With the 2016 US Presidential election approach there have been questions about what this could mean for the US economy in 2017. In this blog, economist Rupert Seggins draws on the historical experience of the US and its G7 peers to offer an answer.
While this time may be different, history suggests that the bar for a President-caused US recession in 2017 is set much higher than may commonly be thought.
As the Chinese authorities inject a fresh $1trn in new credit in the first quarter of 2016, Economist Marcus Wright examines this latest development and what it means for China and the world economy.
China's economy: slowing distorted and debt-addictedRBS Economics
China's economy is slowing. It's policy makers are having to contend with a massive debt-fuelled investment binge and the need to implement necessary reforms to rebalance the economy.
Senior Economist Marcus Wright goes behind the headlines with this stock take that sets out the main economic challenges facing China.
Growth in emerging markets is slowing. This is concerning. Senior Economist Marcus Wright considers two questions. What are the problems in emerging market economies? Why does that matter to us?
This report draws on over 10,000 interviews with business leaders as well as economic forecast data to better understand the growth opportunities and challenges facing dynamic companies over the next 12 months.
Will the US election trump the economy in 2017?Rupert Seggins
With the US Presidential election due in November, many people are asking what the outcome might be for the economy next year. In this post, I take a look at what US and wider G7 country history can tell us about the immediate aftermath of elections. I find that while this time may be different, the risk of a President-caused economic recession in 2017 is much lower than may commonly be thought. I also offer some thoughts on what types of policy decision may precipitate an immediate downturn.
As the Chinese authorities inject a fresh $1trn in new credit in the first quarter of 2016, Economist Marcus Wright examines this latest development and what it means for China and the world economy.
China's economy: slowing distorted and debt-addictedRBS Economics
China's economy is slowing. It's policy makers are having to contend with a massive debt-fuelled investment binge and the need to implement necessary reforms to rebalance the economy.
Senior Economist Marcus Wright goes behind the headlines with this stock take that sets out the main economic challenges facing China.
Growth in emerging markets is slowing. This is concerning. Senior Economist Marcus Wright considers two questions. What are the problems in emerging market economies? Why does that matter to us?
This report draws on over 10,000 interviews with business leaders as well as economic forecast data to better understand the growth opportunities and challenges facing dynamic companies over the next 12 months.
Will the US election trump the economy in 2017?Rupert Seggins
With the US Presidential election due in November, many people are asking what the outcome might be for the economy next year. In this post, I take a look at what US and wider G7 country history can tell us about the immediate aftermath of elections. I find that while this time may be different, the risk of a President-caused economic recession in 2017 is much lower than may commonly be thought. I also offer some thoughts on what types of policy decision may precipitate an immediate downturn.
China's economic slowdown isn't just bad for china94ajay
China's Economic Slowdown Isn't just bad for china, it's bad for everyone who trade with china, but India can take this opportunity to promote 'Make in India'
CHINA STOCK MARKET CRASH 2015,
CHINA
INTRODUCTION
The Chinese stock market crash began with the popping of the stock market bubble on 12 June 2015.A third of the value of A-shares on the Shanghai Stock Exchange was lost within one month of the event. Major aftershocks occurred around 27 July and 24 August's "Black Monday."
CAUSES
Enthusiastic individual investors inflated the stock market bubble through mass amounts of investments in stocks often using borrowed money, exceeding the rate of economic growth and profits of the companies they were investing in.
Investors faced margin calls on their stocks and many were forced to sell off shares in droves, precipitating the crash.
By 8–9 July 2015, the Shanghai stock market had fallen 30 percent over three weeks as 1,400 companies, or more than half listed, filed for a trading halt in an attempt to prevent further losses.
Values of Chinese stock markets continued to drop despite efforts by the government to reduce the fall.
After three stable weeks the Shanghai index fell again on 27 July by 8.5 percent, marking the largest fall since 2007.
The founder of Alibaba Jack Ma said that the war will continue for 20 years. The trade war takes a new tern to a war of supremacy of technology. It has been presumed that the next new administration in Washington even cannot withdraw the trade war and it will continue till the raise of China to number one economy of the world toppling USA or until loss of relevance of such war to both the parties.
Presentation delivered by Chris Leung, Chief China Economist, Executive Director, DBS Bank at the marcus evans Private Wealth Management Summit APAC fall 2019 in Macao.
D&B's 2013 mid-year Global Economic Outlook gives an update on regional insights, upgrades and downgrades for countries around the world so far in 2013, as well as a prediction for these economies through 2017.
With such an unpredictable 2016 behind us where Brexit and the election of new US president Donald Trump sent shock waves through the world, the question is, what can we expect for 2017?
Know how China's Economic Slowdown has a significant impact on key economies that have strong trade ties with the country? Download the Aranca special report on China Slowdown here.
A big reason for the stock market rally was that a lot more people started buying stocks with borrowed money. This practice, known as "trading on margin," used to be strictly regulated by the Chinese government. The new rules still included an important safeguard, though: a 2-to-1 margin requirement said that only half of invested funds could be borrowed. The investor needed to put up the rest of the funds herself. There were also restrictions on which stocks you could buy and how long the money could be borrowed — rules designed to prevent speculative mania from getting out of hand. So borrowed money flooded into the Chinese stock market between June 2014 and June 2015, helping to push stock prices up 150 percent.
How will Trump’s victory impact the global apparel industry?ThreadSol
This ppt will tell you various implications of Donald Trump’s trade policies on the global apparel industry. Check out the full article on http://stitchdiary.com/will-trumps-victory-impact-global-apparel-industry/
China's economic slowdown isn't just bad for china94ajay
China's Economic Slowdown Isn't just bad for china, it's bad for everyone who trade with china, but India can take this opportunity to promote 'Make in India'
CHINA STOCK MARKET CRASH 2015,
CHINA
INTRODUCTION
The Chinese stock market crash began with the popping of the stock market bubble on 12 June 2015.A third of the value of A-shares on the Shanghai Stock Exchange was lost within one month of the event. Major aftershocks occurred around 27 July and 24 August's "Black Monday."
CAUSES
Enthusiastic individual investors inflated the stock market bubble through mass amounts of investments in stocks often using borrowed money, exceeding the rate of economic growth and profits of the companies they were investing in.
Investors faced margin calls on their stocks and many were forced to sell off shares in droves, precipitating the crash.
By 8–9 July 2015, the Shanghai stock market had fallen 30 percent over three weeks as 1,400 companies, or more than half listed, filed for a trading halt in an attempt to prevent further losses.
Values of Chinese stock markets continued to drop despite efforts by the government to reduce the fall.
After three stable weeks the Shanghai index fell again on 27 July by 8.5 percent, marking the largest fall since 2007.
The founder of Alibaba Jack Ma said that the war will continue for 20 years. The trade war takes a new tern to a war of supremacy of technology. It has been presumed that the next new administration in Washington even cannot withdraw the trade war and it will continue till the raise of China to number one economy of the world toppling USA or until loss of relevance of such war to both the parties.
Presentation delivered by Chris Leung, Chief China Economist, Executive Director, DBS Bank at the marcus evans Private Wealth Management Summit APAC fall 2019 in Macao.
D&B's 2013 mid-year Global Economic Outlook gives an update on regional insights, upgrades and downgrades for countries around the world so far in 2013, as well as a prediction for these economies through 2017.
With such an unpredictable 2016 behind us where Brexit and the election of new US president Donald Trump sent shock waves through the world, the question is, what can we expect for 2017?
Know how China's Economic Slowdown has a significant impact on key economies that have strong trade ties with the country? Download the Aranca special report on China Slowdown here.
A big reason for the stock market rally was that a lot more people started buying stocks with borrowed money. This practice, known as "trading on margin," used to be strictly regulated by the Chinese government. The new rules still included an important safeguard, though: a 2-to-1 margin requirement said that only half of invested funds could be borrowed. The investor needed to put up the rest of the funds herself. There were also restrictions on which stocks you could buy and how long the money could be borrowed — rules designed to prevent speculative mania from getting out of hand. So borrowed money flooded into the Chinese stock market between June 2014 and June 2015, helping to push stock prices up 150 percent.
How will Trump’s victory impact the global apparel industry?ThreadSol
This ppt will tell you various implications of Donald Trump’s trade policies on the global apparel industry. Check out the full article on http://stitchdiary.com/will-trumps-victory-impact-global-apparel-industry/
Donald Trump has packed his cabinet with advisors who are pro-Taiwan and anti-China. Most notably,
Trump's Anti-China Triumvirate:
Robert Lighthizer - US trade representative
Wilbur Ross - Secretary of Commerce
Peter Navarro - Newly created White House National Trade Council
He says he will withdraw from the TPP and levy a 45% tariff on Chinese imports. This report will explore the impact of these actions on US small businesses.
The US is China’s number one export partner. For most of the last eight years, China has been the largest holder of US debt. The two countries are closely linked economically. As the world’s number one and number two economies, trade between these giants effects the entre globe. Donald Trump is accusing China of currency manipulation and unfair trade, vowing to remove the US from the Transpacific Partnership and to levy a 45% tariff on Chinese products. He is also threatening a 35% tax on US companies who export jobs to China. This presentation will explore these concepts in detail as well as look at the possible outcome of a trade war between the US and China.
Here we have our students talking about 45th President of The United States – Donald Trump. Through #HBKipedia the idea is to represent thoughts and opinions of our students on the trending topics.
The UK Elections: Today's Intelligence or Yesterday's News? Lars Voedisch
A pre and post event analysis of the UK elections to examine how the social web had impacted public opinion. See how the media coverage both traditional and social tells us about crucial topics in the public mind and how the candidates of Labour, Conservatives and Liberal Democrats were portrayed across media channels.
The current account deficit that cried "wolf!"RBS Economics
The UK current account deficit hit a record 5.2% of GDP in 2015. Senior Economists Rupert Seggins and Marcus Wright take a look at what the current account deficit is, what has happened to it, why and what it does and does not tell us about the economy.
The global economy effects on commodity dependent countries like zambiaKampamba Shula
On the 17th of November 18, 2016 I made a presentation at the FNB Financial Journalism academy on “The Global Economy Effects on Commodity dependent countries like Zambia”. It was well received. Below are some of the highlights
The Macroeconomic Consequences of Mr. Trump’s Economic PoliciesSusana Gallardo
This paper assesses the macroeconomic consequences of presidential candidate Donald
Trump’s proposed economic policies. These include his policies on taxes and government
spending, immigration, and international trade. A similar analysis of candidate Hillary
Clinton’s proposed economic policies will be forthcoming
China is ASEAN’s largest trading partner and a growing economic force in the Asia-Pacific region. Thousands of miles away, America has a new president, Donald Trump, who is threatening to enact anti-China trade policies and to remove the United States from the Transpacific Partnership. This presentation will explore China’s importance in Asia, as well as how changes in Trump-China trade policies will impact ASEAN.
President-elect Donald J. Trump will enter the White House having promised to radically alter United States foreign policy, with ramifications for Americans and the world.
But it’s not yet clear how. Mr. Trump offered vague and sometimes contradictory proposals during his campaign, with few of the typical details or white papers. Voters, foreign policy professionals and the country’s allies are all, to a real extent, left guessing.
Here, then, is a rundown of what we know about Mr. Trump’s foreign policy ideas and what some experts say about their feasibility and likely ramifications.
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Editor
Stefan Schneider
+49 69 910-31790
[email protected]
Technical Assistant
Pia Johnson
+49 69 910-31777
[email protected]
Deutsche Bank Research
Frankfurt am Main
Germany
Internet: www.dbresearch.com
E-mail: [email protected]
Fax: +49 69 910-31877
Managing Director
Norbert Walter
October 1, 2004 Current Issues
The U.S. balance of payments: wide-
spread misconceptions and exaggerated
worries
• The U.S. balance of payments is by far the most confusing and least
understood area of the U.S. economy. The confusion is centered around the
large and rapidly growing deficits. Indeed, the deficit on the current account of
the balance of payments rose to new records, both in absolute and relative
terms.
• These developments created worries and fears regarding the sustainability of
the external deficits. However, closer examination of the issue shows that the
worries and fears are exaggerated and, most importantly, there are no short-
and medium-term solutions because of a number of structural reasons.
Mieczyslaw Karczmar, +1 212 586-3397 ([email protected])
Economic Adviser to DB Research
Guest authors express their own opinions, which may not necessarily be those of Deutsche Bank
Research.
October 1, 2004 Current Issues
Economics 3
The U.S. balance of payments is by far the most confusing and least
understood area of the U.S. economy. The confusion is centered
around the large and rapidly growing deficits. Indeed, the deficit on
the current account of the balance of payments rose from USD 474
billion in 2002 to USD 531 billion in 2003 and is estimated to reach
over USD 600 billion in 2004 (see table 1). In relative terms, the
deficits amount to 4.5%, 4.9% and 5.3% of GDP, respectively, in
those years. Both in absolute and relative terms, these are all-time
records.
The sustainability of external deficits
Persistent and rising external deficits have attracted increasing at-
tention of politicians, economists and the media. Needless to say,
the deficits are generally viewed as highly negative for the U.S.
economy and U.S. financial conditions. The main points of concern
are:
• Rising foreign indebtedness that might create financial difficulties
over time.
• A potential massive dollar depreciation needed to rectify the
situation.
• In an extreme case, a financial crisis as foreigners refuse to fi-
nance U.S. deficits and switch their capital to other places.
The media, regardless of their political outlook, have been
commenting on the U.S. external deficits for quite some time,
spreading fear and predicting all sorts of calamities, which
apparently sells newspapers well. About five years ago, in the fall of
1999, The New York Times ran an article with a pointed headline:
“The United States sets a record for living beyond its means;” and a
Barron’s article talked about a current account crisis and a ticking
time bomb.
Had t.
The Economic Outlook for 2017 by Kevin LingsSTANLIB
South Africa is searching for higher economic growth in a global environment increasingly shaped by rising nationalism, higher levels of trade protection and a fall-off in the effectiveness of monetary policy.
Stewardship a presidential report card v4 r significant foreign influenceBrij Consulting, LLC
More than 1000 prominent Economists have asked for a referendum on the Trump Administration. We have added our Economic Report to the Subject, in V2 we show the econometric means to rebuild our country and in V3 explain the Debt Ratio and how it has been violated by the current administration, but has the means to be challenged and V4 shows the Evidence of Significant Foreign Influence on Domestic Affairs Our Revision demonstrates the need for SOCIAL JUSTICE
on night finally came after a tumultuous year of Hillary
Clinton and Donald Trump battling, and Americans have
voted for Donald Trump to be the 45th president of the United
States. With a business mogul in the White House comes
questions about how markets will react and what changes
individuals can expect in their day-to-day financial lives, if his
policies are enacted.
Personal Capital developed this report to assess the shortand
long-term market and personal finance implications of a
Trump presidency. This report includes an analysis of Trump’s
policies on taxes, Social Security, education and health care to
help investors understand how their money may be affected,
with actionable advice on how to plan accordingly.
The bottom line: Investors should not let short-term
political gyrations drive their long-ter
This report offers a comprehensive overview of the situation in the United States focusing on the business perspective. The United States remains one of the world’s key economic players. With a real GDP per capita of US$62,479.3, this high-income country occupied 6th place in a 2019 global comparison. The U.S. was home to about 329.1 million people in 2019 and is renowned for its extensive entertainment industry.
What's included?
Economic conditions (incl. COVID-19 economic impact), public finances, and detailed information on the labor force
Demographics, consumption, and income
Imports, exports, foreign direct investments
Fitch Solutions operational risk indexes
Business culture and local habits
Government structure, overview of stability and threats, and the political environment
Territorial CO2 emissions, energy shares, and PM2.5 exposure
« Market Perspectives » est notre revue mensuelle des marchés. Elle présente de la façon la plus synthétique possible :
- notre analyse des principaux faits marquants et indicateurs macro susceptibles de dessiner les marchés sur le mois.
- notre vision sur les différentes classes d’actifs
Cette revue sera continument enrichie avec nos indicateurs quantitatifs.
La plupart de nos analyses sont disponibles sur www.finlightresearch.com
Our monthly publication “Market Perspectives” presents a synthetic view of all the asset classes we cover.
The report is composed of six sections covering Macro, Equities, FI & credit, FX, Commodities and Alternatives.
Each section is preceded by a summary of our views on the related asset class.
Most of our publications are available on our web site www.finlightresearch.com
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
how to sell pi coins in all Africa Countries.DOT TECH
Yes. You can sell your pi network for other cryptocurrencies like Bitcoin, usdt , Ethereum and other currencies And this is done easily with the help from a pi merchant.
What is a pi merchant ?
Since pi is not launched yet in any exchange. The only way you can sell right now is through merchants.
A verified Pi merchant is someone who buys pi network coins from miners and resell them to investors looking forward to hold massive quantities of pi coins before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
Exploring Abhay Bhutada’s Views After Poonawalla Fincorp’s Collaboration With...beulahfernandes8
The financial landscape in India has witnessed a significant development with the recent collaboration between Poonawalla Fincorp and IndusInd Bank.
The launch of the co-branded credit card, the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card, marks a major milestone for both entities.
This strategic move aims to redefine and elevate the banking experience for customers.
1. Will the US election
trump the economy
in 2017?
Rupert Seggins, RBS Economics, July 2016
1
2. Information classification: Public/Internal/Confidential/Secret 2
Summary
While this time may be different, history suggests that the bar for a
President-caused US recession in 2017 is set much higher than may
commonly be thought.
• The main thing to watch for that would precipitate an immediate recession is
a significant and simultaneous monetary & fiscal tightening. This requires
more than just the President to accomplish.
• Other policy options either won’t cause a recession (e.g. increasing tariffs on
Chinese goods), are not very plausible (e.g. President causes a banking crisis)
or are just not going to happen(e.g. start a war, lose & get invaded).
• As far as the economy and financial markets are concerned, years following
US Presidential elections are not so different from other years.
3. Information classification: Public/Internal/Confidential/Secret 3
• Post election years look similar to
other years*, both in terms of
average growth and the frequency
of GDP falls.
• If the economy grows in the year
prior to an election, it normally
does the same in the following
year. A change of party makes no
difference to this pattern.
• There is one post-war in which a
growing economy in the year
before November turned to
recession – 1948. However, this was
not precipitated by policy.
US election years – not so different…
*Note: significance or otherwise of differences in frequencies of GDP falls established by chi-squared test at 5% significance level. Significance of average
growth difference by t-test at 5% level.
4. Information classification: Public/Internal/Confidential/Secret 4
• Household consumption follows
existing trends. There is no post-war
example of consumption peaking in an
election quarter.
• Investment is also little affected by
elections. The two post-war cases
where the election quarter was the
peak were 1948 and 2000 (the latter
coincided with the Dot-Com bust).
• No sector of the economy typically
does significantly* better or worse in a
post election year than in a normal
year. The apparently significant
difference for finance disappears if we
exclude 2008/9.
…and nothing significantly changes for any sector
*Note: significance or otherwise of average growth differences established by t-test at 5% significance level.
5. Information classification: Public/Internal/Confidential/Secret 5
• There is no typical path for exchange
rates or the stock market pre or post
elections. Averages are misleading.
• Post-WWII election months coincided
with stock market peaks in 1968 &
1972. In both cases, there was a sharp
rise in the Fed Funds rate.
• The dollar has fallen in the year after 5
out of the 13 elections since 1964.
Longer-term annual data (from 1792)
suggests a meaningfully higher post-
election frequency of dollar
appreciations vs. sterling (70% vs 50%
for other years). But this should be
interpreted with caution, as some
years may be due to sterling weakness.
Financial markets are as unpredictable as ever
6. Information classification: Public/Internal/Confidential/Secret 6
• Whether coincidence or otherwise, the
unemployment rate has taken a pause
in and around a third of all post-WWII
elections. Examples include 1964,
1984, 1996 & 2004).
• Real median family incomes fell during
some presidential terms that saw a
recession. For example, Reagan’s first
term (-0.2%) & Bush Sr.’s presidency (-
2.9%).
• But owing in part to globalisation and
technological change, recent income
falls have gone beyond single
presidents. They have fallen during
both Bush Jr. terms (-3%) and the six
years of Obama for which we have
data (-1.5%).
Unemployment pauses and longer term income
troubles
7. Information classification: Public/Internal/Confidential/Secret 7
• Across all G7 countries there is not a
significant difference between average
GDP growth in post-election and other
years.
• France’s economy has seen the most
GDP falls since 1871, but even there,
the frequency of annual economic
contractions is not significantly
different between post-election &
other years.
• Elections can and sometimes do lead
to high levels of uncertainty about
policy. Big monthly increases in
uncertainty have more often not been
election-related.
The experience of other G7 economies – guess what?
The same.
Note: significance or otherwise of differences in frequencies of GDP falls established by chi-squared test at 5% significance level. Significance of average growth
difference by t-test at 5% level. Data for uncertainty chart sourced from Baker, Bloom & Davis (2016), available at www.policyuncertainty.com
8. Information classification: Public/Internal/Confidential/Secret 8
House prices & stock markets across the G7
• House price downturns are
uncommon. The UK and Germany
are the only two G7 countries since
1975 that have seen rising prices
before the election turn to falling
prices just after (2010 for the UK
and 1983 & 2005 for Germany).
• As might be expected, Canada’s
stock market has typically had the
highest correlation with the US.
However, there is still no typical
difference between the years
before and after US elections and
other years.
9. Information classification: Public/Internal/Confidential/Secret 9
• Typically, the consumer is the backbone
of economic resilience. Post election
falls are uncommon (10 out of 84 post-
war elections) and reversals from
growth to decline rarer still (5 out of 84)
• Unsurprisingly, investment has been
more volatile with falls in advance of
around 1 in 3 elections and falls
following 1 in 4 elections.
• Manufacturing and construction output
are typically more volatile than service
sector output.
• All of the above is also the case in years
that are not post-election ones.
Election years - all eyes on the consumer
10. Information classification: Public/Internal/Confidential/Secret 10
• Given that US elections typically don’t
coincide with recessions, it is not
surprising that historically there is little
coincidence with a downturn in world
growth. However, this is not to say
that US recessions don’t influence
world economic growth (e.g. 1981/2 &
2008/9).
• There is also no significant* difference
for world trade, although here it is
more likely because things like US
tariff policy decisions have historically
taken time to debate and pass (e.g.
1828 Tariff of Abominations, McKinley
1890, Smoot-Hawley 1930).
Global economic & trade growth
*Note: significance or otherwise of differences in frequencies of falls established by chi-squared test at 5% significance level. Significance of average growth
difference by t-test at 5% level.
11. Information classification: Public/Internal/Confidential/Secret 11
• There is little evidence from US history
that raising tariff barriers has in and of
itself precipitated an immediate
economy-wide recession. There is
evidence that it creates winners and
losers within the country (e.g.
producers in different parts of the
country as in 1928). It also hinders
longer-term growth potential.
• Despite the oft-quoted Smoot-Hawley
tariff and subsequent response from
other nations, net trade contributed
little to the US Depression and
recovery. Employment and earnings
falls were no greater in agriculture and
manufacturing (where the tariffs
applied) than in other sectors.
Elections, protectionism & recessions
12. Information classification: Public/Internal/Confidential/Secret 12
Fiscal tightening (when accompanied by
monetary tightening).
• E.g. UK in 1980, US in 1937/8, Italy
2011/12. Usually done in response to
high inflation or debt sustainability
concerns.
• In extreme circumstances, this type of
policy action can precipitate a severe
recession where GDP falls by between
4%-9% (e.g. US in 1938 and Italy in 2012).
• UK in 2010 is an example where fiscal
tightening was sufficiently offset by
accommodative monetary policy such
that the economy did not fall into a
recession, despite a fall in consumption.
What policy decision involving a President would
precipitate an immediate recession?
13. Information classification: Public/Internal/Confidential/Secret 13
• The majority of very severe recessions
in G7 countries (4% to 9% fall in GDP)
have been linked to a financial crash of
some description.
• In order to cause a depression or
worse starting in 2017 (>9% fall in
GDP), G7 history suggests that the new
President would have to either:
i. Start a war with another country and
see the US invaded.
ii. Put the US on a fixed exchange rate
standard and immediately cause a
financial system crisis, while
continuing to defend that standard.
For the extremists among you…
14. Information classification: Public/Internal/Confidential/Secret 14
Some thoughts for 2017
• History suggests that the risk of an annual GDP fall in 2017 following the US
election is no higher or lower than in any non-post election year.
• History also suggests that economic conditions coming out of the election
will be similar to those going in.
• The main thing to watch for that would precipitate an immediate recession
is a significant and simultaneous monetary & fiscal tightening.
• Most other policy options are either not going to cause a recession, too
slow to act or are simply implausible.
While this time may be different, the bar for an immediate President-caused
US recession is set higher than may commonly be thought.