One Less Issue in the Frantic Homestretch: No Government Shutdown
Author: Greg Valliere
September 23, 2020
THIS PASSES AS PROGRESS: Yesterday the House overwhelmingly agreed to a stop-gap funding bill that will keep the government open until Dec. 11. The agreement between Nancy Pelosi and Steven Mnuchin, which almost certainly will pass in the Senate, did not address a pandemic relief bill, which remains stalled.
THE DEAL MEANS THERE WON’T BE A GOVERNMENT SHUTDOWN when the fiscal year begins on Oct. 1, but it also means that a contentious spending battle is likely, as usual, just before the holidays. The so-called “continuing resolution” probably will need another extension that will last until days before Christmas.
MEMBERS OF CONGRESS are eager to get out of town next week. Republicans believe the economy will recover without another stimulus bill, while Democrats want to begin campaigning against the steamrolling of a Supreme Court nominee, who is poised to win approval in record time.
REPUBLICANS WE’VE TALKED WITH believe the Supreme Court vote will produce a conservative majority for at least two decades, fulfilling their greatest goal. Even if the GOP loses the White House and the Senate this fall, a transformed court will be Mitch McConnell’s legacy; he has an iron grip on the process.
DEMOCRATS WE’VE TALKED WITH are increasingly nervous about Joe Biden, who has not shared their outrage over the court. They fear Trump’s energy and audacity on the campaign trail, contrasting with Biden’s passivity. But the Democrats believe they’re close to flipping the Senate, and we agree.
BOTH PARTIES ARE HOLDING THEIR BREATH ahead of the pivotal first debate next Tuesday night; either candidate is capable of a horrific gaffe. Trump has refused any debate preparation, while Biden is memorizing his lines after weeks of scripting by his camp.
WHILE THE SUPREME COURT AND ABORTION will become dominant issues, this might not affect the electorate much because so many voters — close to 90 percent — have made up their minds. The pivotal issue, in our opinion, is Trump’s handling of the virus — it’s an even bigger issue than the economy, which slightly favors Trump.
THE PRESIDENT GIVES HIMSELF an A-plus for his “phenomenal” handling of the virus, and if he repeats that every day until Nov. 3, enough people may believe him. The FDA and other medical experts do not believe him; they are certain that a vaccine will not be available by election day, as Trump claims. A vaccine this winter is a more realistic goal.
THE DEMOCRATS, MEANWHILE, seem fearful of a Trump surge in battleground states that resembles the 2016 photo finish. But Democrats have two very important cards to play: the abortion issue, which will motivate female voters, and a huge financial advantage. Biden’s TV ads are everywhere, while the Trump camp, surprisingly, has financial woes. In a close election, that could make a difference.
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.
