2026: Trump's dream year?

The event is inherently broad, which cuts both ways. If the market is asking whether 2026 turns into a genuinely favorable year for Trump across politics, courts, and the economy, that is not a likely base case; there are too many ways for headlines to turn adverse, and the burden of “bull case” usually implies a confluence of positive outcomes rather than just one win. Still, Trump enters 2026 with substantial institutional power and a highly polarized electorate, which gives him multiple paths to a favorable narrative if the economy holds up, Congress cooperates even partially, or legal and political setbacks prove less damaging than expected.

The biggest reason to keep the probability above the floor is that positive Trump scenarios often do not require everything to go right, only enough to shape the year’s dominant story. A softer economy, a strong stock market, immigration enforcement wins, court decisions that narrow liabilities, or favorable foreign-policy developments could all be enough to create a “dream year” framing even amid controversy. In other words, the distribution is asymmetric: the downside is easier to imagine and more common, but the upside can arrive through several distinct channels.

Compared with the current market price of 5.3%, the market looks a bit too dismissive of the upside paths. A single-digit price implies the bull case is close to an extreme tail event, but that seems too low for a president who still has powerful agenda-setting ability and multiple live catalysts over a 16-month horizon. I would still keep the probability well below 20% because the definition is broad and the environment is volatile, but 12% better reflects the real chance that 2026 produces a materially favorable Trump narrative.