Chaotic US election stress tests global economy

With Donald Trump, the buck always stops somewhere else. Yet investors now worry the real, actual buck will get trashed amid Trump’s desperate attempt to cling to the US presidency.

After four days – four days! – of vote counting there is still no decisive result. Democratic Candidate Joe Biden seems on the verge of victory in the November 3 election but Trump isn’t simply refusing to concede. He’s preparing an epic scorched-earth legal battle that may take world markets down in his wake.

This last week was traumatic enough for markets around the globe – particularly those of the emerging variety. Concerns about Covid-19 second waves, debt sustainability, geopolitical tensions and a possible bubble in tech shares made for uniquely volatile trading.

But none of these risks comes close to the ways in which Trump is about to stress test the global economy. In his desperation to secure a second term, Trump seems willing to throw the dollar and US Treasury securities, the two linchpins of global finance, under the proverbial bus.