Donald J. Trump officially took the office of President of the United States of America yesterday.
Given the occasion, the US stock market headed slightly higher and the US dollar headed slightly lower (compared to a basket of other important currencies). Now some analysts are calling for a very rough first 100 days of the new president’s term. They’ve been suggesting that a prolonged economic recession/depression that could truly change the standard of living for Americans across the country could be just around the corner…..and that the coming financial calamity will be blamed squarely on the new president. While I wouldn’t rule out the possibility of either of those, I’m not entirely convinced they will come to fruition over the next 100 days (or even the next 200 or 300 days for that matter). There are a couple things I would consider as guaranteed though for the US over the next year and remainder of the decade (if not longer);
Here in Chile, things are a world apart. Even with a “left leaning” government in power for the last three years, Chile has somehow managed to maintain one of the lowest debt to GDP ratios in the world (they actually keep a “reserve fund” to help weather any economic storms that may be lurking on the horizon). Out of 178 countries that were evaluated in the Heritage Foundation’s 2016 Economic Freedom Index, Chile was ranked as the 7th freest economy, ahead of the US and every European country except for Switzerland (http://www.heritage.org/index). Unemployment is low and while the mining industry has suffered in recent years due to weak copper prices, a number of other sectors such as energy and infrastructure have seen significant investments being made from both foreign and domestic sources. More economic freedom and increased investment in energy, technology, and infrastructure. Less debt, lower violent crime rates, and fewer military “adventures”. Personally, I know I made the right choice when I decided to uproot myself from my “comfortable” life in the United States and start all over again down on this side of the planet over six and a half years ago. Life tends to be much slower paced in Chile than it is in the US and the population tends to be much less polarized (both positives in my eyes). The country isn’t completely free of challenges though. Right now there are some pretty serious wild fires in the coastal mountain range just southwest of Santiago. And thanks to the country’s economic stability and clear rule of law, there has been a bit of a wave of immigration from poorer, less stable countries (such as Colombia, Haiti, the Dominican Republic, and Venezuela) which has led to some debate recently among Chileans as to whether their immigration policy is too relaxed. More importantly though, thanks to the foresight of the leadership here (both past and current), future generations in Chile aren’t being overloaded with financial obligations they have no way of repaying. Once again, leading to a slower pace of life, less cultural extremism, and a lower likelihood of internal strife and external conflict. When you put all these together, it’s pretty easy to be optimistic about the future here. If you live in Chile and you’re willing to produce and add value to the economy, it’s quite clear that your standard of living is going to be improving. Unfortunately, I’m not sure if the same can be said for those still living in the supposedly “United” States of America today. ------------------------------------------------------------------------
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