How Trump's isolationism threatens long-term equity returns

February 03, 2024 at 13:17 PM EST

Now that Donald Trump has become the presumptive Republican nominee for President, Wall Street is scrambling to model how a Trump White House may affect capital markets. A recent Bloomberg article summarized the consensus:

Bond market: Expect rising yields from upward pressures on term premium.
Currencies: Rising yields will put a bid under the USD.
Equities: Stocks in limbo as it’s difficult to form a consensus.

I wrote about the effects of a Trump victory about a month ago (see What the Politics of 2024 Tell Us About 2025) and highlighted the geopolitical risk from Trump’s foreign policy. Further analysis leads us to believe that Trump’s foreign policy could unravel the “Stocks for the Long Run” narrative popularized by Jeremy Siegel. This could have profound long-run implications for investors in their investment planning.

Here’s why. The full post can be found here.