Elevated uncertainty related to the U.S. 2024 election has investors preparing for the possibility of it being held without President Biden. There’s talk that he may soon bow out, which would be market-moving. The most likely scenario if Biden drops out is Vice President Kamala Harris steps up as the Democratic nominee. So this prospect begs the question: What would Harris’ previous economic policies suggest “Kamala-nomics” look like?
With this proposition in mind, investors should consider potential scenarios and how they may impact the markets. Let’s examine Harris’ recent statements and actions for clues.
Harris’ Nationwide Economic Opportunity Tour
In April 2024, Harris launched a nationwide tour focused on economic opportunity and community investment. The tour highlighted the administration’s record on small business growth, affordable housing, healthcare access, student loan forgiveness, and infrastructure spending.
On the tour, VP Harris provided insights into her economic priorities, which include job creation, support for small businesses, and investments in infrastructure. Harris consistently emphasized the importance of equitable growth, aiming to reduce economic disparities across communities.
Where Harris May Differ from Biden
While Harris has largely been aligned with Biden’s economic agenda, some differences have emerged. For example, Harris has been more aggressive on housing affordability, proposing a $100 billion initiative to help close the racial wealth gap.
Harris has backed a public option on healthcare, a plan to initiate a government-run health insurance agency that would rival the private insurance giants, whereas Biden has not gone that far. Harris also supports further sweeping student loan forgiveness than Biden’s targeted plans.
Market Implications
Investors need to consider how these policies might influence various sectors. For instance, increased infrastructure spending could benefit the construction and manufacturing industries. On the other hand, higher support for small businesses might lead to a more competitive landscape for larger corporations.
Political Uncertainty and Market Volatility
Political uncertainty always brings a degree of market volatility. Harris’s potential presidency could create shifts in investor sentiment, impacting stock prices and market dynamics. It’s crucial to stay informed and be prepared to adjust investment strategies accordingly.
Key Takeaway
While Harris would likely continue many of Biden’s economic policies if she became the nominee, there are hints of a more progressive, equity-focused approach. Investors should monitor whether Harris takes a more forceful stance on housing, healthcare, and student debt if she takes the reins. Her focus on racial wealth disparities also suggests a continued emphasis on economic justice initiatives.
Overall, a Kamala-nomics scenario would likely mean continuity with Biden’s agenda but with the potential for slightly more aggressive action on progressive economic priorities.
