by Greg Valliere, AGF Management Ltd.
NEVER MIND: After insisting during the holidays that he welcomed a Senate trial, President Trump is now demanding an immediate dismissal of all charges — but Republicans won’t comply. They are carefully monitoring the polls, which show 60% of the public wants to hear testimony from John Bolton.
THERE MAY BE JUST ENOUGH REPUBLICANS worried about their re-elections next fall to push for hearing from witnesses at the trial; they fear a backlash from voters in moderate states who tend to agree that a trial should scrutinize the evidence and call witnesses. So there will be no immediate dismissal this week or next.
THE DEMOCRATS’ GOAL ISN’T TO CONVICT TRUMP: They concede, in private, that it’s virtually impossible to win 20 GOP defectors. But the Democrats are convinced they can wound Trump, portraying him as erratic and untruthful, which also describes Trump’s daily shifts on the intelligence that prompted the killing of Iranian Gen. Qassem Soleimani.
THIS TRIAL IS ALL ABOUT MOVING PUBLIC OPINION, and if the Democrats push the needle a few points, they think their prospects in November will improve. And Trump, who is likely to over-do his furious tweets during the trial, will have the “impeachment” stigma for ever. The desire to damage Trump is visceral in this city, even if means spending several weeks on an impeachment trial that will result in acquittal.
* * * * *
A LIFE PRESERVER, RIGHT ON SCHEDULE: For all of last fall, we thought there would be a China trade deal by late winter of 2020, so getting one signed this Wednesday is close enough. Timed conveniently to coincide with the beginning of the impeachment trial, the trade pact will give Trump an opportunity change the subject, declaring that this is the greatest trade deal of all time.
ACTUALLY, THE KEY PROVISIONS LOOK PRETTY IMPRESSIVE: China loses its designation as a currency manipulator, there are intellectual property protections for the U.S., more trade opportunities for both countries, and the enforcement mechanism contains the threat of fresh tariffs if they are violated. Not a bad Phase One.
THE IMPACT OF WEDNESDAY’S SIGNING will be modest on U.S. GDP, as the Wall Street Journal and others have pointed out. But the uncertainty that plagued U.S. small businesses and farmers will subside, as Trump will boast on the
campaign trail for the next several months.
NEXT COMES SENATE RATIFICATION of the U.S.-Mexico-Canada treaty, which has produced grumbling from some Republicans who believe the deal has given away too much to organized labor. But passage is likely, perhaps not until the impeachment trial is finished. In the meantime, we’re stocking up on European wine — that’s the next Trump target if there’s no progress on Airbus subsidies and tech disputes.
The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies.
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), Highstreet Asset Management Inc. (Highstreet), 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 and Highstreet are registered as 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.
This post was first published at the AGF Perspectives Blog.
