Anyone else transferring their 401(k) funds to low-risk investments?

[crimycarny]

17. From my financial advisor--take it for what it's worth

Here is an email my financial advisor sent out after the election. Take it for what it's worth. So far my financial advisor has been pretty spot on but obviously no one really knows since Trump is a lunatic so completely unpredictable.

How is the market going to react to the election results? Read below for multiple analyst/economists reactions:

Trump/GOP Senate/Dem House: Look for a temporary extension of the 2017 tax cuts but only after the GOP shows a willingness to negotiate and make concessions, including letting the top tax rate go back up to 39.6% and raising the limit on the state and local tax deduction, now capped at $10,000, to $20-25,000, instead. That’d be the political price to get some Democratic House members to vote for an extension. Trump would raise tariffs and reduce net immigration flows, no congressional action required. In addition, in this scenario Trump would try to resurrect the presidential power of “impoundment,” (a power to cut discretionary spending without congressional approval) which hasn’t been used since the early 1970s, claiming the law passed in 1974 under Nixon to eliminate impoundment is ineffective, because it can only be eliminated by a Constitutional Amendment, not a regular law. - Brian S. Wesbury, Chief Economist First Trust

Republican Sweep: Look for a temporary extension of the tax cuts originally enacted in 2017, but with a lower tax rate on corporate profits and some modest targeted tax relief for workers who earn tips. Because of budget rules, the only way to permanently extend the tax cuts is to make major cuts to spending and the bureaucracy. While it seems clear that massive government growth in the past two decades should be reversed, it remains to be seen whether Republicans are serious about it. So, we expect a reduction in green energy subsidies and a focus on reforming Medicaid. Without legislation, President Trump would also raise tariffs, particularly on China and substantially reduce net immigration flows into the US. - Brian S. Wesbury, Chief Economist First Trust

You're going to get some version of a repricing (of Treasuries) just by nature of the math. It's just a question of how long does it last. You're seeing the initial {bond selloff} today. Volatility is important here. I suspect we could see a decline in overall volatility. We're hesitant to buy or sell bonds. We're looking at that 30-year auction today as a barometer of demand. I'm sitting on my hands and seeing how things play out. Treasuries have had a pretty good sell-off coming into this. Ultimately you're making a bet that there is going to be some fiscal responsibility coming out of the Trump administration." - Jack McIntyre Brandywine Global

For now, investor sentiment is pro-growth, pro-deregulation, and pro-markets, as seen in the overnight market action. There is also an assumption that M&A activity will pickup and that more tax cuts are coming or the existing ones will be extended. This creates a strong backdrop for stocks. Financials and Energy are the obvious beneficiaries of Trump's victory amid hopes of deregulation and a greater focus on U.S. energy independence. There may even be other sectors that benefit from Trump's victory, such as technology stocks, especially if the Federal Trade Commission (FTC) is knocked down a peg. We need to see personnel and cabinet appointments in the week ahead to get firmer ideas around all this, as personnel is policy. - David Bahnsen CIO Bahnsen Group

Both parties are going to spend no matter what. This Treasury sell-off is overdone. It's kind of a knee-jerk reaction.(In terms of Fed policy) none of the presidents have been silent on rates. It's going to be a '94-'95 scenario. They used this term 'recalibrate'. It reminds me of a post-'94-'95 period where the Fed was tweaking back and forth to avoid a recession. - Ellis Phifer Raymond James

My quick summary from what I'm reading:

Stocks should benefit over the short/medium term
Bonds negative/neutral over the short/medium term

That last piece, the summary, is what my financial advisor summarized (not me).