The World Economy is Already Responding to the Presidential Transition

As the Trump administration steps up its transition planning, the details of its proposed economic policies remain unclear. During the campaign, Trump took multiple positions that were at odds with Republican orthodoxy on economics, slamming current and potential U.S. free trade deals, calling for possible tariffs on China, Mexico, and other countries, and vowing to unleash a wave of spending in America that could, he argued, bolster infrastructure and revive withering manufacturing industries.

Now, it seems unclear how committed Trump is to many of these promises. His infrastructure proposals may turn into more conventional plans, like credits for public-private building partnerships, that GOP congressional leaders have proposed in the past. His vows to push the Federal Reserve to raise interest rates---over which he has little actual control---and to launch new protectionist policies, have been rolled back somewhat in his few public speeches since Election Day.

But even before taking office, Trump’s ascendance has already triggered a counter-reaction in global trade and global business, showing that other countries are not going to wait for the new president to act to determine their economic futures.

For more on how other countries are already responding, economically, to the presidential transition, see my new piece for Bloomberg.