https://www.bloomberg.com/news/articles/2017-02-06/goldman-sachs-says-trump-rally-curbed-as-economy-lags-enthusiasm
This exuberance is probably peaking, writes Charles Himmelberg, Goldman Sachs Group Inc.’s chief credit strategist, who cites several signs of cooling sentiment:
The Conference Board’s measure of consumer expectations for the U.S. economy over the next six months fell to 99.8 in January from 106.4 the prior month, registering its steepest decline in more than a year.
Retail investors’ preference for stocks over bonds after the election has almost fully reversed, according to Himmelberg, with the four-week trend for mutual-fund flows into U.S. bond funds hitting a six-month high.
The post-election outperformance of Goldman’s "cyclicals versus defensive" basket of stocks has ceased; it now trails the S&P 500 index’s advance since the election.
The yield on 10-year Treasury Inflation Protected Securities jumped nearly 60 basis points in the five weeks following Nov. 8, but has since pared nearly half of that move.
Trump 'rally' is over. Also my favorite on the immigration ban:
Jan Hatzius, Goldman’s chief economist, noted separately that immigration restrictions could serve as a meaningful offset to any boost to productive capacity linked to infrastructure spending, tax reform and deregulation that could be achieved over the long haul. Net migration contributes up to one quarter of the U.S. economy’s 1.75 percent potential growth rate, he estimates.
We have elected the enemy.
