It’s easy to get invested in an election, whether it’s as local as your town’s mayor or as national as the presidency, but once it’s over you have to evaluate what difference it really made, especially when it comes to your investments.
Thinking of past election cycles, I used to write quite a bit about how they might impact specific sectors and industries or even just the broad markets. I didn’t do too much of that this time around because, honestly, it felt like strapping a lightning rod to my head and just waiting for a strike. As a millennial, the 2000 contest between George W. Bush and Al Gore was the first election I really participated in, but I don’t remember any of the elections since as being as contentious as this one.
Now that Donald Trump is our president-elect and the past few weeks have been enough time for that to sink in for everybody, hopefully the waters are safe for me to wade back in.
First things first; the technology industry wasn’t exactly President-Elect Trump’s biggest ally in the election. Back in July, 100 tech industry business leaders published an open letter that wasn’t exactly laudatory, attacking Trump mostly on social issues. Despite Silicon Valley’s largely Libertarian leanings, it’s surprisingly liberal when it comes to social issues. There was also Trump’s position on visas for highly skilled, foreign technology workers (he was against them) which the industry tends to rely on and his call for a boycott against Apple (NSDQ: AAPL), which jangled more than a few nerves. I’ve see some tech insider Trump prognostications that were downright apocalyptic.
I’m not particularly worried, though.
Among a CEO’s many duties is the responsibility to create the most favorable business environment possible. For better or worse, President-Elect Trump’s few enumerated positions and his late-night Twitter rants were enough to make many tech insiders think Clinton would have been more favorable to their industry, so they mostly threw their weight behind her. But that ship has sailed so now we’re on to another of a CEO’s duties; to adapt to the current environment to run their businesses as profitability as possible.
I don’t think that’s going to be a hard adaptation to make. Yes, Trump has attacked Silicon Valley for their use of H-1B visas, but he’s also expressed support for high-skill immigration by other means. He hasn’t said what exactly those means are, but it doesn’t sound like the Valley will be starved for talent. He’s also expressed support for educational cost reform, through student loan repayment caps and lower tuition rates, which should result in more degrees in in-demand fields. And a revamp of American manufacturing, mainly in the form of reshoring, could hurt companies like Apple which produces the iconic iPhone overseas, wouldn’t be a negative for the tech sector as a whole. Really, about the only thing we really know so far is that President Trump will work towards tightening cyber security, something we should all be in favor of.
I’m obviously not the only one who thinks the adaptation isn’t going to be as hard as some might have us think. After dropping like a stone between October 24th and November 4th, the Nasdaq has regained all of its lost ground and then some. No matter what the pundits may think, tech investors obviously don’t think President Trump will be an innovation killer. It’s possible he could even prove a boon for the sector.
So personal feelings aside, don’t let President Trump change your technology outlook. The policies he helps to set might change the direction we take to some degree or another, but he’s not going to be the end of an industry.