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Wall Street Scrambles To Change The Trump Narrative Again

Wednesday, March 1, 2017 14:32
% of readers think this story is Fact. Add your two cents. / by Tyler Durden / Mar 1, 2017 9:16 AM

Until yesterday, the prevailing Wall Street consensus was that in the absence of specifics from President Trump on his economic and fiscal plans, the market would be disappointed, and proceed to slide. It did not, in fact quite the opposite.

As a result, the world’s best paid strategists have again – just like after the election – revised the “Trump narrative” after the fact, and now the prevailing analyst sentiment is that markets will like Trump’s address to Congress as he cooled his rhetoric and likely gained political capital. As Bloomberg adds, the reflation trade, which has been boosting financials, held, even as the speech was short on details, forcing the U-turn in the plotline. Still, while turning tactically bullish overnight, there is an agreement that efforts on tax reform and infrastructure spending are likely a long, uphill slog, as those priorities may get squeezed by other agenda items, like health care.

Here is a recap of some of the most prominent notes flying around this morning, virtually none of which to Mark Cudmore chagrin, suggest – if only for now – that the “emperor is naked.”

KBW (Brian Gardner)

  • Markets likely to react positively to Trump’s less confrontational, more optimistic tone; may like cooler rhetoric on trade; speech may play well among voters outside of Trump’s base, buying him some political capital
  • Possible to read speech as implicit endorsement of border adjustment tax (BAT), though will be “uphill fight” to include BAT in tax reform even with Trump’s support
  • No direct impact on financials as didn’t mention Dodd-Frank or changes to financial regulations; seemed warmer to legal immigration, which may be good for sectors that rely on immigrant labor, like homebuilders; infrastructure spending may get “squeezed out” by competing agenda items like health care, tax reform


The post Wall Street Scrambles To Change The Trump Narrative Again appeared first on Silver For The People.


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