President elect Trump started very well with a conciliatory talks after the election, but as he is forming its “advisers” team – he starting to select very divisive people. Also they are not experts in their field – which is quite worrying per se.
Also the Ultra rich Democratic donor (Aka Soros and friends) are starting to regroup and plan revenge.
And the Trump Trade (USD dollar up, Goold down, reflation trades) is starting to wane.
Trump has been always not really precise in the policies definitions, but something start to be clarified.
Tax cuts are easily passed via Congress as they are a main Republican staple.
Regulatory simplification (red tape) – this is hard to pass.
Infrastructure – it will pass as it has bipartisan support. Probably in a decreased form.
Protectionism – Difficult to pass as there would be a lot of backlash and also a lot of US companies would suffer.
Obamacare – already is not repealed, but to be modified.
All this pose a big question on the fiscal side. Already the US Debt is ballooning and there is no trace in what are his intention on how to finance these expenditures.
Already the US Treasury Bond 30 years (which set the mortgage rate in US and all over the world) is 0.7% higher than 2 months ago.
This fact could bring inflation and stop the hand (at least in initially of the FED…so it will be probably rate hike in December…but then stop)
Apart the initial market rally…I see a lot of uncertainty and volatility in the future
investorpolitico 