Insights: Economic Growth

It appears the GOP has won both the Presidency and US Senate, with control over the House remaining up in the air.  Notwithstanding the incomplete results, here’re some initial takes on potential implications for your personal finances:

 

TAXES: Some key provisions of the 2017 tax cuts (eg. lower income tax rates, higher estate tax & standard deduction amounts) will likely be extended, beyond its sunset date of 2025;

 

BUSINESS: Dealmaking would probably accelerate, given the expected lessening of regulatory oversight;

 

EQUITIES: A positive bias owards further gains in US equities, especially now that the overhang over election uncertainties has been lifted;

 

INFLATION: Economic policies (whether as they relate to taxation or USA-first trade policies) would most likely add to inflation.  To what extent the Federal Reserve can counteract against expansionary pressures will impact Street expectations of Fed rate cuts over the next year;

 

GEOPOLITICS: Given the incoming Administration’s image of a more “transactional” approach towards foreign policy, the risks of unexpected US trajectory can’t be ignored.

 

Kindly note this caveat– the above observations are subject to revision to the extent that campaign rhetoric may prove quite different from actual governance.  In either case, I remain ready & available to examine how any of the above may impact your positioning towards goals, both near- and longer-term.