The Great Debate
It’s showtime! Joe Biden and Donald Trump will face off tonight in an American television tradition that dates back to the 1960s. The presidential debate, hosted by CNN, a division of Warner Bros. Discovery (WBD), will begin at 9 p.m. ET and run for 90 minutes, including two commercial breaks. CNN’s Jake Tapper and Dana Bash will moderate, while new rules will be in place, including muted microphones except when it’s a candidate’s turn to speak and no live studio audience.
Big deal: More than half of the U.S. adult population will attend the event, according to a new poll from the AP and the NORC Center for Public Affairs Research. “57% of Americans say they are extremely or very likely to listen to at least some of the debate or commentary that follows,” according to a new poll from the AP and the NORC Center for Public Affairs Research. More than a third are also very likely to listen or watch live the first of two planned debates, showing how important the platform is in giving themselves an edge in this high-stakes race.
The topics covered are numerous, from immigration to foreign policy including preparation for a second term. But for investors, the economy will be at the heart of the debates. This includes topics like the job market, taxes, the federal deficit, inflation and the cost of living in general, which have many Americans watching their bank accounts and wallets. This also includes investments related to sectors such as environmental rules surrounding the oil and gas industry, or regulations that concern the healthcare market or real estate.
“Voters fondly remember the Trump-era economy before COVID-19 and are frustrated that price levels and interest rates remain high, even as the inflation rate has “To the extent that the debate is about the economy in his respective areas, Trump wins,” wrote Evercore ISI analysts Sarah Bianchi and Matthew Aks. “Biden’s job is to avoid spending too much time focusing on the macroeconomic defense of the economy and his record. He needs to steer the conversation toward two competing visions of the future. Voters tend to support his ideas that “corporations and the rich pay their taxes.” inflationary, he might be able to make progress.”
Conclusion : “When voters are this divided and the polls are this close, even small movements can have decisive results.” In terms of stocks, the S&P 500 Index (SP500) increased by 58% since Trump’s election in 2016 until November 2020, compared to 64% seen after the election of Biden (four months before the deadline). Looking at returns since taking office, the S&P 500 (SPY) (IVV) (VOO) climbed 67% with Trump in the White House, compared to 44% under Biden (to date).
Stay alive
Big banks are well-positioned to weather a severe recession, with all 31 banks subject to the Federal Reserve’s stress test this year remaining above their minimum capital requirements during the hypothetical situation. “Although the severity of this year’s stress test is similar to last year, the test resulted in higher losses because bank balance sheets are a bit riskier and expenses are higher,” Michael said Barr, vice chairman of Fed supervision. In the hypothetical scenario, banks would have lost nearly $685 billion. The scenario assumed a 40% drop in commercial real estate prices, a 36% drop in home prices and a 10% unemployment rate. (24 comments)
More appetizing
Chipotle Mexican Grill (CMG) rose Wednesday in its first trading session after a 50-for-1 stock split, one of the largest in Wall Street history. Shareholders received 49 additional shares for each share held in the stock split, while a one-time stock grant was offered to CEOs and longtime employees. “We believe the stock split will make our stock more accessible to our employees as well as a broader range of investors,” Chipotle CFO Jack Hartung said when the decision was first announced. Interestingly, the restaurant chain has never done a stock split since going public in 2006. (3 comments)
The final frontier
Elon Musk’s SpaceX (SPACE) has been awarded an $843 million contract to develop a spacecraft that will deorbit the aging International Space Station after the lab shuts down in 2030. NASA will take ownership after the spacecraft is built, and it is expected to destructively disintegrate over time with the ISS by burning up in Earth’s atmosphere. The United States, Japan, Canada and participating European countries will operate the station through the end of the decade, while Russia will remain in the program through 2028. Elsewhere, SpaceX has reportedly raised the price of its public offering in the face of strong investor demand, valuing the company at a record $210 billion. (18 comments)
