Brexit and the subsequent economic implications including the devaluation of the British pound seemed almost like a harbinger or warning call of what the Armageddon-like results of 2016 would be like if Donald Trump won the election. In the days following the November 8th<\/sup> result the stock market responded in a way that left many economists, political pundits and speculators curious to say the least. The early stock market response was overly positive with the DOW, Nasdaq 100 and S&P 500 spiking up considerably in the morning after the election and continuing to show positive trends. But what exactly elicited such a positive response from the markets, which all seemed to signal economic victory?<\/p>\n Some experts believe that it may have to do with the Trump administrations promise to cut regulations, a vow to dismantle the Dodd-Frank financial reform, and the corporate tax rate, a move that would benefit the private sector tremendously. The \u201cTrump-ed up\u201d trickle down economics that Hillary oh so cleverly coined during the debates, refers to his plans to cut corporate taxes, from a top rate of 35 percent down to 15 percent; in addition, cutting taxes on America\u2019s wealthiest from 40 to now 33 percent for top rates.<\/p>\n Others believe that the results motivated investors to pour money into major construction and engineering stocks in anticipation of a Trump stimulus package for America\u2019s infrastructure that would include major improvements to roads, bridges, telecommunication, public transportation, \u201cworld-class\u201d airports, security and utilities while simultaneously creating new jobs and higher wages.<\/p>\n \u201cFor the U.S. domestic economy, the obvious winners are\u00a0infrastructure, with a focus on roads, bridges, and airports,\u201d said Mark Burgess, global head of equities at fund company Columbia Threadneedle Investments (Dieterich).<\/p>\n Burgess\u2019s reasoning would explain why the DOW, Nasdaq 100 and S&P 500 companies dealing primarily with industrial materials and services have experienced continued growth in stock values since November.<\/p>\n <\/p>\n \u201cA Goldman Sachs report cautioned that the new U.S. infrastructure spending \u2014 which Trump has put at from $500 billion to $1 trillion \u2014 would not begin until the third quarter of 2017. Moreover, the price tag is a combination of private and public money, so the scope of Trump\u2019s plan depends on how he counts,\u201d (Mufson).<\/p>\n With all this in mind the question remains, where should we invest? In order to answer this question, it is important to first take a look at the President-Elect\u2019s economic plan. While Trump\u2019s plan could change at the drop of a hat as soon as he enters the Oval, analyzing his current proposal is one of the first steps prior to making investments.<\/p>\n Trump\u2019s vision includes the creation of a dynamic booming economy with 25 million new jobs over the next decade. Trump believes that under his presidency there will be a 3.5 percent growth per year on average. Creating all of these new jobs will result from the Trump energy policy, which he plans to \u201cunleash\u201d as soon as he takes office. The energy policy main objective is to make the US entirely energy independent and in doing so create millions of new jobs and protecting clean and clean water. One of the main problems that has been cited with this plan though is that Trump wants to focus all of this energy plan\u2019s efforts on coal, oil, and natural gasses \u2013 all of which contribute to pollution and directly contradict the Paris Climate change agreement. Shifting the focus away from environmental protections and issues could mean an overall increase in drilling everywhere, especially Federal land holdings:<\/p>\n \u201cLifting unnecessary restrictions on all sources of American energy (such as coal and onshore and offshore oil and gas) will (a) increase GDP by more than $100 billion annually, add over 500,000 new jobs annually, and increase annual wages by more than $30 billion over the next 7 years; (b) increase federal, state, and local tax revenues by almost $6 trillion over 4 decades; and (c) increase total economic activity by more than $20 trillion over the next 40 years,\u201d (www.donaldjtrump.com).<\/p>\n The energy policy could mean big returns on energy investments. The big American oil companies, Exxon Mobil (XOM) and Chevron (CVX), will undoubtedly benefit from a pro-oil and natural gas administration. Companies dealing with energy infrastructure should also be given a closer look. Making federal land readily available and investing less in alternative clean energy would drastically support big oil in general. The appointment of Scott Pruitt, former Oklahoma attorney general, to President-elect Trump\u2019s to run the Environmental Protection Agency is a clear signal that the Trump administration plans to shift energy policy\u2019s attention away from clean and renewable energy. Mr. Pruitt, a Republican, is already noted as being a climate change denialist. During his time as Oklahoma\u2019s attorney general, he fought vehemently against President Obama\u2019s climate change policies battling on behalf of the coal industry. In fact, as Oklahoma\u2019s top prosecutor Pruitt went so far as to sue the EPA. The appointment, while bleak does spell out good news for the fossil fuels industry and those who wish to invest their assets in the same companies that gave Pruitt under the counter campaign contributions.<\/p>\n The energy policy makes a stipulation that under a Trump administration the President-Elect would like to see the US become the world\u2019s leader in energy technologies including nuclear power.\u00a0\u00a0 A company like BWX Technologies (BWXT), which specializes in energy infrastructure \u2013more specifically nuclear energy technology \u2013 with a large government, services and facilities management division could see a rise in stock earnings over the next few years. The day of the election BWX Technologies stock traded at 36.63 before spiking up the next day to 39.54, with continued growth since the election and a 5-year record high on November, 25th<\/sup> at 40.52.<\/p>\n \u201cAnalysts at Cantor Fitzgerald recently predicted that there would be a \u201cviolent increase\u201d in uranium prices at some point, theorizing that as much as 80 percent of the uranium market might be uncovered in terms of supply by 2025, and that demand would by then outstrip supply,\u201d (Stafford).<\/p>\n Beyond the infrastructure and energy sectors, there are several top industries that will be impacted by the upcoming Presidential administration. Defense \u00a0will be huge, YUGE! Trump has already indicated that he wishes to expand the size of the Army and Marine Corps dramatically, build new vessels for the Navy and jets for the Air Force, all while modernizing the US\u2019s nuclear arsenal. Lockhead Martin (LMT), Raytheon (RTN), General Dynamics (GD), and BAE Systems (BA), are just a few of the big name defense stocks that have enjoyed growth in investments following last month\u2019s presidential election. Trump\u2019s rhetoric of slashing corporate taxes while beefing up America\u2019s military was the perfect concoction for what resulted with investments in the defense sector.<\/p>\n \u201c\u2018Trump\u2019s win is good news for the defense industry, especially when coupled with Republican majorities in the House and Senate,\u201d said Loren Thompson, a defense consultant who advises many of the nation\u2019s top-tier contractors,\u2019\u201d (Heath).<\/p>\n Defense shares have continued to hold on to steady numbers and still offer new buying opportunities for interested investors. Lockheed Martin alone, experienced a 20-point stock jump following the election results and — as of December 7th<\/sup> — continues to hold on to a solid 266.38 valuation (Carson). Trump\u2019s eagerness to increase the size and capacity of the military will directly benefit defense contractors like BAE Systems and General Dynamics, as well as helicopter and plane manufactures like Boeing.<\/p>\n \u201cEaglen acknowledged that \u201c\u2018the major defense contractors are part of the establishment he\u2019s railing against.\u2019\u201d But she said Trump does not really have a choice but to stick with them. \u201c\u2018If he wants to show results, he\u2019s got to live with the contractors he has,\u201d she said. \u201c\u2018You have to go with the production lines you have open,\u2019\u201d (Heath).<\/p>\n Speculative investments on defense contractors have run rampant in the past month. One company that drew attention, in particular, was Magal Security System (MAGS), the company responsible for building the infamous high-tech fences and walls along Israel\u2019s volatile border. Magal Security System was also responsible for the erection of a massive separation barrier along the West Bank, which includes cameras, sensors, and robotic technology. The supposed wall that Trump plans to build across the US-Mexico 1,933 mile long border likely has something to do with Magal Security System\u2019s uptick in stock prices. The company\u2019s shares were up 24 percent from its 4.45 closing price on Election Day.<\/p>\n \u201c\u2018We believe that the\u00a0U.S. government\u00a0is going to increase its security budgets in the upcoming years and definitely we look forward to take part in it,\u2019\u201d the company\u2019s chief executive, Saar Koursh,\u201d (Scharf).<\/p>\n If your consciousness has not already felt besieged by the possibly lucrative albeit morally ambivalent ways in which you can see investment returns over the next 4 — hopefully 2 — years than prepare yourself for the next industry that might be headed for an upswing. Private prisons.<\/p>\n It was only two months ago that the Justice Department announced a plan to abolish the use of private facilities for its federal inmates. The decision led to a correlated stock dip in corrections companies \u2013 an arguably rightly so.<\/p>\n Unfortunately, Trump\u2019s win has revived the stock earnings of America\u2019s controversial industry. While the President-elect has yet to mention any specific plans of private prisons during his presidency his Nixon-esque \u201cLaw-and-Order\u201d candidate rhetoric has left many people believing that he will ensure and protect these private facilities. Investors are speculating heavily that the administration will require the private prison infrastructure to carry out its \u201cfeasible\u201d plan fro a mass-scale deportation plan. Ultimately \u2013 though \u2013 our hot Cheeto President-Elect has a hot temper and trigger finger when it comes to shooting out tweets and absurd statements that have the power to increase and decrease the value of stocks in a matter of seconds. Just yesterday morning, Trump tweeted out:<\/p>\n \u201cBoeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!\u201d<\/p>\n The problem with his tweet? Other than falsely overestimating the budget of the Air Force One replacement program by roughly $2.0 billion is the impact his words had on Boeing stock. The Boeing stock took a momentary nosedive before recovering by the closing bell. The event is just one example of how the reckless and ill-informed words of America\u2019s soon to be leader could have dire impacts on the US economy and stock market.<\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n http:\/\/www.thefiscaltimes.com\/2016\/12\/07\/Nuclear-Power-Could-Boom-Under-President-Trump<\/a><\/p>\n https:\/\/www.donaldjtrump.com\/press-releases\/fact-sheet-donald-j.-trumps-pro-growth-economic-policy-will-create-25-milli<\/a><\/p>\n https:\/\/www.washingtonpost.com\/news\/energy-environment\/wp\/2016\/12\/07\/trump-names-scott-pruitt-oklahoma-attorney-general-suing-epa-on-climate-change-to-head-the-epa\/?utm_term=.ac7913795562<\/a><\/p>\n http:\/\/www.nytimes.com\/2016\/12\/07\/us\/politics\/scott-pruitt-epa-trump.html<\/a><\/p>\n https:\/\/www.washingtonpost.com\/business\/mr-business-goes-to-washington-now-what\/2016\/11\/12\/8c7f7846-a6e2-11e6-ba59-a7d93165c6d4_story.html?utm_term=.801e360cc433<\/a><\/p>\n http:\/\/www.investors.com\/research\/ibd-industry-themes\/5-defense-stocks-in-or-near-buy-zones-after-trump-offensive\/<\/a><\/p>\n![\"\"](\"http:\/\/j469.ascjclass.org\/wp-content\/uploads\/sites\/22\/2016\/12\/www.usnews.jpg\")
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\nA conservative estimate of Trump\u2019s promised budget has been projected at an additional $55 billion in defense spending. A question that remains though is where exactly Trump plans to find the money to pay his steep tab.<\/p>\n
\nTwo of the largest private prison companies \u2013 CoreCivic (CXW) and the Geo Group (GEO) \u2013 saw spikes in their stocks following the election results (Harlan).<\/p>\n<\/a><\/p>\n
\nSources:<\/p>\n