Betting on an Uncertain Trump Economy

It was possible, in the hours after Donald Trump’s shocking win, to relive the 2016 campaign through a tour of the reeling financial markets. Stocks plummeted as investors accepted that a man best known as a reality-TV star when he entered the race would assume the world’s most powerful office. Mexico’s peso was crushed on assumptions Trump would trash trade agreements and deport immigrants. Russian equities jumped on hopes that Vladimir Putin and Trump would be allies.

Gold, seen as a haven in perilous times, surged as the U.S. military establishment prepared to give nuclear codes to a snappish late-night tweeter. Long-term U.S. Treasury yields spiked, a reflection of Trump’s allusions to cutting taxes, increasing government spending, and defaulting on America’s debt. In each asset class, there was an attempt to put into numbers an event that one struggles to put into words.