What Could Impact the Stock Market and Global Economy as Positively as COVID-19 Has Affected It Negatively?
One word………! The development and distribution of a Covid-19 vaccine would not only rescue the US but the global economy, bringing a full-time return to work. However, considering the current state of the stock market, it is not this promising development that should cause concern.
The Concerns Looming Over the Market
President Trump’s policies, through a reduction in corporate taxes and the rollback of nearly 100 environmental regulations, have been overly friendly to the market. These measures, intended to make it easier and less costly for certain industries to operate, have inadvertently made our society dangerously unhealthy. With these favorable policies set to be reversed in a potential Democratic win, the market is uncertain about its future trajectory.
Elements of Long-Term Positive Impact on the Market
What factors could drive the market and the global economy in a positive direction, as significantly as the negative impacts of the coronavirus?
1. Optimism
People’s belief in a brighter future is the foundation for a prospering market. When everyone is optimistic and hopeful, the future becomes a tangible and achievable goal.
2. Minimal Taxation
Reducing taxation creates a more motivated workforce and stimulates economic growth. By fostering an environment where businesses and individuals can thrive, the market is set up for success.
3. Education and Personal Development
A skilled and educated populace across all classes is more productive and fosters a sense of hope and future opportunity. Access to education provides the tools necessary for people to improve their lives and contribute positively to the economy.
4. Economic Mobility
Hope for the future, regardless of birth circumstances, is essential. Economic mobility allows individuals to transcend their starting points and achieve success through hard work and determination.
5. Capital Formation
Encouraging people to invest in long-term assets and take risks is crucial. Capital formation provides the capital necessary for companies to grow, innovate, and adapt to changing market conditions.
6. Minimal Regulation
Regulations that allow for personal freedom and choice without stifling innovation are vital. A balance between regulation and freedom is key to a healthy and dynamic market.
7. Rule of Law
A fair and just legal system ensures that all individuals, including those of power, are treated equally. When individuals trust the system, it fosters a sense of stability and predictability in business and personal affairs.
8. Trust
A culture of trust in commercial transactions and in government processes is essential. Trust forms the bedrock of economic relationships and supports confidence in the market.
9. Limited Public Debt
Borrowing heavily from future generations should be avoided. Managing public debt effectively ensures that the economy remains solvent and does not burden future generations.
10. Cultural Values
Personal responsibility, honesty, respect for others, and a sense of ethical integrity are foundational values for a prosperous society. These values encourage individuals to contribute positively to their communities and foster a sense of shared purpose.
11. Respect for Diversity of Views
No single person knows the entire truth. Embracing diverse viewpoints and encouraging open dialogue fosters a more informed and resilient society.
12. Personal Freedom
Maximizing choice in social, personal, and commercial matters for everyone encourages innovation and entrepreneurship. When people have freedom to make their own choices, they are more likely to risk and innovate, driving growth and prosperity.
13. International Trade
Supporting international trade with reasonable restrictions can stimulate economic growth and innovation. A system that encourages fair trade and reasonable restrictions promotes a more integrated global economy.
By aligning with these principles, the market and the global economy can experience significant positive impacts. As countries move towards these values, we can expect improvements in the well-being of their citizens.
As societal well-being improves, so too does the economy. People are more likely to invest, explore, innovate, and work hard. These actions also reflect positively in the stock market. As trust in the system grows, so does the potential for market gains.