It appears increasingly likely that Barack Obama will win the US Presidential election - and if that does come to pass, who will be the winners and losers? The Democratic Party is likely to add significantly to its majorities in the House and Senate, which theoretically would prevent Republicans from mounting a filibuster against key legislation, in theory allowing Obama to push through whatever he wishes.

In practice, however, an Obama administration is likely to be greatly constrained by an enormous budget deficit which could reach $1.5 trillion in 2009. Nor is the withdrawal of American forces in Iraq likely to provide a "peace dividend" given the need for additional troop deployments in Afghanistan.

Despite these constraints, I still expect the passage of two fiscal-stimulus Bills in the next six months. The first $150 billion is likely to be passed before the end of this year.

The second Bill could be as large as $300 billion in the first quarter of 2009. Both will provide for tax rebates and tax reductions for middle- and lower-income earners, while also focusing on infrastructure spending for various transportation projects.

From what he has said, we can expect significant changes in US energy policies with an emphasis on the development of alternative sources of power. This is likely to be coupled with a carbon tax, higher automobile mileage requirements and other efforts to reduce the US dependence on carbon fuels.

There will also be increased regulation for a wide variety of industries. Banks, brokers, hedge funds and insurance companies are likely to be primary targets. We will also see more intense regulation of the healthcare industry and food producers.

Because the economy is creaking, government entities will suffer a steep decline in tax revenues. So there will have to be a sharp increase in Washington aid to state and local governments.

Another thing a Democratic administration is likely to boost are unions they have become almost an irrelevance under the Republicans representing only 7.3% of the workforce. Unionisation of the workforce will be increased, though the large corporations are sure to resist this.

Higher income groups, I am afraid, will endure rising taxes. We anticipate that combined state and federal marginal tax rates will exceed 50% in many regions. In addition, social security taxes and medicare taxes will rise and means testing is likely.

The good news is that such tax increases may be delayed until 2010 or even 2011 given the current recessionary environment.

In summary, we anticipate more taxes, more regulation, a bigger government and a massive budget deficit. This sets the stage for a potential inflation bubble of massive dimensions, but that is unlikely to occur until 2011-12 at the earliest. It is in that environment that the dollar is likely to resume its decline against both the euro and yen, but that's another story.

Peter Anderson is chief investment officer for US equities at fund manager RCM, an arm of Allianz Global Investors