JPMorgan Chase: U.S. election results could reshape tax policy, government debt and market stability, bringing about a huge economic shift

Odaily Planet Daily Report: Recently, JPMorgan Chase released a report emphasizing the potential impact of the US election on tax policy, government debt, and market stability, providing guidance for investors on how to view the election period. JPMorgan Chase analysts explained that the key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) will expire in 2025, and Congress may revisit tax policy, as the non-extension of these measures could significantly increase tax revenue. The report states: "In summary, if the temporary provisions of the TCJA expire, individual tax rates will revert to higher levels, resulting in a 1.8% reduction in after-tax income for all US households, and a 3.1% reduction for the top 1% of income earners." Given this, JPMorgan Chase expects both parties to push for at least a partial extension of the TCJA, but the specific details will depend on the election results. Regarding the national deficit, JPMorgan Chase expects the proposals of both Trump and Harris to increase it, which could impact bond yields. The report states: "If all the policy proposals made during the campaign were to become reality (which is unlikely), the deficit could increase by more than $1 trillion over the next 10 years under Harris's leadership, and nearly $4 trillion under Trump's leadership." Although debt concerns are evident, JPMorgan Chase stated that some concerns may be exaggerated. The report explains: "While we believe the debt and deficit trajectory is a risk, some concerns are unfounded. In fact, the current total yield gives investors a second chance." JPMorgan Chase also discussed the possibility of a prolonged or disputed election, noting: "It's hard to say when we'll know who won this election, and we may not have a clear answer for a week or two. If the election is close, we expect to see court challenges and other legal actions by the end of this year. It's also worth noting that the 2022 election counting reform bill aims to strengthen mechanisms to ensure clear execution of election results." Additionally, the analysts advised investors: "After the new government is confirmed, market volatility tends to decline relatively quickly, and on average, the stock market will rise 12 months after the election. In other words, don't let the election disrupt your plan - the election results won't drive long-term market returns." This week, JPMorgan Chase analysts led by Managing Director Nikolaos Panigirtzoglou also predicted that a Trump victory could drive retail investors towards risky assets, potentially pushing up the prices of coin and gold in a broader "reflation trade".