March 03, 2025

The recent elections outcome suggests that voters in the US and parts of Europe rejected the policies adopted in the aftermath of the Financial Crisis. The question facing the investors is whether the policies of the new administrations will increase the global returns? Whether the US policies will prolong the US outperformance or will the policy initiatives of the rest of the world lead to an inflection point and a reversal of the relative performance. The reduction of the regulatory burden, the extension of the Trump tax rate cuts will clearly lead to an increase in the US rates of returns. A successful reshoring policy that as it raises tariff on the goods simultaneously lowers the corporate tax rates to 15% could work to the benefit of the US and the world economy. Similarly, a reciprocal tariff policy would be quite bullish if it leads to a reduction in global trade barriers. But the success of these policies depends on their implementation. Nevertheless, if all of these polices are successfully implements the world and the US will be better off Quite a bullish environment. Then again failure across the board would be an ugly and bearish scenario. Controlling the border will have beneficial effects on the economy. A successful DOGE will reduce the expenditure on the social safety net and free resources for other activities. An immigration reform would be a great complement to the reshoring policy. It will allow the US to entice the workers needed by these industries if they are not available at home. The proposal for a “golden ticket” suggests that the President is thinking about it and looking for an economic solution. The changing attitude of the European countries to the immigration issue, the green agenda may be the precursor to new policy initiatives that take the continent in a different direction. All of these changes if successful will increase the global incentives to work, save and invest. A bullish development for the global economy.

You must have an active account to view these reports. You may register for a trial here

Download Complete Report in PDF Format

Download Complete Report in Word Format