Will Politics End the Bull Market?

US president and Russian president shaking hands

Last week I mentioned that the political situation in the US was about to heat up. In the following days, US President Donald Trump sacked FBI agent Peter Strzok, and then removed former CIA Director John Brennan’s security clearance.

Now, that may not seem like a big deal. And if you listen to the mainstream media, this is all an attempt by Trump to silence his critics and hush up the investigation into his alleged collusion with the Russians to influence the 2016 election.

But is it? Or is there something else going on here?

Let me first say that I am neither pro nor anti Trump. I am simply trying to get to the crux of the issue, and work out what the potential impact on the markets might be. Because it could be BIG.

The thing to consider here is that there are two narratives going on. One is what Trump is really doing, the other is what the media want you to believe is happening.

In terms of what he is really doing, check out this clip. It was a speech he made in the lead up to the 2016 election. Try and ignore the stirring images and just focus on the words. It would have made a lot of special interest groups in Washington — and big business — very nervous.

If you view current events through the lens of this speech, things start to make a lot more sense. Watch it, then keep reading…

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The conspiracy theory of the Russian meddling

Ok, with that in mind, let’s consider this Russian meddling issue. I’m bringing it up now because I think there will be a resolution soon (well before the mid-term elections in November). And with your investor hat on, it is important that you understand what is really happening, and be able to see through the media spin.

It all started with the release of sensitive emails related to the Democratic Party in March 2016. The Democrats claim that Russians hacked their email system, and that they approached the Trump campaign in the lead up to the election saying they had ‘dirt’ on Hillary.

Julian Assange, head of Wikileaks (who published the emails) has consistently said the Russians weren’t the source of the leaks. The smart money is on Seth Rich being the source. Rich was an employee of the Democrats, and had access to the servers.

It just so happened that he was murdered a few weeks before Wikileaks released the emails to the public. If he was the source of the leaks (and not the Russians) how could it now be proved?

The mainstream media will tell you that the claim that Rich was the source is a conspiracy theory — an indication that the theory has legs. There is no better way to get the masses off the scent than to go down the ‘conspiracy’ path…

Could this collusion impact the stock market?

Anyway, bringing it back to Trump, the Democrats are pushing this Russian collusion line because they can use it to impeach him. Why are they so desperate to do this? And why is the mainstream media so against him? Go back and watch the video…

And bringing it back to FBI agent Strzok and John Brennan, the Trump camp claims they used their positions to advance the Russian collusion claims. If true (and if the Trump/Russia connection is false) then their actions border on treason.

Furthermore, Trump’s cancelling of Brennan’s security clearance removes a nice little earner for the former CIA Director. Security clearances provide access to classified information. As such, those with clearances are highly sought after by the private sector once official employment with a government agency ends. It gets them a competitive advantage.

That’s how the ‘swamp’ works. It’s highly lucrative for those in it.

Like him or loathe him, Trump is trying to drain the swamp. This is why he is so hated by the establishment.

Trump’s team is confident that the current Mueller investigation will find no evidence of Russian collusion. If that is the case, the spotlight will turn on the democrats and put into question whether the collusion was actually taking place on their side. That is, were they colluding to frame Trump?

If this story blows up, what will the impact on markets be?

Will there be an impact?

That’s the question I’m currently asking. Right now, US stocks are right near all-time highs. This secular bull market (which started in March 2009) is very close to being the longest in history.

Will an upheaval in US politics be the catalyst that ends the bull? Along with everything else, it’s a question worth keeping in mind.

Regards,

Greg Canavan,
Editor, Crisis & Opportunity

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Greg Canavan

Greg Canavan

Greg Canavan is a Feature Editor at Money Morning and Head of Research at Port Phillip Publishing.

He likes to promote a seemingly weird investment philosophy based on the old adage that ‘ignorance is bliss’.

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