May 05

Trump Effect on Markets, Money and the Economy

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How will Trump affect the financial markets, money markets and the economy? Regardless of what you think of the man, he is already showing a positive effect on all of the above!

I’ll admit to being a little lazy, this is from my Canadian perspective. For the most part, US markets and economy usually demonstrate similar patterns. I’m not going to treat the US separately for this purpose.

Trump The Markets

Sales team in profit mode.Trump was elected November 8, well, into November 9, 2016 by the time it was over. At close of day on November 8, 2016 the Toronto Stock Exchange closed at 14,656.84. A gain of 0.52%.

Just over a week after the election, the market closed last night at 14,733.22. During that 8 day period, the market shifted not much more than one percent up or down on the most volatile of days. As of May 4, 2015, the market was at $15, 396.70. This means the market was up 5% in six months.

There was a more drastic change August 28 to September 17 in 2008 when the market tumbled from 13,750.48 to 11,877.69, a change of 1,872.79 points. This was a drop of 13.6%. (These numbers were calculated using TSX historical market numbers.) >>>Click here to check the numbers

So, what is the net Trump effect? Not much. This isn’t to say there can’t be. As always, we need to be aware of world events and consider them when making investment decisions. The key is to consider  all factors but not in isolation and with a view to the long term.

Trump the Dollars

When Donald Trump won the election, it had a positive effect on the US dollar. Because our dollar is mostly measured against the value of the US dollar, it appears to be Canada’s loss. But, is it?

Trump the Economy

We won’t know the effect of Trump on the economy for some time yet. Typically, the markets are a leading indicator for the economy. Right now, there isn’t enough time passed for a fair measure but the short term numbers seem to be pointing to little change or maybe a positive outlook. We will just have to wait and see.

All The Noise About Trump

Social media has been going nuts with all things Trump for the last year or so. He’s going to deport everyone back to their country or build a fence across the US/Mexico border. As far as I can tell, there has been detainment and yes, it’s more difficult at the border but all in all, life goes on. Just a little louder.

I don’t know about you, but I’m starting to tire of it and really don’t pay a lot of attention. I believe most of the noise is because he wants to keep everyone distracted so he can achieve his objectives. Are you going to let him?

Go ahead. Trump that!

Make it a great day,

Barry

P.S. What am I thankful for today? I’m thankful to be Canadian. I’m thankful it looks like the Trump noise is dying down. I’m thankful for spring showers. What are you thankful for today?

My Own Meeting

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