ARK Invest CEO Cathie Hout drew parallels between the former president Donald Trump‘s economic policies and early U.S. financial strategies during a recent episode of “In the Know,” while analyzing potential market reactions to the upcoming election.
What happened: Wood, popularly known as leading ARK Innovation ETF (NYSE:ARKK) noted a correlation between the S&P 500’s performance and Trump’s polls, highlighting several key economic policies that could impact the markets. She focused mainly on Trump’s stance on taxes, tariffs and monetary policy.
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“The market likes tax cuts and is concerned about the tax cuts in the original tax bill passed under President [Trump] expire at the end of ’25,’ Wood explained. She added that Trump has expressed support for extending these cuts and implementing additional personal and corporate tax cuts.
On rates, Wood offered a historical perspective: “In the very early days of our country… we didn’t have the personal income tax, all we had [were] tariffs and these started under President Washington.” While she personally opposed tariffs, she suggested that markets are starting to see Trump’s tariff rhetoric as a negotiating tactic.
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Why it matters: Wood also addressed Trump’s stance on monetary policy, noting his advocacy for lower interest rates. She suggested that growth-oriented policies, including regulatory cuts, could affect interest rates differently than expected. “If we implement growth policies, there is a good chance that short-term interest rates will not fall as much as we think,” she said.
Wood suggested that reducing regulations could benefit innovation, citing Trump’s previous “two-for-one” regulatory policy that required eliminating two existing regulations for every new regulation.
The upcoming presidential elections will be a tight race between Trump and the vice president Kamala Harriswith recent polls pointing to a neck-and-neck contest.
Moreover, the fiscal policies of both Trump and Harris could have a significant impact on the US national debt. Their proposed tax and spending measures could add trillions to the debt by 2035, according to a recent analysis.
