As we look ahead to 2025 and the upcoming November elections, it’s clear that there are many uncertainties facing investors and the economy. With the possibility of a new administration taking over next year, it’s important to consider how different policies and political changes could impact the markets.
While we may not have a definitive guide to predict the future, it’s helpful to consider some possible scenarios. For example, if the GOP were to win the election, we might see a continuation of the 2017 Tax Cuts and Jobs Act, along with further reductions in corporate taxes and potential tariffs on imports. These policies could benefit businesses and Wall Street in the short term, but they could also contribute to rising deficits and debt in the long run.
On the other hand, if Vice President Kamala Harris were to win and roll back the Trump tax cuts, we could see an increase in corporate taxes and stricter regulations on businesses. While this might not be favorable for the stock market, it could help address income inequality and reduce the deficit.
Given the historical trend of the first year of a presidential cycle being challenging for the stock market, it’s wise for investors to consider locking in profits and setting aside rainy-day funds. This can help hedge against unexpected events and policy changes that could impact the markets.
As we navigate the uncertainties of the upcoming elections and their potential impact on the economy, it’s important to stay informed and prepared for whatever the future may hold. By considering different scenarios and taking proactive steps to protect our investments, we can navigate the challenges of 2025 with confidence and resilience.