Bank of America’s (BofA) latest fund manager survey makes one thing clear – Donald Trump has alarmed investors.
A record rotation out of US stocks, the second-largest drop in global growth expectations ever, the biggest drop in sentiment since March 2020’s Covid shock, a large majority saying “US exceptionalism” has peaked, fears a recessionary trade war is now the biggest tail risk facing stocks – Trump’s name doesn’t appear in BofA’s report, but his shadow is all over it.
Investors can’t say they weren’t warned – about tariffs, about Trump’s authoritarianism, his impulsivity. Days before November’s election, the Economist endorsed Kamala Harris, saying voting for Trump would be “recklessly complacent”, gambling “with the economy, the rule of law and international peace”.
Those sentiments were widespread, but markets appeared blind to risks. “Investors are the most risk-on in 15 years, BofA survey shows”, headlined Bloomberg last month.
One can blame Trump for many things, but not for investors’ willingness to ignore obvious warning signs.
