David Blanchflower, an economics professor at Dartmouth, dives into the ripple effects of Trump's tariffs on the labor market, emphasizing potential challenges for workers and businesses. Wendy Schiller, a Brown University professor, analyzes the unique dynamics of cabinet nominations under Trump's leadership, highlighting the strain between partisanship and Senate independence. They discuss how these developments may reshape economic policies and political strategies amidst a turbulent landscape, all while pondering the future of governance in a changing America.
The podcast discusses the anticipated market growth driven by pro-business policies and tax reductions during a potential Trump administration.
It emphasizes that investors should prioritize economic fundamentals over political influences to navigate market resilience effectively.
Deep dives
The Appeal of the Futures Market
The futures market remains highly active even when other markets slow down. S&P 500 and NASDAQ 100 futures are traded nearly 24 hours a day, providing investors with continuous trading opportunities. Unlike the ETF markets, where liquidity declines after trading hours, the futures market maintains robust volume overnight. This unique aspect of futures trading allows market participants to seize opportunities regardless of the time of day.
Understanding Bitcoin as a Speculatory Asset
Investing in Bitcoin is characterized as speculative due to its lack of underlying assets or consistent cash flow. The market operates significantly on technical analysis and news developments, making it unpredictable and highly sensitive to external factors. As the price reaches new heights, potential investors are often driven by faith in an increasing number of buyers rather than traditional valuation metrics. This 'faith asset' approach shapes the way individuals engage with this controversial cryptocurrency.
Ignoring Politics in Investment Strategies
Investors are advised to minimize the influence of politics on investment decisions to achieve better results. Historically, the stock market has shown resilience, preferring to focus on growth potential rather than the political sphere. The performance of the market tends to remain stable irrespective of whether a Democrat or Republican occupies the White House. Understanding that market outcomes are driven more by economic fundamentals can help investors navigate political upheaval.
Anticipating Market Growth and Inflation Concerns
Market forecasts suggest significant growth, with expectations for the S&P 500 to reach lofty targets in the coming years. This bullish sentiment is largely fueled by perceived pro-business policies and tax reductions anticipated from a Republican leadership. However, inflation could pose potential risks, driven by tariff implications and changes in corporate tax rates. Balancing growth projections with inflationary pressures will be crucial for investors looking to capitalize on future market dynamics.
Watch Tom and Paul LIVE every day on YouTube: http://bit.ly/3vTiACF. Bloomberg Surveillance hosted by Tom Keene and Paul SweeneyNovember 14th, 2024 What would YOU like to hear about on Bloomberg? Help make shows like ours even better by taking our Bloomberg audience survey. (https://bit.ly/4eIFhe5) Featuring:
Ed Yardeni, President at Yardeni Research, discusses his bull market call as the country enters a second Trump administration
David Blanchflower, economics professor at Dartmouth, on the impact of Trump's tariffs
Wendy Schiller, professor at Brown University, on President-elect Donald Trump's cabinet nominations