2026: Trump's bad year?

On the facts available, the key issue is not whether Trump will face setbacks in 2026, but whether those setbacks rise to the level implied by a “bear case” resolution. A president with Trump’s profile almost certainly generates controversy, legal conflict, policy reversals, and political volatility over a full year, so some negative headlines are easy to imagine. That said, prediction markets often price these sorts of questions as if the outcome requires a distinctly bad, sustained, and recognizable deterioration rather than a normal volume of friction, and that keeps my estimate well below a coin flip.

Against a high Yes probability is the fact that Trump’s political coalition has historically shown substantial resilience to scandals and disruption. He can suffer real setbacks and still avoid the kind of broad collapse, reversal, or incapacitating event that would make 2026 clearly qualify as a “bad year” under a stricter reading. If the resolution depends on a specific benchmark such as electoral underperformance, major legislative failure, or a severe legal or health event, those are all possible but far from assured in a single calendar year.

The current market price of 10% looks somewhat too low to me, mainly because a year-long horizon gives multiple opportunities for negative developments to accumulate. I do not think the market is wildly wrong, though, because the event may be resolving on a narrow or unusually demanding standard. My independent view is that the probability is meaningfully above market but still modest, with the most likely outcome being an uneven but not sufficiently disastrous 2026 for Trump to trigger a Yes resolution.