The setting…The Harvard Club W44th Street New York. The date…late June 2016.
A good friend — a retired New York property developer — invited us to join him for dinner in a private dining room at the prestigious club.
Paintings of famous alumni such as JFK, FDR and Teddy Roosevelt adorned the wood-panelled walls.
The Harvard Club oozes tradition. White coated butlers with impeccable manners wait on your every need.
Joining us for dinner was a Wall Street investment banker and his wife. The couple lived on the Upper East side…in a zip code that’s home to many well-heeled New Yorkers.
Prior to dinner, our friend gave me a little heads up on the couple. The wife was a seriously smart businessperson. He showed me photos of her in the company of (then) President Obama and some very high-profile (and instantly recognisable) businessmen.
As the night progressed, the conversation turned to the upcoming (2016) presidential election.
Trump versus Clinton. Who would win?
The conversation danced around policy differences, but what about the personalities? That was the real story.
Sensing the moment was right, I asked directly, ‘who are you going to vote for?’.
I fully expected to be batted away with ‘Hillary of course’.
But they dropped their guard.
In the blink of an eye, I was transformed from dinner guest to therapist. This was a question they’d been agonising over.
‘What a terrible choice this nation has to make. Trump or Clinton. What have we done to deserve this?’
Trump’s many corporate sins and personal indiscretions were well known…especially to those who mix in wealthy New York social circles.
Whereas the Clintons like to cloak themselves with establishment respectability.
The investment banker’s wife tore that to shreds when she said ‘the Clintons are truly awful people. Just evil.’
Was this a Republican bias? No. She voted for Obama in the two previous presidential elections.
However, she did confess that Obama had been a real disappointment. Promised a lot and delivered little.
Mainstream media neatly pigeon-holed Trump supporters with the label of ‘red necks’.
It fitted the left-wing media narrative of how could anyone in their right mind vote for Trump?
Only those dumbass deplorables in the fly over states could have been stupid enough to put the Donald in the Oval Office.
Voters torn between the devil and the sea…
From my experience (and not just at The Harvard Club that night) it was apparent voters were torn between the Devil and the deep blue sea.
In the end, voters in sufficient numbers decided to take their chances on the high seas.
Trump’s somewhat colourful and shady past should have seen him down for the count.
The fact he won tells us much about the depth of loathing and mistrust the American public have for the Clintons.
No matter how hard the Clintons try to wash it off, the pungent odour of graft, corruption and sleaze clings to them like a cheap suit.
Hillary has ‘bathed’ in the cologne of deceit for so long, she’s (almost) lost all sense of smell.
Her carefully stage-managed global speaking engagements, TV interviews and book openings are works of pure fiction…there’s not even a hint of embarrassment over her denials, lies and hypocrisy.
Her concerted efforts (especially in recent times) to re-write history could have something to do with unfinished business in Washington.
I say ‘almost’ lost her sense of smell, because Hillary still has a nose for political blood.
Up until last week, the only thing that could beat the Donald in November was the Donald…on one proviso — the economy and Wall Street kept ticking along.
In typical Donald style, he has proudly claimed paternity rights over the success of both.
Unemployment at near record lows. The Dow at record highs. An economy going from strength to strength.
All this — in Donald’s world — is due to his brilliant stewardship which includes: berating the Fed into cutting rates; providing liquidity to the repo market and underwriting US$1 trillion deficits.
The fraudulent methods used to keep this giant Ponzi scheme from collapsing are at risk of being exposed by COVID-19.
As the number of virus clusters start increasing in the US, it’ll put pressure on an economy that’s heavily reliant (70%) on personal consumption.
People in (voluntary or involuntary) isolation, don’t consume quite so much.
And where the US economy goes, so too does Wall Street.
The economy and Wall Street are Trump’s Achilles heel.
A recession is defined as ‘two consecutive quarters of negative growth’.
Between now and election day (3 November, 2020) there are two full quarters — April to June and July to September.
The Democratic Convention is in mid-July, just after the end of the June quarter.
Maybe, just maybe, there’ll be enough anecdotal evidence on unemployment numbers, Chapter 11 (bankruptcy) filings, consumer confidence indicators and GDP guesstimates for the Democrats to start effectively attacking the Donald on his economic record.
And, if Wall Street is still racking up heavy losses, he can kiss goodbye to spruiking ‘look how much wealth I’ve created since being elected’.
Traditional stimulus ‘fixes’ are unlikely to solve this problem. But what else have they got?
My guess is the prospect of negative growth has Hillary’s nose twitching. She can smell the scent of political blood in the air.
Trump’s twin flanks — the economy and share market — are potentially exposed.
If, between now and the Democratic convention, the US economy goes south and unemployment numbers head north, I reckon Hillary will be (or already is) working the phones.
Hillary knows its now or never
She knows it’s a now or never moment to fulfil her destiny.
Biden’s the front runner, but he and Sanders have a snowball’s chance in hell of beating Trump…with or without an economy in recession and a market in free fall.
Sander’s socialism is a bridge too far for the Democrats, let alone the rest of America.
Biden, while more centrist, will get carved up over his pathetic political record and his son’s rather suspicious (and very well paid) Ukrainian appointment.
Elizabeth Warren is all but out. Bloomberg’s done a Clive Palmer, spent a truckload for nothing.
At present, the odds from Sportsbet on the ‘US Presidential election’ are Trump at AU$1.67, Biden at AU$2.50 and Sanders at AU$13.00.
If you scroll down a little further, who do you see? Hillary…at AU$67. Long odds, but not as long as Elizabeth Warren at AU$131.
Then you can go into the odds on the ‘Democratic Presidential Nominee’ and after Biden and Sanders, in third place there’s Hillary at AU$21…and she’s not even an official candidate.
Here’s my tip.
If the virus infects the economy, Clinton’s going to do a Steven Bradbury.
Hillary will hold back and wait for Sanders and Biden to fall over in the first round of the Democrat Convention.
Then she’ll come skating through in the second round to claim the party’s nomination.
Just for some fun, I’ve placed a small wager on Hillary being the Democrat nominee.
The other thing I’m betting on between now and November is…
- US interest rates going to zero.
- Helicopter money.
- More QE.
- Bigger deficit.
As COVID-19 starts to put serious downward pressure on the US economy and Wall Street, Trump will ‘encourage’ the Fed to unleash the mother of all stimulus packages.
Bloomberg spent US$500 million of his own money to win office. Trump’s going to spend trillions of taxpayer’s money to stay in office.
The Fed’s emergency measures will probably be enough to buy a stay of execution for investors and see the despised Donald defeat the even more despised Hillary.
The real action will be in 2021…when the Dow finishes what’s already started…a descent to an overall loss of 70%-plus.
PS: Discover why forecasting guru Harry Dent is convinced we’re in the ‘the greatest bubble in history’ that could wipe out 40%-plus value from the stock market. Click Here for Your Free Report.