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Consequences of a Trump Presidency

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Published : May 10th, 2016
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Category : Editorials

Now that Donald Trump has managed — against the odds and much to the chagrin of ‘war party’ loyalists — to become the Republican Party’s nominee in the Presidential election to be held in November, it is worth considering what a Trump presidency would mean. Here are some preliminary thoughts.

First, I expect that with the Primary campaign out of the way Trump will start to downplay some of the most hare-brained ideas he has spouted to date, such as building a giant wall along the US-Mexico border and banning all Muslims from entering the US. It’s unlikely that these wildly foolish ideas will ever be turned into actual policies, and in any case even if President Trump tried to implement them it’s unlikely that he would obtain the required parliamentary approval.

Second, I doubt that President Trump would go ahead with his threat to implement hefty tariffs on imports from China, because I don’t think he is stupid enough to believe that imposing such restrictions on international trade could possibly benefit the US economy. My guess is that when he uttered the protectionist nonsense he was pandering to voters who are struggling economically and willing to believe that their problems could be quickly fixed by someone capable of doing smart trade deals with other world leaders. But if I am over-estimating his acumen and he genuinely believes what he is saying on this matter, then President Trump would effectively be pushing for similar trade barriers to the ones that helped make the Great Depression greater than it would otherwise have been.

As an aside, just because someone relentlessly promotes himself as a great deal-maker, doesn’t mean he actually is. Also, the problems facing the US have almost nothing to do with poor deal-making in the past and could not be solved by good deal-making in the future.

Third, I doubt that the result of the November Presidential election will have a big effect on the US economy. The way things are shaping up, whoever gets elected this November will end up presiding over a sluggish economy at best and a severe recession at worst. This is baked into the cake due to what the Fed and the government have already done.

Furthermore, both Trump and Clinton appear to be completely clueless regarding the causes of the economic problems facing the US, which means that economically-constructive policy changes are unlikely over the years immediately ahead irrespective of the election result. For example, Trump has expressed a liking for currency depreciation and artificially-low interest rates, which means that he is a supporter of the Fed’s current course of action even though he would prefer to have a Fed Chief who called himself/herself a Republican. Trump has also said that he would leave the major entitlement programs alone, even though these programs encompass tens of trillions of dollars of unfunded liabilities.

Fourth, it currently isn’t clear that any major financial market will have an advantage or disadvantage depending on who is victorious in November. For example, regardless of who wins in November it’s likely that evidence of an inflation problem will be more obvious during 2017-2018 than it is today, resulting in higher bond yields (lower bond prices). For another example, how the stock market performs from 2017 onward will depend to a larger extent on what happens over the next 6 months than on the election result. In particular, a decline in the S&P500 to below 1600 this year could set the stage for a strong stock market thereafter. For a third example, gold is probably going to be a good investment over the next few years due to the combination of declining real interest rates, rising inflation expectations and problems in the banking industry. This will be the case whether the President’s name is Trump or Clinton.

Fifth, based on what has been said by the two candidates and on Hillary Clinton’s actions during her long stretch as a Washington insider, every advocate of peace should be hoping for a Trump victory in November. The reason is that a vote for Clinton is a vote for the foreign-policy status quo, which means a vote for more humanitarian disasters and strategic blunders along the lines of the Iraq War, the destruction of Libya, the aggressive deployment of predator drones that kill far more innocent people than people who pose a genuine threat, the intervention in Ukraine that needlessly and recklessly brought the US into conflict with Russia, the inadvertent creation and arming of ISIS, and the haphazard bombing of Syria. Based on what he has said on the campaign trail, a vote for Trump would be a vote for foreign policy that was less concerned about regime change, less eager to intervene militarily in the affairs of other countries, and generally less offensive (in both meanings of the word).

Summing up, a Trump presidency would probably be a significant plus in the area of foreign policy (considering the alternative), but there isn’t a good reason to expect that the US economy and financial markets would fare any better or worse under Trump than they would under Clinton. At least, there isn’t a good reason yet.

 

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Trump is running only in order to do these things - to stop globalization from decimating the country.
He has no other purpose in seeking office.

There is a world of difference between Trump and Clinton and those differences would be immediately apparent. Clinton has vowed to open our borders within her first 100 days in office. Trump supports immigration, but legal immigration. Remember when we were once a nation of laws? He does not intend to ban all Muslims, but wants the people who come in to be vetted and legal. Do you really want a flood of unknown immigrants and a gang-rape epidemic as they have in Europe? Do you have any idea what kind of violence is occurring in Europe, even to European men - and children? Trump does not plan to abandon these people. He wants them to be housed safely in the Middle East, in one of the rich Gulf States (they are doing nothing to help). Many are flooding into the US right now, so some will be housed here. Trump will help to rebuild their countries so they can return home when it is safe to do so. Why would you lament that? Don't they deserve to have their homelands restored? In Europe, they live mostly off the state. Most of them do not adapt well to the workforce. They have a lot of special problems. What is it in this that you desire for the US on a permanent basis? Exotic diseases and millions of people we cannot afford to support.... European governments are even throwing Europeans out of their homes to house migrants. Would you like to see Americans left homeless to accommodate foreigners? Let's try to be a little realistic - and try to care about the people of this country, not only the international community.

Working Americans need strict border control, as massive illegal immigration is depressing wages and pushing Americans out of work. Imagine how people will be impacted if Clinton opens the borders and they have to compete with millions more low-wage illegals (from Mexico and further south). Clinton is a globalist who will be focused on dismantling the country economically, militarily, our energy sector, our sovereignty, our constitution. If you honestly believe those things don't matter.... that there is no difference between Clinton and Trump.... well, I am dumbfounded.

TPP will institute corporate and globalist rule - from outside the country. If you think anyone is going to thrive in that environment you are mistaken. It gets worse from there. They will be bringing in foreigners en mass and intentionally forcing Americans out of work.

Obama has spent years unilaterally dismantling the country, doing whatever he wants to do. He is running an entirely illegal federal government that is engaging in egregious crimes against our economy and infrastructure, and infringements against the rights of average Americans, doing everything he can to weaken the country and to hurt American people, who he clearly despises. If he can get away with all of that, I suspect Trump can somehow try to put it all back together again. It may be an awkward process and it will take time, but it must be done. I suppose a man who has turned $1 million into $10 billion, who has created and run businesses around the world, must have some unique talents. He also has an extraordinary team ready to help him. And yet you compare him to Clinton, whose only accomplishments in life are derived from an extraordinary reign of criminal activity.

I sense Cruz supporters on this page. Give it up. Get over it. He lost.
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Well Steve, let's say you're right about the Trump Presidency and The Wall not being built. We already have no wall. Let's say you're right about the Trump Presidency not changing The Trade Deal with China. We already have the bad trade deal with China that costs us $558 BILLION a year. Let's say you're right about the Trump Presidency not eliminating the TPP Deal, and not altering Obama Care, and not making the Federal Reserve answer to The People. We already HAVE all that.

Steve; what you're saying is: the Trump Presidency will be a continuation of the Obama Presidency. Do you really believe ANYONE will believe you ?
Rightly so, you concur w/ the author regardless if it is merely one candle in the darkness...;0
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Trump is running only in order to do these things - to stop globalization from decimating the country. He has no other purpose in seeking office. There is a world of difference between Trump and Clinton and those differences would be immediately appa  Read more
pacanon - 6/1/2016 at 3:42 AM GMT
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