Dr. Jens Ehrhardt, a renowned figure in the stock market, issues a caution: "Prepare to invest in specific stocks if Trump secures victory."
In the world of finance, the potential return of Donald Trump as president has sparked discussions about its impact on the stock market. Dr. Jens Ehrhardt, a renowned economist, shares his insights on this topic.
If Trump were to become president again, the stock market impact may initially involve volatility, particularly related to trade policies such as tariffs. However, equity markets have shown resilience and continued growth recently under his administration. Conversely, a presidency under Kamala Harris would likely be evaluated on a different approach to deficits and economic policies, with an emphasis on fiscal management and regulatory factors, but recent detailed data comparing her specific influence on stocks and deficits is not directly available.
Under Trump's presidency, the dollar is expected to rise, according to Dr. Ehrhardt. This trend is partly attributed to strong corporate earnings and optimism around transformative tech sectors like AI. Notably, major U.S. indices like the S&P 500 have risen significantly in 2025, despite tariff-related "chaos" and trade tensions.
The driving force behind the strong economy and the rise in the stock market, Dr. Ehrhardt suggests, is the large amount of government debt taken on by Americans and to some extent Europeans, particularly southern Europeans. This debt, he argues, has pumped billions of new funds into the system, supporting corporate profits and the stock market.
However, Dr. Ehrhardt remains skeptical about German stocks, as the MDAX, which represents medium-sized German companies, is weak due to its heavy dependence on the German economy. In contrast, the DAX, which is very international, is performing better.
Dr. Ehrhardt indicates that the political and fiscal policies have become significant stock market factors under Trump's presidency. If Trump wins the election, he predicts a potential increase in deficits to around 4 trillion dollars. With such deficits, there could be tax cuts, which could potentially drive the stock market higher.
Despite the rising deficits, Dr. Ehrhardt notes that there were no monetary reasons for the strong stock market gains. Instead, he predicts that capital will flow more to America if Trump becomes president, leading to a potential rise in the stock market.
However, if Harris becomes president, Dr. Ehrhardt suggests that government deficits could potentially decrease if she raises taxes. This could have a different impact on the stock market, as it would represent a shift in economic priorities.
In summary, Trump's presidency has been associated with market rises amid volatility caused by tariff policies and strong tech-sector investments, which may drive long-term gains despite economic headwinds. Detailed comparative effects of a Harris presidency on deficits and stock markets are not available at this time.
Investing in the stock market under a potential second term of President Trump could initialy involve market volatility, particularly due to trade policies like tariffs. However, the equity markets have shown resilience and continued growth in this administration.
If President Trump wins the election, Dr. Ehrhardt predicts a potential increase in government deficits to around 4 trillion dollars, which could be offset by potential tax cuts, driving the stock market higher.
