After Trump was elected

High-level things that people/market celebrates:

1/ more M&A in the US

2/ certainty in taxes: Harris proposed raising corporate income tax, stock buyback tax, unrealized capital gains tax

3/ near-term possibility of ending wars globally

 

Rates / Treasury yields

bad for long-term bondholders – higher inflation, higher deficits (more supply). but long-term treasury can’t rise too much – it can hurt US domestic mfg etc. if rates are high.

Trump would want Fed to cut rates. Even if Fed cuts, long-term bond yield could be hard to come down.

Thus, we should see a steepened yield curve, which is good for banks! Banks are borrowing current (cheaper cost) and lending long-term (higher yield).

 

China

1/ less probability of near-term war on TW strait (less idealogical driven; deal maker)

2/ higher tariff, less export – China needs to rely more on domestic consumption

 

Industries

1/ obviously, IRA could be changed. Then bad for renewables like solar, etc. It’s such an interesting industry.. no real demand if no IRA?

2/ crypto obviously, can boom especially if a new pro-crypto SEC chair comes in power

 

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