Business leaders and investors crave certainty—something that will be lacking in the U.S. economy with the inauguration of Donald Trump as president, say PR agency leaders.
With the news of Trump’s win, equity futures fell late Tuesday and early Wednesday, with S&P 500 futures hitting a trading limit, down 5%, the biggest futures drop allowed under CME Group rules. However, U.S. stocks rebounded by midday on Wednesday, with Dow industrials trading more than 200 points higher as of early afternoon.
The main issue: Trump is a "known unknown," says Publicis Groupe SVP Olivier Fleurot, referencing a phrase former Defense Secretary Donald Rumsfeld used in 2002.
Fleurot questions if President Trump will be the same as Candidate Trump. It doesn’t help that Trump’s campaign promises were short on details.
"We know little about his foreign policy," says Fleurot. "Who will inspire it? If protectionism is a pillar of his policy, that is certainly not good news for business in general, and for marketing specifically."
The business climate for the energy and domestic-manufacturing sectors will improve, predicts Saxum chairman and CEO Renzi Stone. However, for any company that trades in a global marketplace, Trump’s victory creates great uncertainty due to his campaign promises to change trade deals, he says.
"In healthcare, there will be pandemonium until everyone knows what ‘repeal and replace’ means with [the Affordable Care Act]," Stone explains. "As it relates to financial markets, I imagine there will be wild swings until his economic policy priorities become clear, like repatriating the $3 trillion held by corporations overseas."
Disruption of the status quo was a key Trump campaign theme, Stone adds, noting that he fully expects disruption and uncertainty to rule at least in the short-term.
"I am optimistic [about Trump’s affect on the business climate]," says John Saunders, CEO of FleishmanHillard. "If the polls had been more reflective of the simmering demand for change then maybe the markets would not have been so jumpy today. It will all calm down."
Rick French, chairman and CEO of French|West|Vaughan, concurs that the world financial markets will recover after a period of unrest.
"The U.S. economy could see a short-term lift on the expectation of future tax cuts, the repeal of [the Affordable Care Act], changes to NAFTA that could create manufacturing jobs for U.S. workers, and the possibility that new federal wage guidelines slated to take effect on December 1 could be lifted by the Republican-controlled House and Senate," French says.
Doug Spong, who holds an of-counsel role at Fahlgren Mortine, downplays the effect any politician can have on the business environment.
"The business climate is much bigger than one person," he says, noting that factors such as the Fed’s action on interest rates and the global market can be more impactful.
A calming role for communicators
With Trump’s win, communicators have a responsibility to be a calming voice in turbulent times and understand the perspective of others, says Aedhmar Hynes, CEO of Text100.
While Hynes acknowledges elections have consequences, and the impact of this result will be felt for many years, she says the broader arc of history bends toward justice, peace, and understanding.
"We will face many challenges in the years ahead, but I know that our strengths are our values, our tolerance, our support, and our compassion," she says. "We must step forward with confidence and strength assured that we can be the positive force that the world needs more than ever now."