2 reasons why conventional wisdom about Trump’s victory and the stock market is wrong: Unlimited’s Bob Elliott

Two things go against the conventional market view that a win for former President Donald Trump would be positive for stocks, Bob Elliott, co-founder of ETF provider Unlimited Funds and former Bridgewater Associates executive, told MarketWatch on Tuesday night.

First, he said in a phone interview that stocks had already seen a strong rally on expectations that Trump would win. Second, the real question is whether it makes sense to focus solely on the possibility of corporate tax cuts and their benefits to stocks when looking broadly at a policy mix that is effectively an inflationary middle-class tax cut, including tariffs. a set of positive policies, particularly towards stock markets.”

Elliott thinks it’s almost the opposite of the situation in 2016, when Trump’s win was expected to result in a stock market sell-off. Instead, stocks initially fell on election night, then rose after the result became clear.

Trump’s victory, or the large projected deficit if Republicans win the election, could begin to trigger a move from the dollar to other assets such as gold.