Stop-Time Trading and Wall Street

Za "Time" from San Francisco

The news of current US President Biden's withdrawal from the presidential race and the nomination of current Vice President Kamala Harris as the Democratic candidate in that camp revived the hope that Donald Trump will not win a second term. This worldwide news resounded during my visit to friends in San Francisco, so I had the opportunity to see firsthand the relief among progressive voters.

The aftermath of Joe Biden's disastrous debate with Trump gave Trump an edge in the polls. After the failed assassination attempt on Trump, that advantage increased and Trump became a martyr among his supporters. This had the effect of intensifying the tension on the political scene. Conspiracy theories and edited photos began to circulate on social networks, and in such an electrified atmosphere, one could feel the anxiety among the students I spoke with.

I was surprised by the students' awareness of current political events and their clearly defined views. I'm not used to it and I didn't expect it. Dissatisfaction and anxiety were visible among the students that the situation will be bad no matter who wins - Trump or Biden. In the case of Trump's victory, problems would arise in the implementation of policies towards immigrants, abortion, the introduction of high tariffs and the complete turning of America into internal affairs. In the event of a Biden victory, students were worried that Trump supporters would riot, as happened after the previous election, and not accept the election results.

WHAT THE STOCK EXCHANGE SAYS

It is also very interesting to follow the events on the stock market, because the price movements were connected with the changes in the ratings of the presidential candidates. A key driver of stock prices lately has been investors' assessment of who will be the next president. This is how a new term, "Trump trade", was born, which means buying shares of corporations that are believed to profit in the event of Donald Trump's victory. During pre-election conventions and public appearances, the former president announced the changes he plans to introduce, and stock market traders determined what effects this would have on some sectors. When Trump's chances peaked around July 16, the S&P 500 hit a new high.

In his campaign appearances, Trump announced that if he were elected in November, he would favor the auto industry and the energy sector, in order to immediately limit Biden's clean energy initiatives and reduce the regulation of the banking sector. Shares of his social media company (DJT) aren't the only ones that have risen in value after the assassination attempt on the Republican candidate and the debate that hurt Democratic President Joe Biden.

"Drill baby drill, and close our borders," Trump said during the Republican convention on Thursday night. In doing so, he announced that if he won the election, there would be fewer restrictions on oil drilling permits and that drilling fees would be reduced.

"Republicans have a plan to bring prices down, and that can be done quickly by reducing energy costs," Trump said at the convention. The analyzes that followed shortly after this announcement showed that this plan is not realistic.

The case of private prison companies is also interesting. Their value has risen over the past month thanks to Trump's tough stance on illegal immigration and increased border patrol. The lowest paying jobs are held by illegal immigrants, so reducing immigration would bring more work to the residents of private prisons and more profits to private prison companies.

At the same Republican convention, Trump also indicated his intention to limit Biden's clean energy initiatives, especially electric vehicles.

"I will stop subsidizing electric vehicles on day one, saving the American auto industry from total destruction," said the Republican candidate.

The announced higher tariffs on Chinese electric car makers should prevent them from flooding the US market with cheap cars in the coming years. Banks, especially regional ones, would also benefit from Trump's victory, given the expected less stringent regulations on bank capital and liquidity.

Trump's support for cryptocurrencies is also a shift from his position when he was president. In May, Trump's campaign headquarters announced that they would begin accepting donations via bitcoin. Bitcoin (BTC-US) rose roughly 10 percent after the July 13 assassination attempt, hovering near $65.000 per token.

photo: ap photo

NEW CANDIDATE, NEW CHANCE

In this atmosphere, when everyone is already starting to calculate how much profit they will make when Trump becomes president again, Biden withdraws and nominates Vice President Kamala Harris as the Democratic candidate.

And the stock market immediately reacted to the news of US President Joseph Biden's withdrawal from the race for a second term and his proposal to replace him as a candidate with Vice President Kamala Harris. Thus, already on July 22, the S&P 500 rose by over one percent. Namely, investors got a clear picture regarding the state of the Democratic list, especially since several prominent Democrats joined Biden's proposal, primarily the gray eminence of Democrats Nancy Pelosi. Public opinion polls that were conducted immediately showed that now the chances are even, and Vice President Harris already collected 231 million dollars in donations on the first day.

However, the nomination of Kamala Harris as a presidential candidate, as of this writing, has not yet been endorsed by some very prominent Democrats (for example, former President Barack Obama). There is a problem with the procedure – Vice President Harris was not elected in a party election (primaries) for the candidate of the Democratic Party, rather than being nominated. Critics say "crowned". Although everyone claims that Kamala Harris is an excellent candidate, they wish that the procedure had been followed and that her nomination had come as a result of a victory in the internal party elections. It is also interesting that the Republicans are protesting because of the violation of the internal party procedure by the Democrats and are thus trying to challenge the nomination of Kamala Harris.

photo: ap photo

The real pre-election campaign is just starting and it will be very interesting to watch in which direction it will develop. Kamala Harris has so far focused more on social issues than on economic initiatives, while Trump's campaign initiatives are dominated by economic themes. Analysts believe Harris' candidacy will rely heavily on her experience as a district attorney, attorney general and cross-examiner in Senate hearings. By the way, she spent a much larger part of her career as a prosecutor than as a senator or vice president - and that is exactly how she will now run against Donald Trump. We will also see how Wall Street will evaluate and evaluate the programs and chances of candidates.

The impression is that now the atmosphere is less electrified and that there is a real chance of calming down. It would be important to resolve the controversy surrounding the actions of the secret service during the unsuccessful assassination attempt on Trump, but also to stop the spread of conspiracy theories, fake news and simple but impractical populist solutions.

In addition to the actors of the political struggle, the media should contribute significantly to this.

When visiting California, I always make sure to visit famous universities such as Stanford and Berkeley. During my pilgrimage to Stanford this year, I visited the Hoover Tower and in the section dedicated to the former US President Herbert Hoover, a quote from his speech from November 08, 1937 caught my attention: "The permanence of free speech and a free press rests on the simple concept of seeking the truth and the truth... Freedom of expression will not survive if it is used to stir up malice in people's minds. It will not survive if it is used to exploit hatred.”