New Concern For Joe Biden This Morning — GDP Report
October 28, 2021
New Concern for Joe Biden This Morning — The GDP Report
October 28, 2021
THE THIRD QUARTER WAS A STINKER: The raging Delta variant, supply chain bottlenecks, acute labor shortages, etc. This should produce a soft GDP report this morning, possibly showing growth around 2%.
THIS COULD BE STILL ANOTHER HEADACHE for the reeling Biden Administration, which is bracing for Republican charges that the economy is facing stagflation. We think economic growth will be solid next year, but the narrative today may focus on how weak the economy has gotten after the first half surge.
YIELDS ON THE 10-YEAR TREASURY BOND have fallen significantly in recent days, perhaps anticipating a weak GDP report and growing pessimism over global growth, which is dependent on surging energy prices.
THERE’S LITTLE BIDEN CAN DO: He wants lower energy prices — which would boost consumers’ disposable income — but appealing to OPEC to ramp up production would look ridiculous as global leaders meet at the Glasgow climate summit. Getting an infrastructure deal from Congress — any deal — would help boost consumer confidence.
ACTUALLY, CONFIDENCE IS IN GOOD SHAPE, as Americans see a strong stock market, plentiful jobs and this month’s sharp reduction in Covid cases. But a weak GDP report this morning, combined with persistent inflation, could give the Democrats a fresh anxiety attack; they’re already very worried about Virginia next Tuesday.
* * * * *
WE HAVE TO AGREE WITH THE WALL STREET JOURNAL editorial this morning — we’ve never seen anything as reckless as the current attempt to pass anything possible to raise taxes. There’s a new trial balloon every day: a wealth tax, a corporate minimum tax, you name it.
NONE OF THESE IDEAS HAVE BEEN VETTED — and many haven’t even been considered by the tax-writing House Ways and Means Committee. So it has come to this: put anything in a tax bill that can raise revenues, then worry about writing the legislative language until later.
PRESIDENT BIDEN WILL TRY ONE MORE TIME this morning to get a “framework” deal that he can take to Europe this evening. But that train has left the station; there will be no final deal today.
THERE ARE HUGE SPENDING AND TAX ISSUES still to be resolved in this embarrassing spectacle despite the happy talk that an agreement is imminent. A final deal by Thanksgiving is a more likely outcome.
The views expressed in this blog are provided as a general source of information based on information available as of the date of publication and should not be considered as personal investment advice or an offer or solicitation to buy and/or sell securities. Speculation or stated believes about future events, such as market or economic conditions, company or security performance, or other projections represent the beliefs of the author and do not necessarily represent the view of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies. Every effort has been made to ensure accuracy in these commentaries at the time of publication; however, accuracy cannot be guaranteed. Market conditions may change and AGF accepts no responsibility for individual investment decisions arising from the use of or reliance on the information contained herein. Any financial projections are based on the opinions of the author and should not be considered as a forecast. The forward looking statements and opinions may be affected by changing economic circumstances and are subject to a number of uncertainties that may cause actual results to differ materially from those contemplated in the forward looking statements. The information contained in this commentary is designed to provide you with general information related to the political and economic environment in the United States. It is not intended to be comprehensive investment advice applicable to the circumstances of the individual.
AGF Investments is a group of wholly owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments America Inc. (AGFA), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFA and AGFUS are registered advisors in the U.S. AGFI is a registered as a portfolio manager across Canadian securities commissions. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The subsidiaries that form AGF Investments manage a variety of mandates comprised of equity, fixed income and balanced assets.
About AGF Management Limited
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. AGF brings a disciplined approach to delivering excellence in investment management through its fundamental, quantitative, alternative and high-net-worth businesses focused on providing an exceptional client experience. AGF’s suite of investment solutions extends globally to a wide range of clients, from financial advisors and individual investors to institutional investors including pension plans, corporate plans, sovereign wealth funds and endowments and foundations.
For further information, please visit AGF.com.
©2021 AGF Management Limited. All rights reserved.