As Wednesday morning broke, the news that few expected to hear resounded from TVs, radios and frenzied social media posts. Against all odds, Donald J Trump, billionaire businessman and political newcomer had beaten his rival Hillary Clinton to become President-Elect. The message was clear – Americans had rejected the political establishment and embraced an alternative order.
Making America great again
Trump promised “Brexit times 10” and he delivered.
As with Brexit, the polls got it wrong, predicting a win for Clinton. The result was not a one-sided victory, however. The popular vote went to Clinton, but under the Electoral College system, Trump emerged as the winner. Appreciating the acrimonious nature of the contest, and the wider social discord in US, Trump’s victory speech was surprisingly conciliatory, calling for unity and binding the “wounds of division”.
What can we expect from a Trump presidency?
On economic policy, reaction has been mixed. Judging by the positive move in equity markets, his promises of tax cuts and infrastructure spending have been cautiously welcomed. However, his policies of trade protectionism and imposing punitive tariffs on Chinese imports have been criticised by economists.
On other issues, much uncertainty remains. Trump aims to do away with Obamacare but hasn’t proposed an alternative healthcare system. Referencing climate change as a “Chinese hoax”, he aims to pull the US out of the landmark Paris Agreement on climate change but how far he will (or can) go in that aim remains unclear.
The Republican Party now controls both the Senate and House of Representatives of the US Congress. While this may smooth the path for Trump to push forward with policy proposals, he does not enjoy unqualified support even within his own party.
Throughout the campaign, Trump drew parallels between his election campaign and Britain’s future departure from the EU, even referring to himself as “Mr Brexit”. It remains to be seen if he accentuates his family roots and affinity to the UK when liaising with the UK government, which is actively seeking new trade deals with countries outside the EU.
Building bridges (not walls)
International reaction has so far been mixed. UK Prime Minister Theresa May re-emphasised the special relationship between the UK and US. Russian leader Vladimir Putin was among the first to congratulate Trump stating that Russia is ready to restore “fully fledged relations” with the US. German leader, Angela Merkel was more measured in comparison, promising close co-operation based on common values.
Financial markets have so far met Trump’s win with surprising calm. While there has been a move into safe-haven assets (for example, gold and the Japanese yen), higher-risk assets have also performed well. As at the close of trading on Thursday, the S&P 500 index was up nearly 4%, while the FTSE 100 and FTSE Europe (ex-UK) indices rose by 2.0% and 2.6% respectively.
Lucy O’Carroll, Chief Economist at Aberdeen commented: “…more clarity in three areas – monetary policy, fiscal policy and the extent of any ‘de-globalisation’ moves – is required”. Given the political and economic uncertainty, a US interest rate rise in December is now viewed as much less likely.
M&S: souping up
Marks and Spencer, the 132-year old British retailer, announced a major change in strategic direction this week. In the wake of ongoing losses, M&S revealed plans to close 30 UK stores and more overseas, and convert 45 more into ‘Simply Food’ stores over a five-year period. Chief Executive Steve Rowe announced the aim to build a sustainable business that “delights” customers and delivers long-term value for shareholders.
Meanwhile, British luxury retailer, Burberry has also been facing difficulties, posting a 40% drop in its first half-year profit. An asset write-down and restructuring charges were cited as the cause, along with elevated import costs due to the weak pound following the June Brexit vote.
Spring forward, fall back. It’s the American way of remembering how to adjust the clocks when daylight savings time kicks in. And since the change takes place in the middle of the night, there’s a minimum of disruption to most people’s lives.
It also provides the answer to what sounds like a thoroughly perplexing (and irritating) riddle: how can a boy born after his sibling be the elder of the two? Twins Samuel and Ronan Peterson arrived into the world on Sunday 6 November at Cape Cod Hospital in Massachusetts. While Samuel’s time of birth was 1.39am, his ‘older’ brother Ronan made his appearance 31 minutes later, just as the clocks changed. This makes him the eldest by 29 minutes. Really, we’re not winding you up.
Image credit: grzegorz knec / Alamy Stock Photo