Beyond Politics: Investor Implications of the US Election
Welcome to this week’s issue of Notes to Selfe Publication where we curate insights, trends, and investment opportunities relating to The Future of Women’s Health.
Red or Blue?
The US election is just around the corner, and the pundits and bookmakers are buzzing with predictions and opinions on who might come out on top.
But for investors, the real question isn’t about who’s sitting in the Oval Office—it is about the policies they will bring and how those could reshape the economic landscape.
From government spending to healthcare reform, here are four key areas that I believe every investor should watch closely as the new administration takes shape.
1. Fiscal Dominance and Corporate Taxation
Fiscal dominance may sound like a technical term, but it’s rather straightforward. It is when government spending and taxation start to have a stronger pull on the economy than the Fed’s interest rate moves. With both candidates’ proposals, fiscal dominance is set to increase, but in very different ways.
Kamala Harris has laid out a plan for higher corporate taxes, which she argues would support tax credits for lower-income families and other social programs. While this could bring welcome relief to many households, it also means the government would be more deeply involved in shaping economic outcomes.
On the flip side, Donald Trump is leaning toward corporate tax cuts, focusing on stimulating private sector growth by putting more money back into businesses. While this could mean higher profits for companies in the near term, it also comes with trade-offs—mainly in the form of larger deficits if spending isn’t curtailed elsewhere.
Investor Implications: Corporate tax changes directly affect the profitability of businesses especially in sectors highly sensitive to tax policy, such as technology, healthcare, and energy. Higher corporate taxes could lead to a reduction in corporate profits, impacting stock valuations, while lower taxes may provide a short-term boost in profitability.
2. Debt Levels
The US national debt is already at 99% of GDP, with projections suggesting it could rise significantly over the coming decade. The debt-to-GDP ratio reflects how much the government owes relative to its economic output, and excessive debt can limit the government’s financial flexibility, especially in times of crisis.
According to estimates, Harris’s policies could push this ratio to 133% over the next ten years if additional fiscal spending measures are adopted. On the other hand, if Trump’s policies are implemented, debt could reach 142% of GDP, largely driven by lower tax revenues combined with high spending. While both approaches have distinct economic philosophies, they both present a similar long-term outlook of debt over-extension.
Investment Implications: Rising national debt can lead to higher inflation as the government might have to print more money to finance its liabilities. Inflation erodes purchasing power, and in response, the Federal Reserve could raise interest rates, affecting fixed-income investments and potentially creating volatility in bond markets. A weakened dollar might benefit commodities and certain real estate investments, as these assets tend to perform well when inflation rises. On the flip side, traditional fixed-income investments may suffer as inflation reduces their real return.
3. Healthcare Reform and Funding
Healthcare is a significant issue for both candidates, and their approaches could lead to different impacts on the healthcare industry and beyond. With the US healthcare system already stretched, both parties are seeking ways to make it more accessible and affordable, which could affect funding, costs, and innovation across the healthcare sector.
Kamala Harris is pushing for expanded Medicare coverage and reduced prescription drug costs. If implemented, these changes could pressure pharmaceutical companies and healthcare providers to reduce costs, potentially affecting profit margins. Donald Trump, however, tends to favour private sector solutions with deregulation as a primary tool, which could benefit private healthcare providers and insurers but might reduce government funding for certain public health programs.
Investment Opportunities: Rising healthcare demand, especially with an aging population, presents opportunities for investors in healthcare technology, biotechnology, and wellness sectors. Companies focused on innovative solutions to healthcare challenges, such as remote patient care, affordable diagnostics, and digital health, could see substantial growth.
Additionally, women’s health—an area often underserved—stands out as a resilient and high-growth sector. Solutions for maternal health, preventive care, and women’s mental wellness are in demand and present a meaningful investment avenue for socially conscious investors.
4. Climate and Sustainability Investments
Climate policy is another area where the candidates diverge, and the outcome of the election will likely influence the renewable energy sector and broader sustainability initiatives.
Harris is committed to net-zero emissions, green energy investments, and strict climate regulations. These policies could create significant investment opportunities in renewables, electric vehicles, and sustainable technologies. On the other hand, Trump’s focus is on traditional energy industries, with an emphasis on deregulation. While this may benefit oil, gas, and fossil fuel companies in the short term, the long-term shift toward a global green economy remains a factor to consider.
Investor Implications: Green tech and renewable energy companies could see substantial growth if climate policy becomes a national priority. Even in healthcare, sustainable technologies that reduce environmental impact are gaining traction and aligning with climate goals. This intersection of healthcare and sustainability is another potential investment avenue, especially as demand rises for environmentally friendly healthcare solutions.
Final Thoughts
Regardless of the election outcome, the fiscal landscape is challenging. Debt levels are already high and there are competing demands for government funding across healthcare, climate, and infrastructure. For investors, this means that private sector opportunities will be critical to close gaps in areas where public funding may fall short.
Women’s health, in particular, presents a resilient and impactful investment opportunity. It’s an area that’s often underserved, with demand for solutions in maternal care, preventive health, and mental wellness growing each year. Investing in women’s health aligns with both social impact goals and the increasing need for accessible, comprehensive care.
In a time of political uncertainty, focusing on sectors with long-term growth potential, like women’s health, offers investors a way to make a meaningful impact while benefiting from stable growth.
My Substack Highlight this Week 🔦
The Demonisation of Rest by Benjamin Antoine
Benjamin’s journey starts from a deep passion for writing to burnout and subsequently rediscovering the importance of rest.
“I would feel an uncomfortable sense of unease when I was not working towards my goals”, Benjamin writes.
He explore how cultural factors, such as the Protestant work ethic and capitalism, have led to guilt around taking breaks, and offers practical steps for building rest into daily routines, and learning to say no without guilt.
If you have ever felt guilty for slowing down or taking breaks, this is a must-read.
The demonisation of rest represents a sickness in modern western society, one that prioritises productivity over well-being
Read the full article above and follow and subscribe to his newsletter.
Have a great week,
Maryann
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