It has been eight days since President-elect Donald Trump secured a second term, defeating Vice President Kamala Harris in what was billed as the most important election in US history. Whether the hyperbole was accurate or not, the Trump effect was observed in the financial markets, which rallied as if it were the greatest day on the planet. Stocks roared, cryptocurrencies soared, and Treasury yields ascended to the heavens like a SpaceX rocket. Considering what has occurred in the last week, Trump’s victory may be more than just flooding Wall Street with green ink and boosting asset values. It could result in a seismic shift in the economy and marketplace.
Walking the Trump Effect Runway
Steve Madden is a $3 billion shoe company. Imports into the United States account for roughly two-thirds of the company’s business, with China representing nearly three-quarters of those goods. Based on a third-quarter earnings call, the Trump effect might alter the Steve Madden business model. According to CEO Edward Rosenfeld, the company is “planning for a potential scenario” that would “move goods out of China more quickly.” Rosenfeld estimates that his organization could reduce imports from China by as much as 45% over the next year ahead of the president-elect’s promise to implement sweeping tariffs.
“As of yesterday morning, we are putting that plan into motion, and you should expect to see the percentage of goods that we sourced from China to begin to come down more rapidly going forward,” Rosenfeld told analysts and shareholders on Nov. 7. “If we are contemplating a new policy where there are significant tariffs on China, that’s going to have all sorts of wide-ranging implications not only in the supply chain, but the overall economy.”
Other domestic and foreign businesses have also weighed in on Trump’s proposed expansion of the tariff model. Ralph Lauren, for example, was not too concerned because the brand stated it has diversified its supply chain and sourcing since the onset of the pandemic. Tapestry, a parent company of Coach and Kate Spade, has also expressed little worry since only 10% of its overall sourcing emanates from China. BMW is not “nervous about what might happen,” downplaying potential consequences from the incoming administration’s tariffs.
Potential Cabinet picks have not been as forceful about tariffs as the soon-to-be 47th president. Howard Lutnick, the Trump-Vance transition co-chair, asserted on CNBC that it could be a negotiating tactic that could result in fairer trade. Steve Bessent, a Wall Street veteran who could be tapped as the next Treasury Secretary, preferred tariffs be “layered in gradually” to offset price inflation that disinflation policies would cancel out.
Economic literature disapproves of tariffs as they tax businesses and consumers. However, the early results appear favorable based on what Trump and his team attempt to accomplish on the trade front.
De-Dollarization No More?
Liberty Nation News has detailed in length the global de-dollarization initiative launched by China and Russia more than a decade ago. While the greenback remains the internal reserve currency, its hegemony has eroded over the last 25 years, fueled by the anti-West alliance of developing countries. Since the war in Ukraine, the coalition of emerging markets known as the BRICS has employed strategies to dethrone the king dollar. But are dollar adversaries having a change of heart?
(Photo by Fernando Gutierrez-Juarez/picture alliance via Getty Images)
In a recent sit-down interview following Trump’s electoral victory, Russian President Vladimir Putin admitted that Moscow will not abandon the US dollar. Instead, Russia is “simply refusing to use the dollar as a settlement tool.” He noted that BRICS proposals “are not aimed against [the] dollar. This is simply us rising to the challenge of modern times, in response towards the development of the economy we are thinking.”
Meanwhile, over the past week, the Trump effect was seen in the dollar’s performance in the global financial markets. The US Dollar Index (DXY), a gauge of the buck against a basket of currencies, has risen about 1%, lifting its year-to-date rally to nearly 5%.
It is a case of the good, the bad, and the ugly. First, market watchers say the dollar’s momentum was fueled by expectations of greater demand for the greenback amid tariffs. Second, investors fear widespread tax cuts could exacerbate the nation’s debt and deficits, resulting in higher Treasury yields that further appreciate the dollar. Finally, the Federal Reserve may pause interest rate cuts if tariffs lead to price pressures, leaving rates higher for longer.
Media Upsets
Are CNN and MSNBC doomed?
During the company’s third-quarter earnings call, Comcast President Mike Cavanagh recently revealed that it is exploring a possible separation, spinoff, or sale of MSNBC and other brands. While nothing is concrete, Kavanagh noted that Comcast will “study” the situation and determine what is best.
“Like many of our peers in media, we’re experiencing the effects of the transition of our video businesses and have been studying the best path forward for these assets,” he said. “We are not ready to talk about any specifics yet, but we’ll be back to you as and when we reach firm conclusions.”
According to Nielsen Media Research data, MSNBC’s primetime viewership cratered by 54% following Trump’s successful re-election campaign. After drawing a daily average of 1.1 million viewers in October, the audience plunged to a daily average of 736,000 in the three days after Election Day.
Reports are everywhere that CNN boss Mark Thompson is set to lay off hundreds of personnel. Additionally, the company could request sizable cuts to the immense salaries of network stars, including Anderson Cooper ($20 million per year), Erin Burnett ($6 million), and Kaitlan Collins ($3 million). This comes as Chris Wallace confirmed he was leaving CNN after three years and will turn to podcasting.
CNN’s election night coverage, co-anchored by Cooper and Jake Tapper, plummeted 44% compared with the 2020 election, as 5.1 million viewers tuned in to the network’s reportage of the 2024 election results.
Leftist Meltdown
The Trump effect might also be supporting hilarious content creation.
Social media has been abuzz in the wake of Trump’s victory as progressives have engaged in perfectly normal behavior. Several liberal households have recorded themselves seeking refuge in Canada. Women are shaving their heads and joining the 4B movement that involves no marriage, dating, or childbirth. Many White Dudes for Harris have revealed they are getting in shape to protest the president-elect. The ladies on The View and MSNBC cannot stop calling Latinos racist and black men misogynists.
X has turned into a library for comedy featuring a meltdown on the left.
More to Come?
In the 2016 election, Trump promised that the United States would complain that it was winning too much. This became the subject of a sketch on Saturday Night Live. Will this become a theme two months before Inauguration Day? It has been just one week since Trump was declared the victor in the presidential contest, and his MAGA fanbase may be pleased by the results before he even returns to the White House.
