Donald Trump’s Re-election Campaign Begins Tonight
Author: Greg Valliere
February 5, 2019
MOST STATE OF THE UNION SPEECHES have a shelf life of about 24 hours, and tonight’s address probably will be no different; the bitter divisions over a border wall will persist, as both parties talk past each other. But for President Trump, this will be an opportunity to take credit for the Goldilocks economy — a key element in his re-election campaign, which starts tonight.
YES, TRUMP’S JOB APPROVAL RATINGS are miserable, in the low-40s, but Ronald Reagan’s were slightly worse in 1982, before a miraculous rebound and his subsequent landslide win in 1984. The key then was the economy, and that’s true today.
WALKING A TRICKY TIGHTROPE: Trump reportedly will sound more upbeat about the economy, but many of his core supporters don’t feel it. They believe the tax cuts only benefited corporations and the rich; the country overwhelmingly wants higher taxes on the wealthy. The markets have to pay close attention — higher taxes is the single biggest domestic issue heading into the next decade.
TRUMP NEEDS TO BOAST ABOUT THE ECONOMY TONIGHT: The labor market is red-hot and wages are rising. Inflation is tame. GDP should snap back this spring. Corporate earnings look solid. Real disposable income is rising, putting more money in people’s pockets. Trump needs to accentuate these positives.
BUT IT’S LIKELY THAT HE’LL GET BOGGED DOWN on two issues: funding for a border wall, which has sucked most of the oxygen out of Capitol Hill as shutdown politics have alienated most of Congress; and the threat of trade wars and tariffs — making business leaders reluctant to commit to new investments until there’s a resolution, which we don’t expect for a few more months.
TRUMP’S BASE WILL STICK WITH HIM when the endless Mueller probe finally ends, and why wouldn’t his base stay loyal? They want to hang tough versus China, they want a wall, and they have gotten their dream — two years of confirming dozens of conservative young judges, a great legacy for the president (and Mitch McConnell).
NOW TRUMP HAS A FOIL: If Democrats continue to veer sharply to the left, the scolding will intensify from Howard Schultz, who quite clearly would take more votes from the Democrats’ nominee, not Trump. The president, like Reagan versus Walter Mondale, can claim that his opponents have left the mainstream.
TRUMP IS NO REAGAN, BUT HE STILL HAS A PLAUSIBLE PATH TO RE-ELECTION: It’s a much narrower path than in 2016 thanks to Trump’s declining support in Pennsylvania, Michigan, Wisconsin, etc. Trump needs to expand his base and cut some deals. He’s a salesman who begins his final campaign tonight after a battering in January that raised the likelihood that Trump — unlike Reagan — could be a one-term president.
The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies.
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.
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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), Highstreet Asset Management Inc. (Highstreet), AGF Investments America Inc. (AGFA), AGF Asset Management (Asia) Limited (AGF AM Asia) and AGF International Advisors Company Limited (AGFIA). AGFA is a registered advisor in the U.S. AGFI and Highstreet are registered as portfolio managers across Canadian securities commissions. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. AGF AM Asia is registered as a portfolio manager in Singapore. The subsidiaries that form AGF Investments manage a variety of mandates comprised of equity, fixed income and balanced assets.
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