When the US presidential election was called for Donald Trump, the yield on 10-year US government bonds increased from 4.3% to 4.4%, and the 30-year-bond yield rose from 4.5% to 4.6%, with both remaining at those levels 10 days later. As the bond market declined - higher yields mean lower prices - the stock market rose. Clearly, investors expect the next Trump administration to produce higher government budget deficits and more debt.

It is not difficult to see why. During Trump’s first term in office, he added US$8 trillion to the national debt – all previous presidents combined had accumulat...