JPMorgan stated that if Trump makes policy changes in taxation, deregulation, and cryptos after taking office, the first two years of Trump's second term could be quite influential; If the Republican Party is able to win the majority of seats in both the Senate and the House at the same time, it means that his policy bills will sail smoothly through Congress before the next midterm election.
November 11th, Caixin News (Editor Liu Rui) With Trump winning the U.S. presidential election, Wall Street investment banks have begun preparing in advance for the market impact of Trump's return to the White House.
On Sunday, Eastern Time, Stefan Gratzer, Managing Director of JPMorgan Private Banks, stated that if Trump makes policy changes in taxation, deregulation, and cryptos after taking office, the first two years of Trump's second term could be quite influential.
Preparing for Trump 2.0
After Trump won the election, many people began to optimistically believe that as the Federal Reserve tends to cut interest rates, Trump's growth-promoting promises based on tax cuts and deregulation will bring another round of stimulus to the U.S. economy. Many anticipate that Trump's policy commitments (including a series of tax cuts) will accelerate economic growth, bringing new business to lending institutions.
Gratzer stated that Trump's tax reduction plan is crucial. "If you buy stocks in a company, you are clearly buying their future profits after tax deductions. If tax rates are lowered, your stock prices will rise. I think this is what we saw last week."
Gratzer also mentioned: "One truly unique aspect of Trump's policies is about cryptos, so let's see how it will develop, this could be a completely new development, and no one knows what this will mean. In addition, there is a lot of discussion about deregulation now, which is clearly advantageous for banks like us, but we need to take another look."
The first two years will be a critical period
Glaser also specifically mentioned that the Republicans in the United States retook control of the Senate in last week's election and are expected to maintain a majority in the House of Representatives. If the Republicans can win the majority in both the Senate and the House, it means that Trump's policy bills will sail smoothly through Congress in the first two years of his tenure - before the next midterm elections.
"Obviously, at the moment, both the House and the Senate are now on his side, so we may see this direction over the next two years," Glaser said. "But after the 2026 midterm elections, doing these things may not be so easy."
As of the time of drafting, the Republicans in the Senate have won 53 seats, securing control of the Senate; at the same time, the Republicans in the House of Representatives have already obtained 213 votes, only one step away from the halfway mark of 218 votes.
In fact, although Trump has not taken office yet, the market influence of his policy stance on monetary policy has already emerged. This past Sunday Beijing time, Bitcoin has surpassed the $0.08 million threshold for the first time in history, indicating that Trump's victory has further strengthened the bullish confidence of Bitcoin investors.
