Trump Is Slipping and Investors Don’t Feel So Good

As we welcomed the new decade earlier this year, it was all sunshine and roses for the U.S. economy and markets. The S&P500 gained 30% last year, unemployment sat near 50-year lows, and even though we were in a trade war, the economy kept plugging along. Tack on low taxes and easing government regulations, and you get a pretty good recipe for joy on Wall Street.

All that now seems like a million years ago.

One pandemic, economic shutdown, and race-related protest and riot season later, and the U.S. economy has been upended while the political winds are shifting. Investor concerns over election-fueled volatility have regained prominence in recent weeks, even as broader market swings have subsided and stocks have regained most of their lost ground.

Election-related risk captured in VIX futures has risen to about three times the levels seen ahead of the 2012 and 2016 elections based on the spread between September and October futures.

It’s not just that the election will be close, it’s that polls are showing Trump losing some ground over his handling of the pandemic and the protests sparked by the killing of George Floyd in police custody.

A Democratic victory could threaten policies championed by Trump and generally favored by Wall Street, including lower corporate tax rates and fewer regulations.

Analysts at BofA Global Research said:

“A potential victory by Joe Biden … and to a greater extent, a ‘Democratic sweep,’ are generally considered more market-unfriendly outcomes.”

A recent Reuters/Ipsos poll Biden extending his lead over Trump among registered voters to 10 percentage points – the biggest margin since the former vice president became his party’s presumptive nominee. More than 55% of Americans said they disapproved of Trump’s handling of the protests.

Betting site PredictIt showed Biden increasing his lead from 6 points to 9 over the last month.

Polls have been wrong before, especially this far away from the election. But if Biden remains consistently out front in the weeks and months ahead, the markets might feel some pain, which could be bad for your retirement account.

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Comments (6)


  1. Donald Stromberg
    Reply

    I CERTAINLY HOPE THAT AMERICANS ARE NOT STUPID ENOUGH TO ELECT A DEMOCRAT FOR PRESIDENT!!! THE DEMOCRAT PARTY HAS PROVED THEY ARE LOSERS ON MANY OCCASIONS AND THE LAST THING THIS COUNTRY NEEDS IS ANOTHER DUMB DEMOCRAT RUNNING THIS COUNTRY. OUR PRESIDENT HAS DONE A GREAT AMOUNT OF GOOD DEALS FOR US AND TO FORGET EVERYTHING EACH TIME WE HIT A BUMP IN THE ROAD IS STUPID AND THAT IS EXACTLY WHAT THE DEMOCRAT PARTY HAS TO OFFER– DUMB AND STUPID IDEAS !!!!!!!

  2. Patricia Smith
    Reply

    This President is the biggest liar that ever lived! Trump needs to lose the election and Joe Biden will be our new President !! Trump has done major damage to our country over the past few years!! I am 77 years old and have seen Presidents come and go. But He has made our country less great on the world stage and is losing because of his anger and his major overly self esteem !!

    • Leslie Olson
      Reply

      I believe the President has done an excellent job bringing our beloved country back too America First and will continue too do so when he is reelected. We do not need or want a Democratic with progressive leaning views to destroy this country. I have heard reported that if Biden is elected it will destroy our economy . As far as lies, I remember many lies that the previous president Obama told to this country. As a fourth generation retired navy veteran, My parents both WW2 veterans My Mother a Navy Nurse, my Dad a Marine. I remember when Obama went out of this country and apologized for our beloved country, a disgrace in my opinion.

    • Lovey Baron
      Reply

      Biden doesn’t even know where he is half the time – in his basement or in another state. If he’s so wonderful – why didn’t he stand out more & do more during the 8 years that he & Obama brought down the country to its lowest point? Trump is far from perfect – but he’s a hell of a lot better than Sleepy Joe – who will probably not be able to finish out his first term – he said so himself! The market is in another free fall today because of negative news about Trump by the main stream media. If the dems get in again – this country will be in chaos – in every area imaginable. The dems are in full support of the maniacal antifa mobs destroying businesses across the country – including looting & torching many black run businesses that these people have worked all their lives for. I’ve seen it in my own city, first hand. I’ll never forget seeing that older black man screaming at thugs that were smashing the windows & looting his business.. “How is that helping us black folk??? You are destroying everything I’ve worked my whole life for” He was in tears & shouting at them, but they went right on, literally destroying his life’s work. And democrats don’t care!

    • Allan ANDERSON
      Reply

      As someone who live outside of America, i can assure you no one has done more damge to Americas image than what Bush and Obama did with their murderous wars

  3. bobby hollabaugh
    Reply

    President Trump is not slipping !! it is you that will lose again !!

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