Donald Trump is going to be the next president of the United States of America. In this Livewire video recorded in the hours after his victory became certain, Steve Johnson and Peter Hall discuss what that might mean for your portfolio
8 thoughts on “Steve Johnson and Peter Hall Discuss Investment Implications of a Trump Presidency”
Anyone who wants to know what happens when a narcissistic psychopath gains unfettered control of the world’s most powerful nation would do well to study Roman history, where it has happened plenty of times before. Commodus, Caligula, Caracalla, Constantine II and Julius Caesar, all had very Trumplike characteristics. And that is just the C’s.
In more modern times, Silvio Berlusconi is perhaps the best model for how Trump might act.
Peter Hall is a very good fund manager, but I disagree with some of his prognostications. I think that the only certainty in a Trump presidency is that Trump will work hard to enrich himself.
It is ironic that 60m Americans acted against their own self interest so that one American can.
The beauty of a robust democratic system (unlike Ancient Rome) is that there are limits to how much an individual can use a nation as his play-thing. The other beauty of a robust democratic system, is that the populous can send a signal to the elites, without having to resort to violent overthrow.
It’s all very well for those of us who are educated, with skills that are marketable, let alone that hold as privileged a position in society as to be providers of capital, to prognosticate about the stupidity of the masses. Ultimately, if the masses feel disconnected and disenfranchised, you can only blame them so far before you need to start holding a mirror to yourself.
What good is a rising GDP to someone that can’t get a job? From the perspective of such a person, taking a step backward today, may lead to two steps forward tomorrow.
Well said mars. You just never know, Trump may surprise us all.
He may well surprise us all. But then, he may have to do little more than breathe to surprise on the up side. Unlike Obama, not many are expecting him to perform miracles (well, not many not here in Australia anyway).
People talk ad nausem about the extreme overvaluation of the US, but i must say i dont see it in my portfolio. Sure, bond proxies are expensive, and some parts of the market are fairly clearly overvalued. However, US banks and other financials are generationally cheap. Citigroup for instance trades at 8x earnings at 0.75x tangible book; and is returning huge amounts of capital to shareholders via buybacks. BAC at 10x pe and 1x tangible book with rge buybackw; JPM – one of the worlds best run global banking franchises, at 11x, and WFC at 11x also. Furthermore, this is on an earnings base heavily depressed by low interest rates, and with the banks running at 70-80pc LDRs and with twice the capital they had pre GFC.
Well run companies like VOYA trade at 0.4x book; high single digit PEs, with massive buyback plans. Monoline AGO – which came through the GFC just fine – has been rolling up the industry and making bargain acquisitions, and trades at 0.6x adjusted book and 5x pe, with huge buybacks undeeay. Aircraft leaser AER trades at 6x with 2.7x leverage with big buybacks. ALLY – a well run online bank with an auto lending franchise trades at 7x pe and two thirds of book with huge buybacks. I could go on.
In addition, while tech is not cheap, its by means excessive. Would you rather own google at 25x – one pf the worlds most powerful internet tollgate franchises – or REA or carsales in australia at 30x? Apple at 11x with 20pc of its market cap i cash?
I think if you cant find value in the US, then one is not looking.
The US is about to enter it’s 8th year of a Bull Market. Long term bond yields are rising. Buffett is hoarding records level of cash, forecasted to hit over US$90 B by the end of 2016. I’m keeping some dry powder – just in case.
Looks like my prediction of bad results for OFX comes true. 40% drop in share price 5 months into 6 month reporting period with no announcements not suspicious to ASX/ASIC but it was to anyone with half a clue. Today results terrible as all the insider traders knew and a further 20% drop.
You’re a star Frank. You should start your own blog, and start keeping a public record of these shenanigans. Keep getting these calls right and eventually people (whether regulators or company directors) are going to take notice.
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Posted on 10 Nov 2016 by Steve Johnson
Anyone who wants to know what happens when a narcissistic psychopath gains unfettered control of the world’s most powerful nation would do well to study Roman history, where it has happened plenty of times before. Commodus, Caligula, Caracalla, Constantine II and Julius Caesar, all had very Trumplike characteristics. And that is just the C’s.
In more modern times, Silvio Berlusconi is perhaps the best model for how Trump might act.
Peter Hall is a very good fund manager, but I disagree with some of his prognostications. I think that the only certainty in a Trump presidency is that Trump will work hard to enrich himself.
It is ironic that 60m Americans acted against their own self interest so that one American can.
The beauty of a robust democratic system (unlike Ancient Rome) is that there are limits to how much an individual can use a nation as his play-thing. The other beauty of a robust democratic system, is that the populous can send a signal to the elites, without having to resort to violent overthrow.
It’s all very well for those of us who are educated, with skills that are marketable, let alone that hold as privileged a position in society as to be providers of capital, to prognosticate about the stupidity of the masses. Ultimately, if the masses feel disconnected and disenfranchised, you can only blame them so far before you need to start holding a mirror to yourself.
What good is a rising GDP to someone that can’t get a job? From the perspective of such a person, taking a step backward today, may lead to two steps forward tomorrow.
Well said mars. You just never know, Trump may surprise us all.
He may well surprise us all. But then, he may have to do little more than breathe to surprise on the up side. Unlike Obama, not many are expecting him to perform miracles (well, not many not here in Australia anyway).
People talk ad nausem about the extreme overvaluation of the US, but i must say i dont see it in my portfolio. Sure, bond proxies are expensive, and some parts of the market are fairly clearly overvalued. However, US banks and other financials are generationally cheap. Citigroup for instance trades at 8x earnings at 0.75x tangible book; and is returning huge amounts of capital to shareholders via buybacks. BAC at 10x pe and 1x tangible book with rge buybackw; JPM – one of the worlds best run global banking franchises, at 11x, and WFC at 11x also. Furthermore, this is on an earnings base heavily depressed by low interest rates, and with the banks running at 70-80pc LDRs and with twice the capital they had pre GFC.
Well run companies like VOYA trade at 0.4x book; high single digit PEs, with massive buyback plans. Monoline AGO – which came through the GFC just fine – has been rolling up the industry and making bargain acquisitions, and trades at 0.6x adjusted book and 5x pe, with huge buybacks undeeay. Aircraft leaser AER trades at 6x with 2.7x leverage with big buybacks. ALLY – a well run online bank with an auto lending franchise trades at 7x pe and two thirds of book with huge buybacks. I could go on.
In addition, while tech is not cheap, its by means excessive. Would you rather own google at 25x – one pf the worlds most powerful internet tollgate franchises – or REA or carsales in australia at 30x? Apple at 11x with 20pc of its market cap i cash?
I think if you cant find value in the US, then one is not looking.
The US is about to enter it’s 8th year of a Bull Market. Long term bond yields are rising. Buffett is hoarding records level of cash, forecasted to hit over US$90 B by the end of 2016. I’m keeping some dry powder – just in case.
Looks like my prediction of bad results for OFX comes true. 40% drop in share price 5 months into 6 month reporting period with no announcements not suspicious to ASX/ASIC but it was to anyone with half a clue. Today results terrible as all the insider traders knew and a further 20% drop.
You’re a star Frank. You should start your own blog, and start keeping a public record of these shenanigans. Keep getting these calls right and eventually people (whether regulators or company directors) are going to take notice.