Donald Trump once wondered aloud if he might become the first person to make money running for president. He made rather brazen attempts to fulfill the prediction. But his candidacy has been a downright disaster for the hotels and resorts that bear his gilded surname. Bookings there are down 59 percent since 2015, according to the travel company Hipmunk. Trump Hotels CEO Eric Danzinger announced that the newest hotels will junk the Trump name entirely. The company has settled on “Scion” to rebrand its new line of luxury hotels aimed at Millennials, who are overwhelmingly opposed to his campaign.

Trump isn’t just bad for his business. He’s not even just a danger to the U.S. economy. Investors around the world think that a President Trump would be disastrous for global markets. And now, there is hard data to prove it, thanks to two clever economists and one debate meltdown.

The first presidential debate between Trump and Hillary Clinton was the most watched debate in American history. According to instant polls, it was a trouncing. Clinton beat Trump by 35 percentage points, the third-largest margin in a post-debate poll since 1992.

According to a new paper by Justin Wolfers, an economist at the University of Michigan, and Eric Zitzewitz, an economist at Dartmouth College, Clinton’s victory triggered the financial equivalent of a worldwide happy dance. Soon after the debate ended, stock markets celebrated the news of Trump’s loss. Markets in the U.S., U.K., and Asia soared, the price of crude oil rose, and the currencies of America’s closest trading partners, such as Mexico and Canada, ticked up as well. It was “the most consequential single event (so far!) during the 2016 general election campaign,” they wrote.

The Trump Effect on stock futures between 9 p.m. and 11 p.m. on Monday night was massive, one of the largest movements in stock futures in the last two years. The economists bolster their case that investors rallied on the news of Trump’s thrashing with two graphs showing that Clinton’s election odds, U.S. stock futures, and the value of the Mexican Peso moved up in almost perfect unison in the hours after the debate. (Note: Y-axis purists may note the different scales, but it’s fairly clear that we’re looking at a coinciding rise.)


Wolfers and Zitzewitz

The economists use this data to estimate the perceived cost of a Trump presidency to the global economy. They say investors believe a Clinton loss would reduce the value of American, British, and Asian stock markets by up to 15 percent and lead to a 25 percent decline in the Mexican Peso. “Markets believe this election will have huge ramifications for the global economy,” Wolfers went on to write on Twitter. “It’s not just about us; it’s about the world.”

Just because investors believe something will happen doesn’t make it an inevitability. But Wolfers and Zitzewitz aren’t saying they can prove Trump will destroy the economy, only that a Trump presidency would, in the short run, severely shake investors’ confidence in steady economic growth and trade. And that in itself can prove destabilizing.

The remarkable thing about the perceived impact of a Trump Shock is that in almost every presidential election in the last 140 years, equity markets rose when Republican presidential candidates won elections and fell when Democrats took the White House. GOP victories typically buoy investor hopes. This year, the prospect of a President Trump terrifies investors. In this way, too, Trump is a historic outlier.

The second notable thing about the Trump Shock factor is that investors seem terrified of a Trump presidency, even though his plan to substantially lower corporate income taxes could theoretically increase public companies’ after-tax profits and raise their stock prices. In other words, Trump’s temperament and unpredictability are so scary to so many bankers that they are confident the economy and stock market will be significantly better off under a candidate pledging higher taxes on corporate income.

For a year and a half, Trump’s core claim to presidential competence has been his business record. But his campaign has been disastrous for his business and nightmare-inducing for the global investor community. Count it as one of the last historic accomplishments of a truly historic campaign: Trump is so frightening he’s turned the global financial markets against a tax-cutting billionaire.