About a year ago, I suggested that 2018 would be the year of "full Trump" (see Could a Trump trade war spark a bear market?) which would signal an abrupt shift in policy after his dramatic tax cut victory. Indeed, the rhetoric on Trump specific initiatives, such as rising trade tensions, holding China to account, and the Wall, have become far more prominent in 2018.

The risk in 2019 is "full Trump" becomes "Trump unbridled", which will cause greater anxiety for the markets. To be sure, Trump did not cause the stock market to fall, but his recent behavior has rattled Wall Street that is likely to exacerbate downside risk, in a similar manner that the widespread use of portfolio insurance hedging techniques exacerbated price risk in the Crash of 1987.

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