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So USA are on their way out of the Trans-Pacific Partnership (TPP) and the stock market has been rising ever since and is currently (djia, s&p500) at its highest peak in months.

Why?

Why did investors respond positively to this, when it clearly leads to more uncertainty, and when most economists I've heard talk have said that leaving TPP is presumably not a good thing?

Pete B.
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Miachel
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    "Most economists" have political biases, just like everyone else. – Ben Miller Jan 25 '17 at 15:35
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    Since election day the market has been up quite a bit. The speculation is that Trump will be better for business and the economy then Hillary would have been, and perhaps better than Obama had been. I feel that the aggregate is being examined, not just individual policies. – Pete B. Jan 25 '17 at 15:36
  • well over the news they said: dow jones hits 20000 for first time-ever is this something good or bad ? – Moudiz Jan 25 '17 at 15:37
  • Without getting overly political, the article I read claimed that any likely winner of the White House would have nixed the deal. Hillary, Sanders, and of course Trump all came out against TPP. – Pete B. Jan 25 '17 at 15:58
  • @Moudiz The 20,000 mile marker doesn't mean a whole lot in itself. The major stock indexes have increased this week, which is good for people with investments that are long. – Nosrac Jan 25 '17 at 16:23
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    This question assumes that the two events are related. It could very well be that the market has increased despite who won the election, and despite the recent decisions the US has made. – TTT Jan 25 '17 at 19:34
  • @PeteB.: The TPP could have been passed by Republicans in Congress during the lame duck period when Obama was still in office. But since Trump won the election and is basically the leader of their party now, they didn't want to go against his opposition to the TPP. – user102008 Jan 25 '17 at 19:45

1 Answers1

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Everything is worth what its purchaser will pay for it - Publilius Syrus

It could be that, despite predictions from experts to the contrary, investors believe that renegotiating trade deals will have a positive affect on the economy, despite the upheaval uncertainty, and risk that it brings.

Keep in mind that, as Pete B points out, this is part of a bigger post-election trend many people refer to as the "trump rally," which is a factor of more than one policy. Whether or not these policies will actually result in an a more robust economy, investors seem to be betting that it will.

Nosrac
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