Singapore’s Temasek: Trump would not be good for world economy, financial markets

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As a seasoned crypto investor with a keen interest in global economics, I find myself carefully weighing the potential outcomes of the upcoming U.S. presidential election. With decades of experience under my belt, I’ve learned that every election cycle brings its own unique set of challenges and opportunities.

A Singapore-based investment company named Temasek has expressed worries about how Donald Trump’s election as U.S. President might influence the worldwide economic landscape.

As reported by Bloomberg, Rohit Sipahimalani, Temasek’s top investment officer, suggests that Donald Trump’s market-friendly positions on tax reductions and deregulation might initially attract investors. However, he cautions that Trump’s policies could potentially create tension in global economic growth over the long haul.

As the U.S. presidential election is just around the corner in a week, Sipahimalani points out that Trump’s policies may potentially pose challenges for both American and international corporations, particularly those with significant overseas ventures.

The Bloomberg report indicates that Temasek’s assessment contrasts with some pro-Trump investor sentiment. Notably, Standard Chartered recently predicted a Bitcoin (BTC) rally to $125,000 if a Republican government takes charge. 

While some view him as advantageous for stock markets and Bitcoin, Sipahimalani proposes that if Trump wins, it could bolster the U.S. dollar and increase interest rates, potentially causing difficulties in emerging markets.

The trade strategies implemented by Trump, such as tariffs, worry Temasek too, since these types of actions typically bring about unpredictability that might discourage international investments.

Significantly, the Republican nominee has seized an opportunity with the regulatory ambiguity in the U.S. crypto sector. He proposes to foster industry expansion by implementing policies like maintaining the nation’s Bitcoin reserves and dismissing the current chair of the Securities and Exchange Commission, Gary Gensler.

Currently, Elon Musk, a strong backer of Donald Trump, has proposed a plan to cut U.S. federal expenditure by a minimum of $2 trillion each year, should Trump secure the presidency.

According to rumors suggesting he might take on a cabinet position under Trump, Musk advocates for significant budget reductions to improve government spending efficiency and enhance overall economic stability.

His viewpoint mirrors Trump’s plan for economic restructuring, which involves the possible implementation of tariffs aimed at boosting income, even though economic experts caution that such measures might lead to increased expenses for American families.

From another perspective, Sipahimalani contends that Kamala Harris’s policies may prove advantageous for developing economies. Certain entrepreneurs, such as Mark Cuban, contend that Harris’s strategy is more likely to foster growth in industries centered on innovation, notably green technology and healthcare.

Yet, the Democratic candidate has yet to outline her strategies for growing sectors like cryptocurrency.

In spite of this, Cuban shows optimism that an administration led by Harris could stabilize and spur innovation in these sectors.

As a researcher, I find Temasek’s caution underscores their commitment to maintaining global economic stability. Aware of the far-reaching implications of U.S. policies, they are careful in their approach. With their ambitious $30 billion investment plan within the U.S., they recognize the pivotal role U.S. policy plays in shaping international markets.

Yet, it cautions about potential “long-tailed” risks emerging over the next few years, contingent upon the election results. These risks might stir up volatility that affects both international investors and businesses alike.

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2024-10-29 13:16