Post & Comment {07.01.19}

This is  where I respond with a brief comment to something I've either seen in the news or on line.  
The headline or question I'm addressing is highlighted.

There will be a trade deal coming out of this G-20 meeting between Presidents Xi and Trump.  Unlikely that this will happen.  Best case scenario is both sides say something like process has been made and they agree to keep on talking.  

Many of the Democratic party candidates are proposing all sorts of policies that would cost trillions of dollars.  How likely are these to get passed?  Getting many of these policies through Congress, in their present iterations, is unlikely to occur.  Assuming for the Democrats a best case scenario that says in 2020 they control both branches of Congress and the Presidency, then they  would still need to be able to round up 60 votes in the Senate.  Even if the Republicans take a shellacking next year there is a low probability of them losing that many seats.  Most of this is for consumption of the party's liberal base.  Expect most of it to be toned down by the time we get to next year's general election.

President Trump will be reelected.  Alternatively President Trump will be defeated.  We don't do politics on this blog.  There's plenty of other places you can find that.  When we discuss politics it is in the context of how they play out in financial markets.  Having said that the numbers right now indicate the President is in serious trouble and will likely face a very tough bid to get reelected.  He is behind in polls in many of the swing states he will need to carry next year.  That doesn't mean he's sure to lose.  It does mean that his reelection is no sure thing, especially if the Democrats nominate a more centrist candidate.  Markets won't really start to care about this though until sometime next year, probably in late spring early summer when the Democratic challenger is likely to emerge.

Democrats will nominate a socialist or a very progressive liberal.  In that case it is a very high probability you will have four more years of President Trump.  The base of the Democratic is skewing more liberal these days just as the base of the Republican party has tilted more right.  However, the vast majority of folks in this country reside in the center and there's no evidence yet that they are skewing into the progressive camp.  Of course all of that could change in a year but present trends don't support the notion of the vast majority in this country yearning for a more socialist economic system.  Expect whoever the Democrats nominate next year to recognize that and rapidly move towards the middle once his or her nomination is secure.

Back Thursday.