The Best Stocks for the Rest of Trump’s Term: Bank of America (BAC)
A bet on Donald Trump’s economic growth plan is indirectly a bet on higher interest rates. Growth drives inflation, and higher interest rates keep inflation at palatable levels. The Federal Reserve usually has to put a string of rate hikes in place, however, to keep inflation in check over a period of time.
While that creates a certain amount of misery for borrowers, it’s a boon for banks in that the higher interest rates mover, the more money they make.
The pick of the litter: Bank of America Corp (NYSE:BAC).
Bank of America’s bottom line improved in the fourth quarter of last year on rising rates then, and grew even more in the first quarter for the exact same reason.
Take the hint.