2024 US election – implications for investors

CAMPAIGNS are, of course, about pledges and slogans, which may or may not become policy for the winning candidate. That is not just politics – realities often impose themselves and change the direction of policy. The pandemic and the global financial crisis are recent examples of when policy was forced to adapt to unforeseen challenges.

Candidates may also prefer to avoid comments on items they will inevitably confront, should they win election. In 2025, one of the most important realities the winner will face is a large US federal budget. The other is the expiry of tax cuts passed in 2017.

Based on what has been said, it seems likely that Republican candidate Donald Trump favours a full extension of the Tax Cuts and Jobs Act of 2017. Yet he may face a divided government, should the Democrats retain their majority in the Senate (unlikely) or regain it in the House of Representatives (quite possible).