February 2021 – Mariana Vargas – The post-Trump era is proving to be extremely challenging. Already within days of Joe Biden’s inauguration we have seen protests, highs and lows in the Wall Street stock market, public policies strengthening the battle against Covid-19 and regional organizations preparing for a Democratic mandate.
The first week of January goes unnoticed, with Trump protesters storming the Capitol while it was in session, claiming that action must be taken because of the election fraud committed last November. That day marked history in the United States and for the world. It shows a side of the coin that we were not allowed to see, because it was someone else’s business, it did not have to come out of the (white) house.
The first side shows us that the United States is not so united after all. Trump managed to divide both Americans and the Republican Party. He managed to show that American institutionality is fragile, as are its public health policies and that the racial issue was on the surface.
All prove to be challenges for Biden’s presidency in 2021 and so far the actions taken have been successful. First, every act committed on Capitol Hill will be punished and will not go unpunished. Let us remember the importance of this measure, since it was Donald Trump who called for protests and his most loyal followers, to whom he exerts great influence, heeded the call. Let’s not rule out that once Trump’s immunity is removed, trials will begin against him in illegal cases such as tax evasion.
Although the institutionality has been seen as fragile, the politicians are not. Democrats are acting smartly and are not taking their eyes off the big prize; disqualifying Trump and not allowing a 2024 candidacy. What happened on Capitol Hill is a taste of what America can become if they let Trump escape unscathed. His position as an influential figure who attracts millions remains intact.
On the other hand, Joe Biden begins his presidency with a broken country. Covid-19 cases are growing by the day, division within parties, cases of organized protests and an economy that threatens inflation. The initial $19tn plan recently dictated by President-elect Joe Biden had a major effect on the Wall Street stock market and global financial markets.
In the stock market, companies that were at the top began to decline; Apple, Microsoft, Salesforce and an increase in indices such as the Russell 2000 and S&P 500 (Financial Times, Jan 15th 2021). The reading that certain analysts are giving to these figures is: The Blue Wave. A blue wave, Democrats in control of Congress and the Senate. If this is the case, the measures to be taken will favor the comidities sector (used in infrastructure projects) more than the technology sector. Crude oil prices have remained above $55 p/b. Market behavior also gives a glimpse of an increase in inflation and more pressure on the US Federal Reserve.
If there is one thing Trump has done in recent years, it has been to demonstrate to the European Union the state of vulnerability in which the Euro is immersed and how dependent the Union is on the dollar. That is why European legislators have met to dictate a new measure to try to shield the financial sector and that is to create in the long term more business contracts based on the Euro currency, in order to give it more weight and more prominence within Europe.
In Latin America Trump will not be missed. President-elect Joe Biden has his priorities well defined: to pause the expansion of Russia and China’s influence in the Caribbean and in developing countries, to negotiate Venezuela’s democracy with Nicolás Maduro and to shield alliances with Colombia.
Mariana Vargas, Geopolitical Analyst GELA.