President Elect Trump & Thanksgiving

by Will Becker, AWMA/AIF

Happy Friday!

The Election Is Finally Over… and President Elect Trump is moving forward with his Presidential Transition Team. This was a long and unpleasant campaign, but if it is any consolation, at least one campaign may have been worse.

Contrary to the pollster projections, Trump went on to win and there are now Republican majorities in both the House and Senate. The market response was immediately bad, with Dow Futures plunging 800 points at one point and global markets in a tailspin. But then the Trump Crash turned into a Trump Rally and the Dow ended up making a 1,000 Point recovery.

Paul and I were monitoring the situation almost all night, and good grief was it a roller coaster. For example, the VIX is a measure of Volatility in the Equity Markets; overnight on Nov 8^th  the VIX Futures spiked +55% in a 140 minute period... before crawling back to even on the morning of November 9^th. It was looking bad… very bad. But then in the early morning it became clear that the election would not be contested, and conciliatory comments by Trump, Clinton, and Obama calmed the markets. In the end, the futures were flat.

Not only did the S&P 500 do well the next day… in the week that followed it went on to rebound to +7% thus far in 2016.

Much of our investment focus since the election has been to identify what a Trump Presidency means for the economy, as well as for our clients. For example: Will the economic policies change the course of the business cycle? How much of Trump’s 100 day plan will be implemented? Will particular industries or sectors benefit more than others? How will the policies affect trade, especially with Mexico (our 2^nd largest export market)? If health costs are higher than expected, how does that affect Clients’ retirement plans? If the Estate Tax is lifted, how does that affect Clients’ Estate Plans? A final word on politics before moving on to Thanksgiving… I am once again reminded of the sage wisdom from Winston Churchill: “Democracy is the worst form of government except all those other forms.”

Thanksgiving is next week, and on behalf of everyone on the DeDora team, THANK YOU for welcoming our team into your financial lives, trusting us with intimate financial conversations, and relying on our stewardship of investments. For the clients that have worked with Paul, Forrest, Janie, Terri, or I for years: thank you for staying with us! For the clients that we met this year: thank you for joining us!

Happy Thanksgiving, and good luck on your Holiday Shopping!

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