On the households – The Economist:

‘Mr Trump’s team is playing with fire. As markets have soared, and tech has made investing ever simpler, Americans have rushed into stocks. At the end of last year households and non-profit organisations held $38trn in shares of listed firms. The value of their holdings has exploded, climbing by 128% over the past six years. All told, such holdings are now worth 1.7 times America’s disposable household income, which is more than twice the historical average and near the highest level on a record that stretches to 1947 (see chart). A prolonged stockmarket slump would have profound implications, both for politics and the economy.’

(…)

‘David Zavarelli, a financial planner in Milford, Connecticut, says his left-leaning clients are more concerned about the downturn than right-leaning ones. “It is the first time I have encountered this in my 18 years in the business,” he reports. “How clients are reacting is less about how much risk they’re taking and more about who they voted for in the last election,” says Brian Schmehil of The Mather Group, a wealth-management firm. Such anecdotes are reflected in consumer-confidence data, which, as well as being down on average, are more starkly split along partisan lines than ever before. Since the election Democrats have become extraordinarily gloomy about the economy, while Republicans remain optimistic.’

(…)

‘Whereas a decade or two ago, a stockmarket sell-off would have been most painful for Republicans, today it is Democrats who would be worst hit.’

(…)

‘Since the end of 2019, consumption by the richest fifth of Americans has risen by more than 50%, compared with a 20% rise for the rest of the country. Indeed, over the past year the richest fifth has accounted for almost all growth in consumer spending. If its members see lots of red when they next check Robinhood, the whole country—Republicans included—could be in for a nasty surprise.’

Read the article here.

Trump is just punishing Democrats with the stock market slump.

And the nasty surprise? Après nous, le deluge.

Also interesting: tell me your political preferences and I will tell you how much confidence you have in the economy.