The United States will have a new president in 2021. Democrat Joe Biden will assume the reins of the executive branch, bringing some “normalcy” to the White House after 4 years of a rather atypical presidency.
The difference in styles will certainly be from heaven to earth. Joe Biden will be a more traditional president in terms of tone and form. His administration will undoubtedly be far more presidential than the Trump administration, which was extremely personal. Here we will have an important change.
However, in many ways, 2021 will look a lot like 2020. It will be an extension during the first few months. But things will gradually improve. Generally speaking, it will be a positive year.
We must be very attentive to three processes: The deglobalization of the world, the digitization of the world and the growing rivalry between China and the United States. In economic matters, deflation, unemployment and inequality will continue to be the main problems.
On the other hand, in political and social matters, the great challenge is division. In other words, the polarization of American society. Tribal struggles between groups, races, and parties.
Is Biden a radical on the left? Of course not. We must remember that Biden is no newcomer. In other words, its trajectory is widely known. And his record speaks for itself. His alleged radicalism was a laboratory move by the Trump campaign.
It worked wonders for Latinos in South Florida, by the way. However, propaganda is one thing and reality is another. Joe Biden is clearly a proven moderate. A man of the center, known for knowing how to work with both parties. The danger here is not a radical shift to the left.
Here the danger is inaction. I mean, Biden don’t do anything. An administration rich in words, but poor in actions.
Joe Biden was never a particularly popular candidate. In fact, it was always the anti-Trump or anti-radical left option. We well know that Bernie Sanders and Elizabeth Warren have much more committed followers. However, fanaticism was not enough to beat Trump.
The radical left in the United States does not have the numbers to obtain a majority. So, Biden was a concession. Neutral and respectable enough to attract independents, the undecided, and disgruntled Republicans, but a full-fledged Democrat who would also win the vote of radicals within the party. Many did not vote for Biden per se.
But they did vote for Biden to vote against Trump. Is different.
The strategy worked, because Biden did win the election. However, now is when the hardest part begins. In other words, to govern a deeply divided country with a party invaded by radicals and a Senate against it. Biden’s economic plan is very good. But it’s good on paper. It’s no use if you can’t get support.
It is very possible that the Republicans are blocking it from all sides. Will your bipartisan skill work in the current context? Do you have the leadership to deliver results? That remains to be seen. Politics can easily get in the way of a good plan. Because in politics you don’t just have to be right. You also have to have the support.
What role will Trump play in the opposition? Trump’s followers idolize their leader. Its base is a kind of cult. Personalism at that level is not uncommon in the third world, but Trump managed to recreate that phenomenon in the United States. His messianic demi-god status could still stay alive for a while.
Republicans are scared of Trump, because they don’t want to lose their base support. Which would make Trump a pretty annoying ghost during the Biden administration. The level of influence Trump could have outside the White House remains to be seen.
The United States could grow by 3.6% in 2021 with a deficit of -9.2%. The government will take a big turn to the center with a legislature in constant war. L as racial tensions and street protests will continue.
The coronavirus will continue to claim many lives, but vaccines will get the job done. Here the problem will be the “anti-vaxxer” movement. A real stone in the shoe in the fight against the pandemic. There will be chaos for a time. But everything seems to indicate that 2021 will end on good terms.
Will unemployment return to 4%? Will inflation exceed 2%? Will we have a crash in the stock market? Will the Dollar Index exceed its 2008 record low? Probably not. But there will surely be some scares along the way.
During the Biden administration, many things will return to normal. The United States will once again be part of the World Health Organization, the Paris Accords will be returned, and the children of illegal immigrants will once again have certain protections.
Regarding the covid-19 measures, Biden will be stricter and less ambiguous than Trump. Surely, many things will be mandatory for a while, such as the use of masks, for example.
In the diplomatic field, the Joe Biden administration will surely seek to resume old alliances and try to iron out the rough edges left by Trump internationally. In the domestic field, however, the key will be in the legislature. It will be very difficult for Biden to pass his proposals on health, economy, climate and taxes due to the Republican fence.
When it comes to stimulus, a very relevant issue for Bitcoin and financial markets, the Republicans will continue to put up obstacles.
Republicans will continue to promote fiscal austerity on a matter of doctrine. But this lack of fiscal investment the only thing that will cause will be a continuation of the recovery in the form of K.
In other words, the supposed republican and libertarian “austerity” is basically “austerity” for the neediest, but wealth for the richest .Ironically, this formula will be very convenient for Bitcoin and Wall Street which will grow much faster than the real economy due to the Republican “austerity”.
The money supply will go straight to asset inflation. Excellent for Bitcoin. But not so much for the common citizen suffering from the crisis.
The most important change is the return to institutionality. In other words, a more presidential presidency. On the monetary side, things will not change much during 2021, because the Federal Reserve enjoys a lot of autonomy and will continue to do its job.
I assume that Biden will have a better relationship with Powell. Because Trump always had a very tense relationship. But monetary policy as such will not undergo major changes.
We have to be very attentive to what happens in the Securities and Exchange Commission ( SEC ). Trump was somewhat hostile to the crypto world and Jay Clayton, the outgoing director, wasn’t exactly our best friend, but an SEC under the Biden administration might be a bit more crypto-friendly. What will the new SEC be like regarding Bitcoin? We will see it in 2021.
