More and more business leaders and Wall Street strategy express their concerns about what President Donald Trump’s protectionist policies and an indiscriminate nature of markets and economics may do.
But we all know that the procedure speaks louder than words. What investors already do is in a flagrant contradiction with what people say. Download, S&P 500 and Nasdaq reached its highest level again on Friday.
And Russell 2000, an indicator of the shares of the small company that tends to carry out most of its business in the United States, is now a few points away from the highest level of that time last December following the euphoria in the Trump market.
What’s more Vix ((Vix))The fluctuation scale known as the Wall Street fear scale, about 25 % this year as well. If investors are really afraid of Trump, VIX should be much higher.
The Fear & Greed CNNMoney index, which looks at Vix and six other measures of investor morale, shows the signs of greed and not far from the levels of extreme greed.
Of course, Trump still cannot help himself in Twitter about things that we will not be honest, we will not do anything to help the economy – although Nordstrom investors are richer even though Trump attacks them to throw his daughter Ivanka.
But to give the credit in time, it seems that the main reason that the stocks have recently started is that Trump promised to reveal a “huge” tax plan soon.
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Trump also again pledged to invest in infrastructure when he met the heads of airlines on Thursday.
This is what the market wants to hear.
“We still expect financial motivation, low taxes and lower regulation,” said Matt Locridge, director of the Westwood Small Cap Fund Fund. “The timing is the big question, but it is coming.”
Lockidge believes that many companies that generate the majority of their revenues from America should benefit from it if it ends with Trump to kick the economy in higher equipment.
He loves stocks in a variety of industries, such as the owner of the Film Theater Masco ((but))The snack company for foods J & J. ((JJs)) Airline equipment company Kaman ((Humin)).
Another money manager said he is still optimistic about the American small stocks that could get a Trump’s elevator.
Related: Wall Street has a strong seat on the Trump table
Barry James, President and CEO of James Investment Research, said he bought Ishaares Russell 2000 ETF ((IWM)) The next day of the elections because it is confident that the Trump motivation plan will enhance the growth of American small companies.
“When Trump said America first, I really think this is what it means,” James said, adding that he is thinking about the service of the Internet Vonage ((Vg))Retailing rental stores to join Aaron ((in)) And the opponent series Great ((big)) Can everyone flourish if Trump’s proposals pass.
But there is another reason that makes American markets near their highest levels ever. Despite each case of uncertainty in Washington, the United States is still seen as the height of relative stability compared to other parts of the world.
The economy in Europe is still a large wild card thanks to Britain’s exit from the European Union, and the rise of populism in France, which led to fears of the so-called Fresritt and more concerns about the problem that does not seem to disappear-the problems of Greek debt.
The Japanese economy is still stagnant. We are talking about more than just a lost contract now. It is the plural form. The Chinese economy also slows down.
Often, the director of the bond fund, Bill Gross, said that America is similar to what Johnny Cash and Chris Christopson rich in “Sunday morning” – “Clean the dirty shirt.”
To achieve this purpose, analysts at the Fitch’s bond classification company wrote in Friday that “President Trump’s economic agenda will be positive for growth,” but added that “the current balance of risk indicates a less benign global result.”
Of course, there are two sides of that currency. The Trump bomb can return to chase it.
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The continuous inclination of the company that does not agree on Twitter can confidence in the investor.
Although his proposed travel ban on immigrants from seven Muslim countries has been overturned by the American court regime at the present time, the President has pledged to fight for his re -re -re -.
Even if he loses that battle, it is still clear that Trump is serious in turning more inward, with plans for definitions and amended taxes on the borders that can ignite commercial wars with Mexico, China and Japan. It can harm multinational companies in the large United States and lead to job cuts.
But it seems that investors still believe/hope that the advantages of stimulating plans for growth and tax reducing will outperform the effect of isolation. Let’s hope they are right.
Investors may be holding their noses, closing their eyes and stuffing cotton in their ears to flood the president. But they are still buying stocks.
CNNMoney (New York) It was first published on Feb 10 2017: 11:55 AM Et