Wall Street Is Too Pumped About Trump to Worry About His Policies

David Bahnsen has a chipper prediction about Donald Trump 's return to the White House—one that doubles as a psychological assessment: The president-elect is so keen to fit in with the Manhattan financial elite that he won't dare jeopardize its fortunes. "The reason he cares so much about financial markets is that there's a validation they represent to him," says Bahnsen, whose Bahnsen Group manages $6.5 billion. "He has spent his whole adult life feeling like an outsider in Manhattan, never getting the credit or respect he felt like he deserved."

That's a taste of the positive thinking that's thrived on Wall Street since Trump won a second term. Bankers, investors, executives and their advisers crave the deregulation and tax cuts he's promised. And while higher US government bond yields suggest some investors are worried about bigger budget deficits and the inflation expected to result from his pledges of mass deportation and giant tariffs, the Trump optimists don't expect him to follow through on them. They can even sound reassured by Trump's topsy-turvy style—assuming his habit of zigzagging and reversing himself means he'll backtrack from his most destructive plans.