Who’s Eyeing Up 2020? Warren or Sanford?
ElectionOracle / US Presidential Election 2020 Oct 10, 2019 - 08:59 PM GMTBy: Rodney_Johnson
In a recent interview with MSNBC, Representative Adam Schiff (D-CA) said that his House Permanent Select Committee on Intelligence had no knowledge of the UkraineGate whistleblower claim before notification from the Inspector General.
That statement was eventually proven false. As the first whistleblower approached staffers for Schiff’s committee before going to the IG. For the falsehood, the Washington Post awarded Schiff “four Pinocchios.”
Although, as my Millennial kids would tell me, if we’re counting falsehoods, the Washington Post would probably award Trump “all the Pinocchios.”
The Ukraine phone call scandal might not sink President Trump. However, he’s still polling well behind Democratic presidential nominees Joe Biden and Elizabeth Warren in head-to-head polls. As investors, we’d be fools not to think about what might happen in the very real scenario where Trump doesn’t occupy the White House in the last week of January 2021.
Scenario No. 1: Removal from Office
It’s not likely that the Republican Senate would convict the president following the House’s almost inevitable impeach, but it’s possible. Should Trump gets the boot early, we’d need a Republican candidate to run in 2020. Former Governor of Massachusetts Bill Weld is running in the Republican primary; at least, he is in the states holding a primary. Former South Carolina Governor and Rep. Mark Sanford has also thrown his hat in the ring, along with former Illinois Rep. Joe Walsh.
Sanford is the most interesting of the three because he’s a) from south of the Mason-Dixon line, a positive for a Republican, and 2) he’s the only candidate who claimed to be hiking the Appalachian Trail when he’d actually run off to Argentina to have an affair.
Scenario No. 2: We Get a Democrat
With a tailwind, no real competition, and Joe Biden gaffing his way through Iowa, the election could be Sen. Elizabeth Warren’s to lose.
That should give investors some real pause.
Contemplating a Hillary presidency, investors took the S&P 500 in late October 2016 back down to exactly where it had been a year earlier. Hillary promised higher taxes and more regulation. When Trump won, the futures fell 800 points, then turned on a dime and shot to the moon. Since his inauguration, Trump’s supported lower taxes and fewer regulations. The trade wars hurt, but they’re (supposed to be) temporary.
Warren promises much more than Hillary ever dreamed of.
Higher Taxes?
Of course. According to a new book due out next week, The Triumph of Injustice, the average tax rate on the 400 wealthiest households in 2018 was just 23%, well below that of Middle America. This will be the statistic that Warren and others use as a billy club for the rest of the election cycle.
More say and Pay for Workers?
It’s already on the table. More than 180 members of the Business Round Table, a gathering of CEOs from the largest American companies, recently signed a statement claiming that shareholders are no longer their central focus. From this point forward, they’ll focus on all “stakeholders,” including customers, workers, the environment, probably extraterrestrials, and somewhere down the line they might still give a thought to the providers of capital.
Senator Warren was delighted, and sent several of the CEOs a letter explaining her Orwellian Accountable Capitalism Act, which requires companies worth more than $1 billion to obtain a federal charter, and for 40% of the board seats to be awarded to members of the workforce. She also noted that, given their signatories on the roundtable statement, she “expects” them to fully endorse her proposed act, which will become a demand if she earns the seat in the Oval Office.
This is just a taste of what will be a very unsavory meal for Corporate America.
Stay Tuned
This might be what the country needs, or it could be the biggest setback since the 1970s. That’s for voters to decide. But as investors, we’d be crazy not to evaluate the likelihood of a Warren presidency and the possible effects it would have on the economy and our holdings. As more facts about UkraineGate come to light and November 2020 inches closer, don’t be shy about taking profits off the table.
As many smart people before me have said, “You never go broke taking a profit.”
Rodney Johnson
Follow me on Twitter ;@RJHSDent
By Rodney Johnson, Senior Editor of Economy & Markets
Copyright © 2019 Rodney Johnson - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.
