Why Markets May Be Right To Bet On A Trump Win
Signs Suggesting A Trump Win
As Zero Hedge reported earlier this week, markets are now anchoring on a potential Trump victory. Let's look at a few reasons why the markets may be right here. Following that, we'll close with a brief trading note about this week's earnings reports.
Trump May Not Face The Same Elite Opposition
After the 2020 election, Time Magazine famously posted a victory lap by elites who helped steer the election in Biden's direction.
That's a bit more than people publicly talking about it.
— West Bestern 🛡️ (@western_bester) January 31, 2024
Time came out with this article the week after Biden was nominated to basically brag about some of the extra legal methods and conspiracies that were hatched to "fortify" the election.https://t.co/xPr3aohLib
Notably, comments from influential figures like Jamie Dimon, who acknowledged that Trump was right on a number of major issues, signal a shift in elite comfort levels with the possibility of a Trump win in the upcoming presidential election.
Endorsement from Influential Figures
Jamie Dimon's recent acknowledgment of Trump's correctness on several major issues is pivotal. It suggests that the business elite, who were previously wary of Trump's unconventional approach, are now recognizing the effectiveness of his policies in certain areas. This shift indicates a growing acceptance among elites, who are crucial in shaping public opinion and investment flows, potentially easing the path for Trump's campaign.
Polling Data
Recent head-to-head poll results between Trump leading Biden nationally and in key battleground states. Additionally, Biden's job performance polls are weak, with many Americans believing the country is on the wrong track. These trends suggest a challenging reelection campaign for Biden, bolstering the argument for a Trump win.
Republican National Committee Leadership Changes
The removal of RNC Chairwoman Ronna McDaniel, criticized for the party's performance in recent election cycles, signifies a strategic recalibration within the Republican Party. Depending on who her replacement is, with a more effective leader, the GOP might be better able to counter "election fortification" this year.
Border and Immigration Issues
The border and illegal migration issue remains a critical point of contention, drawing criticism from Democratic mayors in cities like Chicago and New York, as well as figures like The Rev. Al Sharpton. These criticisms from erstwhile Biden allies highlight the hole the Biden administration has dug for itself on illegal migration.
Foreign Policy and Funding for Ukraine
The Biden administration's inability to secure further funding for the Ukraine War, due to tying it to a border bill, suggests that under pressure from its base, Republicans in Congress may be less likely to hand Team Biden a ladder they can use to climb out of that hole.
A Perfect Storm For Biden
These developments suggest a political climate that may be more conducive to a Trump victory than in the previous two elections. The acknowledgment by figures like Jamie Dimon, alongside the tangible concerns reflected in public opinion and policy challenges, explain why investors and political strategists might see a Trump win as increasingly plausible.
Trading Update
After our 138% gain on a bullish bet on Estée Lauder (EL -2.58%↓) earlier this week, we've got two bearish bets teed up for today on companies reporting after the close today and before the open tomorrow. If you'd like a heads up when we place those trades, feel free to subscribe to our trading Substack/occasional email list below.
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