It wasn’t just media pundits who got the election and its consequences all wrong – prevailing wisdom from our financial elites got it dead wrong too.
British bank Barclays predicted the S&P 500 would lose 11 to 13 percent if Trump won, but would rise two to three percent if Hillary won. Citibank predicted a five percent drop-off under a Trump victory. J.P. Morgan predicted a three percent rise following a Hillary victory, compared to markets “falling further” if Trump won.
By the week’s end, the Dow Jones index has increased by 3.3 pecent, closing at a record high, while when Obama won in 2008, by the end of the week the Dow was down 4.1 percent.
So how do you lose money from a market rally like this? Be George Soros – and structure your investments specifically banking on a Hillary victory. Hillary Clinton once asked about Donald Trump “what kind of businessman loses $1 billion in a year?” and in addition to the answer being “Hillary Clinton’s 2016 campaign,” it’s George Soros.
As Breitbart reported:
Billionaire hedge-fund manager George Soros lost nearly $1 billion as a result of the stock-market rally spurred by Donald Trump’s surprise presidential election.
But Stanley Druckenmiller, Mr. Soros’s former deputy who helped Mr. Soros score $1 billion of profits betting against the British pound in 1992, anticipated the market’s recent climb and racked up sizable gains, according to people close to the matter.
The divergent bets of the two traders are a stark reminder of the challenges even acclaimed investors have faced following Mr. Trump’s unexpected victory.
Mr. Soros was cautious about the market going into November and became more bearish immediately after Mr. Trump’s election, according to people close to the matter. The stance proved a mistake—the stock market has rallied on expectations that Mr. Trump’s policies will boost corporate earnings and the overall economy.
Thanks to Soros’s diversified portfolio, his funds still earned 5% on the year, but the stock market (measured by the Standard & Poor 500 Index) increased 11.2% (excluding dividends) in 2016.
Liberals should cheer: thanks to Donald Trump, an evil rich guy is a billion dollars poorer.