Sanders Surge Could Trigger $6 Trillion Stock Selloff

With Senator Bernie Sanders currently leading Democratic presidential polls in Iowa and New Hampshire — and with caucuses and the primary in those states less than a month away — it's time to start paying attention to what a Sanders presidency would mean for the stock market.

Several prominent money managers have warned that a victory by Sanders or his ideological ally, Senator Elizabeth Warren, would bring a decline of between 25% and 40% in the value of U.S. stocks. That would destroy trillions of dollars in wealth of U.S. households. The resulting negative effect on everything from tax revenues to employment would affect even families without much saved in the stock market, and, ironically, could make Sanders's agenda of government expansion much harder to achieve.