September 30, 2018 | Market at Record Highs Is Flouting Big Risks Just Ahead

So much is riding on the outcome of this week’s FBI investigation that stocks are likely to remain unusually subdued until Kavanaugh’s appointment is decided. If the Senate does not confirm him for a seat on the Supreme Court, this could brew a perfect storm for investors in October that would feature the following: 1) Democratic majorities in the House and Senate; 2) Trump as a lame-duck president; and, 3) a coincidental escalation of the tariff war with China.  Think of the ‘Trump rally’ in reverse and you can see how the Dow might be trading 5000 points lower in six weeks. Putting aside the effects Kavanaugh’s rejection might have on the stock market, it would be catastrophic for America, turning seething hostilities across the red state/blue state divide into a potential civil war. This would likely happen even more quickly if Kavanaugh wins, since the left has threatened to impeach him and Trump.  They are certain to make good on this threat if they win big in November, unsettling America politically and economically for the foreseeable future. With the stock market trading in record territory, it is clear that investors are blithely oblivious to such risks and unprepared for the consequences.

Rick Ackerman September 30th, 2018

Posted In: Rick's Picks

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