Donald Trump's Failure Of NAFTA In The United States

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The upcoming presidential election in the US has been making the stock market very volatile. The investors are scared that, if Donald Trump becomes the next president, it will affect the business investments, which in result may put the economy in a recession. His policies for deporting 11 million immigrants, building a wall and starting wars with other countries are some of the few reasons as to why many economists believe that the US economy would shrink by 1 trillion dollars over five years; also, they believe that his policies will destroy 4 million US jobs. This unpredictability of who is going to win the election is making the investors very cautious. This is referred to as the “fear gauge” on the Wall Street. The S&P 500, which is the…show more content…
It is known that he believes NAFTA is one of the leading causes of America’s downfall. To counteract that, Trump has proposed to change NAFTA and make it better. The idea of changing the agreement has made Mexico’s currency become very volatile because there is uncertainty on what will happen if Trump gets elected. The NAFTA has led to a better business relationship between Canada, the US and Mexico; however, a sudden change in how the new president will perceive the NAFTA agreement will affect the currency rate for Mexico and the United States. Companies who have locked their exchange rates during trade agreements that become affected as the rates continue to fluctuate. Trade wars may occur making the future unpredictable for the companies. When this happens, companies will have to slow down and hold more capital to protect themselves from potential losses. With limited growth and a willingness to expand, the stock market will slow to a halt if there are no impressive milestones to be shown to potential the investors. With more companies trying to hold on to capital, their plan is to “have a case cushion” when Trump is elected, which will inevitably going to lead to slow growth across many
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