by Greg Valliere, AGF Management Ltd.
Insights and Market Perspectives
Author: 8
November 17, 2020
NOT GOING QUIETLY: While continuing to challenge the election outcome, Donald Trump has an enormous agenda — ranging from regulatory reform to prescription drugs to a potential conflict with Iran. The next two months of his administration will be frenetic.
HERE’S A LIST OF SOME OF THE TRUMP PRIORITIES:
Challenging the Election: Trump will continue to insist that the election was rigged, establishing a narrative to prepare his loyal base for the possibility that he — or one of his children — could be on the 2024 ticket. We strongly doubt Trump will ever concede that he lost the election.
Pardons: Most presidents issue pardons in their last two months in office — Bill Clinton was particularly active, with 140 pardons on his final day — and it’s probable that Trump will pardon Gen. Michael Flynn, Paul Manafort and others. The big issue: will Trump pardon himself? That could inoculate him from federal charges but would not affect the cases pending against him in the southern district of New York.
Regulations: Fresh regulatory proposals are likely; the White House will push hard for opening up the Arctic Wildlife Reserve for drilling, perhaps granting licenses just before the Jan. 20 inauguration. And in recent weeks there have been new Trump regulatory reform proposals for labor standards, emissions, etc.
Joe Biden will immediately reverse many of the Trump regulations. The new president will scrap travel bans, largely aimed at Muslim countries, and the U.S. will be back in the Paris climate talks by February.
Prescription drugs: Trump loathes the pharmaceutical industry, which ran harsh ads against him this fall. He will push ahead — possibly this week, according to the web site TheHill.com — with regulations that would lower prices for Medicare drugs to match cheaper prices in other countries.
More firings: Trump is furious at what he considers disloyalty by many aides, so we expect more firings at the Pentagon, the CIA, the FBI and the Department of Homeland Security, etc. Not even Attorney General William Barr is safe from the purge.
Geopolitics: Most Republicans, including Mitch McConnell, are aghast that Trump may withdraw U.S. troops from Afghanistan, Iraq and other countries. The president will not be dissuaded; troop withdrawals probably will be announced around Thanksgiving.
Trump wants to disengage from foreign conflicts, but he’s itching to confront Iran; the New York Times reports this morning that Trump’s desire to strike Iranian nuclear sites is opposed by most of his advisers, who feel such action could lead to a wide Mideast conflict.
BOTTOM LINE: The biggest issue, of course, is the pandemic; U.S. fatalities will hit a quarter million in the next few days. Trump will have to acknowledge the loss, while taking credit for the development of vaccines. He’ll get some credit, deservedly, for Operation Warp Speed.
THE NEXT TWO MONTHS WILL BE CONTENTIOUS: Trump may not allow the Biden team to have normal transition assistance until the Electoral College votes on Dec. 14. And the threat of geopolitical surprises — more tariffs or targeted assassinations in the Mideast — will persist right up until Jan. 20. Trump will not go quietly.
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.
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This post was first published at the AGF Perspectives Blog.
