Best stock to invest in – What Trump’s Victory Means For The Bioeconomy

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Jim Lane

In Washington, Donald Trump captured the US Presidency in an upset
victory that confounded pollsters and political pundits even as it
delighted supporters of his maverick candidacy based on themes of
immigration and trade reform coupled with a message that government
policies of the past generation had failed for too many Americans.

An unexpected series of wins across US Midwestern states –
capturing Iowa, Pennsylvania, Wisconsin and Ohio which had gone
for Obama in 2012 – provided a comfortable margin of victory in
the Electoral College and the popular vote.

5 Themes

Some immediate themes emerge for the global bioeconomy as the US
turns now from its lengthy election process to the transition
period between Administrations.

1. Trade rebalancing is front and center on the
agenda. That’s not entirely bad for the bieconomy and for US-based
manufacturing. Over at the Renewable Fuels Association, CEO Bob
Dinneen noted:

“A core principle of the Trump
campaign has been putting America first and more aggressively
pursuing fair trade agreements that recognize the value of
American products.”

2. Climate action is likely to be scaled back
sharply. The President-elect is opposed to the Paris Climate
Agreement — we’ll have to see how that translates into meeting
obligations imposed by that deal. At the very least, leadership on
climate activities is likely to pass to others, and a shift back
towards policies that favor US domestic production of coal, oil
and natural gas is likely.

3. First-gen biofuels less impacted. Owing to
fitting in to Trump’s themes of economic nationalism,
manufacturing revival and domestic energy security, a Bush-era
emphasis on the energy security aspects of shifting from imported
fuels to biofuels is likely to remain in favor. Trump himself
strongly backed the Renewable Fuel Standard, almost alone among
front-runners for the Republican nomination, and Iowa Governor
Terry Branstad, and Bruce Rastetter, the president of Summit Ag
Group, had been appointed to Donald Trump’s agricultural advisory
panel in August. Eric Branstad, the governor’s son. led anti-Cruz
forces in the state a year ago and was chairman of the successful
Trump campaign in Iowa.

RFA CEO Bob Dinneen added:

“The president-elect repeatedly
expressed strong support for ethanol, generally, and the
Renewable Fuel Standard (RFS), specifically, on the campaign
trail. He understands the importance of clean, domestic energy
resources and the economic power of value-added agriculture. We
are confident Mr. Trump will continue to support the expanded
production and use of fuel ethanol. Moreover, the
president-elect is committed to removing regulatory barriers
that impede growth. We look forward to working with a Trump
administration to remove unnecessary volatility restrictions
that have discouraged market acceptance of higher level ethanol
blends like E15 and created unreasonable administrative burdens
on gasoline marketers willing to offer these fuels to consumers.
FWe are eager to work with the new Administration on myriad
trade challenges currently facing the U.S. ethanol industry.”

Adam Monroe, President Americas for Novozymes (NVZMY)

“During the campaign, the
President-elect expressed support for biotechnology generally
and bioenergy and agriculture specifically, all core to
America’s economy and keeping our country on the leading edge of
innovation and discovery. At Novozymes, we’re looking forward to
supporting those ambitions.

“President-elect Trump
understands the need for good policy to help foster American
innovation. It’s incumbent on the private sector to imagine and
build cutting-edge solutions to solve society’s challenges – but
we count on the President-elect to encourage that kind of
groundbreaking innovation with smart, consistently-administered
policy, fueling our economy and creating products used across
the world.”

4. Reduced emphasis on government spending and a
reduction in the government’s role in the economy can be expected
to impact applied government R&D programs. However, the
incoming Administration has not run on an anti-R&D program,
but rather an anti-regulatory program and we can expect more
action at this stage in rolling back EPA’s influenace rather than
in wholesale slashing of government research.

5. A Farm Bill is due in 2018 and spending and
priorities until then will largely continue along the lines
established in the 2014 Farm Bill. Pro-domestic energy forces in
the Midwest largely supported the Trump candidacy, and there’s no
evidence yet that there will be wholesale changes in US domestic
agricultural policies. A focus on renegotiating or exiting NAFTA
will have impact on agricultural prices.

Looking at the result for meaning

1. A mirror of 2008. At the Digest, we see this
election in many ways as a mirror of 2008 — a candidate
campaigning on “change you can believe in” and pointing to
“inconvenient truths” in trade and immigration – but aimed at
reversing Obama’s policies rather than Bush’s. We may well see, as
a result, an unwinding of portions, or the whole of, the US health
care reform authorized under the Affordable Care Act — and changes
in foreign policy. Supporters of the President-elect may well find
that change is harder to deliver than it is to vote for — we’ll
see whether this President grapples more effectively to deliver on
his ambitions and permanently embed change into the US way of

2. Too many left behind? Most experts believe
that the shift towards global free trade is, on the average,
better for all. Also, that the shift towards an advanced economy
based around the innovation center of Silicon Valley, the policy
center of Washington and the financial center of New York is, on
average, better for all.

But experts also agree that trade deals and seismic shifts in the
economy create winners and losers. The average economic result,
for example, of NAFTA may well be positive. But it creates a
have/have-not equation in sophisticated economies, and we have
seen a concentration of wealth and power in recent years — and a
decline in the prosperity of the middle class. It is not
controversial to say that people are left behind as economies and
countries evolve, and in the US it appears that voters feel too
many have been left behind. There simply are not as many affluent
Americans who are for “more of the same” as there used to be, as
wealth concentrates into the hands of fewer and fewer.

The discussion of how to spread the wealth of any nation is one
that parties grapple with — should it be through unleashing more
opportunity for those left behind, or through redistributive tax
and spending policies. Last night, the US public spoke on that

Jim Lane is editor and publisher  of Biofuels Digest where 
this article was originally published
. Biofuels Digest is the most widely
read  Biofuels daily read by 14,000+ organizations.

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