Imagine that it is November 9, 2016. Republicans are celebrating an unexpected Trump victory. The markets, however, see Trump as a chaos agent, given his plans to tear up treaties, engage in trade wars, etc. They are in free fall all over the world.
President Obama calls on Trump to make a public statement to calm things down. Trump duly complies, telling the media that the inflammatory statements he made during the campaign were just “truthful hyperbole” and are only the starting point for negotiations with Congress and other world leaders.
The problem is that while markets operate on the basis of credibility and confidence, Trump openly views lying as a legitimate negotiating tactic to be used while he is President. As a result, no one believes anything he says, and the free fall continues.
By the time of the inauguration, Americans have lost about a third of their wealth, and the economy is losing jobs at the rate of a million a month as a new Great Recession kicks in. And so is America “made great again” by the man on golf cart.