The US presidential election
The 2016 US presidential election will be held on November 8, 2016. From an investment point of view, most fund managers and billionaire investors keep track of polls that come out from time to time. They believe investment decisions vary according to the strategy of the candidate at the top of the given polls.
DoubleLine Capital’s Jeffrey Gundlach thinks that Donald Trump will win the US (VFINX) (SPY) (VOO) presidential election. According to Gundlach, Trump is more comfortable with debt. Investors who expect a Trump win also expect the US (QQQ) (IWM) budget deficit to widen.
In his election campaign, Trump is promising to invest in infrastructure, invest in defense, build a wall on the US-Mexico (EWW) border, and create jobs. His focus on defense would give a boost to the US defense sector (ITA) (XAR), and thus investors are keeping an eye on defense. Of course, investment decisions will vary according to who’s elected in November.
What does Rubenstein think about the US presidential election?
In an interview after the SALT (SkyBridge Alternatives) Conference, David M. Rubenstein of the Carlyle Group told Bloomberg that he thinks there’s a higher chance that Hillary Clinton will win the presidential election than Donald Trump. But he also said that doesn’t mean Trump couldn’t win. But whoever wins, Rubenstein doesn’t believe it will accelerate economic growth in the United States. He believes the US economy will experience a slow growth environment due to a sluggish global (ACWI) (VTI) economic environment.
Rubenstein also pointed out that the last recession ended around June 2009. That was seven years ago, and the US GDP hasn’t seen a high growth rate in that period. So he believes a new president may not accelerate economic growth on its own.
In the next part of this series, we’ll see whether the US growth forecast could change after the US presidential election.