The election is finally over. Much to the establishments chagrin Donald Trump is now President Elect of the United States. Personally I and my friends are happy campers but the other half of the country thinks Hitler is manifest in the land.
The problem for us traders/investors is do we get into the market now and stay in or get out and stay out.
The big money backed Hillary Clinton because she was in their pocket. That made her a sure thing for them. If they needed legislation or a presidential push to favor their business interests she would be there for them. Although the democrats bill themselves as the party of the people in the last 25 years they have reversed rolls with the republicans and become the party of big money.
In the meantime the republicans moved from fiscal conservatives to cowards who were willing to do anything to win an election. Because Donald Trump exposed the republicans for the two-faced *%#holes they have been for the last 30 years and the democrats slipped into communism a complete neophyte on the political scene won election to president of the U.S.A.
Although I think Donald Trump is what the country needs to straighten out our fiscal and social problems at this time, I also think he will be very disruptive to our economic markets for the first year or two of his term.
You may have noticed that when the FBI dropped their email investigation last Friday the DJIA jumped more than 300 points. Conversely when it became apparent the Trump was going to become president elect the DJIA futures dropped more than 900 points in the overnight trading on the international markets. That was big money’s reaction to not getting what they wanted and expected. I expected three or four days of trading down but was surprised to see the DJIA only down about 350 at 6:30 the next morning and then ending the day with a 317 point gain. Quite a reversal. I think the reversal was caused by we, the people.
So, should we sit on the sidelines or jump in now. Truthfully I am torn by this decision because the Donald is going to be a big market/economic disrupter.
On the one hand he will be great for the country in the long run, but on the negative side Donald will immediately on entering office dismantle and rebuild the health care system, he will start building a wall between us and Mexico, hopefully institute E Verify to stop employers from hiring illegally immigrants.
On the positive side, he will lift restrictions on the oil industry, cancel billions in funding to climate change boondoggles, renegotiate NAFTA and cancel many of Obama’s executive actions.
These are only a few samples. But every one of these actions would have a huge impact on the market on any given day or week or month. As you read the plus and minus paragraphs, realize that I could switch one into the other and they would still be mostly valid.
As we all know the markets are a forward looking mechanism and these things and more are going to disrupt investors outlook.
For those who feel they must be in the market (what your broker will tell you) I wouldn’t put more than half of your cash in and I would put a stop market order in just under the 18000 area.
The markets have been overpriced for quite some time and we are long overdue for a major correction. This is an excellent opportunity for this to occur.
Yesterday and today (currently up 222) we are experiencing euphoria based on not being inflicted with an even more corrupt government and possible getting a president who could actually straighten some of the problems out.