Trouble In Paradise As Trump Presidency Looms

Normally, stocks are flat - as they were Monday - in anticipation of an FOMC rate policy meeting.

This time is different.

Stocks took a turn for the worse on Tuesday, with the major averages dipping more than 1/2 percent all around. The cause: the truly frightening possibility of a Donald Trump presidency, signifying a change from the crony capitalism of the past 30 years to a more measured, honest, workable structure favoring small business instead of major corporations erecting barriers to business through their henchmen in the US congress and various state assemblies.

That Trump could win the White House - disappointing the supporters of Hillary Clinton and the status quo - is a very disturbing development for Wall Street insiders who have counted on special favors, underhanded practices, and a compliant government to rack up big profits and fleece taxpayers and the investing public, all at the same time.

People who say that a Trump win would cause a market crash may be right, and it's just the medicine this sick globalized economy would need to mend itself. Trump is for a level playing field, lower taxes for individuals and corporations, tariffs as opposed to "free" trade, tighter border control, and fewer regulations.

While those proposals generally sound positive for US business, the devil is in the details. Policy leads reality and Trump's policies would likely put fire to the feet of fat-cat corporate types, ending the corruption and control frauds that plague business and government alike.

Yesterday's drop on the markets was not a one-time event and it also had nothing at all to do with the Fed and their FOMC meeting, which wraps up 2:00 pm ET Wednesday. As has been the case for the past ten months, the Fed will huff and puff and then do nothing. It's obviously too close to the election for the Fed to do anything that might upset the apple cart.

With a Trump presidency now a real, emerging possibility (since Clinton has finally been exposed as corrupt, incompetent, and dishonest) there may be more of these daily dips, especially if the media is forced to tell the truth about the economy and investments.

Time will tell. It's a week to the election and Trump is surging. Like it or not, stocks may take a dive and the economy will probably fall into a recession, all of which will be net positive for America. A good draining of the swamps in Washington and Wall Street is long overdue.

Dow Jones Industrial Average
18,037.10, -105.32 (-0.58%)

NASDAQ
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S&P 500
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NYSE Composite
10,414.05, -67.84 (-0.65%)