually unthinkable for a building society to fail, but in the past month three — the Derbyshire, Cheshire and Scarborough — have had to be taken over in circumstances that have been remarkably close to rescues.

So it is foolhardy to leave more than £50,000 in a single account, other than on a strictly temporary basis.

Tricky, though, for a chief executive to admit this to a big saver, as the unavoidable message is to take most of your money away. That’s customer service for you, though.

The Financial Services Authority is planning to regulate the high-street end of banking, and I do hope it forces the banks to hold such meetings as a matter of course.

They might learn home truths that might shake their complacency about customer satisfaction.