Trump vs Harris: Simplifying the Market Impacts
As President Donald Trump and Vice President Kamala Harris square off in the 2024 election, their contrasting economic visions promise to create major ripple effects across asset classes. While intricate policies can get convoluted, here's a straightforward breakdown of how markets may move under each scenario:
Trump's Pro-Business Lean
A Trump re-election would likely extend his business-friendly, deregulatory agenda prioritizing corporate profit growth over environmental or social concerns:
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Stocks: The 2017 tax cuts turbo-charged stock buybacks and dividends, so maintaining those corporate rates could keep padding equity prices. Sectors like energy, financials and industrials may outperform.
Bonds: Despite rising deficits, Trump's fiscal hawks at the Fed could keep a lid on inflation keeping bond yields rangebound. Corporate debt may remain attractive.
Commodities: Energy commodities like oil and natural gas would continue benefiting from expanded exploration under Trump's "energy dominance" push.
Real Estate: The 2017 tax reform slashed rates for real estate investment trusts (REITs) and rental income, a boon that would persist under Trump's extension plans.
Foreign Exchange: A strong U.S. dollar policy and mercantilist trade stance threatens volatility across emerging market and trade partner currencies.
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Harris's Progressive Economic Overhaul
In contrast, a Harris presidency focused on clean energy, higher taxes and stricter regulation would disrupt markets in new ways:
Stocks: While tech titans like Apple and Amazon may get spooked by antitrust scrutiny, solar stocks, ESG funds and healthcare shares could get a boost from climate and Medicare initiatives.
Bonds: Higher corporate taxes, regulation, and another multitrillion-dollar pandemic recovery plan could stoke inflation worries and push up yields across bond markets.
Commodities: Oil/gas dinosaurs may sink while clean energy metals like lithium, cobalt and rare earth minerals used in batteries gain traction.
Real Estate: Housing affordability programs like purchase tax credits could prop up homebuilders and residential REITs focused on starter homes.
Foreign Exchange: The U.S. dollar may weaken if Harris scraps Trump's strong dollar policies to aid exporters and rejoin trade partners' currency domains.
Of course, policy impacts can cut across asset classes too. For example, Harris's climate regulation could hinder capital expenditure across energy, manufacturing and transportation - creating headwinds for both equity and debt issuers.
Whether you're a trader looking to capitalize on volatility plays, or an investor positioning for long-term certainty, having a simplified roadmap for how the competing "Trump-onomics" or "Harris-onomics" regimes could reset markets is critical. Paying close attention to the policy headlines and market reactions will help illuminate the best paths to profits.
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America's Next Nightmare (has nothing to do with November)
Roosevelt failed to make it work during World War II. It failed again for Nixon in the ‘70s.
Right now, our government is so desperate, they're pulling the same dangerous maneuver... and when it inevitably fails this time, it could tip America into an economic nightmare.
It doesn't matter who the Dems select as their nominee – Biden has already set this in motion. Full details here.
