3 Shifts Edition (Nov 8 2024): Tariffs and the economy under Trump, Cutting China out of supply chains, The auto industry’s trials and travails

6Pages Market Shifts

Hi everyone – what a week! Welcome to your [AI-generated] post-election 3 Shifts Edition. The coming transition will shift the market in many ways, but with control of the House still up for grabs, we’ll try to focus on what we know.

Our first Shift looks at the tension between this week’s market optimism and the expected new tariff regime, which are likely to be inflationary. The US president has powers delegated from Congress to institute tariffs, which means the ball could get rolling on this from Day 1.

Next, the promised tariffs are likely to accelerate the ongoing shift of supply chains away from China. This week saw reports of US shoe and drinkware brands, drugmakers, and chip-equipment manufacturers all making moves to cut their supply chains’ exposure to China.

Finally, this week’s election will shake up the already-strained auto industry even further. Even for US automakers, the election isn’t all good news. Tariffs on vehicles and parts imported from Mexico represent risk, and EV makers will likely take a hit from new policies. Some automakers are already considering doubling down on manufacturing in the US market.

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Enjoy.
– Tam