00:00The U.S. midterm elections were more than a political verdict on Donald Trump.
00:04They could also reshape the economic landscape of the world's largest economy.
00:09From Wall Street to the dollar, from interest rates to global trade,
00:13investors are watching closely what's going to happen now that Trump is weakened,
00:18and what that means for their money.
00:20So, what should investors expect, especially in Europe?
00:24Earlier I spoke to Xavier Volatier, head of Transatlantic Private Wealth,
00:28the U.S. branch of the French Banque Transatlantique.
00:32And I wanted to know whether the midterms could be a game-changer for European investors.
00:37Here's what he said.
00:38The Congress will probably try to work things around AI, especially.
00:44That's the matter that we're most heard of.
00:48And that's probably the biggest changes that we're going to see in the upcoming weeks and months,
00:53compared to the previous Congress we had here in the U.S.
00:57That should not be too much of a difference.
01:02I mean, the biggest difference we experienced the last few years were regarding the visas.
01:07I don't see many changes there, at least for the very next time we're going to see that in the
01:16next few months, I mean.
01:17So, after that blue democratic wave, markets could reassess growth expectations, bond yields, and the dollar's trajectory.
01:27What would be the repercussions of such developments for Europe?
01:31Obviously, we saw that overnight.
01:33I think it's already turning around a little bit.
01:36And the main repercussions for Europe, I guess it's going back to your previous question also,
01:42is, again, we see a tremendous growth in the AI sector.
01:46And I think it's going to keep going for many years.
01:49And we experienced that as a wealth management team here in the U.S.,
01:55affiliated to a French bank, as you know.
01:57So, we experienced more and more demand from U.S. clients willing to invest in Europe on a more personal
02:05side, obviously.
02:06But I think that's dragging a lot of growth in Europe also, especially in real estate.
02:13And the Republicans lost the election partly because of deep-seated economic insecurity.
02:20Is American optimism still the driving force behind their economy?
02:27Definitely. Definitely.
02:29I mean, I've been here for now 10 years.
02:31I studied here a little bit.
02:33I know you lived here also.
02:35And I think that's the key component of the U.S.
02:39I mean, Americans stay optimists.
02:42And that's the main difference I experience every time I go back to Europe.
02:46Honestly, that's the thing that strikes me every time.
02:49And I think that even if we are facing tough time here in the U.S. on inflation again, still,
02:56I mean, people are able to find jobs.
02:59Their employment rate is still very low.
03:01And that contributes to that optimism.
03:04And what would you advise a European investor who is heavily exposed to U.S. markets?
03:10Stay the course, hedge against political risk or diversify?
03:15I guess the key, as always, is diversification.
03:18You know, you experienced that the other way around two years ago when we saw tremendous requests from U.S.
03:26investors to diversify in currency, in assets,
03:30where we all witnessed the European market going up even, you know, in a larger number than U.S. markets
03:39last year.
03:40And I think that's also true the other way around.
03:44Diversification will always take the key.
