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By Greater Fool (Reporter)
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He didn’t mean it

Wednesday, November 9, 2016 17:09
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What can a few words do?

Miracles. Any proof you need came in the last 24 hours. Before Donald Trump took the podium to deliver an acceptance speech, he was the guy encouraging crowds to chant ‘Lock her up.’ He was the same Trump who said in a debate that as president he’d appoint a special prosecutor to see Hillary fry. Minutes later he interrupted Clinton. “Nasty woman,” he spat into the mic.

This was the Trump the markets had seen. A radical, extremist, populist demagogue willing to deport millions, openly discriminate on the basis of religion, shred trade deals, demonize immigrants and refuse to release (or maybe even pay) his taxes. He scared them. Unpredictable, spooky, erratic, singular and volatile.

That’s why the first reaction to his this-can’t-be-happening victory was to sell stuff, jump into the bushes and ask questions later. Over the course of six hours, that’s exactly what happened. Stock futures tanked more than 700 points, bond prices roared higher, gold soared and the currency market buckled.

And then he spoke.

“We owe this woman,” Trump said, “our deep gratitude. She has worked so hard for our nation.”

Not that markets actually care about Clinton (they don’t), but they do care about compromise, rationality, common sense and Presidential behaviour. In his words late last night, they got that. And the bleeding stopped. In the most dramatic market recovery since the depths of the 2008 recession, the Dow swung almost 1,000 points, opening flat at 9:30 am, roaring ahead all day, and finishing up a glorious 256 points. The index, in fact, briefly passed its all-time high – on a day when it looked like the gutters on Wall Street would be running red.

After listening to the guy hope emerged that Trump the blustery, bully, bellicose candidate would not be Trump the President. And then more confidence a pro-business, Republican leader supported by a pro-business Republican Congress might enact sweeping pro-business legislation – letting corporations make oodles of money and greasing markets.

Big winners? Banks and health-care providers, now snatched from the jaws of populist reforms promised by Clinton. Ironically, Trump is seen as the laissez-faire dude, even the inflation President – presiding over an economy in which tax cuts for corporations, a massive hike in government spending, higher oil values and wall-building excess will see businesses prosper, prices rise and interest rates swell. (The odds of a December interest rate increase with Trump as POTUS have surged now to 88%.)

It may come as a shock to Main Street, but Donald Trump’s been embraced by the same elitist, corporate cronies that Joe & Mary Front Porch believed he’d rescue them from. At least, that was Day One. What a ride.

Well, anyone sitting in cash has so far missed a week in which markets strongly advanced for three sessions. People who sold out before the election, trying to time things or believing some wussy advisor who’s too scared to invest, must buy back in at higher prices. The simple fact this event is now behind us, and that there’ll be no recounts, court challenges or electoral uncertainty is fundamental to the rally which is likely to continue. The kneejerkers and pantywaists were dominant during the darkness, but with the dawn came the realization Trump didn’t actually mean half of what he said.

Miraculous. A politician.

$    $    $

Ontario will unveil new policies next week to deal with houses people can’t afford anymore. “Something has to be done,” says the finance minister, Charles Sousa. But it won’t be a BC-style Chinese Dudes tax.

Instead the betting is the province will unveil new incentives, grants, freebies or credits for first-time moisters who can’t save enough (given their pathetic jobs and ginormous expectations) for a down payment on a house in Toronto. Apparently the measures will be GTA-centric, because Sousa says he “does not want to impact prices in surrounding areas”, (whatever that means).

What to expect?

Special incentives to light up the very same people that Wild Bill Morneau’s mortgage mayhem package of October 3 was designed to hose down. After all, house prices will never fall in any meaningful way, boosting affordability, until demand is contained. By forcing moisters to qualify for mortgages at the Bank of Canada benchmark rate (4.6%) rather than the contract rate (2.2%), the feds are trying to keep debt under control and engineer a soft landing in a city where a detached now averages an obscene $1.3 million.

Will Sousa screw it up?

Of course he will. Let’s Make Leslieville Great Again!


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