Why Not Profit While Others Protest?

Stock market

20 days is an incredibly long time. You could write a book in 20 days if you commit to it. You could travel the world in 20 days if you had the money to. You could learn to swim, ride a bike, skateboard or kitesurf.

If you’re Donald Trump, you can achieve a lot in 20 days. For instance, you can sign seven presidential executive orders. And you can singlehandedly change the fortunes of public companies.

An executive order is a legally binding order from the US president. It’s a bit of a legislative go-around to get things done, fast.

Airlines no, concrete yes

As you already know, a couple of these executive orders have been controversial. One of the most recent has created global chaos.

The executive order we wrote about yesterday is the one that’s grabbing all the headlines. That’s where the US is temporarily banning citizens from Iran, Iraq, Libya, Yemen, Somalia, Sudan and Syria.

It’s seen the airline industry in a spin. For example, Delta Airlines [NYSE:DAL] was trading at US$51.40 early Thursday. Earlier today, it was US$47.63.

You can see how this makes life hard for airlines. Imagine you’re on the check-in desk for Delta at Heathrow. And you’re checking in passengers for a flight to LA. On Thursday, you get a passenger with a Syrian passport boarding the flight. No problem. Have a safe flight, Mr Syrian National.

But then come Saturday, you get a Somalian national trying to board the LON–LAX flight. Sorry, no can do. The US is banning you from entry. Why? You’re from Somalia. And President Trump says you’re a terrorist — or a potential terrorist.

That is what the executive order says. The primary purpose of it is to ‘protect the American people from terrorist attacks by foreign nationals admitted to the United States’. And if you’re from one of those seven countries, you’re one of ‘those’ foreign nationals.

However, Trump did promise in his campaign to do exactly that. And, well, he’s just fulfilling his election promise.

And then there’s the ‘wall’. On 25 January, he signed the executive order to ‘secure the southern border of the United States through the immediate construction of a physical wall on the southern border’.

There’s already a wall there. Well, a fence really. But this wall will be grand. It will be ‘Trump’s Wall’. And the executive order says it’s going to happen.

This order has sent construction companies into overdrive. Take, for instance, a company like CEMEX SAB de CV (ADR) [NYSE:CX], which is a concrete company. And believe it or not, CEMEX is Mexican. But its stock price is up 103% in the last year thanks to Trump. Since Trump’s inauguration, it’s up 16.92%

None of this should really be a surprise. After all, Trump promised he would do this in his election campaign. He is just fulfilling his election promise…again.

On 24 January, Trump signed another executive order. This one was to rebuild America. Its purpose is to create ‘millions of jobs’. It’s designed to increase wages, strengthen the economic platform, and reduce the cost of goods and services.

It’s a grand plan to invest in infrastructure. The order streamlines environmental reviews and approvals for all infrastructure projects. In particular, it has a focus on ‘electric grid and telecommunications systems and repairing and upgrading critical port facilities, airports, pipelines, bridges, and highways.’

This order has had a major impact closer to home. ASX-listed Eden Innovations [ASX:EDE] makes concrete admixtures. And it’s now up 31.91% since Trump’s inauguration. This is partly because it sells and operates directly out of the US.

The immigration ban. The wall. The infrastructure spending. These are executive orders that create controversy. But don’t be shocked or surprised. Look for the companies that will benefit, or suffer.

The most divisive person of the 21st century

It is incredible what Trump has been able to get done in just 20 days. I don’t agree with it all. I think some of it is downright bigotry. Ironically, the executive order for the temporary immigration ban states: ‘In addition, the United States should not admit those who engage in acts of bigotry or hatred’.

But I’m not surprised. Trump has said all this before. But most people didn’t think he was serious. Guess what? He is.

And perhaps that’s the real focus we should have here. No executive order Trump has signed has been a surprise. None of them are out of left field. They are all promises he made in his election campaign. And unlike most politicians, he’s actually following through on his promises.

Now, this has obviously enraged half the population. It’s also enraged around half the people overseas. I say half because that’s what Trump is good at. Divide and conquer. He’s perhaps the most divisive character of the 21st century.

I can’t recall anyone else creating so much debate. No one of recent times has been able to polarise groups of people with such ease. He is a phenomenon. One of a kind.

I took note of a BBC report this evening. It was highlighting some of the protests about Trump’s immigration ban. It made note of the immense number of young people demonstrating. Well, of course they would. You see, young people generally don’t like Trump.

But they weren’t the ones that voted him into power. Edison Research for the National Election Pool has some incredible numbers on the demographics of Trump’s election victory.

In major cities, Clinton easily beat Trump. But in the suburbs — which were 49% of the vote — Trump took 50% of the vote, Clinton 45%. The numbers are astonishing when you push out further to rural areas and small cities. These areas carry 17% of the vote. Here, Trump took 62% versus Clinton’s 34%.

And then there are the age demographics. Have a look at the chart below.


Source: Business Insider
Click to enlarge

As you can see, the older votes (and the majority of voters) went to Trump. The younger to Clinton. So of course the youth will protest and complain about a president they didn’t vote for.

Profit while others protest

But there’s the silent population of the US that’s thrilled with Trump. The millions that voted him into power will be happy with their leader. He’s been able to follow through with more promises in such a short time than any president before.

You won’t see these people on the news. You won’t see them at protests. You’ll find them in the suburbs and rural areas of the US. They’re the retired neighbours. The older folk on the farms. They’re the ones who are saying to themselves, ‘We made the right choice.’

Here’s a president of action. And he’s doing what most politicians fail to do. He’s doing what he said he would do. In a democratic society, when a politician actually does what they say they’ll do, you have to be impressed.

You don’t have to agree with it. You don’t even have to like it. But you absolutely should keep an eye out for what executive orders come next. If you’re sharp enough, and take the time to read them, you could benefit from them. Look at companies like CEMEX and Eden Innovations. Just two examples of many.

And with the next lot of executive orders (and there will be more), there will be other companies that benefit. With decisive action — a bit like Trump — you might be able to profit while others protest.

Regards,
Sam Volkering

Sam Volkering

Sam Volkering is Editor for Money Morning and its small-cap, cryptocurrency and technology expert. Find out what he has to say here with all his latest articles.

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