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France: Macron vs. Le Pen to Decide Fate of EU

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France: Macron vs. Le Pen to Decide Fate of EU

French Elections: Macron vs. Le Pen to Decide Fate of EU

The first round of the French presidential election is now complete, with only two candidates remaining:

Candidate% Vote (Round 1)
Emmanuel Macron23.9%
Marine Le Pen21.4%
François Fillon20.0%
Jean-Luc Mélenchon19.6%
Benoît Hamon6.4%
Nicolas Dupont-Aignan4.7%
Others4.0%

Because no candidate received a majority of votes, there will be a run-off vote on May 7 in which French voters decide between Emmanuel Macron and Marine Le Pen.

While the two candidates are each considered outsiders for different reasons, their key platform differences could not be more stark. The major fundamental issue they disagree on is EU membership – and as a result, French voters potentially hold the fate of the entire EU in their hands.

Head-to-head: Macron vs. Le Pen

Today’s infographic is from Swissquote, and it compares the platforms of Macron and Le Pen head-to-head.

Here are some of the key differences between the two:

Background:
Emmanuel Macron is an investment banker that was the Minister of the Economy for François Hollande’s government. He left in 2016 to start En Marche!, a centrist political movement that describes itself as “neither right nor left”.

Marine Le Pen has been the leader of the National Front since 2011, and is a lawyer by trade. She is the youngest daughter of National Front founder Jean-Marie Le Pen, and has worked in politics since 1998. She’s also been a Member of European Parliament since 2004.

European Union:
Macron wants to remain in the European Union and to seek a common asylum policy. Meanwhile, Le Pen wants to hold a referendum on France’s EU membership, while re-instating a national currency.

Economic Policies:
Macron wants to cut government spending to 50% of GDP, to limit the wealth tax to real estate, and to cut the corporate tax rate from 33.3% to 25%.

Le Pen supports re-industrialization of France as well as “intelligent protectionism”. She wants to allow the Banque de France to print money to fund the treasury up to an annual maximum of 5% of total money supply, and also advocates a 10% cut for the lowest income tax brackets.

Security:
Macron wants to stay in the Schengen border-free zone, while Le Pen wants to exit it. Both want to hire new police officers and to add new prison spaces, though Le Pen wants to add higher amounts of each.

Le Pen also wants to cut legal immigration to France to 10,000 per year.

Military:
Both Macron and Le Pen want to re-introduce military conscription for short periods of time. Each wants to increase defense spending, as well: Macron by 2% by 2025, and Le Pen by 3% of GDP by 2022.

Labor:
Both want to keep the 35-hour work week, although with some exceptions. Macron wants to extend unemployment benefits to entrepreneurs, farmers, self-employed, and those who quit jobs voluntarily. He also wants to implement a universal pension system, and to boost training schemes for unemployed youth.

Le Pen advocates the lowering of the retirement age to 60, and for a “purchasing-power bonus” of €1,000 a year for low-wage earners and pensioners. She also wants a national plan for equal pay for women, and for overtime to be tax-free.

Environment:
Macron is opposed to the exploitation of shale gas and offshore drilling, and wants the remaining coal-fired plants in France to be closed.

Le Pen calls for a move to a “zero-carbon” economy, and to ban shale gas exploration, while setting a moratorium on windmills for power generation. Le Pen also would like to ban GMOs.

Education:
Macron says up to 5,000 new teaching jobs should be created. Le Pen wants there to be no free education for children of illegal immigrants, and to restrict the use of foreign languages in schools. She also thinks school uniforms should be mandatory.

Civil Liberties:
Macron supports same-sex marriage, while Le Pen wants to scrap the 2014 law allowing same-sex marriage and to replace it with civil unions.

Macron supports medically assisted procreation for lesbians, but opposes recourse to surrogate mothers by homosexual couples. Le Pen wants to ban surrogacy and to restrict medically-supported procreation to people with sterility problems.

Governance
Both candidates want to introduce some degree of proportional representation to the electoral system, though Le Pen wants to take it further.

Macron wants to cut 120,000 state jobs by not replacing retiring civil servants. Le Pen wants to put French flags on all public buildings, to cut the number of lawmakers in the National Assembly and Senate, and to shrink the size of local governments in half.

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Bitcoin

How Decentralized Finance Could Make Investing More Accessible

Under the current global financial system, billions of people do not have access to quality assets. Here’s how decentralized finance is changing that.

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Infographic: How Decentralized Finance Could Make Investing More Accessible

Did you know that a majority of the global population doesn’t have access to quality financial assets?

In advanced economies, we are lucky to have simple options to grow and protect our wealth. Banks are all over the place, markets are robust, and we can invest our money into assets like stocks or bonds at the drop of a hat.

In the United States, roughly 52% of people are invested in the stock market – but in a place like India, for example, this portion drops to a paltry 2%. How can we make it possible for people on the “outside” of the financial system to gain access?

Breaking Down Barriers

Today’s infographic comes to us from Abra, and it shows how decentralized finance could make investing a more universal phenomenon, especially for those that don’t have access to the modern financial system.

It lays out four key obstacles that prevent people in developing markets from investing in quality financial assets in the first place:

  1. The Geographic Lottery
    Where you live plays a massive role in determining your ability to build wealth. In advanced Western economies, the average person is much more likely to be invested in financial markets that can help compound wealth.
  2. Financial Literacy and Complexity
    Roughly 3.5 billion adults globally lack an understanding of basic financial concepts, which creates an impenetrable barrier to investing.
  3. Local Market Turmoil
    Even if a person is mentally prepared to invest, local market turmoil (hyperinflation, political crises, closed borders, etc.) can make it difficult to get access to stable assets.
  4. The Cost of Investing in Foreign Markets
    Foreign assets can be pricey. One share of Amazon is $1,800, which is realistically more money than many people around the world can afford.

In other words, there are billions of people globally that can’t take advantage of some of the most effective wealth-building tactics.

This is just one flaw in the current financial system, a paradigm that has created massive amounts of wealth but only for a specific and well-connected group of people.

Enter Decentralized Finance

Could decentralized finance be the alternative to open up access to financial markets?

By combining apps with blockchain technology – specifically through public blockchains such as Bitcoin or Ethereum – decentralized finance makes it possible to get around some of the barriers that are created by more traditional systems.

Here are some of the innovations that are making this possible:

Smart contracts could automate transactions and remove intermediaries, making investing cheaper, faster, and more accessible.

Fractional investing could allow partial or shared ownership of financial assets by using tokenization. This would make expensive stocks like Amazon ($1,800 per share) available to a much wider segment of the population.

Location independent investing is possible through smartphones. This would make it possible for people in remote parts of the developing world to invest, even without access to nearby financial institutions or local markets.

Like the internet with knowledge, decentralized finance could reshape the world by making financial access universal. Who’s ready?

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Economy

How Macro Trends Shape the Market’s Future

From climate change to aging populations, macro trends are changing the future. Here’s how to use them to your advantage.

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It’s hard to say for certain what the future holds.

Without the luxury of a crystal ball, investors must find opportunities by analyzing the market. There’s just one problem: the 24/7 news cycle is enough to make anyone’s head spin.

Where should an investor focus their attention, when almost every new venture is forecast to be the next big thing?

The Powerful Influence of Macro Trends

Today’s infographic comes to us from U.S. Global Investors, and it highlights how analyzing macro trends can serve as a key investment tool.

U.S. Global Macro Trends

Two Main Investment Approaches

When selecting stocks, many investors fall into one of two camps:

1. Top-down Investing

  1. Analyze macroeconomic trends.
  2. Identify specific sectors and regions.
  3. Choose individual stocks based on company fundamentals.

Considering the aging Chinese population, a top-down investor may choose to invest in Chinese healthcare stocks.

2. Bottom-up Investing

  1. Complete in-depth company analyses.
  2. Select a stock that is outperforming others in its sector.

A bottom-up investor could analyze Home Depot and choose to invest if it had strong performance relative to Lowe’s.

These approaches can be used separately, or even combined together. Zooming out allows investors to identify the big picture opportunities. Then, a bottom-up approach can find the companies that best capitalize on each trend.

What is a Macro Trend?

A macro trend is a long-term directional shift that affects a large population, often on a global scale. For example, climate change is affecting industries in both positive and negative ways. While “green” industries have seen increased support, ski resorts are projected to have 50% shorter winter seasons by 2050.

There are a couple of main ways to identify macro trends:

  1. Government policy
    Government policies are a precursor to change, shaping macro trends and creating opportunities. For instance, Obama’s Recovery Act fueled growth in renewable energy with a $90 billion investment.
  2. Economic cycles
    The cyclical nature of the economy means that investors can also use history to identify macro trends. Consider fiscal and monetary policy, which is implemented in response to economic data:

    • Expanding economy
      The central bank raises rates and the government reduces fiscal stimulus. As a result, inflation is moderated.
      • Contracting economy
        The central bank lowers rates and the government increases fiscal stimulus. As a result, growth is stimulated.

Discovering Long-Term Value

Macro trends are a key tool for discovering long-term market opportunities. They are beneficial because they are:

  • Unbiased and data-driven
  • Not swayed by daily headlines
  • Tend to avoid riskier, niche industries
  • Can be diversified by sectors and regions

There are currently many macro trends at play. For example, Trump’s sweeping tax reform and deregulation boosted the U.S. economy, lifting GDP growth to a 13-year high of over 3% in 2018 Q3.

However, not everyone’s a winner. America’s reduced taxes have made Canada less competitive. It’s estimated that 4.9% of Canada’s GDP is at risk due to ripple effects from U.S. tax reform. What’s more, regulators worry that the bank deregulations might put the financial system at risk.

The proposals under consideration… weaken the buffers that are core to the resilience of our system.

— Lael Brainard, Member of the Board of Governors of the Federal Reserve

So, how do investors distill this wealth of information into a future of wealth?

Spotting the Next Wave

In today’s hyper-connected world, it’s easy to get lost in data overload. Thinking big picture allows investors to focus on trends that:

  • Have a long-term outlook
  • Affect a large population
  • Create a clearer vision of the future

Then, an investor can target the most promising regions and sectors. When used effectively, this approach enables investors to ride the next big wave that will shape markets.

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