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Summary
Akhil’s post-election reaction. He was wrong about the outcome (expected Biden to benefit from incumbency advantage). But the cycle remains on track — Trump will keep it going. Trump will deliver tax cuts, low short-term interest rates, and massive public spending (Republican deficits historically larger than Democrat ones). Markets can expect strong growth. Key warnings: don’t be fooled by grand statements (“golden age”); the cycle powers the economy, not Trump. Focus on fundamentals. Final stage is marked by “this time things are different” feeling. AI is the dominant industry. Assets going up most at this stage often have zero earnings. The time to start reducing leverage and building cash is approaching.
Key Claims
- Trump’s election keeps the cycle on track and likely makes it more predictable. — confidence: high
- Trump will deliver tax cuts, low interest rates, and large deficit spending. — confidence: high
- Republican administrations historically produce larger deficits than Democrat ones. — confidence: high
- “This time things are different” feeling marks the final stage of every cycle. — confidence: high
- AI is the dominant industry of the current cycle’s final stage. — confidence: high
- Time to start reducing leverage and building cash positions, not adding to them. — confidence: high
Predictions / Forecasts
- Strong market performance for some months following election result. — status: confirmed (early 2025)
- Trump’s presidency winds down into the 2026-2028 cycle bottom. — status: pending