The investigation into Trump, et al will take a long time. I would seriously doubt there's any type of resolution in the near term. Whether or not this derails all of the efforts being made to reform healthcare or taxes is still debatable. Other than being in the bully pulpit, I'm not sure Trump can do a lot about the dysfunction in both houses of Congress or within either party.
I do believe that one of the reasons the markets in the US are going up is that even a token move towards lower business taxes is a big deal for profits and earnings. As long as it's possible that our political system can come up with something that would create a broad boost to the economy, we'll see a lot of bullishness surfacing. Partly this is due to the negativity (justified or not) that was clearly in vogue the past 2 years (2015-16).
Using the above as a backdrop, I still think there are plenty of reasons why the short term bullishness is a bit thick and could use some lower expectations. Almost no one is even calling for a minor correction! Sure, there are people like me who are "cautious" but few are out and out bearish. No one wants to step in front of the freight train. I certainly don't. I am watching to see if this train starts to lose momentum and starts showing signs of slowing down.
I think it's cynical to think Trump would risk a nuclear confrontation simply to deflect the investigations into his campaign but then again, history shows us that many people in power have made similar moves. I truly believe in our country and it's checks and balances, so I think that in the short run he could make some outrageous moves. I find it hard to believe he'd risk so much over so little but then it will be completely obvious to all that he's either unstable or excessively power hungry.
I think it's simpler, as an investor and business person, to be aware of the possibilities and have contingency plans for as many as is reasonable to consider. With respect to NK, their potential bite is getting as strong as their rhetoric. At the same time, the disaster that would be a physical confrontation with them would fallout much more in the region, with SK, Japan, China and likely Russia to bare the brunt of the consequences of a war. |
