by Greg Valliere, AGF Management Ltd.
Insights and Market Perspectives
Author: Greg Valliere
September 28, 2020
LAST NIGHT’S REPORT on Donald Trump’s taxes didn’t disclose much that wasn’t known or suspected — he pays virtually no taxes, his companies hemorrhage money, he gets huge write-offs for employing family members as “consultants,” etc. No real surprises there.
THE NEW YORK TIMES REPORT — with a promise of more to come — didn’t touch the one angle that could have affected the election: Trump’s financial ties with Russian oligarchs, who — many suspect — bailed him out when his casinos were staggering.
TRUMP NATURALLY CALLED THE MAMMOTH TIMES REPORT “fake news” designed to influence the election, and that will be enough for his fanatic base. Perhaps some undecided voters will ask why they pay taxes and Trump probably doesn’t; perhaps some voters will wonder whether Trump is really a good businessman, but we don’t think this will change many opinions — the electorate largely has made up its mind.
WHAT HURTS TRUMP is that the furor over his taxes will gobble up the news cycle today and deflect some of the positive spin he enjoyed as Amy Coney Barrett appears headed for confirmation before the election. Still another lost day for Trump. Is the Times attempting to affect the outcome of the election? Of course.
THE DEMOCRATS, MEANHILE, HAVE A DIANNE FEINSTEIN PROBLEM: The ranking Democrat on the Senate Judiciary Committee hasn’t been shy about calling out Barrett’s evangelical Catholicism, which is exactly what the White House wants — a religious attack on Barrett that will anger Catholic voters.
SOME DEMOCRATS HAVE DROPPED HINTS that Feinstein, 87, might want to step aside for Kamala Harris, another committee member. If Barrett is virtually certain to win confirmation, why make this a religious fight?
JOE BIDEN, A DEVOUT CATHOLIC, doesn’t want to focus on religion or abortion; he will emphasize that Obamacare could be struck down by the high court. Trump recently signed a meaningless executive order pledging to retain the pre-existing conditions portion of the law, but Biden knows that white women focus on health care more than any other issue.
WITH ALL THIS DRAMA, the one stable aspect of the campaign is the polls, which haven’t really budged since late August, when Trump enjoyed a modest bump. Several high-profile polls this weekend gave Biden a 6-to-10 point lead nationwide, with somewhat smaller margins in key states. The election is still Biden’s to lose.
BY TOMORROW, THE FIRST DEBATE will dominate the news. Trump is asserting that Biden is taking performance enhancing drugs that will help the former vice president tomorrow night, while the bigger story is debate preparation — intense for Biden, sporadic for Trump. Incumbent presidents often have a weak first debate, but Trump cannot afford a shaky performance, which could put Biden’s lead out of reach.
IF THERE’S A THEME IN ALL OF THIS, it’s that Trump’s flailing precludes him from staying on message. He throws out accusations about Biden taking drugs or pocketing a billion dollars from China, and loses time as the media rises to the bait. And now there’s the issue of Trump’s taxes and huge business losses, still another distraction for a president who doesn’t need any more.
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