The US election financial storm hit, what will bring

Every four years a financial storm hits, why do we call it a financial storm? Those who are familiar with the US election know that the positions of the voters represented by the candidates on both sides of the US election are different, or even opposite, which leads to differences in governance policies. Therefore, the election of different people has different effects on financial markets. This election is expected to be the most expensive in American history. It's a "war of the billionaires," with the super-rich spending vast sums of money to influence the US election. This "gambling game" of the rich will be the culmination of the "money politics" in the United States. As of this week, Musk has contributed a total of $119 million to Trump's 2024 campaign cycle.

As one of the most important political events in the world, the result of the US election not only has a profound impact on the domestic political trend of the United States, but also may set off a global financial storm. The first is the impact on global financial markets, which tend to fluctuate sharply during the US election due to increased political uncertainty. Investors are likely to be cautious until the outcome of the election is clear, leading to more volatility in the prices of risky assets such as stocks and bonds. The outcome of the election may affect the trend of the US dollar exchange rate and the flow of global capital, and the policy propositions of different candidates may lead to changes in market expectations of the future value of the US dollar, which will lead to volatility in the exchange rate market. For example, if Trump is elected and pushes for across-the-board tariff increases, it could be detrimental to currencies such as the euro, causing the euro to fall against the dollar. If the election results lead to sharp market volatility, it could cause investors to reassess the risks and returns of global assets, thereby rebalancing portfolios and triggering changes in capital flows between countries.

Second, the impact on the US economy, the election result will lead to increased uncertainty about the direction of US policy. Different candidates may come to power with very different policy propositions, including fiscal, monetary, trade and many other aspects. The uncertainty of these policy changes could have profound implications for the US economy. It could also affect market expectations for U.S. economic growth. If the election results spark market optimism, it could boost economic growth expectations; Conversely, if the election results raise market concerns, it could dampen economic growth expectations. During the election period, business investment and consumer confidence can be affected by the outcome of the election. If the election results lead to increased policy uncertainty, it could dampen business investment and consumer confidence, thereby affecting economic growth.

The third is the impact on the global political pattern. The result of the US election may affect the foreign policy of the US, including the trade policy with China and the diplomatic strategy towards Russia. These changes are likely to trigger upheavals and adjustments in the global political landscape. If Trump is elected and continues to implement his trade protectionist policies, it may lead to a further deterioration of the global trade environment and trigger a trade war. This will be detrimental to global economic recovery and growth.Whichever candidate is elected, his or her trade policies could have far-reaching implications for the United States and its trading partners. Trump advocates across-the-board tariff increases and protectionist trade policies, while Harris is likely to implement a more targeted tariff strategy. These policy changes could lead to increased uncertainty in the global trade environment. Geopolitical risks could rise during the election. If the election results lead to an increase in regional tensions or the outbreak of conflict, it could lead to an increased risk of geopolitical conflict, with far-reaching implications for the global political landscape.

To sum up, the US election financial storm will have a profound impact on the global financial market. Investors need to pay close attention to electoral developments and policy changes, and adjust their investment strategies and risk management measures in a timely manner. At the same time, countries around the world also need to strengthen cooperation and coordination to deal with potential economic and financial risks.