Despite all the media hype about Donald Trump; Hillary Clinton is still the probable winner of the US presidential election. Therefore investors and entrepreneurs need to ask themselves: how would a Clinton election impact the global economy?

Unlike Trump, Clinton seems to favor the economic status quo in the United States and the world. Trump has proposed some very radical economic changes; including 45% tariffs on Chinese imports to the US and a 35% tariff on many imports from Mexico. The real estate mogul has even spoken favorably of the idea of trade wars.

“I don’t mind trade wars when we’re losing $58 billion a year,” Trump said of US trade with Mexico in a February 25, 2016, debate.

Clinton, on the other hand; is seen as an advocate of free trade. She negotiated the controversial Trans-Pacific Partnership as US Secretary of State (foreign minister). Clinton’s husband; Bill, signed the unpopular North American Free Trade Agreement as president.

Hillary has refused to talk about trade on the campaign trail, because free trade agreements are very unpopular with some of the voters; whose support she needs in the Democratic primaries. The base of her Democratic Party; includes labor unions and other groups that view trade agreements as job killers. Clinton’s opponent for the Democratic nomination; US Senator Bernie Sanders (D-Vermont), is a well-known critic of free-trade.

Which Presidential Candidate is good for the Stock Market?

It can be safely assumed that Clinton strongly supports free trade, and would promote it as president. Her election would probably mean an upsurge in the stock markets in countries that depend heavily on US trade; including the People’s Republic of China.

Trump’s election, on the other hand; could cause a major drop in Chinese stocks that would hit the US stock market too. Some observers; including American businessman and Shark Tank star Mark Cuban, predict a bear market in US stocks would follow a Trump victory.

Losses in the US stock market would exceed 20% if Trump were elected, Cuban told CNN on May 16. The Dallas Mavericks owner believes that Trump’s erratic behavior would scare investors, and trigger a sell off.

If Cuban is correct we can expect an upsurge in stocks and a continued bull market after a Clinton victory. This means we might see a major drop in the US stock market in September and October, particularly if the media continues its habit of focusing attention on Trump. That could be followed by a major upsurge in stock values; if Hillary wins the presidential election on November 8.

How Electoral Polls could affect the Stock Market

A major factor determining stock values this fall will be election polling in the United States. There is a good chance, stocks will go up if Clinton is doing well in the polls, and down if Trump does well.

Something investors need to keep in mind here is that election polling is a very inexact science. During the 2012 US presidential election the Real Clear Politics average of polls predicted that Barrack Obama would win by .7%. In the actual election, Obama won by 3.9%, which indicates a 3.2% margin of error.

An even greater of failure of polling occurred in last year’s British election; when 100% of the polls were wrong. All the polls predicted that no party would win a majority in parliament; instead the Conservatives won a clear 15 seat working majority.

This means we could see an electoral surprise in the fall, which could affect stock prices. An interesting side effect could be that investors might stop paying attention to polls if the margin of error becomes public knowledge.

Trump could Change the US Congress

Interestingly enough, investors’ attention to the presidential election could be misplaced, because in the United States Congress; not the President, sets economic policy.

All major decisions on matters like taxation, trade and the budget are made by Congress. Under the US Constitution, the lower house (the Representatives) writes the budget; and the US Senate (upper house) must approve treaties.

The president; unlike the prime minister of the United Kingdom, is not the party leader and has little control over legislation. Congress is not even obligated to pay attention to the president’s suggestions, or return his phone calls. The only legislative power the President has is the ability to veto legislation.

Trump could lead to a Democratic Congress and Major Changes in US Policy

This means that the biggest impact Trump could have on the economy is his influence on the Congressional elections. Currently, the Republicans control both houses of Congress; but some observers think Trump could change that.

There has been considerable speculation that Trump; who is a Republican, is so unpopular his presence on the ballot could cost that party its congressional majority. Most US political observers now expect Republicans to lose control of the US Senate, Politico magazine reported. Some Republicans are also worried that their party could lose control of the House.

This could lead affect business, because most Congressional Democrats are to the left of Clinton. If Democrats took control of the Senate; their probable leader would be Elizabeth Warren of Massachusetts, who favors strict relations on banks and the financial industry.

Warren; like most Congressional Democrats, also favors a significant expansion of the US welfare state including the adoption of single payer health insurance. Such an expansion would probably require a major revision of the US tax structure and tax increases. Since Clinton is a Democrat; who will need Congressional support if she wants to run for reelection in 2020, she would have little choice but to go along with such efforts.

The effects of such reforms on business could be far reaching. Many Democrats favor the abolition of the private health insurance industry, higher corporate taxes and strict financial regulation.

The imposition of single-payer health insurance in the United States could have an impact on global drug prices. Currently, drug-industry research is underwritten by the high prices Americans pay for prescriptions. If the US were to impose strict price controls on drugs; other nations might be forced to pay higher prices to cover research costs.

A Hillary Clinton victory could have a tremendous impact on the global economy. That impact could be greatly magnified by a Democratic majority in Congress. Those changes might be the true legacy of Donald Trump’s disruptive presidential run.