So yes, the market likes Mr. Trump for his tax plan and his protectionist leanings. However, the best kept secret may be the market's disdain for regulation, whose days may be numbered. Bankers and mortgage brokers will tell you quickly that the government is up in their business like your Gastroenterologist. You may say that is a necessary evil given their propensity to misbehave like the subprime fiasco. But I will retort that subprime was the manifestation of social-engineering rules that originated with Bill Clinton and Barney Frank in 1996 when they legislated that financing for low-income buyers "was just too restrictive". They forced Fannie Mae to lower lending standards and required them to lend to shaky buyers; aka subprime. Subprime was never the idea of the bankers; the social programs drew first blood. That being said, many bankers' moral compasses went haywire along the way and they made the most of their new opportunity. I'm not defending that. I'm simply mindful of the unintended consequences of bureaucratic social engineering, and Wall Street's history of payola, hyper-creativity and complicity.
The sometimes cozy relationship between the investment community and legislators can also lead to unintended consequences. While seated at a meeting in 1999 with (then-Chairman) Sanford Weill telling us about the pending merger of Citibank, Smith Barney, and Traveler's Insurance only being illegal until the repeal of Glass-Steagall, I leaned over to my friend, Michael Brunner, and whispered "this won't end well". Indeed.
Bring back Glass-Steagall and repeal Dodd-Frank! I will bet Mr. Trump agrees.