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A Trump presidency & the markets

expatsp
in Off-Topic
Anyone know any economist who's put out a convincing model of what a Trump presidency means for the markets, not just today, but for the next four years? Here are a few rapid thoughts, but I'm not an expert, I'd love to hear from or see a link to someone who's already thought hard about this:

1. More trade conflicts: bad for all markets
2. Giant tax cuts = bigger deficits = more inflation + short-term growth: good for stock markets at least for a year or two, bad for Treasuries
3. Greater geopolitical uncertainty: bad for stock markets, good for Swiss Franc, German govt bonds, gold, etc.
4. Unified Congress + Presidency = better chance of a swift policy response when the next crisis comes: good for all markets.

I'm trying to stick just to the market impact, based on his stated positions, and keep out my personal opinion on these policies.

Comments

  • VintageFreakVintageFreak
    Please don't take this the wrong way. I think we all are entirely too sanguine about our intelligence and abilities to do what you are trying to do. I don't think you are looking to do day trading, so I don't think there is enough time to look at observable evidence rather than predict anything.

    Tonight, I might go 100% in cash in my retirement accounts. WTF cares what individual stocks/securities are doing?
  • JohnChisum
    This is a mutual fund board rather than a stock board. With that said, natural resources could do well here going forward. (Coal etc) Green energy is in the doghouse especially companies that are being propped by Wash D.C.

    I wouldn't make any drastic moves based on a emotional response to the election results. Some fine tuning of the fund portfolio might be profitable if you hit the right funds. It's wait and see time.
  • msf
    I don't think anyone has a clue. Flight to quality? Last night the 10 year yield dropped about a dozen basis points (higher Treasury prices), yet this morning the yield was up. One could say that this was the realization sinking in that the US might now actually "renegotiate" its bonds. While I seriously doubt that will happen, it's just one more piece of evidence that no one knows.
  • MikeMMikeM
    Canadian infrastructure stocks may be where the hot money goes. They are building a wall to keep Americans out.
  • willmatt72
    So far, it looks like a severe overreaction last night based on what's going on today.
  • MikeMMikeM
    FWIW: this is a Schwab commentary on the suprize election results.
    The bottom line: We suggest investors ignore the noise while the dust settles and stick to their long-term asset allocations. Volatility is likely to be extreme. Reacting emotionally is a time-tested poor strategy for managing one’s money.
    http://www.schwab.com/insights/market-commentary/trump-wins-what-happens-now
  • DanHardy
    expatsp said:


    1. More trade conflicts: bad for all markets - Yes, previous trade deals helped companies to move overseas or go out of business.

    2. Giant tax cuts = bigger deficits = more inflation + short-term growth: good for stock markets at least for a year or two, bad for Treasuries - Yes, tax cuts the other side of the coin of deficit spending.


    3. Greater geopolitical uncertainty: bad for stock markets, good for Swiss Franc, German govt bonds, gold, etc. Yes, same said about Reagan, Bush II, Obama


    4. Unified Congress + Presidency = better chance of a swift policy response when the next crisis comes: good for all markets. Possibly but look at Obamacare when he Dems were in control

    I'm trying to stick just to the market impact, based on his stated positions, and keep out my personal opinion on these policies.

    Nothing is new except for the history you do not know. Nothing much has changed but if you do you might want to look into real estate in Canada. I understand there will be a lot of new people going there.
  • MJG
    edited November 2016
    Hi Guys,

    Another election and another peaceful transfer of leadership is anticipated. I sure hope Trump has the requisite leadership,skill set. The most likely answer is a firm "yes" based on his success in the rough and tumble business world..

    Leadership must endure many challenges. An understanding of leadership traits have been recognized over time. They include factors such as commitment, a vision, communication skills, dedication to duty, team building proficiency, listening to others, and the ability to integrate a diversity of opinions. Trump has demonstrated most of these necessary characteristics.

    "Judgment comes from experience and experience comes from bad judgments." Mistaken judgments happen. That deep thought comes from General of the Army Omar N. Bradley. I extracted it from the US Army Field Manuel on leadership. That Manuel is a great guide to leadership demands and execution principles. Here is a Link that allows a free download of it:

    http://usacac.army.mil/cac2/Repository/Materials/fm6-22.pdf

    It's an easy read that is filled with examples, stories, and meaningful quotes. Please give it a try. It just might help your investment decision making.

    For years I have purchased and distributed copies of the referenced Army Leadership Manuel to young members of my family. I believe it helps their maturing process. It might also be a not bad investment in reading time for us older investing types.

    Best Regards.
  • jstr
    Using a well designed, empirically based investment process with diversification using stock universes that have produced excess returns consistently over long samples, 5 and 15 year forward total returns periods resulted in Buffet matching returns averaging 154% vs. 71% for S&P500 ( 5 year periods ) and 1968% % vs. 403% ( 15 year periods ). This over many different variants of House and Senate composition, administrations, fiscal / structural changes, stock market valuations, geopolitical events, etc.

    The DIY design entails the purchase of a 3 blend universe of small cap value, emerging small cap, and large value on Nov 1 and then switched for utilities sector ( or bonds / cash ( when risk algorithm signals "high risk" year in February )) on May 1 of the next year and switch back to 3 blend on Nov 1.
    https://docs.google.com/spreadsheets/d/1tvKoFaFCQhbO5gQSld7i8TMPw_ZTXB1-AA_9velX_tM/edit#gid=102066566
    https://docs.google.com/spreadsheets/d/1tvKoFaFCQhbO5gQSld7i8TMPw_ZTXB1-AA_9velX_tM/edit#gid=1235486791

    Uncertainty about what the future holds for investment returns under X political climate / elected official scenario may be alleviated by viewing forward 5 and 15 year total returns over the past 14 election years utilizing this process https://docs.google.com/spreadsheets/d/1tvKoFaFCQhbO5gQSld7i8TMPw_ZTXB1-AA_9velX_tM/edit#gid=1245955002

    These asset class exposures all available through exchange traded funds
  • hank
    VintageFreak said:

    Tonight, I might go 100% in cash in my retirement accounts. WTF cares what individual stocks/securities are doing?

    VF: That was my first thought this morning too. Than I thought to myself, "What the hell. It's only money."

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