From a policy standpoint what does this mean for the economy? Trump’s economic plan is considered to be pro-growth focusing primarily on tax policy, trade, and deregulation. Let’s revisit the election commentary we published a few weeks ago regarding Trump’s policies.
Under a Trump administration, the Fed would likely take a more hawkish tone and could be a little destabilizing with the Fed audit crowd gaining support.
Trump has been in opposition to the Trans-Pacific Partnership (TPP), but when push comes to shove, he will not want to get into a trade war with China and it is very unlikely that Chinese tariffs are meaningfully altered.
It is the difference between one candidate promoting lower marginal tax rates to drive revenues through economic growth and the other candidate driving revenues through more taxation. As an example, Trump would use an easier, less punitive tax code to help stimulate economic growth. Trump has proposed fewer tax brackets and lower rates for most individuals, lower capital gains and dividend taxes, and lowering the corporate tax rate from 35% to 15%.
Regulation can have a real impact on economic growth and it can happen much quicker through executive action than going through the normal legislative processes. Trump has called for deregulation to get the Federal government out of the free market and said that government regulations should be pared back to ensure that their benefits outweigh their costs and they don’t eliminate U.S. jobs. Trump said he wants to repeal the Affordable Care Act and called regulation a “stealth tax.”
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