By Ulvi Hagverdi
Your commercial awareness dose
The whole globe is looking forward to the US Presidential election, to be held on November 3, 2020. The incumbent’s President Donald Trump’s main rival is Joe Biden, representing the Democratic Party. As someone who has served as Vice President of the US from 2009 to 2017, Biden possesses extensive political and economic experience. The candidate has attracted significant positive publicity after selecting Kamala Harris as his vice-presidential running mate. Alongside being the first Black woman representing a major party during the elections, she is also the second black women to be elected to the US Senate in the US history.
Compared to Donald Trump, who is known for radical economic and social policies (such as immigration), Joe Biden is seemed as a more liberal, maneuverable and equal leader. He has already put forward quite a dozen of promising plans to recover the halted US economy and fix the social discrepancies existing within the American society. Firstly, the shocking news for the investor community was when Biden and Harris announced that they would reverse the tax cuts introduced by Trump in 2017 and would increase corporate tax from 21% to 28%. These cuts have enabled corporations to invest back in their businesses which has subsequently reflected on the stock market growth.
Another area of utmost economic importance that Biden has proposed adjustments is housing. With nearly 28 million US citizens presently facing eviction, Biden is well aware of this area’s impact on the general economy. A refundable tax credit of up to $15,000 that would assist millions of Americans to purchase their first property was suggested by him and Harris. It also seems that the controversial US Health Sector that is widely criticized for being costly and ineffective would also enjoy a potential Biden-Harris Victory if they will realize their agenda. The Democratic Candidates is looking to expand on the Affordable Care Act passed during Biden’s vice-presidency.
Compared to the incumbent President, Biden has also pointed out stringer regulations for the Wall Street. This might not be in the interests of the massive financial institutions, such as investment banks and insurance companies, which has also suffered tragically from the pandemic and low interest rates. A democrative triump would not also be particularly great news for US Tech giants such as Facebook and Amazon. Having already faced sufficient regulation and monitoring by the US government, Democratic politicians have accused of these companies with selling their users’ data and corporate overturns of avoiding taxes. Eventually, it goes without saying that Biden places a vital emphasis on the environment and greener economy. His approach evidently differs from Trump and would benefit the ethical investors and zero-emissions companies, such as Tesla.
Having set out the main promises and agenda of Biden and Harris, one might ask that what are the implications of this election might be for Europe and particularly the EU – the world’s biggest trading block! The continent has already been caught in the crossfire of the US-China trade war, alongside facing its own trade sanctions by the Trump administration. 15% of the asset base of the largest European corporations are based in the US, while the US sales generate 20% revenue of these companies. Economists forecast the European export-driven sectors, such as automakers with complex global supply chains will be significantly impacted the election, regardless of its result. Stronger pound and euro are also among the speculations of the analysts, when it comes to the implications of the election.
The polls for now support the Biden’s victory. Nevertheless, it might still be too early to predict the election result as there are still 3 weeks to the election day. Donald Trump rejecting to attend virtual debates makes is even more complicated to come up with a firm argument to compared the capabilities of two candidates. Controversies existing around voting by mail also catalyses the current election crisis.
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