Markets love a narrative, sure, but there's something they love even more: a catchy buzzword. All the more so if it rhymes or alliterates. So it's no surprise that we haven't seen a week go by since November 9 without some mention of the Trump trade, the Trump bump, or (less poetically) the Trump rally. Wednesday, amazingly, was no exception.
Endless amounts of neural capacity have gone into analyzing this lump of jargon – whether it's here to stay, whether it has any bearing on reality, whether it's just a mirage, etc. We're not here to validate any side of any theory. We have a simple message: Please, for the love of Christ, just stop talking about it. Particularly if you're going to pronounce it dead.
- Jan 17: 3 charts that may explain why the 'Trump rally' is stalling (BI)
- Jan 31: Risk aversion builds as Trump trade fades (FT)
- Feb 8: ROUBINI: The Trump rally is about to smack into a wall of worry (BI)
- Mar 22: As Trump Trade Fades, Investors Reverse Course (WSJ)
- Mar 22: Here’s the latest sign that the ‘Trump trade’ is losing traction (MarketWatch)
- Mar 27: The Trump stock market rally is under siege (CNN Money)
- Mar 30: Why the Trump Trade Is Already Unwound (BBG)
- Apr 3: Now that the 'Trump trade' is over, here's what's next for stocks (Yahoo Finance)
- Apr 7: The 'Trump rally' is on its last legs — here’s what that means for the market (CNBC)
- Apr 17: The data show the ‘Trump bump’ is dead (MarketWatch)
- Apr 18: Trump Trade is Over (BBG)
- May 10: There isn't a Trump trade left in the market, equity strategist says (CNBC)
- May 17: The Trump Trade Is Done (WSJ)
This is an incomplete list. The Trump trade is like a horror movie franchise where the villain needs to be kept just intact enough by the end of the movie to rise from his shallow grave and give a final menacing grimace before the credits roll. Every supposed coup de grace just gives us something to hope for the next time around.
We're not disputing underlying justifications here. Sure, the prospect of tax reform and deregulation warranted an upside for stocks (though infrastructure was always a lark). And yeah, underlying fundamentals like actual earnings growth have provided some solid foundations to equity prices.
But that's only more reason to stop discussing a “Trump trade” as such. There are lots of things happening in the world! Some of them have to do with Trump, many of them don't. The fact that it was Trump’s slapstick governance that caused Wednesday's market nausea doesn't mean we should start talking about the Trump trade again – this side of Trump is the polar opposite of the one investors were banking on when we started talking Trump trade.
Which is all to say that from here on out, should markets respond to subsequent impacts in Trump's slow-motion tumble from the highest office of the land, please find a poetic construction that isn't “Trump trade.” Because that (you heard it here first, folks!) is over.
*Award subject to change.