Trump is president but DON’T panic……


The sun will still rise in the morning, set at night and the earth will still spin. Those with vested interests in market panics (stockbrokers and investment banks) will try their hardest to take money from your panic and exploit the behavioural finance (where your emotions override logic – an extremely natural phenomenon that served us well as evolving beings, but often is a disaster in financial markets) traits that many non-professional investors exhibit. The markets have dropped and recovered already this morning, there will be some big losers out there if they panicked in the early hours of today.

Whilst certainly not the outcome I personally would have wanted, one positive thing you can say about Donald Trump is he will be the most business friendly president of the United States of America we’ve had in a very long time. Hilary would have been pro-business (even as a Democrat) but Donald J Trump will be a turbo charged version. If anything he says can be believed then he will look to cut corporation taxes early and embark on a massive fiscal stimulus package, moving away from the monetary stimulus that we have seen with the Quantitative Easing program. We believe that would have happened whoever won as it is also going to happen over here on this side of the Atlantic, but spending lots of government money on large projects can be expected soon. The US economy already looked like it had the potential to surge forward with the increases in consumer spending, high levels of corporate activity and its increased oil and natural gas production all being healthy catalysts but if the US government releases its spending brakes as well then we could see some extraordinary growth in its GDP. As the largest economy in the world, a healthy US can have positive knock on effects for the rest of the globe, so hopefully if we can stroke his ego in our newly necessary trade negotiations after Brexit, we may be able to ride on the US coat tails with some great deals.

On the downside, we may well be referring to our friends across the pond as the Disunited States of America soon as we struggle to think of a less popular decision as a president amongst the policymakers in America; working with the Democrats was always an unlikely scenario going forwards for president Trump, but even working with his own Republicans may be a pipe dream! And remember how so many expected so much from Obama, only for the system to beat him and tie up everything he tried in knots, we can’t believe President Trump will be anything other than a loud mouthpiece restricted in his important or controversial actions by everyone around him. Remember, even more so than here in the UK, the US political system is a massive money spinner and at times little more than a crass reality TV show, all the campaign managers and advisers and their entourages will be cashing their pay checks (sic) today and already thinking of the 2018 mid-terms and looking at ways to diffuse their new president in a ‘controlled explosion’ kind of way. Or else he could be the last Republican President ever. His acceptance speech this morning was as contrite as we have seen him for years in its tone.

For anyone worried about the impact on their savings and pensions, speak to your regulated Independent Financial Adviser (or find one), make sure your money is invested appropriately for your risk appetite and your goals and objectives and that its being monitored regularly, then just let it do in the medium and longer term what you agreed you wanted it to do, no knee jerk reactions. For those of you worried about giving the codes to the largest nuclear stockpile on the planet to a man who can’t even manage his own Twitter account properly we can only hope they give him the wrong numbers and he never notices whilst he stares at himself in the bathroom mirror, comb in hand…

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