Trump Market

Barrow thinks the Trump election has caused investors to go with gut instinct. What Keynes called "animal spirits."

"Steve Barrow, currency and fixed-income analyst at Standard Bank, said in a Wednesday research note “whatever fears might exist in some quarters about Trump’s win, some sort of animal spirits might have been spurred.” So-called animal spirits is an oft-used term on Wall Street coined by famed economist John Maynard Keynes to describe gut instinct. Or as Keynes explained, “a spontaneous urge to action rather than inaction,” in his book The General Theory of Employment, Interest, and Money."



Why do the markets like a Trump presidency?

1. No uncertainty. Election is over.
2. Tax reform.
3. Real job growth.
4. Infrastructure spending.
5. Pro growth, pro markets people in his administration. 

Concern of the markets?

1. Will he keep his promises or waffle on some?
2. Will he create a counterproductive trade war?

3. Inflation leading to higher interest rates.
4. Infrastructure spending. He could spend too much.

"Now, with the GOP controlling the House as well as the Senate, traders see real economic growth on the horizon, not just a Fed-induced stock-market bubble where interest rates are so low, there’s no other place to put your money."

"What, specifically, does the market like about Trump’s plans? His promise to cut both corporate taxes and red tape will translate into higher corporate profits so businesses can expand and create jobs. Real unemployment can finally decline not because people are dropping out of the workforce but because they’re actually working again."

Charles Gasparino is a Fox Business Network senior correspondent.


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