As the US approaches a presidential election, many people are looking at the candidates and how they might affect the economy. Hillary Clinton, in particular, is creating some panic among investors. While she locks in the Democratic nomination, people question a Clinton presidency in regard to Wall Street regulations, taxes, trade and wages. Will she have a centrist approach like her husband? Alternatively, will she take a more liberal stance like president Obama? With current polls showing her slightly ahead of Trump in a Trump-Clinton election, it is important to look at how she would run the country and impact the economy.
Let’s take a look at what Hillary says she will do if she wins the presidential election. Assuming these measures pass in Congress, we will also examine how these standards would affect the economy.
She is not looking to break up the nation’s largest banks, like her Democratic opponent Bernie Sanders. However, she does want to impose stricter regulations on Wall Street. After the 2008 financial meltdown and a 17% unemployment rate, people are calling for tougher Wall Street enforcement. Even some Republicans, who were negatively impacted by the crisis, want more regulations in place to protect their investments. The American people are hostile toward financial institutions, and it would be nearly impossible for anyone to get elected supporting Wall Street.
Dodd-Frank Wall Street Reform and Consumer Protection Act
Clinton supports this reform, which is a set of federal regulations, impacting financial institutions and their customers. The Obama administration passed these provisions in 2010. It is intended to reduce risk in various areas of the American financial system.
This is just one example of Clinton’s agenda to tighten restrictions. While increased regulations may appeal to some people, it has Wall Street very concerned. Clinton claims that she does not intend to upset Wall Street and financial institutions. However, a potential Clinton presidency causes great concern for these groups. When people become frightened, the markets get volatile. This could be devastating for the US stock markets and investors.
This is by far the biggest threat to investors. Clinton has several plans to change current tax code. She intends to raise taxes on short-term capital gains and put an end to the earned interest “loophole” which allows hedge funds and money managers to have their fees taxed as capital gains rather than regular income. Additionally, she wants to implement a 4% “surcharge” on people earning more than $5 million. Generally speaking, she will raise taxes among the wealthy and those who earn most of their money through investing. This could affect the average investor and the economy as a whole. Raising investment taxes simply discourages investing. Additionally, if we hold the “trickle-down effect” to be true, it could certainly negatively affect our entire economy.
Clinton has increasingly described herself as progressive and indicated that she plans to continue much of Obama’s agenda in this area. We can expect to see “more of the same” in regard to union organization, immigration, and wage increases. Many people believe the progressive approach to these issues has a negative impact on the economy. Raising wages, especially, could force many small businesses to shut down. Provisions that hurt business owners, injure the overall economy. Clinton’s agenda in the realm of jobs and wages is anything but centrist . Her radical liberal agenda in this area could be disastrous.
There is a good chance Clinton will not only win the Democratic nomination, but the presidency as well. In the face of this possibility, it is important to consider your investments and which options are safest. In order to protect your money from an economically devastating president, consider investing in precious metals. Invest in assets that can endure a Clinton presidency. Contact us for more information and assistance.