Trump Exposes Narrow Minded Press
Let’s begin with how disappointing the general media interpretation of the election was. The lack of strong independent news reporting came into full view during the long election campaign. As the 2016 US Presidential election approached the closing stages, it became very obvious the reporting’s from many major news outlets were only to influence the outcome and push home their own commercial agendas. Even here in Australia, the ABC dismissed Donald Trump’s chance of winning and all but labeling it a side show. In America the public media does not have the budget or resources that some of the largest and privately owned media outlets have, making it very hard to get a fair and balanced view of what is really happening. It seems there was no editorial fairness or deep investigating by our media, to dig a little deeper into what was driving middle-class America away from mainstream politics. The same old rhetoric was not going to cut it with an angry and disenfranchised working class America. Communities had lost their jobs and homes after the 2008 financial crisis, and the Government stood idle while most of the manufacturing sector was shut down, and in the process of being relocated to developing Countries. People were told that the service industry and renewable energy was the new Future and these industries would create new employment opportunities. However, this never materialised and people were left extremely disillusioned and abandoned by the two main political parties. This was the Strategy that Donald Trump built his entire campaign on, which inevitably gave him the US Presidency.
The Dow and Gold react to Donald Trump’s Victory
As previously mentioned in last month’s news blog we covered the fact that if Donald Trump won the US Election, we would see a fall in the equity markets due to the political risk. Due to all major forecasters predicting a landslide win to Hillary Clinton, this only compounded the initial reaction when it became clear that Trump had won the election. The Dow Jones was immediately sold off in excess of 900 points, only to end the day’s trading 300 points up for the day’s opening. Gold reacted strongly with buyers jumping in looking to offset risk. Only to be sold off again once the market had digested the result.
The Market decided to look at the positive rather than concentrate on all the uncertainty that had been created by the result. What comes into focus was the fact that Trump had outlined tax cuts along with government fiscal spending and a promise to return manufacturing to America.