For The Times, They Are a Changin

Come Senators, Congressmen, please heed the call. Don’t stand in the doorway, don’t block up the hall. For he that gets hurt, will be he who has stalled. For the times they are a Changin”  ~ Bob Dylan

One week from now, at exactly noon, a transfer of power will take place in Washington DC, and Donald J. Trump will take the oath of office and become the 45^th President of the United States. As it has been done for over 200 years now, the world will once again witness the greatest peaceful transfer of power from one leader to the next. The world will also witness the transition from one set of ideologies to a new set of ideologies.

Next week’s transfer of power will set into motion a major rewrite of the way Washington does business. This rewrite will occur during a period in our history when the two political parties are extremely polarized with diametrically opposed visions as to how to move America and its economy forward. Even more fascinating is the fact that a president who has never held a political post will direct this rewrite.

The Trump Effect

Even before President-elect Donald Trump has taken the oath of office, we have begun to see bits and pieces of his style of leadership. We have gotten glimpses of potential effects on our markets. We have seen how a platform limited to 145 characters can dramatically move markets. Never before has a single tweet had such an overwhelming, massive effect; some with enormous repercussions.

What has transpired since the presidential election is a dynamic rally in US equities which has moved the Dow Jones Industrial Average, the Standard & Poor’s 500, and the NASDAQ indices to new all-time record highs. This was the polar opposite of what was forecast if Donald Trump won the election.

During the same period of time, we have seen gold prices drop dramatically immediately following the election results; again the polar opposite of what was widely believed to occur. However, in the case of gold, traders witnessed a conclusion to the selloff that began shortly after the election results, and ended on December 15, when gold prices found support at 1123. Since that point, we have seen gold prices consistently appreciate, briefly moving above $1200 per ounce. This rally in gold continues today.

Next week will be the beginning of a new era, with a new chapter in American history. The opportunity for great and beneficial changes is real, but not etched in stone. Trump’s ability to implement his vision will determine where this country is headed. Whether he is able to change the political landscape to better serve the people is unknown. What is known is that this rewrite will look to abolish the status quo and replace it with a fresh and different approach, an approach that will look to get things done. If Trump is able to do what he says he can, America’s future is extremely bright.

Although it is too early to know the outcome, what we do know is that the times they will be a changin.

Wishing you as always, good trading,