Since Donald Trump came into the presidency, the stock market has seen a sudden boost. Many are calling this dramatic, sudden boost a bump in the stock market. Many have decided to start calling this the ‘Trump Bump.’
The stock market has boosted already about $3 trillion. Many investors have been reaping the fruits of the Trump Bump and are taking advantage of it. Many have also been saying that the momentum will continue for the rest of the year in 2017. But how long will the Trump Bump economic boom really last?
There has been much speculation about how long it will continue to rise. Some say that the stock market rally will go on in 2017, while some experts don’t believe so.
How Long Can The Trump Bump Last?
One stock market expert strategist stated that the stocks are most likely going to keep on increasing because of the momentum they have made during the first two months of 2017. They saw a nearly 2% gain in January, while in February, it reached to a boost of nearly 4%. Currently, the stocks have been continuing to increase to about 6% presently.
Stock market strategists also said that the boost in January and February was the 27th time that the stock market index rose in those same two months since the year 1945. As they study the pattern of this bump in the economy since 1945, they have seen that those years always ended up profitable and did not have any losses.
The Pattern in The Stock Market and the Trump Bump Feaver
With those same patterns, there were some situations where the stocks did end up dropping. Those three years were in 1987 when there came a fairly large “stock crash”. After that, it took more than two decades to occur again. That case was seen in 2011 when the stocks steadily increased in the first months and went down during the last month of the year.
Although, it was safe to call it a flat year where there were essentially no profits nor were there any losses. And the latest occurrence was in 2016 when the stock market index fell in the first two months at 6%. Nonetheless, the market was resilient and returned fairly decent numbers as the year ended, boosting up to 13%.
During the years when the stock index rose in the first two months, they have seen that it kept on rising until the end of the year. They have also found out that the stock returns in the course of the entire year have been averaging about 24% which means that investments can turn almost a quarter higher once claimed.
Because of this pattern that stock market experts have found, it could most probably be that the Trump Bump campaign that President Donald Trump can be credited with. This trend should carry on and will last until the end of the year. Consequently, it could also be the right time for investors to put their money into stocks and reap the benefits at the end of the year.
To Invest or Not to Invest
Though there have been many stock market predictions made by many different experts, the actual flow of the gain or loss can’t really be determined. Although it is not 100% clear how long the Trump Bump will run, the trend that the strategists have found may prove those predictions to be true.
Trade, or commerce, involves the transfer of goods or services from one person or entity to another, often in exchange for money. A network that allows trade is called a market.
The original form of trade, barter, saw the direct exchange of goods and services for other goods and services. Barter is trading things without the use of money. Later one side of the barter started to involve precious metals, which gained symbolic as well as practical importance. Modern traders generally negotiate through a medium of exchange, such as money. As a result, buying can be separated from selling, or earning. The invention of money (and later credit, paper money and non-physical money) greatly simplified and promoted trade. Trade between two traders is called bilateral trade, while trade between more than two traders is called multilateral trade.
Trade exists due to the specialization and division of labor, in which most people concentrate on a small aspect of production, but use that output in trades for other products and needs. Trade exists between regions because different regions may have a comparative advantage (perceived or real) in the production of some trade-able commodity—including production of natural resources scarce or limited elsewhere, or because different regions’ size may encourage mass production. As such, trade at market prices between locations can benefit both locations.
Retail trade consists of the sale of goods or merchandise from a very fixed location, such as a department store, boutique or kiosk, online or by mail, in small or individual lots for direct consumption or use by the purchaser. Wholesale trade is defined as the sale of goods that are sold as merchandise to retailers, or industrial, commercial, institutional, or other professional business users, or to other wholesalers and related subordinated services.