How Will President Elect Trump Rebuild Your Investment in Infrastructure Debt?
Donald Trump has promised his fellow Americans during the whole of his election campaign that he will spend double the amount that his rival Hillary Clinton has promised on rebuilding the infrastructure assets of the USA. In fact, this is the sole pledge he made while making his victory speech where he promised to fix inner cities and rebuild the airports, tunnels, hospitals, schools etc. He says that he is going to make the infrastructure second to none and he will employ millions of people on the task thus creating new jobs in the long- run.
The promise to rebuild the nation with the aid of infrastructure
His victory speech and his commitment towards recovering the infrastructure of the USA have encouraged fiscal stimulus and governmental spending. This in fact, is presently in vogue and the central banks are spared from the trouble of doing all the work themselves. Spending on infrastructure makes complete sense and if you check the history of the USA in the last few years, the nation has actually not spent much on it. It has been estimated by The American Society of Civil Engineersthat there is about a $1.44tn funding investment gap between 2016 and 2025 on infrastructure assets. The popular consultancy McKinsley says that $57tn is required across the globe by 2030 for financing the infrastructure projects.
The promises he has made
Donald Trump is not the first politician in the last few months to promise people with infrastructure spending. In the UK, Philip Hammond, the chancellor is also expected to make an announcement for boosting infrastructure projects in the first Autumn Statement. Here, both the governments of UK and USA expect and require the private sector to step in and help in finance projects. This will potentially create a huge and large opportunity for the retail investors who are looking for lucrative returns when it comes to infrastructure assets.
Donald Trump has also stated that new jobs will be created in the steel, construction and manufacturing industries because of his plan. This will lead to the stimulus of the economy and help the nation recover. In the last eight years, there has been no focus on infrastructure debt portfolio as he has promised the people that he will spend funds on infrastructure assets to see the nation grow fast.
Now, for Donald Trump, he is yet to come out with a plan to ensure the successful implementation of the above. There are some questions that remain on whether he is able to pass the required bills for infrastructure investment passed by his fellow Republicans. The Speaker of the House of Representatives and Paul Ryan are against the idea of taking so much of money. David Stubbs – global market strategist with JP Morgan Asset Management again asks the question as to whether Donald Trump is to get this infrastructure spend. According to him Donald Trump has in fact promised everything to everyone during his election campaign and only time will tell as to what he does.