Regardless of what happens on inauguration day, there will be a huge effort to rally the stock market big time. That is the standard mode of operation with respect to potentially big days bad or good. Expect massive intervention. If prices ever decline, to a degree that can’t controlled, the entire system will collapse. Every event has a rally. There will be an time when a rally is attempted but fails. When that happens, the mob will cut and run. There will be hell to pay.
What do we know about big events with respect to the stock market? In this case we are not talking about a market as such. Stock prices have been managed to one degree or another by government since Ronald Reagan first intervened with the President’s Working Group on Financial Markets or plunge protection team. Since that time stock prices have been less and less indicative of economic considerations and more of a system of planned wealth creation. Today 10 percent of the our population owns 80 percent of all stock outstanding. This is by far the largest welfare system, in the history of the world. The one and only function our federal government serves today is providing enormous wealth and income benefits to its most powerful citizens.
The consortium that currently manages stock prices consists of the Federal Reserve Open Market Committee and privateer firms which participate in return for advance information and other trading advantages they are given. Corporations assist by buying up their own stock to degree the Federal Reserve can assure them of continued assistance.
Destroying a large economy takes decades. When the economy is indeed destroyed, the market will fall no matter what. Please understand, the destruction of the economy is not intentional. That is just what happens when a free market system is dismantled so as to give benefits to the politically powerful.