Government economic policies are the driving force of asset returns, and there are stark policy differences between the two U.S. presidential candidates this year. The American electorate will soon vote its best interest and in doing so will elect a new president and Congress. The investment ramifications of the resultant policy shift are enormous. It’s game time for policy.
Hillary Clinton is promising a set of policies that are weak Dollar and highly economically contractionary via tax increases and regulatory wedge expansions. Donald Trump is promising a set of policies that are strong Dollar and economically expansionary via lower marginal tax rates and decreased regulatory burden. Further, Trump is the only candidate touching the arena of monetary policy. He’s been highly critical of the Fed’s monetary policy actions and methods, and he is supportive of solutions like rules based monetary policy.
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