Can Trump Move Markets?

Based on election results, run out and buy Microsoft, Citigroup, Amazon and Goldman Sachs. The thinking is Trump won’t try to do anything negative,  but moves to get GDP humming again in a setting of moderate inflation. Who wouldn’t do the same? 

Billionaires now can sleep more restful, as well. Wealth taxes get thrown out the window along with creeping interest rates. Inflation is anyone’s guess because oil quotes are tied to the Mideast action which shows no end in sight. 

My investment issue is the market is fully priced as expressed in the current ratio of 20 times forward 12-months earnings projections. It’s the reason I’ve averaged between 50% and 60% committed to the S&P 500 market.  I haven’t overweighted high tech like Meta Platforms, Netflix, Nvidia and Alphabet. I missed Tesla’s recovery. 

My picks are four old maids.  Namely Microsoft, Amazon and Alphabet.  Overweights in financials embrace Citigroup, Bank of America and Goldman Sachs. JP Morgan and Morgan Stanley tick at a premium to my group. The swingers are welcome to them. Thirty years ago JPM wouldn’t write me a mortgage on my Hudson Valley spread. I just retired my final payment here. 

I’d characterize the Fed as overly wimpish on easement of interest rates. It’s coming but not enough to impact the economy’s growth rate. My read on Trump’s impact on financial markets is minimal, but at least he won’t hurt us by doing too much or too little. 

As I write this piece, the market has just hit my bids on Citigroup and Bank of America, both down nearly 2% in a zippy setting. Microsoft is up 5 points and Meta 21 points without my participation. I just bought into Home Depot, ticking over $400. Some 30 years ago I turned down backing a deal proposal here, a new venture in building materials. It's now worth billions. 

I do own Alibaba, too, my entry card to retailing. 

The bull market in Apple may be history.  Unless banks take off, Berkshire Hathaway languishes. Buffett’s company had a dry spell years ago when it underperformed peers for 3 or 4 years, as did Microsoft over a decade ago. 

Recessions are a killer, especially for growth stocks that shed their premium price-earnings ratios quite rapidly. You need to jump off your bus early if you’re a growth stock player. The Magnificent 7 can be slain on the battlefield just like Ford, U.S. Steel and Alcoa decades ago. 

As for our new President, his foundation account last time I looked was miniscule for a man who says Mar-a-Lago is a billion plus property.  Tell it to the marines, Donald. Maybe, they’ll believe him.