ICLN - 4 Surprising Stocks I'm Buying In Anticipation Of A Republican Sweep
2024-07-20 10:49:49 ET
Summary
- Lots of things are happening all at once: economic weakening, rising odds of Fed rate cuts, and political chaos.
- US manufacturing output and employment increased until the 2018 tariffs took effect.
- Tariffs led to a decline in US manufacturing output and employment, especially due to retaliatory tariffs from China.
- Restrictionist immigration policies (and especially mass deportation, if implemented) would likely exacerbate the underlying structural labor shortage and cause a wage-price spiral.
- I explain why I'm buying a few contrarian dividend stocks in the midst of a selloff.
Did I miss anything while I was hiking?
That's a joke, of course. The peace, tranquility, and quiet of the cool mountain air I've enjoyed over the last few weeks contrasts sharply with the chaos happening in the rest of the world.
As investors, there are aspects of this chaos that need to be addressed.
Anytime I discuss the economic effects of government policy (or proposed policy changes), some readers comment that I should steer clear of "politics."
But to write about macroeconomics every week as I do and not mention the US election and its potential economic effects would, in my estimation, be political. To pretend that it will have no effect would be doing a disservice to anyone reading.
So I will discuss the probable economic effects of a potential Republican sweep (which currently appears likely) in the same way that CNBC and other financial media outlets do: By focusing on the economics and investment implications.
I'll focus primarily on Trump's three marquee policies: (1) protectionism, (2) immigration restrictionism, and (3) loose fiscal policy.
Here's the table of contents:
- So much is happening right now.
- Ratcheting up the trade war.
- Immigration restrictions and deportation's effect on the labor market.
- The potential consequences of loose fiscal policy: Spiraling inflation or Japanification?
- My contrarian buy list right now.