The economy under Kamala Harris.

0:00 Speaker 1 Sunday morning. Three days in the election. We talked about almost about everything but the economy at the stock market, interest rates well with just today is Adam Johnson once more guy. He worked at Bloomberg Television for over five years interviewing CEOs, and he he knows where to what the score is, Adam three days away? What happens if

0:34 Trump wins? What happens if Irris wins?

0:39 Speaker 2 Well, I think there are two ways we have to think about this, John, conventional wisdom and unconventional wisdom. Conventional wisdom is the easy one. Trump is better for markets because Trump is lower taxes, lower regulation, and drill baby drill, which means cheaper oil, and that’s good for everyone. So Trump is good for markets. Then by definition Harris must

1:04 be had for markets, right, because she’s the polar opposite of Donald Trump. So that’s the conventional wisdom. But then there’s unconventional wisdom. And I think we need to think about this, John, because it’s very possible we’re going to end up with some form of divided government, and historically markets actually like divide the government. What if what if

1:28 Harris wins and she is kept in check by a Republican House and or a Republican Senate. You then have a scenario where Harris wants to effectively bring your hands out handouts and stimulate the middle class. The Conference says, not so fast. We’re going to keep you in check, We’re not going to let you raise taxes, etc. That’s

1:51 the kind of gridlock, believe it or not, John, that markets typically like. And in fact, if you go back since World War Two and look at which combination is best for markets. I hate to say it as a Republican because I’d like to see a Republican sweep, but if you go back historically since World War Two, the

2:07 best combination for markets down is a Democrat in the White House, Democrats in the Senate, and Republicans in the House, and that combination on average has produced annual returns of sixteen percent. So again, I think you have to kind of, you know, start thinking about different scenarios. There’s conventional wisdom and unconventional and conventional.

2:30 Speaker 1 But the Democratic part Adam, I was a Democrat. I supported Bill Clinton and I helped a great deal with his campaign. But this Democratic Party is different than any Democratic party we ever had. The vice presidential candidate said that AOC should be the Speaker of.

2:53 Speaker 2 The House, which is crazy, crazy. I mean, so you’re right, I.

2:58 Speaker 1 Think you can’t use statistics from historical statistics because this is a different Democratic Party.

3:08 Speaker 2 Well, there’s no question the current Democratic Party is far more radical than Democratic parties of the past. I mean, gone are the days where you know, he had blue dog Democrats like you know, Bill Clinton, who could cross the aisle, or you know, for that matter, even Joe Manchin.

3:25 You know, he was sort of the last reasonable Democrat left standing and he’s leaving. So fair point. The Democratic Party is far more radical than it used to be, and their issues are so different, and I think that’s why they are struggling to find momentum and Harris is struggling to find her message. You know, I think Americans

3:48 are tired about, you know, talking about gender neutral bathrooms and pronouns. Americans want security. We want to know it’s safe when we can go outside. We want to know that if you go to vote for a candidate, you’ve earned that right because you’re an American citizen. We want to know that our taxes aren’t going up and that

4:09 inflation is going down. We want to know that there is a stable economy at which we can all work hard and thrive and provide for our families. That’s the message out of the Republican Party. And you’re right, it’s not the message out of the Democrat Party.

4:26 Speaker 1 And don’t forget. Let’s talk about domestic policy, and let’s talk about international policy. Domestic policy. Our borders are under attack. They let thirteen thousand murderers into our country, a lot of them in New York. I mean, doesn’t that cross the word treason? Somewhere? They let Ftanol is being fed in by the Chinese into the Mexican cotels, and it’s

4:54 killing one hundred thousand Americans a year. Let’s look at international The world isn’t a mess. How many countries do you have to have at war before you call it a world war. We have a message in the Ukraine, we have a mess in Israel. We have a mess all over the place. Don’t the American people? Can’t they

5:14 see that?

5:16 Speaker 2 Oh, they see it. They absolutely see it. And that’s one of the reasons why mister Trump is resonating with voters. You know, he himself has said if he were in office, and you know, I guess we’ll never know because shots have already been fired. But you know, he made the comment that Putin would never have gone into Ukraine because

5:33 he would have realized that the stakes are too high. I can only imagine what’s going to happen with Iran if mister Trump is elected, because all of a sudden, they will be running scared. Trump has made it very clear there’s no room for Iran in a Trump presidency, you know, unlike what happened under Obama, where you remember

5:55 when six billion dollars US dollars actually made their way.

6:00 Speaker 1 Wasn’t one hundred dollar bills?

6:02 Speaker 2 Yeah? Yeah, one hundred dollar bills? And it’s just it’s crazy, John, and I think it is crazy.

6:09 Speaker 1 I’m going to ask you one last question before we go off the Sunday morning. Yeah, they fed lowered interest rates by fifty basis points, yes, and then the markets went down by at least fifty basis points, and all of a sudden, in the clear blue sky, right, it’s up seventy five basis points. In another words, up the

6:29 reinterest rates are up again. And I asked one person, I said, he says to me, well, the Treasury is is failing and selling what they want to sell is there a panic at the Treasury Department.

6:44 Speaker 2 No, but I think there is a realization amongst market participants John that both Harris and Trump are likely the inflationary Harris because all she wants to do is spend, spend, spend, and because they are likely to be tariffs, that means that goods coming into this country costs more by edition is inflation. So if each candidate is inflationary, then bond

7:11 yields are going to actually go up to reflect a view that there is going to be higher inflation down the road. The one thing to remember those jobs is you know, and you know this as well as anybody.

7:23 Markets move on a motion, and the pendulum always swings too far. So I think actually the decline in bond yields ahead of ray cuts from the Fed probably went too far. And now all of a sudden they’re saying, oh jeez, we went too far, and oh my gosh, they want to be inflation. So now you know, yields

7:42 have reinflated and that pendulum is going too far. Somewhere in the middle liized reality. The good news is inflation is coming down. The good news is earnings are rising. The good news is the economy is stronger than most people think. The good news is people are employed in spending money. And the best news of all, John, is

8:01 that it’s election Day on Tuesday and we’re going to have a new president and his name is Donald Trump.

8:08 Speaker 1 Well, God bless America. Thank you so much, and we’ll catch up again real soon.

8:12 Speaker 2 Oh thanks John, God bless