August Market Review: The 2020 Election
August 13, 2020
What, if any, are the investment implications of presidential election jockeying? In simple terms, the answer lies in the starkly disparate policy priorities put forth by the two candidates.
Although President Trump has not yet provided a detailed set of policy goals for a prospective second term, most political commentators believe a reelected Trump administration would continue to focus on deregulation, a U.S.-centered approach to global trade and reductions in both corporate and individual taxes.
In contrast, the Biden campaign has emphasized increased federal spending directed toward the mitigation of climate change, increased taxes on corporations and individuals in the highest income tax brackets and expanded access to health care funded through the federal government.
While both the Trump and Biden policy agendas create general investment implications, we think it makes sense for investors to consider the critical, but often overlooked, step of congressional control when attempting to connect the impact of presidential elections and markets.