This has been a busy week with more than a few long nights, but the new paradigm in global markets is beginning to take shape. Master Investor Editorial Director James Faulkner has outlined his position below and we hope that you are able to find some time during the relative peace of the weekend to consider the appropriate strategy to adopt going forward.
Building a wall? A ban on Muslims entering the US? Mass deportation of illegal immigrants? Anyone assessing some of Donald Trump's more outlandish policies might appear well justified in coming to the conclusion that the 45th President of the United States is set be an economic disaster. But it would be a mistake for investors to allow the rhetoric to dominate their perception of what a Trump presidency means for the global economy. In fact, there is a growing sense that much of Trump's economic agenda could be just what is needed in order to spur global growth.
We have been living in a topsy-turvy world of quantitative easing, zero and negative interest rates, low growth and soaring asset prices. Much of what has transpired since the global financial crash of 2007-09 has set the stage for 'populist' events like Brexit and the election of Trump. Despite central banks' injection of trillions of dollars into the global economy, growth remains subdued, real incomes have stalled (and by some measures are lower than they were before the crisis) and ordinary savers have been punished – all while the rich have seen their wealth soar. The massive levels of inequality that this engenders represent an existential threat to the capitalist free market system. Many believe Trump is the embodiment of this threat; but in fact, he could prove to be the saviour of capitalism.
by Zak Mir | Trading| 1 mins. to read I have to say that despite being a fan of Ascent Resources (LON:AST), it felt as if the company was a little too rough a ride. However, for the bulls at least it may be that things are finally entering calmer waters.
by Robert Stephens | Equities | 5 mins. to read The reaction to Donald Trump's election victory has been surprising. First, stock markets sank. Then they rose. Now at the time of writing they are falling once more.
by Zak Mir | Trading | 1 mins. to read Rather like the stock market analogy of profits warnings coming in threes, there is the situation where one capitulates on a stock or market just before the great turnaround arrives.
by Filipe R Costa | Economics | 13 mins. to read To prove that Wall Street is an early omen of movements still to come in GNP, commentators quote economic studies alleging that market downturns predicted four out of the last five recessions. That is an understatement.
by Evil Knievil | Evil Diaries | 1 mins. to read Every time the doorbell goes I fear that it is a courier-sped P45 from the chairman. For I it was who urged him to put £100,000 (I do not know whether he took this advice – after all, he may be wise) on Clinton at around 4/9.
Material contained within Master Investor Magazine and its website is for general information purposes only and is not intended to be relied upon by individual readers in making (or refraining from making) any specific investment decisions. Master Investor Ltd. does not accept any liability for any losses suffered by any user as a result or any such descision.
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