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Post by Financial Thing on Nov 9, 2016 18:43:34 GMT
Result shows just how much polls were skewed by the media. The election was always going to be much closer than the polls showed. Putting money into the stock market now is very much a volatile gamble. I actually bought equities this morning. I think once the initial shock is over the market will see Trump as a positive and will move higher. You're a brave man! The stock markets aren't running on fundamentals and have been propped up by the Fed and government money printing for a long time. If Trump attempts to go against the old political system and pulls the money printing plug (he has to at some point) the markets will be in for a serious drop. Not a matter of if, only when.
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hazellend
Member of DD Central
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Post by hazellend on Nov 9, 2016 20:11:41 GMT
I actually bought equities this morning. I think once the initial shock is over the market will see Trump as a positive and will move higher. You're a brave man! The stock markets aren't running on fundamentals and have been propped up by the Fed and government money printing for a long time. If Trump attempts to go against the old political system and pulls the money printing plug (he has to at some point) the markets will be in for a serious drop. Not a matter of if, only when. So you are shorting the markets then seeing as it is such a dead cert? Good luck to you. I am 100% confident I will beat you over the lifetime of my investment (20 years +) buy just buying and holding.
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bg
Member of DD Central
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Post by bg on Nov 9, 2016 20:26:07 GMT
I actually bought equities this morning. I think once the initial shock is over the market will see Trump as a positive and will move higher. You're a brave man! The stock markets aren't running on fundamentals and have been propped up by the Fed and government money printing for a long time. If Trump attempts to go against the old political system and pulls the money printing plug (he has to at some point) the markets will be in for a serious drop. Not a matter of if, only when. Yeah it's not without risks but all investing is risky (not least P2P). I did this for several reasons:- 1. I think holding the equity of profitable companies in the long run has been and will continue to be the most profitable way of investing capital. Over the last 20+ years the wage share of income has been decreasing primarily driven by technological advances (less manual labour, more automation) and I think will continue to do so. This leaves wealth and income in the hands of equity holders of solid business. Of course this phenomenon is what is driving the events of recent years (Brexit, Trump etc). It's leading to inequality and working people are starting to revolt so there are risks but I don't see the GOP being massively anti business in government. If Sanders (or Corbyn in the UK) had got in I'd be more worried. The Republicans aren't going to block trade and business. 2. I think Trump will pull back from a lot of the ridiculous things he has said and will be lead by his party (Congress would block him if he tried to 'build that wall'). What is likely to happen is the lowering of taxes and massive investment in infrastructure - both good for equities and for growth. This will of course lead to higher inflation which is good for equities but very bad for bonds. 3. Bonds are a terrible investment. Yields are going up, the bubble will burst, longer dated US yields are going to surge...on an asset allocation basis, equities win hands down (see point 2 above). 4. The market is short its benchmark. All I hear is people saying stocks are too high - even well before the election. I've met countless investors and IFA's who have sold equities as they fear a Trump victory in recent weeks. They're out the market - what are they going to do now...wait for the pull back..what when it keeps going up? They will panic and buy 5-10% higher. We could get a melt up. 5. I agree, stock markets have been helped by monetary policy...but what asset hasn't. I would say stocks have been helped the least. Bonds, property have been boosted far more (not least by central banks buying them). Furthermore I can't see that policy changing in a hurry. I'm happy to ride this train while it's still going. 6. You mention fundamentals - but I think they're supportive. With bonds so expensive, and demand for bonds so high from pension funds etc I think there is a massive supply imbalance. The number of IPO's have fallen off a cliff - cheaper to take on debt (And they don't lose control of their business). Companies have been buying back their own shares, supply is reducing. Equities are so unfashionable right now, people are running scared of them. A lot of people who read/post on these boards think lending money to companies is much less risky than taking an equity stake - I would disagree and think the rewards for doing so are significantly lower. Take a share in the upside of innovation, technology and growth. Own a part of it! All just my opinion of course (cue a huge sell off tomorrow!)
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Post by Financial Thing on Nov 9, 2016 21:24:56 GMT
You're a brave man! The stock markets aren't running on fundamentals and have been propped up by the Fed and government money printing for a long time. If Trump attempts to go against the old political system and pulls the money printing plug (he has to at some point) the markets will be in for a serious drop. Not a matter of if, only when. So you are shorting the markets then seeing as it is such a dead cert? Good luck to you. I am 100% confident I will beat you over the lifetime of my investment (20 years +) buy just buying and holding. Certainly not shorting the market and never will, too risky. And it depends what investment you are buying and holding; I'm 99% certain (nothing is ever 100%) my investments will be ok 
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