I know it seems like there’s a real race to be the GOP presidential nominee in 2024. There was a debate the other night, sponsored by my employer, Fox Business, with all seven of the top GOP candidates duking it out.
Well not all the top GOP candidates. The top, top candidate boycotted the event. His name, of course, is Donald Trump. He says he doesn’t have to argue with the hoi polloi. He’s ahead according to every poll, and by a lot.
Wall Street agrees.
You might not appreciate the volume of Wall Street political research that comes out daily in election years, particularly presidential elections. I do, because it’s part of my job to sift through the numbers, pie charts and graphs that try to make sense of Wall Street trying to make sense of our fractious and volatile politics these days. Wall Street really cares about politics because it’s all about the money. Whoever gets in the White House will impact the markets, the P&L (profit-and-loss) statements of financial institutions. Spending, taxation and regulation all flow from the White House.
Yes, we live in fractious and volatile times. A recession is possible, even likely. Inflation, a pernicious tax on the working class, isn’t going away, at least not fast enough. Yet these research reports are fairly stable about whom they believe will be running for president in 2024: Two old dudes whom much of the country doesn’t particularly like and who ran against each other last time around.
That’s right: Wall Street believes it’s going to be 77-year-old Ditzy Donald Trump vs. 80-something Sleepy Joe Biden, and by a mile.
Many Americans say they want fresh faces in presidential politics; Wall Street does as well. The reasons: Trump was a hot mess while in office the last time, why would he change now? He cut their taxes and scaled back the regulatory state, but started trade wars they hated. He was a mess on COVID-19. Petty feuds on Twitter. January 6 was a horrible look.
They aren’t too keen on Biden either. He was supposed to be moderate but gave away key economic and regulatory posts to the Bernie Sanders wing of his party. He raised their taxes, spent money when he didn’t need to, causing interest rates to spike. Migrants keep flooding in, and now they’re camping in front of their offices in midtown Manhattan. Trump might act like a madman; Biden acts barely sentient.
Inevitable rematch
Yet the numbers Wall Street is amassing show the inevitability of Trump vs. Biden, the reports say. Both parties are controlled by their respective bases and those bases remain married to both men. Barring a serious recession in the next year (many on Wall Street give it mixed odds), it will be difficult for the Dems to ditch an incumbent president who wants another four years, writes Matt Gertken of BCA Research, in a report titled “Peak Polarization: Investment Implications of the 2024 Election.”
Trump, meanwhile, is way ahead of all competitors. Again, voters say they want a change, but GOP voters don’t seem to. Barring his imprisonment over any or all of those criminal cases you keep reading about, he will win the GOP nomination, Gertken says. The party elders know if they figure out a way to deny Trump that, he will run as a third-party candidate, and the White House is lost.
The Wall Street research says the Trump-Biden matchup is too close to call. For that reason, be prepared for Biden’s VP Kamala Harris to be president maybe sooner rather than later if her boss wins. A “Washington Policy Perspectives” report by JPMorgan actually put a number on Harris becoming president because Biden obviously doesn’t have the stamina to make it through an entire second term. It quoted a DC insider saying it’s as high as “65% in the next three years.” A scary thought since Harris, in addition to being loathed, is considered maybe less competent than her nearly brain-dead boss.
Funny, because Trump, the reports say, might not make it through his term at least living in the White House. As president, he can pardon himself, of course, but only on federal offenses. He has also been charged criminally by Manhattan DA Alvin Bragg for campaign financial violations in the Stormy Daniels hush-money case. Then there’s Fulton County DA Fani Willis, who convinced a local grand jury to indict Trump for interfering in the 2020 election when he famously pressured Georgia election officials to find votes for him to win the state he lost to Biden.
Yes, Wall Street is betting on a presidential race of dual toxicity, Sleepy vs. Ditzy. Wall Street, of course, has been wrong in the past. Here’s hoping the money men are wrong again.
If you want to take a measure of how much the Street dreads the Biden-Trump rematch, you need to listen to some top Wall Street executives talk, somewhat glowingly, about an organization called No Labels.
The bipartisan group is associated with politicians like centrist West Virginia Sen. Joe Manchin and Larry Hogan, the former governor of Maryland. They’re planning to mount a third-party challenge in 2024.
“Every day I get something from those people telling me how we need change and looking for money,” said a JPMorgan banker who is a registered Republican. “I kind of like what they stand for, but I don’t know if they can win.”
Of course, the history of third-party candidates winning presidential elections is pretty dreadful. Ross Perot did OK back in the day, but he didn’t win a single state. The people at No Labels say 2024 will be different if it features the dual toxicity of Biden and Trump. So stay tuned.
