The market is still enjoying its post-Trump honeymoon period

BrianTycangco鄭彥渊
11-13

The market is still enjoying its post-Trump honeymoon period. Strong dollar. Strong equities. Strong crypto. Down everything else.

But soon, reality will dawn that Trump's policies are going to be quite inflationary. We have what appears to be:

1. A worsening trade war with China (tariffs have been shown to increase inflation for US consumers).

2. Tighter labor market (wage inflation).

3. Corporate and income tax cuts (more on personal income tax impact on inflation & spending).

4. Reduced government tax revenues as a result of 3 increases the need to borrow.

5. Pressure on the Fed to lower interest rates as a result of 4 could further reignite inflation.

6. Too strong a US dollar will make it quite expensive for foreign firms to set up manufacturing in the country & for US exporters to compete globally.

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Trump Trade Fizzles: Has Market Hit a Short-Term Peak?
After a week of gains, the "Trump trade" cooled off yesterday, with Tesla and Bitcoin-related stocks seeing slight pullbacks. Do you think the market has reached a short-term top? Would you buy into COIN or Tesla? Are you bullish long-term? And do you think U.S. stocks, especially Trump-themed ones, are overvalued now?
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