So here we are. In just two months time the world will be watching the inauguration of President Donald J Trump. While it is safe to say not everyone welcomed the outcome of the US election with open arms, politicians and us mere mortals are beginning to, at the very least, come to terms with the prospect of a new and very different leader of the free world.
Hot on the heels of Brexit, the parallels between the two votes are both inevitable and inescapable. The result no-one was expecting. The expected market rout. The impact on global macroeconomic policy. Etc etc.
Whether it is the desire to look for a silver lining, or what fund managers call a “buying opportunity”, global markets have yet to fall through the floor. With the exception of the Mexican peso, obviously.
Fund groups are clinging to the positives: a move towards financial services deregulation for example (whether that is positive for Joe Public is a debate for another day). They also point to the expected investment in infrastructure, proposed tax cuts and other growth-driving policies as reasons to be cheerful.
Both the Trump win and the Brexit vote take us into unchartered territory, though it has been pointed out that while President Trump may be limited to a four-year term, the uncertainty heralded by Brexit is likely to last far longer, particularly with the outcome of the Government’s Article 50 appeal next month.
It has been a year of political shocks. But in hindsight, perhaps we should not be so surprised after all at the turn of events. When you think about it, ever since the financial crash eight years ago we have been lurching from one crisis to the next, what with fears over the break-up of the eurozone (part one), Greece, China, Brexit, and now President Trump. Maybe we should have been better prepared.
Old Mutual Global Investors’ Richard Buxton has an interesting take on all of this. He talks of a shift in power, not from the establishment elite to the people (as Trump would have us believe), but from the central banks to the politicians. It may be the likes of President-elect Trump and Prime Minister Theresa May who start calling the shots and moving markets, rather than Carney, Yellen et al. Perhaps that is the scariest thought of all.