The G20 summit took place in Bali, Indonesia, on November 2022…
USD: Trump, Biden, and the future
Information is not investment advice
Another US Presidential debate took place on Thursday. Donald Trump and Joe Biden faced each other over central questions of American social issues, economics, and foreign policies. What are they and where each candidate is planning to steer the country?
Both candidates were happily accusing each other of falling under “Russian influence”. Both were reassuring the public that their opponent was having “extra” benefits from China. Joe Biden went as far as to say that Donald Trump befriended with the North Korean leader instead of duly putting the latter into a “duly” position as he ought to do. From this exchange, we are getting that Joe Biden – should he become a president and follow his words – comes as a more ideologically strict politician who divides the world into clear camps. Two, precisely: “liberty, freedom, and democracy” – that foes for “good” countries such as the USA, the UK, France, and their peers (in the developed world, most probably); and “autocracy, domination, and force” – that goes for “bad” countries such as Russia, North Korea, Iran, and others (China goes here as well but it is too rich to be recognized as just “bad” – probably, there is a separate category in Joe Biden’s vision for countries like this). In the meantime, Donald Trump, as verbally blaming as he sometimes is, appears to be more of a trading approach, a business approach in a multipolar world. Well, maybe the world is not prepared yet to become multipolar, or maybe it is not supposed to be multipolar – we’ll see. The bipolarity of Biden is so far winning over the multipolarity of Trump by an average of 8% across the US. This would very much affect the USD over other currencies. Specifically, against what many say, there may be a higher probability that the USD loses value in the case of Joe Biden’s victory. Primarily, that’s because that will be a change of direction in the US policies that brings uncertainty: it may force investors to look for other currencies to keep their funds. Second, Joe Biden suggests many programs that require quite a lot of money – much of which will be injected into the US economy if Joe Biden follows his words. More money – less value. There are other implications but probably that will be too much for one article. In a nutshell, it is unlikely that the USD will just stay steady where it is of Joe Biden comes to reside in the White House.
Will the EUR/USD rise above the trend on the USD uncertainty?
Joe Biden said that by 2025 (or 2030, doesn’t really matter) he wants to see the US with zero net gas emissions, etc. He sees renewable energy taking over the oil industry as the energy basis of the economy. Transitioning from oil is his proposition. Trump was very doubtful about that entire approach. He didn’t hesitate to say that this “transition” would be killing for Texas, Oklahoma, and other states that basically live off oil profits in the US. But leaving the debate aside, how realistic is it, in general, to transition to renewable energy 100%? Especially, windmills that Joe Biden is so fond of? And on top of that, how realistic would be all that to complete in a 5-year or 10-year term? Trump, as “un-green” as he may be, was factually correct to state that the US became energetically independent from other countries on his watch. The “transition” from the oil industry may not only destabilize that status but also destabilize the oil market in the world. OPEC may be happy about it though: if the US cut their oil production, there will be more space for the OPEC to market their oil. Prices may go higher.
Can Joe Biden's plan push oil into higher zones?
Obviously, Trump stands by the stock market, and the stock market stands by Trump. Biden is like from another room. By saying “the idea that the stock market is booming is his only measure of what’s happening” about Trump, Biden recognized that the stock market and the corporate world, in general, will not be his first priority should he become the US President. Meaning, that’s just another facet in Joe Biden’s stance against how the corporate world enjoys low taxes, high profits, and booming stock prices. Donald Trump explicitly said that the stock market will fall if his opponent wins the election. Indeed, many observers predict such an outcome if Joe Biden wins. Well, you know how to buy the lowest lows right?
How deep may the S&P fall is Donald Trump loses?
The deafening news shocked the whole world yesterday: the British Queen Elizabeth II died peacefully at the age of 96…
After months of pressure from the White House, Saudi Arabia relented and agreed with other OPEC+ members to increase production.
This week, there are a few high-probability trade ideas I'd like to recommend to you. Trading these setups, be sure to implement a proper risk management approach.
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates? Recall that the Federal Open Market Committee had previously ended the year 2022 with a 50bps hike, and an indication from Powell, the committee chairman, that the Fed could consider raising interest rates by 75bps in the course of the year 2023.