Trump 2024: What His Presidency Could Mean for U.S. and Global Markets

With Trump back in the White House, major shifts in tech and trade policies are underway. As antitrust advocates and crypto-skeptics vacate their roles, Big Tech companies are breathing a sigh of relief - and so is the crypto world. Lina Khan, chair of the Federal Trade Commission (FTC), is rumored to be on her way out, which could greenlight delayed mergers and acquisitions. Elon Musk recently suggested that her departure is imminent, a sentiment that is gaining traction on social media and within investment circles. If these changes materialize, tech giants could enter a new phase of expansion.

For those invested in crypto, Trump's leadership brings hope. Gary Gensler, chair of the Securities and Exchange Commission (SEC) and a vocal crypto critic, is also rumored to be facing replacement. Bitcoin has already spiked in response to Trump's win, and some crypto advocates call this the dawn of a "Golden Age of Crypto." Trump's pro-crypto stance has also attracted powerful Silicon Valley allies eager to see clearer, friendlier regulation.

Yet, investors beware: Trump's first term wasn't all smooth sailing for Big Tech, as evidenced by the FTC's lawsuit against Google's alleged monopoly. This administration's track record could still make investment bankers nervous. If these issues escalate, tech-related stocks might see an uptick in volatility.

Federal Reserve Jitters: Powell vs. Trump

Just as Jerome Powell was celebrating a successful soft landing with inflation under control, Trump's win could mean turbulence ahead. The Federal Reserve recently made a quarter-point cut, following a significant rate reduction earlier this year, in an effort to manage inflation without stifling growth. However, Trump's policy goals - such as tax cuts, increased tariffs, and a pro-debt fiscal strategy - may fuel inflationary pressures that put Powell's efforts at risk.

Economists are already predicting that the Fed will be cautious about future cuts, even though Trump's policy shifts might demand a looser monetary approach. Jeffrey Roach, Chief Economist at LPL Financial, notes that markets must adapt to Trump's pro-growth, deficit-widening policies with a clear focus on managing investor expectations.

Another layer of complexity is Trump's historical stance on the Fed's independence. While he has stated he won't remove Powell prematurely, he is likely to appoint a new Fed chair in 2026, and the "independence" question could become a hot-button issue. Trump's rhetoric has hinted at more direct influence over monetary policy, raising questions about the balance of power between the Fed and the Oval Office. Historically, such influence (e.g., Nixon's influence over the Fed) has led to economic turmoil, a reminder that investors and policymakers alike would do well to monitor this evolving relationship.

Booming M&A Activity Under Trump's Regulatory Reset

Trump's pro-business approach is also expected to ignite the mergers and acquisitions (M&A) market. During his campaign, Trump expressed a commitment to overhaul top regulatory positions, targeting the heads of both the SEC and FTC. In a recent statement, Goldman Sachs Chief U.S. Equity Strategist David Kostin projected a 20% increase in M&A activity by 2025. This contrasts starkly with the 15% decline we've seen this year, and it suggests a return to robust deal-making conditions, fueled by lower regulatory barriers and market stability.

A more favorable environment for IPOs could also emerge, as many companies delayed public listings due to unpredictable financial conditions. Kostin's projections indicate that these conditions will improve, thanks to economic growth, loose financial policy, and reduced volatility in equity markets. A Trump administration could expedite IPOs, leading to increased liquidity and opportunity in financial markets.

For investors, a rebound in M&A activity could mean a stronger market for equities, especially in tech and energy. Companies that are cash-rich may pursue acquisitions to capitalize on favorable conditions. For those eyeing IPOs or major stock plays, 2025 could be the year to watch.

Global Markets Brace for High Tariffs and New Trade Policies

Trump's tariff-heavy approach to foreign policy is back in play, and the implications for global markets are significant. His proposal to impose a 60% to 100% levy on Chinese products, along with a 10% levy on other imports, is fueling global economic uncertainty. Goldman Sachs has already adjusted growth forecasts for European nations, anticipating slower GDP growth in the Eurozone due to potential disruptions in trade.

Germany, whose largest export market is the United States, could see its car industry suffer under heavy tariffs. European GDP is projected to grow at only 0.8% next year, down from an earlier forecast of 1.1%. Mexico, whose economy is closely tied to the U.S. as its largest trading partner, may experience a GDP decline of up to 1.9%.

On the domestic front, U.S. businesses that rely on imports are likely to pass on the higher costs to consumers, resulting in higher prices across various sectors. Retaliatory tariffs could further impact American companies with strong overseas markets, especially those tied to European economies.

Crypto's Golden Age? Trump's Support Signals Boom for Digital Assets

Trump's unexpected pro-crypto stance has already made waves, especially among digital asset investors. The value of Bitcoin rose significantly on news of his win, and industry leaders are forecasting that his administration could usher in a period of mainstream crypto adoption. Matt Hougan, Chief Investment Officer at Bitwise, calls this the beginning of a "Golden Age of Crypto," expecting it to attract greater institutional investment and encourage innovation in financial services.

Trump's promises for the crypto world include creating a national "strategic reserve" of Bitcoin and ensuring future mining operations are U.S.-based. He is also committed to supporting the Digital Commodities Consumer Protection Act, which would move crypto regulation to the Commodity Futures Trading Commission (CFTC) instead of the SEC.

However, with Trump's unpredictable policy-making style, the crypto industry is keeping a close eye on him. While his current stance looks promising, his historical skepticism leaves room for uncertainty. Crypto investors might see an opportunity but should brace for volatility, as Trump's administration will undoubtedly impact the fast-evolving digital asset space.

The Verdict: How Trump's Policies Could Impact Your Portfolio

From tech giants to crypto investors and everyone in between, Trump's return could significantly reshape U.S. and global markets. His policies on trade, tech, and crypto regulation promise substantial opportunities and risks. For those looking to hedge against potential inflationary pressure, investing in commodities or alternative assets could be prudent. For more aggressive investors, sectors such as tech and digital assets might present growth potential under Trump's pro-business policies.

For now, the best strategy is to remain nimble. The global economy may be entering uncharted territory, and Trump's presidency could accelerate changes that redefine international trade, monetary policy, and the digital landscape.