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Donald Trump stood on Wall Street on Thursday, before a euphoric crowd of America's economic elite gathered before him, and rang the bell to kick off morning stock trading.
The atmosphere was festive. Not only has the president-elect just been named Person of the Year by Time, but the stock market, already rising sharply, has reached new heights since his election.
For Trump, whose public appearances have been relatively subdued since his election victory last month, the visit is a reminder of the high value he places on market sentiment.
But it remains to be seen whether history will regard its appearance as a timely heralding of a new economic boom – or as the death knell.
Trump comes to power with an American economy which, according to the recent words of the head of the American central bank, Jerome Powell, is the envy of many other countries, with solid growth of 2.8%, unemployment close to the lowest historical 4.2% and that mysterious ingredient called “productivity” on a tear.
These factors combined have pushed U.S. stocks to record highs: the Dow Jones Industrial Average is on track to finish the year up more than 17%.
The S&P 500, a larger index made up of the 500 largest U.S. companies, has jumped 28% since January, while the Nasdaq, where technology companies have a large presence, is up more than 40%.
Investors are hoping for more, with the Trump administration expected to ease regulations and greenlight acquisitions that may have faced tough scrutiny under President Joe Biden's administration.
On Thursday, at the stock market, all the elite of the business world gathered, including the boss of Goldman Sachs, David Solomon, and the boss of Target, Brian Solomon. The president-elect was greeted with sustained applause and whistles, which then gave way to chants of “USA!” USA!
His visit marked a relatively rare appearance by a sitting or former president.
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But analysts warn that current highs may be difficult to sustain over the coming year.
Job creation is already slowing, and many of Trump's priorities – including cutting government spending, erecting rigid and widespread trade barriers, and launching mass expulsions of migrants – if enacted, could pose new challenges. challenges to growth.
Although there is ongoing debate about what the president will actually do, the proposals generate uncertainty and risk significant disruption, said Mark Zandi, chief economist at Moody's Analytics.
“The whole package of policies, if implemented to the extent that the president has indicated, will, I think, be problematic for the economy,” he said.
On Thursday, on the stock market, Trump focused his comments on other aspects of his program more acceptable to the markets: his promises to reduce taxes from 21% to 15% for manufacturing companies in the United States, to reduce regulation and expedite government approvals.
“A nuclear power plant, I would say a week would be enough. What do you think?” he said laughing.
Similar policies, which Zandi said would be good for corporate bottom lines and even the economy, significantly boosted stock prices during Trump's first term.
He repeatedly cited these gains as a sign of his administration's success, especially early on.
But the market retreated during trade wars with allies and with China – then plunged at the start of the Covid-19 pandemic, before quickly recovering.
Ultimately, the S&P 500 gained more than 67% under his leadership – a record broken by Presidents Bill Clinton in the 1990s and Barack Obama in his first four years.
Under Biden, the index is up 59% so far. He declined to predict whether Trump will be able to repeat that performance.
Asked at the stock exchange what investors should buy in anticipation of the future, Trump, somewhat unusually, hesitated.
“I don't want to find myself in a situation where they would do it and we would have a decline or something like that,” he said, before adding: “In the long term, it will be a country not like the others.”
