Wall Street Skepticism Over Trump’s Immigration and Spending Plans #

President-elect Donald Trump has vowed to expel millions of undocumented individuals as part of a significant deportation initiative. However, Wall Street remains doubtful that this immigration crackdown will match the campaign promises. Investors foresee a slowdown in immigration during Trump’s administration, yet only 6% believe net immigration will turn negative. In essence, expectations lean towards more people entering than leaving the United States, providing relief to business owners concerned about worker shortages due to large-scale deportations.

The anticipated constraints include economic risks and logistical challenges. Investors predict annual immigration to average between 500,000 and 1 million under Trump, a decline from recent peaks. Over 20% expect immigration levels to exceed the pre-pandemic pace.

Trump also plans to slash government spending with the assistance of tech billionaire Elon Musk, who leads the new Department of Government Efficiency. However, skepticism persists about the feasibility of reducing spending by more than $400 billion annually.

“Well, I think we could do at least $2 trillion,” Musk claimed at a rally, aiming to cut waste from the federal budget of $6.5 trillion. Despite ambitious targets, challenges in touching entitlement programs, defense budgets, or interest payments remain. Experts warn that finding $2 trillion in cuts is nearly impossible.

Investors express concerns around Trump’s trade promises, particularly tariffs, marking them as a major concern for their implications on inflation and economic growth. Despite these qualms, the stock market remained buoyant following Trump’s pronounced threats of significant tariffs on China, Russia, and other BRICS nations.