According to Bennett, the stock market certainly hasn’t been a free market. It’s been controlled by central banks, and as a result, people have opted out, mutual and hedge funds have closed, and no one can make money in the market.
“In order to take this market off remote control, it’s going to have to be on its own, and certainly corporate earnings and revenues haven’t been as strong as they were eight years ago, so I don’t know what will happen at that point. That is going to affect American’s pocket books,” said Bennett.
According to Goodman, the DOW has been up 8% since the election— one of the biggest gains we’ve seen in a while between election and inauguration— and this anticipates what’s to come.
“If regulations come down, if corporate tax rates come down, if we repatriate a lot of the two and half trillion dollars sitting overseas and bring that back here, and corporations either invest it here or buy back stock or raise dividends, these are all positive for the U.S. economy, and that’s what the stock market’s been anticipating,” he said.
He continued, “There’s going to be winners and losers, though. The winners avoid his Tweets and the losers get tweeted to death, whether it be a drug company or General Motors or Boeing or whoever it may be. In the Tweet market, you never know who’s going to get hit next. Overall, if you get corporate earnings up, which I think all of his policies will do, that supports higher stock prices. We’ve been floating around 20,000 in the DOW for a while here, but I’m predicting we’re going to end 2017 at about 23,000. I think we have a lot of room to go up.”
Despite this optimistic view, Goodman said he is most concerned about trade wars with China, Mexico and Japan.
“He [Trump] has very strong rhetoric, and maybe that’s a bargaining ploy, and maybe it will work,” Goodman said. “Maybe we’ll get better deals, maybe our trade deficit will come down with these countries, but I think the opposite could happen.”
He continued, “If we don’t get a deal we want, and he does put a 35 percent tariff on them, they’re clearly going to retaliate and make it hard for American goods to go there as well. That’s my biggest economic concern. Then politically, I’m concerned about wars. In the South China Sea, or if we move the embassy in Tel Aviv to Jerusalem and that causes a Middle East war. Those are the kind of things I’m most concerned about on the down side. He didn’t get elected in China, so the Chinese aren’t his constituency. So that’s what I’m most concerned about is getting into trade wars.”