Swing-ier
Is Trump better for the Stock Market ?
Mary, Joseph and mother of God, if one more person asks me : whether Trump is better than Biden and Harris for the stock market, I’m going to have to start using colorful syntax about that person’s mom and sister, in response
I live in NYC and I take great pleasure in asking people to go to hell and beyond, if they piss me off
Between last June and November, do you have any idea about how many people asked me that on Wall Street ? If DJT is indeed better for the stock market ?
They think the stock market is some alien thing that thinks like they do - and offers gifts to people based on their political sentiment
As if, investors around the world all collectively get together and decide that they like Harris over Trump
‘tis the same thing they ask comedians too - about if DJT being in office is better for comedy
Because, they think the joke writes itself when he is in 1600 Penn
The stock market has a mind of its own, and sometimes it behaves rationally, its basically your teenage son or daughter going through adolescence
We need to talk about VIX (implied volatility in the stock market), and we will in the upcoming weeks, but before that, I had to think about this question they ask me so many times
The stock market isn’t necessarily better or worse when DJT is in office - I would say … it is just more Swingier
As in, there are more ups and downs than when Biden was in office
The stock market is not something that is removed from you and me, it is after all - you, me and a whole bunch of other people in the country and beyond
If you have read this space for any length of time, you know the stock market hates uncertainties. If I say, five kittens would be shot dead on ninth ave and 50 in Manhattan tomorrow, and if those kittens are indeed shot dead on the morrow, then it would be fine, the market does not panic, because it all goes according to plan
But, if you wake up and then suddenly find out those kittens are dead as a doorknob, then the market would react violently
and investors would panic like my mom, when she has four people coming over for snacks and my teenage dumbass self ate all the snacks she had made for the guests
Its pretty simple and yet, confusing : even if say, META beats Wall Street expectations in terms of EPS (earnings per share) during quarterly earnings calls, sometimes, the investors get excited and buy the stock, thus leading to increase in price
Other times, investors might completely ignore EPS and get worried that META has all these funds committed to AI, which they deem too high - and might simply sell the stock, which leads to decrease in price
McConaughey’s Mark Hanna is right … he is so right, nobody knows if the stock is going to go up or down, in circles or sideways, least of all stock-brokers or finance majors
I don’t know … but I can guess at times
Day to day swings, or even intra-day swings aren’t really tied to fundamentals. They are just tied to the feels, the feels of the investors
For instance
The tariff threats from DJT has been making the markets nervous throughout the week
But, earlier today (Friday 02/28), inflation data was generally positive based on the Fed’s preferred gauge (PCE), which was good news for the market, so the market started high just after the opening bell
Then panic ensued as the Trump, Vance and Zelensky White-House Halloween show happened … and the market panicked, and panicked bad
Patrick Bateman and Hannibal Lecter ain’t got nothin’ on this show, as the global press watched it - with not as much as a word spoken for a whole ten minutes amongst themselves
The stock market is just a thumbprint of all of our feels - in real time to real events
With enough time to settle post-lunch tummy cramps, the investors decided to screw it all, and recover - as we go into the weekend
After the stock price hit the bottom of the water slide, it started picking up steam like a raging coke-head
… and got itself back on track
NASDAQ, 2/28
S&P 500, 2/28
Russell 2000 Index (Small Caps), 2/28
All was good with the world at closing bell, and now we can pay for those over-priced steaks and preposterously expensive scotch on Broad and Wall
Short term trading and sentiment isn’t based on macro-economic or financial fundamentals (such as the impact of tariffs on domestic consumers) … it is to a large extent, based on surprises and shocks the market did not expect and needs to take into account in real time
Is the event priced in yet ?, as we often ask on Wall Street
Trump shoots from the hip way more than Biden, or really, above and beyond any president we have had thus far, and he revels in calling audibles real time
Its kind of his thing - to improv in real time
So, its not better or worse, the stock market is just way more Swing-ier when DJT is in the house