How does one even begin to recap the fever swamp of trading we witnessed this week?
Let's start with the most ironic part. Remember that last-minute Trump ad, "Argument for America," that was widely criticized for being anti-Semitic because of whom it portrayed as villains? We all got a little worried about that one fellow shown strolling onto the Clinton Global Initiative stage just as Trump gets to the words "large corporations" in this line:
It's a global power structure that's responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations and political entities.
That ad made you wonder if this poor guy, Lloyd Blankfein, would be getting fitted for an orange jump suit after a Trump victory. In fact, his firm's hiring of Hillary Clinton to give speeches is arguably a reason she lost the election.
But we can all stop worrying about that guy. It looked a little dicey for him before the election, with his net worth dipping precariously below $1 billion, but he's got even more money in his pockets now:
In fact, if the rally in the stock market is any indication of how America is being made great again, then Goldman Sachs should be at the top of our thank-you card list. And that's why it beats out all contenders for the latest Trade of the Week. With a 15 percent gain in the week, the ol' squid was by far the biggest contributor to the breakneck gain that returned the Dow Jones Industrial Average to a record:
Sure, Goldman's high share price exerts an oversized influence on the Dow because of its 1890s-era methodology. But if we're going to Make America Great Again then we'll have to abandon the newfangled thinking that got us in trouble, like market-cap index weighting and common decency to other human beings.
Blankfein would also win Zinger of the Week, if such an award existed, for his endorsement of JPMorgan Chase's Jamie Dimon as Treasury secretary for two reasons: It would be good for the nation and even better for Goldman if Dimon wasn't running a fierce rival. You don't need a quant to recognize addition by subtraction.
This new market world order may be tough to process, so let's take a crack at trump-splaining it. This is the "honeymoon period" for the new president and markets (and he's had quite a few honeymoons, so he knows his way around the block).
Here's what you do during honeymoons: stare blissfully into each other's eyes, sip pina coladas and avoid discussions about who's going to do the laundry back home.
So in this honeymoon, the market got to look on dreamily at the effects of higher interest rates and steeper yield curves that will bolster lending margins for banks without worrying much about what that means for the rest of the economy.
The market stared into the sexy eyes of a potential dismantling of the Dodd-Frank Act -- and all the capital that would be unlocked and returned to shareholders, and all the animal spirits set free once again on trading desks -- without having to worry about how we'll clean up the mess of the next financial crisis.
The market danced joyfully at the prospect of a halving of the corporate tax rate -- America-great-again-maker Goldman estimates that this alone could double S&P 500 earnings growth next year to 20 percent -- without worrying about the multitrillion-dollar hole that would be blown in the budget. And let's just ignore the fact that this tax plan comes from the guy who refused to release his returns.
While we're at it, if we're ignoring the deficit, the market can toast the potential economic boost from a huge infrastructure spending package without worrying that it missed the memo trump-splaining how Republicans who shut down the government over the deficit all became Keynesians this week.
We can ignore the riots breaking out. Hey, these are all "professional protesters" right, and they're working overtime! Very stimulative! Plus any damage just means more spending to fix it, right? The Law & Order president will handle those rioters, so load up on private-prison stocks!
Let's ignore all the nasty campaign talk about hedge fund managers and put our trust in these hedge fund managers our new president is getting counsel from.
Honeymoons are no time to bring up old issues we once had with each other, like what happens next if we rip up treaties on trade and the environment, deport all the illegal immigrants, ban an entire religion from our shores, bully our southern neighbor into building a border wall and bully NATO into coughing up pizzo to the new Don.
This is a honeymoon, after all, so just relax and order another pina coloda. Actually, scratch that. In honor of the occasion, make it a Moscow Mule.
This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
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Michael P. Regan in New York at firstname.lastname@example.org
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