Jeff Sommer of the New York Times writes of Trump's charming of the market after a wild swing when he unexpectedly won the Presidential race.
Prices rose as Mr. Trump read smoothly from a teleprompter, uttering familiar bromides. When he is President, economic growth will double, he proclaimed. America's interests will come first, but other countries will be treated fairly.
Of course, this doesn't take into account the congratulations that Trump received the next day from Russia's Putin, as well as Islamic State and the KKK. But then, they probably found Trump's teleprompter skills to be charming, too.
Sommer does mention a more likely scenario for a calming market: that many businesses like the idea of a Republican trifecta, where regulations are tossed aside like potato peelings, and profit is the deciding factor on what lives and dies.
The odd thing about regulations, though. When you remove one to aid one industry, other industries suffer.
Remove any limits on fracking, and alternative energy industries die—not to mention most of Oklahoma. Remove water pollution controls on upstate farms, and kill those down river. Trash the Affordable Care Act and watch entire healthcare industries collapse.
(As a personal aside, as much as it would be fun to remove all financial regulations and watch the big players tear each other up, I'd rather not be one of the little people caught up in the bloodshed.)
The tax cuts for wealthy businesses sound ripe, except that it's awfully difficult to sell things to people when the roads are so bad, they can't even drive to the store. Of course they could order products online, except the people will be broke from trying to pay for healthcare.
Sommer ends with an interesting litany of assumptions necessary for a positive market:
Mr. Trump will always be a calm and soothing presence and will not lead the country into major crises; he will smoothly conclude legislative deals with conservative congressional Republicans for whom policies like deficit spending are anathema; his avowed "America first" policies will not severely damage emerging market nations or start debilitating trade wars or otherwise destabilize the global economy; he will appoint effective Federal Reserve Board members; and his plans to deregulate industry and dismantle the Obama legacy will benefit the economy and markets.
In other words, instead of a bull or bear market, we're looking at a "when pigs fly" market.
OK, then.
