Pop champagne and watch for stock bubbles

THE stock market was supposed to collapse if Donald Trump became president.

Remember, that was the prevailing view during the campaign and right up to when they were counting the votes.

It was also a good scare tactic for those who were maybe a little concerned that this guy with the crazy hair had even a tiny chance of pulling off an upset. Surely people wouldn’t vote for a guy who could cost them money, his opponents figured.

Late into the night of Nov. 8, as Trump pulled ahead, futures for the Dow Jones industrial average sank about 800 points — until a rescue effort was made by a Trump pal, billionaire Carl Icahn, and other forces unknown.

Icahn said the drop in the market was stupid and that he was a buyer because he believed in Trump.

Well, Trump has been president for less than a week and whaddya know? On Wednesday, the Dow breached the 20,000 level for the first time. It closed up 155.80 points, at 20,068.51.

Pop the corks. And throw the Gatorade over the coach’s head. It’s happy days again.

As I’ve been explaining for a long time, stock prices are very high. And the market is dangerous for anyone but the very brave and the wilfully careless. Even Trump, when he was a candidate, said that the stock market was in a bubble.

So, the irony that the market should reach a milestone during Trump’s first week can’t be missed.

Corporate profits continue to be weak and company revenues weaker.

The market’s price-to-earnings ratio — which is a traditional gauge for the market’s bloatedness — is already off the charts.

But this week, Trump did stuff that might cause the market’s current levels to make a little more sense. I emphasize the word “might” because what Trump has done might also lead to Wall Street’s next collapse.

Let’s go with the optimistic view first, because, as you know, the champagne is already in the glasses and you shouldn’t poop a party that so many people are already enjoying.

Trump, the businessman, has been quite clear all week that he is keeping his pledge to attempt a rescue of a US economy that has been listless for nearly a decade. He has pulled out of talks over a trade agreement in Asia, browbeaten companies that are manufacturing in Mexico and — with the swipe of a pen — OK’d a job-creating pipeline in the Midwest.

The moves had the effect of spurring a feeling that he might get the economy moving a little faster. And that could be good for companies, which in turn could make stocks absolutely properly priced.

But then again — there are a lot of things that could go wrong with President Trump’s actions. For one thing, I don’t think he has completely thought through the fight he is picking with China. That country owns more than $1 trillion in US debt and can cause interest rates to soar by just uttering the word “sell.”

If borrowing costs go up, the economy will slow down.

Still, sip some bubbly and enjoy the moment. There’s no reason you can’t celebrate at halftime when your team is ahead.

Just don’t celebrate too much.

With all the nonsense that occurred during the last financial crisis, nobody got punished except Sergey Aleynikov. He was a computer programmer for Goldman Sachs who was accused, convicted, un-con- victed, then accused and convicted again and then un-convicted. I might have missed one. This week, a New York state appeals court reinstated a criminal conviction that was thrown out in the summer of 2015 after he was convicted just two months earlier.

That second un-conviction was appealed by Manhattan District Attorney Cyrus Vance, who clearly has nothing better to do than kowtow to the wishes of Goldman, which should have filed a civil complaint against Aleynikov in the first place but went criminal because of its vast clout with the Justice Department. I say enough already. The computer code that Aleynikov allegedly took was, according to an FBI agent who quoted Goldman, powerful enough to rig the stock market.

It begs the question, what was Goldman doing with such a computer program?

If authorities are going to continue to pursue Aleynikov, I say let’s go the distance and find out how Goldman was able to get Washington to cooperate on this crap prosecution in the first place and what kind of mischief was the brokerage firm planning with that code?

And Vance should find something else to keep himself occupied. Sean Spicer, the White House spokesman, the other day refused to answer a direct question about the nation’s unemployment rate. I don’t blame him. He’d have to do a whole press conference on that one issue. Aside from the nonsense that I’ve documented about the way the data for the jobless rate are carelessly collected, there is really no good answer to that question. The official unemployment rate is 4.7 percent. The Labor Departmment calls that the U-3. But there are five other ways unemployment is officially calculated, including the U-6 rate. The U-6 includes everyone who wants a fulltime job but can only find a part-time gig, plus people who are actually unemployed. Using this calculation, the government comes up with an unemployment rate of 9.2 percent. That would make the unemployment rate somewhere between 4.7 and 9.2 percent. No wonder Spicer didn’t answer the question.