November 22, 2016

"Stunning! Dow hits new high of 19,000 as Trump rally continues."

That's the headline at CNN Money.

I guess that Trump's attack on the media worked. He's getting fawning headlines from CNN — a day after "He called out Jeff Zucker by name and said everyone at CNN was a liar, and CNN was [a] network of liars."

Anyway, it's nice for the market to be up.

46 comments:

Sebastian said...

Paul Krugman hardest hit.

Rick said...

“It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?” Krugman said in his post. “If the question is when markets will recover, a first-pass answer is never.”

Paul Krugman the partisan hack is really letting down Paul Krugman the Economist. At this rate he'll burn through his credibility long before normal retirement age.

rehajm said...

CNN calling it Stunning! isn't so much fawning on Trump as genuine surprise from CNN that the tragic global economic meltdown they demaded to happen if Trump won failed to materialize.

Original Mike said...

Glad I held pat. I was thinking of taking a significant amount off the table in the days leading up to the election.

Nonapod said...

Here's my favorite piece of fruit that sprouted from the mind of the great genius:

"The growth of the Internet will slow drastically... By 2005 or so, it will become clear that the Internet's impact on the economy has been no greater than the fax machine's." - Paul Krugman.

SukieTawdry said...

Anyway, it's nice for the market to be up.

Yes, well, maybe. When the correction finally comes, it's going to be a doozy.

CNN calling it Stunning! isn't so much fawning on Trump as genuine surprise from CNN that the tragic global economic meltdown they demaded to happen if Trump won failed to materialize.

Brexit redux. The media has to find a way to extract itself from "the wish is father to the thought" mindset.

AprilApple said...

Fraud Paul Krugman hardest hit.

Original Mike said...

"Paul Krugman the partisan hack is really letting down Paul Krugman the Economist. At this rate he'll burn through his credibility long before normal retirement age."

Horse. Barn door.

CJinPA said...

Looks like the Trump meeting with the NY Times is back on. CNN says he's heading over there now.

Smart move. Although this was a paper that promoted the idea that journalists needed to shed their professional ethics and elect Clinton.

YoungHegelian said...

@Original Mike,

Paul Krugman the partisan hack is really letting down Paul Krugman the Economist. At this rate he'll burn through his credibility long before normal retirement age."

Horse. Barn door.


No. The literate man's response is not "Horse. Barn Door". It's "Shaka, when the walls fell".

Original Mike said...

"Kiteo, his eyes closed."

damikesc said...

I wish he'd call out notorious dipshit Paul Krugman.

CNN calling it Stunning! isn't so much fawning on Trump as genuine surprise from CNN that the tragic global economic meltdown they demaded to happen if Trump won failed to materialize.

Shocked they didn't call it "unexpected".

320Busdriver said...

Stocks mostly flag for the first two years of any presidents term(s). They do best for the final two years, at least going back 75 years.

This might be be a time when being in stocks during the first half of a term actually breaks that norm.

AprilApple said...

LOL - oops

Larry J said...

YoungHegelian said...
@Original Mike,

Paul Krugman the partisan hack is really letting down Paul Krugman the Economist. At this rate he'll burn through his credibility long before normal retirement age."

Horse. Barn door.

No. The literate man's response is not "Horse. Barn Door". It's "Shaka, when the walls fell".


"Trump, his face black, his eyes red."

Paddy O said...

All the money that was pouring into the Clinton foundation can now go into the markets and back into schools.

buwaya puti said...

Correction is due.
Also a recession is due.
I suspect this is just a short term pop.

We have done very well in equities so I'm not complaining, but perspective counsels caution.

I am also not convinced that Trump can do much about the ongoing decadence that has shown up in poor productivity growth (see numerous recent articles about, say, what Greenspan has been depressed about). I am not a long or even medium-term optimist.

SukieTawdry said...

I am not a long or even medium-term optimist.

No, neither am I.

Balfegor said...

Well, it's nice for the "unexpected" developments to be positive, for a change, rather than negative, the way they consistently were under Obama.

But I'm not sure that this is great for his message -- the stock market being up is a positive for the investor/rentier class. His appeal was supposed to be to the working man. Or the man (or woman) who wanted to be working, only the jobs he could do were no longer in demand.

Michael Fitzgerald said...

Cue the new democrat talking points about how Trump is already serving the 1%. When the markets didn't crash like they predicted, now a surging stock market is going to be a BAD thing, unlike how awesome it was when Obama was in office.

Fernandinande said...

The latest column from the That Guy Who's Always Wrong:

An earlier version of this column misstated, in an example, how much a private consortium might borrow to build a toll road. It would be $800 million, not $800 billion.

Hagar said...

The higher they rise, the harder they fall.

mikee said...

Sometimes even a blind squirrel finds a nut, and sometimes even CNN reports the facts of a news story correctly. But in CNN's case, if it were hunting nuts, it would be blind, deaf, mute, and brain dead. So rejoice in the annual truthful CNN story, for until this time next year you may well not find another.

mikee said...

As to the stock market going up, where else can the rest of the world find any stability to hide their money? This is a bubble on the way to a loud pop.

Fabi said...

When the stock market rises under Trump it will only impact rich people, furthering wealth inequality.

Brando said...

To the extent this is election related, this may be because investors expect some big tax cuts and stimulus spending, though if the Fed responds with a rate hike we could be in for a drop. We're due for a recession soon--we usually don't go more than 8 years between them.

Still, good to see we're getting a rally--better than the alternative.

Mick said...

The "market" is not a "market" at all. It is a propaganda tool, providing Confirmation Bias, and is propped up by Share buybacks, 0% interest and welfare to corporations. As soon as Interest rates tick back up to 3-5% historical norms the party will be over.
When the time value of your money is ZERO, what is your money worth? Get a clue "Law Prof".

Brando said...

"When the stock market rises under Trump it will only impact rich people, furthering wealth inequality."

I haven't seen any studies on it, but I figure times of greater "wealth inequality" are better for the lower income groups compared to less "wealth inequality" because the latter is more likely than during downturns (when the wealthy lose a lot more than the middle class, even if the middle class is less able to afford the loss of income). People often confuse "greater inequality!" with "the poor and middle class are suffering more!" when those aren't necessarily the same thing.

Fabi said...

@Brando -- I was just joshing on the way the MSM will flavor any seemingly good news for Trump.

eric said...

Blogger buwaya puti said...
Correction is due.
Also a recession is due.
I suspect this is just a short term pop.


Look, Obama is still president. Economic news is rainbows and unicorns. He will leave office with headlines announcing he presided over huge market gains.

Trump will come into office with no where for the market to go but down. He will be beaten up every day as the market descends from these heights. Itll all be his fault. They will begin to poll people who will blame his policies, in order to get him to Listen to Paul Krugman advice, which is always the same. Raise taxes and spend lots of money.

This is a trap. The greedy euphoria you're feeling is going to hurt so much more when the markets fall.

That isn't to say I know when they will fall. If I could time the markets I'd be rich.

But they will fall during trumps administration. They may even fall back to the Bush administration lows.

This isn't a conspiracy. It's more like lemmings. The media reports all economic news with a positive spin during a Democrat administration. It reports all economic news during Republican administrations with a negative spin. Human nature then takes over.

Achilles said...

Original Mike said...
Glad I held pat. I was thinking of taking a significant amount off the table in the days leading up to the election.

This is the high point. We have borrowed/printed 15% of our GDP for the last 8 years and we have had less than 2% GDP growth. There is no there there. Stock market gains have far outpaced productivity. Total world debt is 225% of total world GDP. Economics is math. Math will always win.

They will pull the plug and blame it on tax cuts and deregulation. This will happen in 2018/19 and there will be Depression! news stories blaming Trump all of the way through the next election cycle.

Fabi said...

(I hit submit too soon)

Here's how the MSM will report it --

"With record stock market gains under President Trump, the rich continue to garner unprecedented windfall wealth at the expense of the poorest and most vulnerable Americans, raising the ugly specter of even greater inequality in a nation already under attack from the richest one percent."

Achilles said...

Trump needs to get out in front of this now. Democrats caused the 2008 crash with cronyist fanny/freddy/walstreet policy and blamed it on Bush. They are causing the next crash with the impossibly massive borrowing and spending and they will blame it on Trump.

Book it.

Crazy Jane said...

Don't get too excited.

Interest rates are going up, which means house prices are going down -- not good for all those 97 percent and 100 percent home loans Fannie and the VA have guaranteed the last few years. Car sales/leases peaked under the no-interest regime, and those will be lower for the next several years. The cost of the national debt will be marked closer to market rates, which will inflate the cost of government even absent new programs for infrastructure.

And we're overdue for the next recession.

gerry said...

As to the stock market going up, where else can the rest of the world find any stability to hide their money? This is a bubble on the way to a loud pop.

That's what one would think, but then the Euro-folks came up with negative-return bonds, so big, big money entities could park their lucre and have a guaranteed rate of loss until the bond maturity date. That way the investor can't lose more than the bond loss rate.

I have a heck of a time getting my head around the concept, but that's how it was explained to me.

Big Mike said...

Hillary rescued my 401K by running such a lousy campaign that Trump won.

Achilles said...

Fabi said...
(I hit submit too soon)

Here's how the MSM will report it --

"With record stock market gains under President Trump, the rich continue to garner unprecedented windfall wealth at the expense of the poorest and most vulnerable Americans, raising the ugly specter of even greater inequality in a nation already under attack from the richest one percent."


Wrong x 1000.

They will say that the record stock market gains were due to Obama's legacy and the impending correction was due to deregulation tax cuts republicans.

So far Trump has been smarter than this. I hope he is ready for what is coming.

Brando said...

"@Brando -- I was just joshing on the way the MSM will flavor any seemingly good news for Trump."

Oh, I know! And I'd bet anything that when we get the recession they'll blame it on him too, even if it hits as early as next month. They did the same with Bush in 2001--he somehow managed to crash the economy before he took office. Amazing what these Republicans can do.

Aside from politics, my concern is we already have pretty big deficits so we won't have much fiscal space to move in when the recession does hit. This is from decades of ignoring entitlement spending and wishing for bubbles. I'm just hoping it won't be as bad as the last one.

Fabi said...

I'm cautiously optimistic, Brando. The only impediment to enjoying the cyclical post-recession rebound during this administration was the implementation of O-care. The combination of uncertainty and risk-aversion from companies combined with obscene premium increases really kept our growth under two percent. The opposite of the wealth effect.

Dismantling that grotesque legislation -- or imparting substantive change -- will be enough to bring back confidence to employers and private citizens, knowing that this country will be pro-business once again.

Brando said...

"Dismantling that grotesque legislation -- or imparting substantive change -- will be enough to bring back confidence to employers and private citizens, knowing that this country will be pro-business once again."

That should help. Some certainty that we won't have minimum wage increases and elimination of some workplace regulations would help too.

I think some kind of even modest entitlement reform will do a lot to reassure investors and businesses that we won't get stuck with massive payroll tax hikes in the future.

Chuck said...

The moment that I heard that Trump claimed that everyone at CNN was a liar, all I could think was that CNN had given Trump toadies Jeffrey Lord and Corey Lewandowski their biggest paychecks in their lives.

Brando said...

"The moment that I heard that Trump claimed that everyone at CNN was a liar, all I could think was that CNN had given Trump toadies Jeffrey Lord and Corey Lewandowski their biggest paychecks in their lives."

CNN deserves all the mockery it gets for hiring Lewandowski who was still under an NDA with Trump. Who on earth wants a commentator who legally cannot speak frankly and honestly about the very subject he is hired to comment on?

Achilles said...

Brando said...
"Dismantling that grotesque legislation -- or imparting substantive change -- will be enough to bring back confidence to employers and private citizens, knowing that this country will be pro-business once again."

That should help. Some certainty that we won't have minimum wage increases and elimination of some workplace regulations would help too.

I think some kind of even modest entitlement reform will do a lot to reassure investors and businesses that we won't get stuck with massive payroll tax hikes in the future.


It doesn't matter what actually happens. Total workforce participation is at the lowest levels since the Carter years but all we hear is how low unemployment is. You can get as many jobs as you want right now for 11$ an hour where I live. Rent starts at 1200$ a month for a modest 1 bd. Getting a job where you could afford rent? It makes no sense to work for 11$ an hour. The number of people working 2 or more jobs is also at record levels.

But that is the Obama economy. Even if things improve for the rest of us the economy is going to be total garbage according to the intelligentsia. Because a republican is president. And there will be a correction before the election. It will be blamed on deregulation and tax cuts. Are you ready for that?

Brando said...

"But that is the Obama economy. Even if things improve for the rest of us the economy is going to be total garbage according to the intelligentsia. Because a republican is president. And there will be a correction before the election. It will be blamed on deregulation and tax cuts. Are you ready for that?"

I'm less concerned with what the "intelligentsia" think and more concerned with the reality. Obviously the left is going to blame any recession on Trump, just as they credit any recovery to Obama--it's an old pattern. They blamed the last downturn on Bush even though no one could come up with a plausible reason that Bush caused it (I've heard everything from "tax cuts something something" to "he didn't do enough to rein in Wall Street" even though no one explains what he could have done to make the bubble not happen. Maybe intentionally crash the economy earlier?).

Drago said...

Chuck: "The moment that I heard that Trump claimed that everyone at CNN was a liar, all I could think was that CNN had given Trump toadies Jeffrey Lord and Corey Lewandowski their biggest paychecks in their lives."

Being completely and spectacularly wrong about every single aspect of the recent election can make one lash out as "lifelong republican" chuck just did.

Original Mike said...

"This is the high point. We have borrowed/printed 15% of our GDP for the last 8 years and we have had less than 2% GDP growth. There is no there there. Stock market gains have far outpaced productivity. Total world debt is 225% of total world GDP."

Oh, I'm still getting out.