Message From Last Night: Closing Arguments Are Coming Into Focus
Author: Greg Valliere
October 8, 2020
WHY LAST NIGHT WAS SIGNIFICANT: Let’s call the debate a draw; both candidates got in some shots, both evaded a lot of questions, and they didn’t move the needle much. What stood out to us is that the closing arguments from both parties are coming into focus.
FOR THE DEMOCRATS, it’s clear that health care — pre-existing conditions, the handling of the pandemic, Obamacare — is the dominant issue. Female voters say that’s their major concern, and Joe Biden is now doing better than Hillary Clinton in 2016 among women.
FOR THE REPUBLICANS, the message is that the Biden agenda has veered sharply leftward, promising to spend trillions on new progressive programs, while raising taxes more aggressively than the Democrats will admit. Candidates who promise to raise taxes often stumble on election day.
THERE ARE OTHER ISSUES, of course — race relations, urban crime, climate change, geopolitics, etc. And there’s the issue of Donald Trump’s temperament, which has played a major role in the dramatic Biden surge in the polls; he leads by
8 to 12 points nationwide, and his margin in key states like Pennsylvania and Michigan has widened.
YET THERE’S STILL A CASE for Trump closing the gap in the next four weeks. First, he needs to change the subject, away from Covid-19, and there’s still a chance for a modest stimulus bill that would be a win for Trump. More importantly, there’s a chance to change the subject as hearings begin next Monday on Amy Coney Barrett’s nomination to the Supreme Court.
TRUMP CLOSED A HUGE GAP WITH HILLARY CLINTON in final four weeks of the 2016 campaign, as the polls missed tremendous enthusiasm for Trump that was just under the radar screen. Could Trump still win Florida, Arizona, Georgia, North Carolina, etc.? He’s within striking distance of Biden in those states; of course, Biden could lose all of them and still win the presidency.
THE KEY, IN OUR OPINION, is whether Trump can stay on message. He’s making the election all about him and the virus, which is not a winning strategy. If he hammers Biden’s left-leaning agenda, there’s a chance that Trump could make this a photo finish. We still think Biden will win, narrowly — but we’re not buying the hype that this will be a landslide.
* * * * *
STIMULUS HYSTERIA: The stock market reacts wildly to any little tidbit on a stimulus bill, apparently overlooking two crucial points: First, Nancy Pelosi doesn’t really want a deal because it could help Trump. Second, even if there is a deal between Pelosi and Steve Mnuchin, Republicans in Congress have no stomach to spend big bucks.
THERE’S STILL A CHANCE of aid to the airline industry and small business, but a truly significant deal — with a price tag of close to $2 trillion — will have wait until after the election.
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 Asset Management (Asia) Limited (AGF AM Asia) and AGF International Advisors Company Limited (AGFIA). AGFA is a registered advisor in the U.S. AGFI is registered as a 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.
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.
© 2020 AGF Management Limited. All rights reserved.
