
Trump has defied the odds and silenced his critics. Today, he will be sworn in as the 47th President of the United States, marking a historic comeback. Despite spending four years outside the White House, the limelight has rarely left him. Twice impeached and now a convicted criminal, few believed he could stage such a return. This inauguration marks only the second time since 1897 that a president will serve two non-consecutive terms.
Over the weekend, Trump celebrated the occasion with a lavish party at his Virginia golf club. Addressing his supporters, he declared, 'Tomorrow at noon, the curtain falls on four long years of American decline, and we usher in a new era of strength, prosperity, dignity, and pride.
“We’re going to stop the invasion of our borders,” Trump promised. “We’re going to unlock the liquid gold that’s right under our feet ... We’re going to bring back law and order to our cities ... We’re going to get radical woke ideology the hell out of our military.”
Trump has promised to act swiftly as he returns to Office. He has expressed unshakable optimism about his economic agenda. "We’re on the brink of a great, beautiful golden age for business," he proclaimed from the podium at Mar-a-Lago earlier this month.
Trump on Inflation
Trump has vowed to address inflation by expanding US oil and gas production. However, the factors that drive energy prices are not entirely within the president's control.
He has promised that “prices will come down.” Reducing inflation doesn’t actually lower prices, it merely slows the rate at which they rise. Prices, typically, only fall during an economic crisis, a scenario that is hardly one Trump would want to promote.
Trump On Tariffs
Another of his central promises is to place higher tariffs on goods coming into the country. He has said that a 10% tax on all goods will be put in place, and this will rise to 60% for products from China. Some advisors suggest that this will be used as a negotiating tool, and suggest that Trump is likely to settle for lower tariffs if other issues such as border security meet certain agreements.
These tariffs may undermine Trump’s inflation goals, as higher tariffs could result in increased prices for American consumers. The consequences are already becoming evident. According to Oxford Economics, even the debate over tariffs is creating uncertainty, which is impacting investment and slowing economic growth.
Trump On Taxes
Trump has vowed to reduce taxes. However, this may lead to inflation rising as increased borrowing will be necessary.
Michael Steele, a former chair of the Republican National Committee, said: “It feels different because they’re smarter, they’re faster, they’ve had four years to plot and plan. They have weakened the infrastructure in critical areas like law enforcement and the Department of Justice.
“I don’t think Democrats are prepared to deal to with what’s about to be thrown at them, starting on inauguration day. The executive orders and actions that will be taken in the time that Donald Trump is giving his inaugural speech will shock people and I don’t think they are ready for that.”
There’s another key distinction, the world's billionaires are backing Trump. Elon Musk, the world’s wealthiest individual, reportedly spent $200 million to help secure Trump’s election and has since emerged as a key adviser on the Department of Government Efficiency (Doge), a non-governmental task force. This support from high-profile business leaders signals a significant shift in the way corporate elites are engaging with politics, which could have major implications for future policy. Musk will be joined by notable figures such as OpenAI’s Sam Altman, Amazon’s Jeff Bezos, TikTok’s Shou Zi Chew, Apple’s Tim Cook, Google’s Sundar Pichai, and Meta’s Mark Zuckerberg at the inauguration.
So what will the economic future of America look like under Trump 2.0?
It is hard to say. There was an initial rush of excitement after his victory, and the stock market reflected that. The Russell 2000 Index jumped 5.8% on the day after the election. Shares of energy companies also caught a post-election bid based on Trump’s “drill-baby-drill” stance on oil and gas production. The S&P 500 Energy Index climbed 3.5% on Nov. 6 for its best session in a year, and rose 6.5% from Election Day through Nov. 22. Since then however, it’s been on a turbulent ride, losing 3.2% amid fears of oversupply, tariffs and economic growth. However, once momentum resided so too did the stock market.
A great deal will be learned by the end of today, as the events unfold and the true impact of Trump’s return to office begins to take shape. The decisions made today could offer valuable insights into his economic policies, his relationships with business leaders, and the direction of his administration moving forward.
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