Making Markets Sam Rines: What the Election Means for Markets - [Making Markets, EP.48]
Nov 1, 2024
Sam Rines, an economist and managing director of Corbu LLC, returns to share his insights just before the upcoming election. He dives into potential market scenarios and the impacts of a split Congress. Rines discusses the strength of the US consumer amidst economic uncertainty and the Fed's role in market dynamics. He also highlights surprising resilience in sectors like travel post-COVID. Additionally, he examines strategic investment shifts from major companies and the implications for inflationary markets. Tune in for thought-provoking analysis!
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Markets Already Price The Likely Outcome
- The market has largely priced a Trump win, so surprises will matter more than expected outcomes.
- If neither party can enact big policies due to split Congress, markets may react positively to limited risk of policy shocks.
Red Sweep Has Mixed Sector Effects
- A Republican sweep helps some sectors but harms others and may lower oil prices via more drilling.
- Policy promises can be offsetting and create unexpected winners and losers across sectors.
Position For Limited Tax Changes
- Base-case: expect little tax-code change absent a congressional sweep, so plan for expiration of TCJA provisions.
- Position for marginal higher corporate and individual rates but renewed SALT and specific deductions returning.