US Vice President Kamala Harris is riding a wave of momentum after accepting the Democratic Party's nomination for president last week, but the economy remains the paramount issue in this year's race.
“This election, the outcome is going to be determined by how people vote with their wallets based on inflation,” Ryan Sweet, chief US economist at Oxford Economics, told reporters last week.
According to an ABC News/Washington Post/Ipsos poll, Ms Harris's Republican rival Donald Trump holds a nine-point lead when it comes to who Americans trust more to handle the economy and inflation. Meanwhile, a poll released by the Financial Times and the University of Michigan Ross School of Business showed the Democrat with a one-point advantage.
The election's outcome will have significant effects on the economy with the Federal Reserve's inflation battle still being fought and the expiration of Mr Trump's tax cuts next year that will be fiercely debated in Congress.
Both candidates have been on the campaign trail in the past week laying out their agendas – Ms Harris with an appearance last Friday in North Carolina, and Mr Trump with a speech in the battleground state of Pennsylvania on Monday.
Inflation and interest rates
The inflation scenario varies, with economists agreeing Mr Trump's protectionism and immigration policies will stall progress in restoring price stability.
Mr Trump has recently proposed a 10 per cent tariff on all US trading partners – as well as a 60 per cent tariff on Chinese goods – as a replacement to income taxes.
A recent paper from the Peterson Institute of International Economics said higher tariffs would harm US exports and diminish economic growth, while also leading to higher inflation. A separate study by the Lombard Odier Group predicts that a Trump presidency and a Republican-controlled Congress would also stall inflation, forcing the Federal Reserve to halt cutting interest rates at around 4 per cent.
“In the event of a Trump presidency with a divided Congress, the impact of tariffs would likely dominate, slowing growth while still increasing inflation,” the group wrote in its latest CIO Office Viewpoint.
The current target range for US interest rates is 5.25 to 5.50 per cent.
Bond yields would also probably rise, and so would the US dollar against the euro, the organisation said. The company expected a Harris-led presidency to have greater policy continuity should she succeed Mr Biden, with the Fed cutting rates through mid-2025.
Changes to the Fed's monetary policy will have implications for most central banks in the Gulf Co-operation Council, whose currencies are pegged to the US dollar.
“Any drop in the benchmark interest rates or higher-for-longer scenario will have an impact on interest rate-sensitive sectors in the GCC like banking, real estate, utilities as well as leverage companies,” said Faisal Hasan, chief investment officer at Al Mal Capital in Dubai.
“The investors here are also very international [in their focus] and changes in the monetary policy will impact their investment.”
Tariq Qaqish, chief executive at the Salt Fund Placement advisory firm in Dubai, said GCC countries must prepare for both administrations.
Mr Qaqish anticipates a Trump win would lead to a weaker dollar, thereby increasing liquidity into the region. A Harris win, he said, would lead to a stronger US dollar which would hamper economic growth.
Federal deficit
Regardless of who wins the 2024 election, the US federal deficit is expected to further increase.
The International Monetary Fund has warned that high fiscal deficits and the continuing increase in the debt-to-GDP ratio are not only a risk for the US, but also the global economy.
Ms Harris last week released some elements of her economic agenda, including expanding the child tax credit base from $2,000 to $3,000, expanding the earned income tax credit, advancing a federal ban on price-gouging on groceries and providing a tax credit of up to $25,000 for first-time homebuyers.
These and other plans make up the elements of the Agenda to Lower Costs for American Families, which outlines her intentions for her first 100 days in office.
All told, the plan would increase the US federal deficit by $1.7 trillion over a decade, according to the bipartisan Committee for a Responsible Federal Budget (CRFB). That figure would rise to $2 trillion if the housing policies became permanent.
Mr Trump has thus far not released a detailed economic agenda. The CRFB in July estimated that his plans to eliminate taxes on Social Security benefits would increase deficits by $1.6 trillion to $1.8 trillion through 2035.
The national debt also soared during Mr Trump's term in office.
According to another analysis conducted by the CRFB, Mr Trump added $8.4 trillion to the national debt. Of that, $3.6 trillion was from Covid relief laws.
A second Trump term would likely be a continuation of the Make America Great Again agenda that defined his first term, where he wants further tax cuts and enhancing US industries, Mr Qaqish said.
“These policies could stimulate growth but will put more pressure on fiscal deficits,” he said, adding that geopolitical factors must also be considered. Should Mr Trump win and negotiate a ceasefire between Russia and Ukraine, as well as a peace deal between Israel and Palestine, then Mr Qaqish expects a lower level of government spending and national debt.
Corporate taxes in focus
In one major policy shift, Ms Harris's campaign said her administration would lift the US corporate tax rate to 28 per cent from its current rate of 21 per cent. The campaign's proposal is in line with President Joe Biden's most recent budget proposal.
Mr Qaqish said this would have a direct impact on investors, who would establish businesses outside the US to reduce their corporate taxes.
Mr Trump cut the corporate tax rate from 35 per cent to 21 per cent as part of his 2017 tax plan, and pledged to further cut taxes if he was elected president again. Mr Trump's tax plan brought the US's corporate income tax rate down from the fourth-highest in the world to roughly median, according to the Tax Foundation.
The non-partisan Congressional Budget Office (CBO) in 2018 said raising the current corporate tax rate by one percentage point would raise US revenue by $96 billion from 2019 to 2028.
Mr Trump's tax plan is set to expire at the end of next year, and will be one of the biggest issues facing Congress when the new session begins.
Extending the tax cuts would add $3.3 trillion to the US deficit over the next 10 years, the CBO said.
UAE currency: the story behind the money in your pockets
Closing the loophole on sugary drinks
As The National reported last year, non-fizzy sugared drinks were not covered when the original tax was introduced in 2017. Sports drinks sold in supermarkets were found to contain, on average, 20 grams of sugar per 500ml bottle.
The non-fizzy drink AriZona Iced Tea contains 65 grams of sugar – about 16 teaspoons – per 680ml can. The average can costs about Dh6, which would rise to Dh9.
Drinks such as Starbucks Bottled Mocha Frappuccino contain 31g of sugar in 270ml, while Nescafe Mocha in a can contains 15.6g of sugar in a 240ml can.
Flavoured water, long-life fruit juice concentrates, pre-packaged sweetened coffee drinks fall under the ‘sweetened drink’ category
Not taxed:
Freshly squeezed fruit juices, ground coffee beans, tea leaves and pre-prepared flavoured milkshakes do not come under the ‘sweetened drink’ band.
What is dialysis?
Dialysis is a way of cleaning your blood when your kidneys fail and can no longer do the job.
It gets rid of your body's wastes, extra salt and water, and helps to control your blood pressure. The main cause of kidney failure is diabetes and hypertension.
There are two kinds of dialysis — haemodialysis and peritoneal.
In haemodialysis, blood is pumped out of your body to an artificial kidney machine that filter your blood and returns it to your body by tubes.
In peritoneal dialysis, the inside lining of your own belly acts as a natural filter. Wastes are taken out by means of a cleansing fluid which is washed in and out of your belly in cycles.
It isn’t an option for everyone but if eligible, can be done at home by the patient or caregiver. This, as opposed to home haemodialysis, is covered by insurance in the UAE.
Richard Jewell
Director: Clint Eastwood
Stars: Paul Walter Hauser, Sam Rockwell, Brandon Stanley
Two-and-a-half out of five stars
Naga
%3Cp%3E%3Cstrong%3EDirector%3A%C2%A0%3C%2Fstrong%3EMeshal%20Al%20Jaser%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%C2%A0%3C%2Fstrong%3EAdwa%20Bader%2C%20Yazeed%20Almajyul%2C%20Khalid%20Bin%20Shaddad%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E4%2F5%3C%2Fp%3E%0A
KILLING OF QASSEM SULEIMANI
Profile of MoneyFellows
Founder: Ahmed Wadi
Launched: 2016
Employees: 76
Financing stage: Series A ($4 million)
Investors: Partech, Sawari Ventures, 500 Startups, Dubai Angel Investors, Phoenician Fund
BMW M5 specs
Engine: 4.4-litre twin-turbo V-8 petrol enging with additional electric motor
Power: 727hp
Torque: 1,000Nm
Transmission: 8-speed auto
Fuel consumption: 10.6L/100km
On sale: Now
Price: From Dh650,000
RESULTS
Argentina 4 Haiti 0
Peru 2 Scotland 0
Panama 0 Northern Ireland 0
Essentials
The flights
Etihad (etihad.ae) and flydubai (flydubai.com) fly direct to Baku three times a week from Dh1,250 return, including taxes.
The stay
A seven-night “Fundamental Detox” programme at the Chenot Palace (chenotpalace.com/en) costs from €3,000 (Dh13,197) per person, including taxes, accommodation, 3 medical consultations, 2 nutritional consultations, a detox diet, a body composition analysis, a bio-energetic check-up, four Chenot bio-energetic treatments, six Chenot energetic massages, six hydro-aromatherapy treatments, six phyto-mud treatments, six hydro-jet treatments and access to the gym, indoor pool, sauna and steam room. Additional tests and treatments cost extra.
Gully Boy
Director: Zoya Akhtar
Producer: Excel Entertainment & Tiger Baby
Cast: Ranveer Singh, Alia Bhatt, Kalki Koechlin, Siddhant Chaturvedi
Rating: 4/5 stars
UAE v Gibraltar
What: International friendly
When: 7pm kick off
Where: Rugby Park, Dubai Sports City
Admission: Free
Online: The match will be broadcast live on Dubai Exiles’ Facebook page
UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)
Arabian Gulf Cup FINAL
Al Nasr 2
(Negredo 1, Tozo 50)
Shabab Al Ahli 1
(Jaber 13)
Three ways to limit your social media use
Clinical psychologist, Dr Saliha Afridi at The Lighthouse Arabia suggests three easy things you can do every day to cut back on the time you spend online.
1. Put the social media app in a folder on the second or third screen of your phone so it has to remain a conscious decision to open, rather than something your fingers gravitate towards without consideration.
2. Schedule a time to use social media instead of consistently throughout the day. I recommend setting aside certain times of the day or week when you upload pictures or share information.
3. Take a mental snapshot rather than a photo on your phone. Instead of sharing it with your social world, try to absorb the moment, connect with your feeling, experience the moment with all five of your senses. You will have a memory of that moment more vividly and for far longer than if you take a picture of it.
The specs
Engine: 5.0-litre V8
Power: 480hp at 7,250rpm
Torque: 566Nm at 4,600rpm
Transmission: 10-speed auto
Fuel consumption: L/100km
Price: Dh306,495
On sale: now
ULTRA PROCESSED FOODS
- Carbonated drinks, sweet or savoury packaged snacks, confectionery, mass-produced packaged breads and buns
- Margarines and spreads; cookies, biscuits, pastries, cakes, and cake mixes, breakfast cereals, cereal and energy bars
- Energy drinks, milk drinks, fruit yoghurts and fruit drinks, cocoa drinks, meat and chicken extracts and instant sauces
- Infant formulas and follow-on milks, health and slimming products such as powdered or fortified meal and dish substitutes
- Many ready-to-heat products including pre-prepared pies and pasta and pizza dishes, poultry and fish nuggets and sticks, sausages, burgers, hot dogs, and other reconstituted meat products, powdered and packaged instant soups, noodles and desserts
Another way to earn air miles
In addition to the Emirates and Etihad programmes, there is the Air Miles Middle East card, which offers members the ability to choose any airline, has no black-out dates and no restrictions on seat availability. Air Miles is linked up to HSBC credit cards and can also be earned through retail partners such as Spinneys, Sharaf DG and The Toy Store.
An Emirates Dubai-London round-trip ticket costs 180,000 miles on the Air Miles website. But customers earn these ‘miles’ at a much faster rate than airline miles. Adidas offers two air miles per Dh1 spent. Air Miles has partnerships with websites as well, so booking.com and agoda.com offer three miles per Dh1 spent.
“If you use your HSBC credit card when shopping at our partners, you are able to earn Air Miles twice which will mean you can get that flight reward faster and for less spend,” says Paul Lacey, the managing director for Europe, Middle East and India for Aimia, which owns and operates Air Miles Middle East.
