What to look for when the era of Trump 2.0 begins
United States President Donald Trump during the 60th Presidential Inaugural Rally at Capital One Arena on Sunday, January 19, 2025 in Washington, DC.
Al Drago Bloomberg | Getty Images
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What you need to know today
Trump declared a national emergency.
US President Donald Trump said on Monday. Declaring a national energy emergency — part of a sweeping agenda aimed at increasing fossil fuel production — would end what he calls the “Green New Deal” and withdraw America from international commitments to fight climate change.
An optimistic view of Trump’s tenure
Trump’s return to the White House has raised concerns about tariffs and unpredictable foreign policies in some countries. But people in many other countries are optimistic about Trump 2.0, according to research by the European Council on Foreign Relations. An international opinion On Wednesday.
$MELANIA AND $TRUMP
First Lady Melania Trump launched her own meme coin called “Melania” on Sunday evening. The token is currently trading at $4.20, down from a high of $13. On Friday, Trump also announced a meme coin called “Official Trump.” At the peak of the tokens’ value, the Trump family’s fortune has risen by billions of dollars, based on its newly launched holdings of digital assets.
Biden’s apology
Former US President Joe Biden has granted pre-pardons to several family members, citing fears they could be targeted in “baseless and politically motivated investigations”. Biden on Jan. 6 apologized to members of Congress who investigated the Capitol riots and others he called “baseless” threats to political causes, including Anthony Fauci, Gen. Mark Miley, and others.
The euro and sterling are encouraged against the dollar
US markets were closed Monday for Martin Luther King Jr. Day. Pan-European Stoxx 600 index It increased by 0.05%. of Euro And British pound The dollar strengthened after Trump announced that he would not impose tariffs on US trading partners on his first day in office.
(PRO) The first echo for the second time?
Some on Wall Street say Trump’s second term could have the same effect on certain asset classes as his first term. To find out, CNBC Pro looked at the performance of several assets during the first 100 days of Trump’s last presidency and asked analysts how those assets would fare.
Bottom line
Tariff
“To me, the most beautiful word in the dictionary is ‘tariff,'” Trump told the Economic Club of Chicago in October. On the campaign trail, Trump promised to impose tariffs of 20% on all imports into the US, 25% on goods from Canada and Mexico, and more than 60% on Chinese imports.
Tariffs are imposed by governments to ostensibly protect domestic industries. Companies that import goods are mainly taxed by increasing costs. This leads them to look for local suppliers instead.
As supply chains are globally integrated and much of the manufacturing is done outside the US, companies may find it difficult to move production to local shores. The higher cost will probably be passed on to the consumer in the form of higher prices.
In other words, tariffs can cause more inflation.
displacement
“The invasion of our country will stop,” Trump promised supporters at a graduation event titled “Make America Great Again.” Like tariffs, strict immigration policies — or outright deportations — are typically aimed at protecting the domestic economy (among other reasons).
The theory is, the fewer people competing for each job opening, the easier it is to find a job.
But many parts of the U.S. economy, such as construction and agriculture, are dominated by undocumented immigrants, taking jobs that aren’t needed by residents. Even documented immigrants are vital to high-skill sectors like tech — as evidenced by Elon Musk’s clash with Trump supporters H-1B visas.
If reliable sources of labor disappear overnight, companies will have to raise wages to attract talent, which could reignite the dreaded wage-price spiral.
Other policies
Trump has promised several other economic measures, such as corporate tax cuts, legalization of cryptocurrency, and green energy subsidies.
Tariffs, however, may have the greatest impact on the global economy and financial institutions.
— CNBC’s Sam Meredith, Ryan Ermey, Annie Nova, Rebecca Picciotto, Evelyn Cheng and Lim Hui Ji contributed to this report.