What should we look for tomorrow if we want to trade Trump?
I don't want to get bogged down in yet another Trump post but as this is trading related, I think it's worth expanding quickly on my prior post.
We know the devil will be in the details of whatever Trump announces tomorrow (and wherever else going forward), if he does actually announce anything major at all. Those details are often few and far between, as we've just seen from the $54bn defense/non-defense accounting trick. I mean, non-def spending covers a huge range of programs, so what's actually getting cut?
If the market is going to buy into these plans it's going to need more than the usual government policy of robbing Peter to pay Paul. To do that Trump needs to pay for his plans by cutting back on the billions of wastage most governments are guilty of.
If you want to trade this, look to see if he can highlight those areas for cuts rather than milking other genuine programs. If he does that then we've got a trade on, and possibly one that will really take off. If he fails to give any real details, the dollar and the Trump trade could be in bigly trouble once again.
If I had to plan a trading strategy, it will be to let any grandstanding comments pass, then trade the finer details.
It's time for Trump to show us the money.
