Noam Chomsky, described by The New York Times as 'the most important intellectual alive', he is one of the world's most most-cited sources in academic journals

Noam Chomsky has warned the Donald Trump-fuelled rally in capital markets is coming to a close and another financial crash is on the horizon.

The linguist, philosopher and social critic said the President’s “anti-estabishment” status was a “joke” given his establishment appointees and anti-regulation policies, which have encouraged the stock market.

“What's anti-establishment?” he asked, as reported by AlterNet.

“This [cabinet] is drawing from the billionaire class, largely financial institutions, and military and so on; in fact, take a look at the stock market, that tells you how anti-establishment he is.”

He pointed to cabinet members such as Treasury Secretary Steve Mnuchin, a Goldman Sachs alumnus. Gary Cohn, his Director of the National Economic Council, was the COO at the same bank.

“As soon as Trump was elected, and since, stock values in financial institutions escalated to the sky,” said Mr Chomsky.

“Investors are “delighted he's going to eliminate regulations, let them make more profit; of course, it'll lead to another crash, but that's somebody else's problem. The taxpayers will take care of that.”

After almost eight years of a bull run during former President Barack Obama’s administration, pundits expected financial turmoil under President Trump – a lot of the anticipated negative reaction was due to the element of uncertainty as Hillary Clinton’s victory had been priced into markets.

Despite jitters around his Muslim ban executive order and his tweets targeting certain companies, causing them to temporarily plunge in value, the US stock market reached a record high after the November 8 election and continues to rise - for now. Stocks like pharmaceuticals, banks and prisons have all soared under the promise of tax reform and less regulation.

For example, the President signed an executive order to review the Dodd-Frank Act, signed under Mr Obama after the financial crisis to ensure banks hold larger capital buffers and limit risky investments to protect consumers. He also scrapped the impending Fiduciary Rule, which, if made into law, would have forced financial advisers to put the best interests of their clients first.

The bellwether index of US companies, the S&P 500 Index, has soared more than 10 per cent since Mr Trump was elected. Banks enjoyed an even higher rise. The iShares US Financials ETF, a passive fund that invests in financial stocks, rose more than 17 per cent in the same period.

Mr Trump has pointed to rising markets as a sign that his administration has been successful since Inauguration on 20 January. He was also pleased with the Bureau of Labour's report of 235,000 new jobs in February, even though he said similar numbers under the Obama administration were “phony” and “monkey business”.

One problem is that markets have already rallied so much and corporate valuations have become so stretched that even if Mr Trump implements the reforms he has pledged, “rich returns may still be out of reach”, explained Shawn Tully, Fortune Magazine’s senior editor-at-large.

At the very least, the President appears set on making the rich richer, in a country where more than five million people are millionaires.

He has said he will slash corporation tax from 35 to 15 per cent, and abandon federal estate and gift taxes.

“We’re going to... lower the overall tax burden on American businesses big-league. That’s coming along very well. We’re way ahead of schedule, I believe,” he said at a recent meeting with airline executives.

Independent News Service