If This Chart Is Any Indication, The ‘Trump Trade’ Is Alive And Well

On Friday, I noticed a chart I hadn’t seen before and by virtue of not having seen it, I wasn’t entirely sure what to make of it.

So what I decided to do was, I decided to wait to comment until someone else confirmed that they hadn’t seen it before either. See how that works? It gives me some plausible deniability – if at least one other person on the planet wasn’t watching it, well then even if everyone else was, at least I’m not the only person who wasn’t paying attention.

This morning, I got what I was looking for, because as it turns out, Bloomberg’s Michael Regan is in the same boat as me in terms of thinking that the following chart from Goldman is “quirky”:

SmallMedium

“Perhaps the most notable of the many so-called ‘Trump trades’ has been the rise of companies with the highest small and medium business exposure,” Goldman wrote on Friday, before explaining that “the median stock in this basket generates 71% of its sales from small-and-mid-sized business customers.”

My knee-jerk reaction to that was that it seems like a tortured attempt to find a “Trump trade” that hasn’t been faded and honestly, Goldman didn’t do themselves any favors by plotting it against the poster child for faded Trump trades (i.e. the Russell vs. the S&P).

The reason I say “tortured” is because if you just kind of run down the list, you won’t see much in the way of evidence that anyone still believes in Trumpian reflation.

Seeing it in the curve? No…

Curve

Are high tax companies outperforming? No…

HIghtax

Value versus growth? God no…

ValueGrowth

So it kind of seems like we’re now searching far and wide for anything that supports the notion that investors are still confident in the “Trump trade.” But who am I to question Goldman? Just because I’ve never heard of ticker “GSRHSMBX” doesn’t mean it’s not important.

And besides, at the end of the day all you need to know is the following, as “articulated” by the President aboard Air Farce Force One on Friday:

The reason our stock market is so successful is because of me. I’ve always been great with money. That’s what I do.

Got it.

Speak your mind

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4 thoughts on “If This Chart Is Any Indication, The ‘Trump Trade’ Is Alive And Well

  1. “I’ve always been great with money.” Well, you know except for all those times when Trump wasn’t great with money.

    Like most Trump claims – the only basis they have are in his mind’s selective memory. A memory fogged by his raging inferiority complex and its over compensations. A psychic void of empathy for his victims and consequently absent of conscience or any mediating. All create the Trump creature’s complete disassociations with actual reality.

    What isn’t in Trump’s mind is that everyone except his base is going to check the public records on the internet regarding his many failures. Doing so they will find that Trump has a long record as a totally unethical business person. One that fails to honor personal promises, contracts, debts, and a proclivity of cutting his losses and running – before failures can be connected to him. As well as being vindictive to those that point out his short comings in public. This is why he will eventually resign from the Presidency just before he can be prosecuted – it’s his elemental personality.

    Trump has never filed for personal bankruptcy, but companies that he founded and managed have. At least 6 official complete and verified bankruptcies from his companies, but they are not limited to those that might not have been in directly under his name and in which he played a major role. Again, Trump has often cut his losses by leaving a business before it collapsed. Some pre-election article excerpts from WaPo:

    #1) Trump Taj Mahal (1991): The Trump Taj Mahal casino in Atlantic City opened in 1990, with Trump financing the completion of its construction with $675 million in junk bonds at 14% interest. By the following year the casino itself was in debt to the tune of $3 billion, while Trump himself owed some $900 million in personal liabilities.

    In order to keep the Taj Mahal afloat, Trump struck a deal with his lenders in which he gave up half his ownership share and equity in the casino, sold his Trump Shuttle airline and his Trump Princess 220-foot yacht, and agreed to a bank-set limit on his personal spending in exchange for a lower interest rate and additional time to make his loan payments.

    #2 and #3) Trump’s Castle and Trump Plaza Casinos (1992): Less than a year after the Taj Mahal bankruptcy Trump filed for Chapter 11 protection again for two more Atlantic City hotel-casinos, the Trump Plaza and Trump’s Castle, over their inability to make principal and interest payments on bonds. The Plaza ($550 million in debt) and the Castle ($338 million in debt) were competing against each other, as well as against the Taj Mahal, and Trump gave up a 50% share in exchange for more favorable terms on the debts.

    #4) Trump Plaza Hotel (1992): Donald Trump filed for bankruptcy protection a third time in 1992 over the Trump Plaza Hotel on New York’s famous Fifth Avenue, overlooking Central Park in midtown Manhattan. Once again, Trump gave up a 49% stake in the property to secure more favorable terms from lenders on the luxury hotel’s debt of more than $550 million.

    #5) Trump Hotels and Casinos Resorts (2004): In 1995, Donald Trump established Trump Hotels and Casino Resorts as a publicly traded company, an entity that eventually consolidated his three Atlantic City casinos (Trump Taj Mahal, Trump Castle, and Trump Plaza), along with other properties, under one company. In 2004, Trump sought Chapter 11 bankruptcy protection for the company, with filings listing about $1.8 billion in debt. Yet again, Trump’s ownership in the business was reduced, from 47% to 27%, in order to obtain more favorable terms from lenders.

    #6) Trump Entertainment Resorts (2009): After its 2004 bankruptcy, Trump Hotels and Casino Resorts was renamed Trump Entertainment Resorts (TER), and that latter entity went Chapter 11 in 2009 with a debt of $1.2 billion. Trump fought with his board of directors over how to restructure the company and ended up reducing his ownership share of the business once again (to 10%) and resigning as chairman of the board.

    From Snopes, a number of Trump’s other businesses ventures failed and or were closed before they went bankrupt including – but not limited to:

    Trump Steaks
    GoTrump (online travel site)
    Trump Airlines
    Trump Vodka
    Trump Mortgage
    Trump: The Game
    Trump Magazine
    Trump University
    Trump Ice (bottled water)
    The New Jersey Generals (pro football team)
    Tour de Trump (bicycle race)
    Trump Network (nutritional supplements)
    Trumped! (syndicated radio spot)

    Trump says he has a great business record of only 6 bankruptcies out of 515 companies. However, he had little to do with the management in most of those 515 companies and or only tangential relationships at best – and as such little to do with their successes or failures.

    Basically Trump boils down to a guy who was born with enough money to hire people to make more money for him and or to avoid prosecutions that would normally land a less wealthy person in jail for thievery, fraud and being a professional con artist.

    https://www.snopes.com/2016/08/01/donald-trumps-bankruptcies/

    https://www.washingtonpost.com/politics/2016/live-updates/general-election/real-time-fact-checking-and-analysis-of-the-first-presidential-debate/fact-check-has-trump-declared-bankruptcy-four-or-six-times/?utm_term=.12d92ea04f07

  2. His connection to Puerto Rico predates his incompetent and despicable comments and behavior after the hurricane destruction and U.S. failure to take responsibility and to this day, still fails to manage support and reconstruction they are entitled to!

    A golf course resort in Puerto Rico was failing terribly and trump took over management in 2008 and required the course be renamed using his name, all of which was done. He was still the managing agent when it was clear there would be no recovery. Bankruptcy was filed by the owners, $33 million loss to Puerto Rico and trump had the audacity to file for a payment of $900+thousand dollars for what he said they owed him when bankruptcy was filed. The owners either reorganized or sold (some question on which it was-most say they reorganized, without trump) and the golf course is still in operation now as CoCo Beach Resort.

    “Whatever that plan was, it did not succeed. The 2012 financials show that the club’s average annual losses rose to $6.3 million during the period that Trump’s company provided management services to the resort (2008-2012), $1 million more per year than the business had been losing before. Further, for this lack of success, Trump International garnered a total of $609,607 in management fees between 2008 and 2012.”

    “Donald Trump did not set Coco Beach Golf and Country Club on course for ruin, but he wasn’t able to save it from that fate. His role in the bankruptcy of the company, which ended up costing Puerto Rican taxpayers $32.6 million, was significant but limited. That $32.6 million loss constituted 0.03 percent of the territory’s total $123 billion debt, which prompted the Puerto Rican government to file for bankruptcy relief in May 2017.”

    full story: https://www.snopes.com/trump-puerto-rico-golf-course/

    AND THEN as we all saw with our own eyes and heard with our own ears, he has the audacity to pathetically fail to manage his responsibilities as President of the United States for recovery and reconstruction of Puerto Rico.

    It seems to me that his behavior appears to be more revengeful than helpful.

  3. > “The reason our stock market is so successful is because of me”

    An inappropriate & dumb thing to say, along with cheer leading the DJIA. So was there ever any doubt that he’d nominate Powell, and did so at least in part to continue & reinforce this unofficial third mandate of the Fed to levitate stock prices, started by the bernank & Yellen.

    Anyway it’s not quite “so successful” as others in terms of foreign currencies this year, but shhhhh.

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