Both the S&P 500 and the Nasdaq 100 are at an all-time high.
Surprising, considering the new administration seems to shake up the US in a big way. Could go right, could go wrong - but shouldn't the uncertainty alone already devalue the US stock market?
The public fund buying has been ~50bn / month which is considerably more than people like Buffett's selling.
The market is on the high side by most metrics, see eg. https://www.currentmarketvaluation.com/
To me, it seems that the political environment in the US is the most corporate -friendly it’s maybe ever been, so maybe the market priced that in but for the other direction.
All of the Magnificent 7 have kissed the ring and paid their indulgence, earning unlimited favor.
The federal agencies are being gutted left and right, regulations, where they still exist, have no one to enforce them.
Just a few examples: A number of environmental regulations have been, or are in the process of being rolled back. There's pledges in Washington to open up more land for mineral exploration. "Drill, baby drill" is back in fashion. Lots of politicians talking about selling off millions of acres of BLM land for private development. Talk in Washington about selling off public land that was recently made into national monuments.
There are literally hundreds more.
If you haven't seen any, you haven't tried. It's not even every day. It's almost every hour.
I agree with this notion. Which is why it's so strange to see so many very large companies shedding thousands of employees right now.
Chevron: 2,000
Southwest Airlines: 1,500
I know that there is an adage that "Wall Street hates uncertainty," but I feel like some businesspeople in very high places are very worried about the near future.
UK ... well, there's the Brexit mess, and UK MAY be exiting a 1.5 year long recession (numbers "look good", in the sense that it's no longer getting worse, but a serious hickup can still make this a 2 year long recession)
France was pretty close to an extreme-right takeover (which was entirely Macron's fault, with his "elect either me or Le Hitler" ploy that he has used 4 times now and every time he uses it, it gets Le Pen closer to the presidency), and has taken a hard-right turn in policies. In this environment, parliament kicked out the government and, frankly, they're being SO stupid that it actually makes Macron look good. However, it is at least not in recession, but it's certainly going through a deep downturn.
Italy WAS taken over by the extreme-right, and has been in a crisis for decades (also before Meloni, she's a symptom, not a cause. Also not making things better).
Poland is an actual bona fide bright spot in this environment.
Spain, Portugal, Greece, Romania, Hungary ... are not.
Then there's Ukraine ... whilst perhaps not directly disrupting Western European economies, it's certainly not a positive. War, maybe constant war, has now returned to Europe. And of course, Kosovo recently felt the need to remind everyone that though the war ended, things are not resolved. And in Georgia, and the Baltic states, as well as the Polish border and Finland Putin is reminding everyone that he won't be done after the Ukraine war.
Meanwhile the EU itself seems to be disintegrating. Frankly EU cohesion has taken a sharp downturn since the EU constitution disaster. Even the Shengen treaty is falling apart. It is also making a sharp right turn and now you can find headlines that "the EU commission is turning authoritarian".
Makes you think that one, most European politicians are seriously denying economic reality ... and second maybe that the rise of the right and the failure of economic policy in the last decade is not a coincidence.
It’s hard to price in an unknown quantity though. If the war in Europe spreads, who knows what happens? If Trump chokes on some novichok of just gives out from all the hard grifting he’s done all his life, who knows?
I think a more interesting measure is looking at indicies since the change in leadership.
Dow: 43,528 → 43,428
Nasdaq: 19,734 → 19,524
S&P: 6,014 → 6,013