Will Politics Kill This Bull Market?

[bjwgyinp70]

Live by the sword, die by the sword.

It is the common rendering of the Biblical verse Matthew 26:52, in which the King James version reads, Then said Jesus unto him, Put up again thy sword into his place: for all they that take the sword shall perish with the sword.

[broolvgd88]

This bull market reminds me of that poetic verse. Since Election Day on Nov. 8, stocks have surged to more than 32 all-time record highs on the Dow Jones Industrial Average.

[bnelkdni49]

One cursory glance at the SPDR Dow Jones Industrial Average ETF (DIA) shows the near-parabolic surge in markets from Nov. 9 until today.

[BTPK]

Remarkably, there have only been two breaches of the 50-day moving average since Election Day. That is what resilient bull markets are all about!

Still, I firmly believe that this bull market has lived by the sword of political hopes.

Those hopes are, of course, rooted in President Trump is pro-growth economic agenda. That agenda included regulatory reform, Obamacare repeal/replace, an infrastructure spending plan and, most importantly, tax reform that includes a substantive cut in the corporate tax rate.

[buymesoTar]

As for Obamacare, well, that must be looked upon as an epic fail by not only President Trump, but also by Republicans in Congress. Despite having majorities in both chambers, the GOP failed to deliver on one of its key platform positions of the past seven years.

Yet interestingly, the failure to repeal/replace Obamacare still did not stop this bull market. Nor has the lack of any progress on an infrastructure spending plan. In fact, infrastructure has rarely been mentioned by the White House, despite all of the campaign rhetoric about building a big, beautiful border wall and rebuilding the nation is roads, bridges, dams, etc.