For a long time now, I’ve felt that no matter who wins this election, the U.S. is in for extremely difficult times over at least the next 4 years. The reason is twofold. First, when you combine Donald Trump and Bernie Sanders supporters (the latter didn’t just disappear), a majority of the population is in full on revolt against the status quo. This mood isn’t going anywhere. Combine this backdrop with the very high likelihood of an economic downturn, and you have a recipe for mayhem. This isn’t even taking into account the possible end to a multi-decade secular bull market in sovereign bonds, the ramifications of which represent a financial extinction-level event for much of the Western world.
When I look at the financial markets and note that they appear totally unwilling to even flirt with the very real possibility of a Trump victory, I conclude that the current status quo assumption is not only that Hillary will win, but that after she wins, the social mood will get better. I, on the other hand, think it will get far, far worse, as disgusted Trump and Sanders supporters push back relentlessly from day one. As I noted earlier today on Twitter:
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