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Why has Trump's Covid led to a market fall?

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bluedonkey
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Why has Trump's Covid led to a market fall?

#344408

Postby bluedonkey » October 2nd, 2020, 10:29 am

Moderator Message:
Moved from Investment Strategies to here (leaving a link) because this is not an investment strategy, unless it is a strategy that relies on presidents getting Ill. - Chris


Why has Trump's Covid led to a market fall? Presumably the market was betting on a Biden win given the polls. What's changed and why? I'm confused.

scrumpyjack
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Re: Why has Trump's Covid led to a market fall?

#344410

Postby scrumpyjack » October 2nd, 2020, 10:34 am

bluedonkey wrote:Why has Trump's Covid led to a market fall? Presumably the market was betting on a Biden win given the polls. What's changed and why? I'm confused.


Markets hate uncertainty

mc2fool
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Re: Why has Trump's Covid led to a market fall?

#344440

Postby mc2fool » October 2nd, 2020, 11:21 am

bluedonkey wrote:Why has Trump's Covid led to a market fall? Presumably the market was betting on a Biden win given the polls. What's changed and why? I'm confused.

What makes you believe that Trump's Covid has led to a market fall? Coincidence is not proof of causality.

Today's movement looks pretty minor in the recent scheme of things: http://mediacharting.digitallook.com/cg ... dicator_3=

bluedonkey
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Re: Why has Trump's Covid led to a market fall?

#344450

Postby bluedonkey » October 2nd, 2020, 11:30 am

mc2fool wrote:
bluedonkey wrote:Why has Trump's Covid led to a market fall? Presumably the market was betting on a Biden win given the polls. What's changed and why? I'm confused.

What makes you believe that Trump's Covid has led to a market fall? Coincidence is not proof of causality.

Today's movement looks pretty minor in the recent scheme of things: http://mediacharting.digitallook.com/cg ... dicator_3=

Fair point. In slightly related news though, Betfair has suspended betting on the outcome of the US Presidential election.

SalvorHardin
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Re: Why has Trump's Covid led to a market fall?

#344458

Postby SalvorHardin » October 2nd, 2020, 11:46 am

As mc2fool has said, correlation is not necessarily causality. However, that doesn't mean that there isn't some connection. Here are a few ideas:

As previously mentioned, markets hate uncertainty. Loathe it.

Any country (or terrorist group) which is looking to make trouble against America (or its allies), might decide that it is now a good time to do so because the President of the United States is ill. History has shown that a good time to strike is when a country's executive is highly distracted and/or its chain of commands is impaired.

Anticipating higher taxes and more regulations under a Biden administration.

Biden's mental competence is an issue if he wins. Which has become more likely.

The odds of Mike Pence becoming the next President have rocketed. More uncertainty.

The odds that the Presidential election has to be referred to the Supreme Court have increased substantially. This has increased the odds of some sort of armed conflict between Democrat and Republican supporters becoming more likely.

Democrats have become much weaker on property rights and the rule of law. Look at how the Democrat mayors of some cities, notably Portland, Seattle and Minneapolis, have stopped the police from preventing massive property damage in the centres of their cities. Some, notably Portland, have effectively decriminalised criminal damage and serious acts of violence, by ordering the police to stand down and release those arrested for such offences without any charges. Biden has refused to condemn the rioting and property damage. Given how investors like property rights to be respected, America has become a slightly less attractive place in which to invest.

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Re: Why has Trump's Covid led to a market fall?

#344469

Postby redsturgeon » October 2nd, 2020, 12:05 pm

SalvorHardin wrote: Biden has refused to condemn the rioting and property damage. .


Not true

https://www.reuters.com/article/uk-fact ... SKBN25V2O1

John

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Re: Why has Trump's Covid led to a market fall?

#344470

Postby servodude » October 2nd, 2020, 12:07 pm

SalvorHardin wrote:Biden's mental competence is an issue if he wins. Which has become more likely.


Vis a vis DJT?

JamesMuenchen
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Re: Why has Trump's Covid led to a market fall?

#344482

Postby JamesMuenchen » October 2nd, 2020, 12:31 pm

bluedonkey wrote:Why has Trump's Covid led to a market fall? Presumably the market was betting on a Biden win given the polls. What's changed and why? I'm confused.

Probably just because it brings Covid to the front of people's minds and induces a pessimistic view of future lock-downs, etc.

This is borne out by looking away from the FTSE to the NASDAQ or individual shares that have previously benefitted from Covid concerns, they're going up not down.

If they were also down we would have to blame it on the idea of Vice-President Pence being sworn in as President for a few days :)

Or
mc2fool wrote:Coincidence is not proof of causality

what he said.

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Re: Why has Trump's Covid led to a market fall?

#344485

Postby terminal7 » October 2nd, 2020, 12:36 pm

In slightly related news though, Betfair has suspended betting on the outcome of the US Presidential election.


Still suspended - though interesting to note that Pence odds tumbled from over 200 to 36 just before suspension. Not sure why they are suspending given that Harris and Pence were both quoted before suspension - thus incorporating into the market a possibility of Trump/Biden possibly falling by the wayside before the election.

T7

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Re: Why has Trump's Covid led to a market fall?

#344490

Postby SalvorHardin » October 2nd, 2020, 12:40 pm


I shall rephrase. Biden has condemned property damage and violence in a general sense, but he has then blamed it upon various "right wing" groups who had nothing to do with it. He doesn't say anything about the actual culprits, Antifa and Black Lives Matter.

Condemning a series of criminal acts then blaming a party who were not involved in the acts whilst ignoring those who performed the criminal acts (because they are your supporters), is not really condemning the criminal actions. Rather it's absolving your allies from blame whilst trying to frame someone else.

The Wall Street Journal yesterday posted an op-ed about Biden and street violence:

"Could Mr. Biden possibly be unaware of the street violence in U.S. cities inflicted for months by leftist radicals? Antifa is not the only really bad idea. Similar groups go by different names and Mr. Biden didn’t choose to condemn any of them."

https://www.wsj.com/articles/why-didnt-biden-condemn-antifa-and-bernie-sanders-11601586778

What we're seeing in some American cities (all controlled by Democrats for decades) is politicians using paramilitary groups to shape the political narrative through intimidation, violence and property damage. This has been going on for years in Chicago, where politicians are allied with criminal gangs, but it has spread to many other cities in 2020.

Countries where politicians are entwined with paramilitary groups make investors more nervous than those without paramilitaries.
Last edited by SalvorHardin on October 2nd, 2020, 12:41 pm, edited 1 time in total.

Howard
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Re: Why has Trump's Covid led to a market fall?

#344491

Postby Howard » October 2nd, 2020, 12:41 pm

Just a thought:

President Trump announces he has Covid. We all believe him.

Two weeks later he makes amazing recovery.

He announces that he is sure that there is a cure for Covid and, anyway, it can be treated easily.

He turns up for the next debate fit as a fiddle!

Good Election strategy? ;)

Howard

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Re: Why has Trump's Covid led to a market fall?

#344519

Postby monabri » October 2nd, 2020, 1:05 pm

I feel sorry for Melania..poor woman is locked away with DJT ... ;)

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Re: Why has Trump's Covid led to a market fall?

#344534

Postby dealtn » October 2nd, 2020, 1:29 pm

Sorry, but what's the Investment Strategy?

SalvorHardin
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Re: Why has Trump's Covid led to a market fall?

#344542

Postby SalvorHardin » October 2nd, 2020, 1:47 pm

dealtn wrote:Sorry, but what's the Investment Strategy?

In my case:

Invest less in America. I've moved just over £100K from America into Canada and Japan in the last few weeks.

In particular avoid investments which are concentrated in Democrat-controlled cities. I sold my American REITs, all of which were New York focused, once the Mayor stopped the police from dealing with violent protests.

And put a few hundred quid on Mike Pence :D
Last edited by SalvorHardin on October 2nd, 2020, 2:00 pm, edited 2 times in total.

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Re: Why has Trump's Covid led to a market fall?

#344543

Postby XFool » October 2nd, 2020, 1:50 pm

servodude wrote:
SalvorHardin wrote:Biden's mental competence is an issue if he wins. Which has become more likely.

Vis a vis DJT?

Was thinking the very same!

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Re: Why has Trump's Covid led to a market fall?

#344570

Postby jonesa1 » October 2nd, 2020, 2:59 pm

Howard wrote:Just a thought:

President Trump announces he has Covid. We all believe him.

Two weeks later he makes amazing recovery.

He announces that he is sure that there is a cure for Covid and, anyway, it can be treated easily.

He turns up for the next debate fit as a fiddle!

Good Election strategy? ;)

Howard


entirely possible with this president

scrumpyjack
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Re: Why has Trump's Covid led to a market fall?

#344599

Postby scrumpyjack » October 2nd, 2020, 3:56 pm

Maybe Markets are worried he is going to drink bleach?

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Re: Why has Trump's Covid led to a market fall?

#344617

Postby SalvorHardin » October 2nd, 2020, 5:05 pm

Yet again an investment thread, where people are talking about how the effect that political events might be having upon markets, has degenerated into 100% noise 0% signal because some posters can't resist the urge to make political comments which have zero investment merit.

Have they forgotten where Polite Discussions is?

It's Godwin's Second Law for TLF - eventually all investment threads will degenerate into commentary about politics which has nothing to do with investment. The First Law being that all threads eventually turn into a discussion of what can and cannot be posted on HYP-Practical

Still, it does provide us with a nice list of Nimrods to filter

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Re: Why has Trump's Covid led to a market fall?

#344621

Postby XFool » October 2nd, 2020, 5:19 pm

SalvorHardin wrote:Yet again an investment thread, where people are talking about how the effect that political events might be having upon markets, has degenerated into 100% noise 0% signal because some posters can't resist the urge to make political comments which have zero investment merit.

Err... Did you not opine on Biden's "mental competence"? Please don't claim this is not a "political" issue.

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Re: Why has Trump's Covid led to a market fall?

#344628

Postby SalvorHardin » October 2nd, 2020, 5:27 pm

XFool wrote:Err... Did you not opine on Biden's "mental competence"?

Yes. But my post also contained a lot of investment and economic information.

in contrast your post contained, erm, nothing about investment, finance, economics, nor even betting odds (something favoured by a few of us).

Granted it wasn't as information free as the post about drinking bleach, but that one did set a particularly low bar.

You'd be much better off on polite discussions. From what I remember posting about investment matters was frowned upon there. More to your taste methinks


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