Tuesday, 20 October 2020 12:22

The Country's First Newly Elected Lame Duck President Will Cause Massive Reversal Of Speculative Gains

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Note: Subscribers should reference the paywall material here for stocksthat should give a good risk/reward scenario for bearish trades.

The Trump administration's legislative outlook is effectively a political desert, with no signs of material legislation either proposed or in sight. The multiple failures of the travel ban and rapid disintegration of the healthcare bill has effectively given Trump the mantle of the nations first lame duck president with only 2 months in office. 

He has expended his political capital on multiple failed policy very early on, purposely alienated many factions, and is now mired in an FBI investigation - not to mention suffering from permanently impaired credibility stemming from an unending cornucopia of unsupported accusations, assertions and allegations (ie. he's lying too much). 

What does this portend for investors in the short term?

In December and January, I penned "Is Time to Short America? Macro Risks + Unpredictable Administration / Geopolitical Uncertainty = ?" Is It Time to Short America?, Part 2: Crony Capitalism Leads to Socioeconomic Stratification - the Rich Get Richer!" The titles speak for themselves. I also gave warning via my Max Keiser interview here.

Let's be clear here. Obamacare is essentially a comprehensive and complex tax designed to fund universal healthcare insurance. Trump ran on the premise that he was a proven master negotiator and would use said skills to repeal and replave the Obamacare tax, recreate US tax policy on a massive scale and deregulate business. The vast majority of this requires legislation. Trump has failed at the most visible portion of his campaign promises horribly, and as a result he's burned a vast amount of political capital with nothing to show for it. In addition, he's lost signifcant credbility through the various fires he's been trying to put out (many of which are sel-inflcted). The result of all of this is a raft of legistlators, political power players and influencers who will not risk sticking their neck out for what is essentially already lame duck president. 

In order to revamp tax policy in any meaningful way, you will need a massive amount of bi-partisan political capital - capital that Trump simply cannot deliver. The result? You tell me, after considering how much US markets have already assumed Trump would be able to wield his poltical capital to corporate benefit.


Read 1686 times Last modified on Saturday, 14 January 2023 12:39