Allocation strategy for 2020 -
It's pretty clear now that the 'sanity will prevail' idea can be permanently shelved when it comes to Trump. Even the idea that Trump will act in his own self interest (reelection) is in serious doubt.
Below are the reasons why Trump's kamikaze course will not abate until the 2020 election at the earliest (and why all we can do as investors is go to cash, bonds, gold, etc) -
Looking at the entities that could restrain/remove Trump -
1) Republican Party - they won't because they want to stay in power and believe Trump is their only chance. So they'll ride this horse for better or worse.
2) Democrat Party - like the Reps, all the Dems care about is regaining power. Since Trump is self destructing so spectacularly on his own, they can sit back and watch as he drives the US into recession. However, with such a lame lineup of candidates for 2020, the Dems have to worry that they'll still lose the election even if there's a recession.
3) Neocons - I think Trump has promised them action on Iran after the election, so the Neocon faction will just sit pat until then.
4) Deep State / Finance Oligarchy - this is the big question. If they are ready for the SDR transition, Trump can be used as the fall guy to induce the required crisis. Under Trump, the crisis will likely start in China, which may be the ideal scenario - to have China weakened heading into the SDR financial 'reset'.
If the Finance Oligarchy isn't ready for the SDR crisis, why aren't they doing more to reign in Trump's kamikaze tariff insanity? It could be that the deranged Trump has become uncontrollable by normal means, in which case extraordinary means would become necessary (?) Possible, but if the powers that be really wanted Trump to cease/desist on China, ultimately they could do it.
My conclusion - all us small fry investors can really do is to batten down the hatches and get into cash, bonds, and gold. For bonds, mainly Treasuries and high quality corporates (avoid junk bonds, leveraged loans). Stock exposure should be reduced toward the minimum allowed in one's asset allocation model.
