A 'Trump Bump' Instead Of A 'Trump Slump' Makes Chumps Out Of Stock Market Experts

12/12/16

It wasn't just political experts who looked bad after Donald Trump's recent victory. Stock market forecasters also looked bad. Most predicted that if Trump won, it would be bad for stock prices.

Whoops!

Before the election, analysts were comparing stock market fluctuations to fluctuations in the relative popularity of Trump and Clinton. It appeared to them that when Trump was doing better, the stock markets declined. When he was doing worse, markets rose. Conclusion: The markets would do better if Clinton were elected. Learned studies were done to prove this, as you can read here.

Immediately after the election, declines were still being forecast. A CBS News Moneywatch article at 5 AM on November 9 (hours after the election was called but before US markets opened) predicted a 7% decline because of Trump's victory. According to the author, "it'll likely resemble the fallout from this past summer's Brexit [stock market decline] all over again. Only bigger. And it'll likely continue."

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