Part of what is holding Trump's administration together publicly, though, is the economy. Are you paying attention to that? GDP? Last quarter, it was hovering at 2.6%. Pretty good. Unemployment is down to 4.1%. Inflation? Nothin' wrong there. Trimmed mean PCE is sitting at 1.67. The stock market? That's just... Scarily good. I do mean "scarily." The S&P 500 is up to 2872. Valuations are starting to look out of proportion to me. What do I mean by that? The ratio between the price of stocks and the profits that companies are making.
Part of it makes sense. Corporate tax cuts! Corporations keep bigger proportions of what comes in the door, so their profit margins go up. But, the extent to which stocks have gone up in the current bull market run is just... insane.
As a trader, the general advice is to buy when others sell, and sell when others buy. If that's the case... sell. Take profit now that prices are up.
Am I telling you to sell?
FUCK no. Don't be a trader. Be an investor. Invest in a diversified portfolio, such as passively managed S&P index funds, and keep your money there. Don't try to time the market. That way lies ruin.
Still, this leads to my point for today. The bull market run can't last. They never do. There will be a "correction" (a 10% decline from the high) or a "bear market" (a 20% decline from the high) at some point. Anyone who tells you that the market has been solved, and now that the Great and Powerful Donald Trump is here, the market will never go down again... um... no.
The probability of a significant decline at some point in the next three years is very high.
The probability of a decline in GDP growth rates if not an outright recession (two consecutive quarters of negative growth), or an increase in unemployment... also high, particularly since the Fed is on track to raise interest rates.
Right now, Trump has a floor of support because of a very good economy. The trajectory was set before Trump was inaugurated. You can see those trends for yourself in the FRED links provided. The only possible exception? The stock market, although we've had a secular bull market going since the bottom hit in 2009. Then again, stocks are booming around the world, so it isn't even clear that the tax cut gets all that much credit for that because other countries, experiencing similar booms, didn't slash corporate taxes.
What happens when we hit a bear market? What happens when GDP declines, unemployment increases, or something like that? And if that happens while Mueller releases some bad shit about Trump? Live by the sword, die by the sword.