Wall Street is not interested in a strong arm president. They don't know what the direction Congress will pursue, so government bonds have now become speculative.
When people like Hillary Clinton are invited to speak to companies and organizations, whether the talk is current or not, it provides a strong base to understand where the leader is on issues of investment. That provides confidence regardless of the electorate's apprehensions. This is a very good example of that.
Municipal Bonds are the backbone of the local economy. Don't dump the bonds they are not risky. The municipality is as close as the local newspaper and investors can derive security of their investment from knowing the best interests of their local economy. Speculation as with Goldman Sachs does not have that ability to assess every bond they hold, so they are simply dumping them.
It is my estimate Wall Street will be looking for stalwart stocks such as those of Warren Buffet as a baseline portfolio. Otherwise, the riskier investments will go to countries in Europe and Australia. The foreign component of the investment capital is actually more stable and reassuring then any American investment at this time.
The rules of the future are not written yet.
November 10, 2016
By Tae Kim
Goldman Sachs (click here) told investors to sell government bonds and buy gold as a hedge due to the prospect of future inflation from Donald Trump's economic agenda.
"The implications of a clean Republican sweep of both houses is probably as important for the markets as the unexpected presidential result. ... Market performance indicates a continuation and intensification of the reflation trend since the summer," Goldman's chief global equity strategist, Peter Oppenheimer, wrote in a note to clients Wednesday.
"Following several years of gridlock between the houses, the potential now exists for a number of legislative initiatives to be passed. Our U.S. strategists point to the possibilities of fiscal stimulus/infrastructure spending, corporate tax reform, reducing regulation and addressing rising health-care costs."...
