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Will the US Dollar and Dow Jones Rampage Continue?

The rampage will continue.  In every election, whether US or foreign, a main concern of a political outcome is always the wallet of the citizen.  For many of us, our futures are directly tied to our retirement accounts.

For that reason alone, emotional investment in politics is understandable.  While your opinion may depend on your worldview, below are a couple of points that have been nothing less than controversial.

All of which will support my thesis that the US dollar and the American market are the place to be.

Warren Buffett

The “Oracle of Omaha” himself has continually backed the USA.  In the spirit of true transparency, I was concerned for the US market back in 2008.  When Warren Buffett himself assured the American public that everything will be okay, I foolishly disagreed.

I know that now and I’m not willing to make the same mistakes.  Recently, Buffett has maintained his bullish stance on the USA by stating that he is “100% optimistic.”

With all of the uncertainty, no matter what side of the aisle you are on, that is a comforting statement.

Trump’s Promises

One of the reasons I agree with Mr. Buffett is because of Trump’s First 100 days plan.  I happen to think the three-pronged approach to the beginning of his reign will benefit our country in the grandest ways.

Tax cuts, the repeal of Obamacare, and term limits are three issues that have been holding our country back for some years – some longer than others.  The cumulative effect of passing all three of these measures will set this country on a path to prosperity not known since decades past.

With Republicans in the House and Senate, his biggest obstacle will be the all-powerful Mitch McConnell.  As a well-documented establishment Republican, he has already stated his opposition to term limits.

While term limits would be a great thing, I don’t believe it will be directly tied to the short-term move in the markets.  You need not worry.

Tax Cuts

With the planned corporate rate to be cut down to 15%, that will drive internal investment into the American economy.  With the highest tier of our current corporate tax rates hovering just below 40%, it’s easy to see why such a change will be so attractive to the business community.

The passage of lower tax rates will drive more investment into the Dow Jones Industrial Average, sending it well in the 20,000 range.  As I said before, the rampage will continue!

That’s something we can all look forward to.

Obamacare Repeal

Repealing Obamacare has proven to be a very decisive issue as part of our national conversation.  Here are my takeaways after MANY conversations will the common folk mixed with my own research:

  1. The repeal of Obamacare will not happen until a replacement plan is in place. The replacement plan most friendly to your money will be that which fosters competition.  The second healthcare drops the artificial barriers of state lines, premiums are sure to fall.  Keep your eyes and ears out for that as part of alternative plans.
  1. For those who can’t afford healthcare and don’t qualify for the exchange, they are getting hit with a fine on their tax return. This is a direct penalty to the American citizen, which takes money straight out of their pocket.  Look for this as part of the repeal, as it is effectively a tax cut.

All in or other markets?

Going “all in” in any market is never a good idea.  If you are going to bet on the continued rise of the DOW, make sure you are doing so with discretionary income.  Don’t bet money you need, as that would be a foolish decision.

If you choose to jump on the US bull wagon, it would be smart to keep a certain percentage in foreign investments as a hedge, or even more advanced hedging options if you’re a business owner.  If you’ve spent anytime investing at all, you’ll know that anything can happen, no matter how sure you think you were.

And if you are anything like me, it will all be so clear on why you should have opted otherwise looking back on your bad decision.

If you are looking for a long-term play, history will be on your side if you choose the United States of America.  Donald Trump’s appeal to the business owner will, in my opinion, drive a short-term bull market as well.  The only thing you can be sure of that will stop it is the roadblocks to his first 100 days plan.

Like him or not, let’s hope he keeps this market hot!

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