Can Kamala Harris regain the momentum? Will Trump’s campaign collapse? Bond and Stock Markets are sounding alarms. The war drums are beating more loudly each day. The strange and winding political road taken by Elon Musk. And much more.
It’s Thursday, October 31, and this is your In Trust Network news summary for the week.\
The Campaign
With less than one week to go before the most chaotic presidential election in recent history record numbers of Americans have voted early — nearly 50 million so far.
Joe Biden calls Trump supporters “garbage,” Trump responds to Biden, and Democrats are expressing dismay that Harris isn’t working harder to convince voters the economy is better than they think and she deserves the credit.
Instead, Kamala’s closing message is that this election is a referendum on abortion and fascism. She claims Trump opposes women’s healthcare because he wants a nationwide abortion ban (which Trump has denied for weeks.) She also calls Trump a fascist (something Democrats have been calling Republicans since Reagan, but now they mean it.)
Now they mean it except for those Democrats running in swing districts and battleground states who are running ads about how they’ve opposed Biden and worked with Trump in the past, and assuring voters they can work with Trump if he wins.
Trump’s closing message is that things were better when he was president .., on the economy, immigration, and crime.
The Polls
In 5 of the last 9 national polls Kamala Harris has a 1% to 3% advantage over Trump according to Forbes Magazine. In the other 4, it’s a tie or Trump has a one digit lead over Kamala. The national popularity contest doesn’t actually count for very much since our presidents are elected by means of the electoral college. Trump can, and in 2016 did, lose the national vote while still winning the electoral vote. What is significant about the national polls is that in 2016 and 2020, Trump was behind by more than he is now, but won in 2016 and did better than the polls predicted in 2020.
Also remarkable about national polls, Trump is making significant headway with Hispanic voters. In an NBC News poll released Sept 29th Harris received 54% of the Hispanic support compared with 40% for Trump. Harris’s lead is substantially below where Democrats stood in 2016 (50 point lead) and in 2020 (36 point lead.)
In the 7 key battleground states, according to the Real Clear Politics polling average, Harris leads in Michigan and Wisconsin by .05%. In Pennsylvania, North Carolina, Georgia, and Arizona, Trump leads. In Nevada, Trump is up by .05%, basically a dead heat.
It’s important because if Trump wins the states he should win, Harris must win the three midwest states of PA, MI, and WI. If she doesn’t, she loses.
So far the momentum seems to be with Trump as he’s closed what was a 3 to 6 point gap in polls conducted right after the Democrat convention.
It’s not a poll, but a top data scientist has introduced a new predictive model he claims gives us an instant indication of change in voter sentiment. Be careful, it’s addicting.
The Economy
The candidates may be ignoring the $35 trillion debt, but bond markets are sounding the alarm. On the heels of a weak bond auction, bond vigilantes have been mustering in the U.S. and UK.
The fact the U.S. is now spending more on interest payments than on defense, and having to borrow even more to pay that interest, are driving bond yields higher.
Meanwhile a big pandemic-era IOU is coming due next year as major U.S. companies face the need to refinance some $250 billion in low-coupon bonds issued in 2020.
Perhaps one of the most interesting sidebars of the 2024 election is the tragic backstory that drove Elon Musk from Hillary supporter in 2016, and Biden supporter in 2020, to taking on the role of head cheerleader for Donald Trump.
Musk says when he’s appointed Government Efficiency and Waste Czar in a Trump Administration, he will move to cut “at least” $2 trillion from federal spending and bring the budget into balance. He acknowledges, however, there’s likely to be a lot of pain associated with austerity for the first year or so. Recession, rising unemployment, higher inflation, a falling stock market, supply shortages, and more are all part of the outlook. But, he says, the pain will be termporary and eventually things should be much better than they would be otherwise.
Musk isn’t the only one who acknowledges potential problems in the stock market. While some see clear sailing ahead, others are predicting a “lost decade” during which we can expect something less than 3% annual growth in equities.
Policy
Speaking of out-of-control federal spending, the Wall Street Journal’s Richard Rubin explains how the deficit got so big and why the candidates don’t talk about it. One thing is certain, whatever the candidates say during the final week of the campaign, they’ll have a lot less money than their promises will cost.
And while Musk admits massive cuts in federal spending will lead to severe economic pain over the short term, the Telegraph says Kamala’s tax plan will cause massive pain over the long term. They call her plan “stupid.”
News Nation reports that the cost of owning a home has soared over the nearly 4 years of the Biden Administration — up 26%.
War
Amidst all the U.S. election hokum it’s easy to overlook the reality of a wide array of new and growing global threats against the prospects for peace.
Russia has suffered 600,000 casualties in the Ukraine war, 10,000 North Korean troops arrived at the Russia-Ukraine border this week, a major Chinese hackunsettled U.S. intelligence agencies, Israel expanded its war in Lebanon and Canada accused the 2nd most powerful man in India’s government of ordering an assassination.
Trump says if he were president, the wars in Ukraine and Israel never would have happened; and that he still has time to derail an escalating conflict between China and its neighbors, particularly Taiwan. He’s probably right in the context of the previous decade. But today, China, Russia, and Iran have entered an alliance every bit as dangerous as the one Germany, Italy, and Japan forged in the last century.
The WSJ notes that Mr. Trump “says he got along with” all the dictators just fine. But, the Journal goes on to suggest, “It would be reassuring if Mr. Trump said, at least once in a while, that these dictators are dangerous and the enemies of liberty.”
Russia is also sending signals that it won’t back down. France 24 reports that Russia test fired missiles earlier this week to simulate a “massive” response to a nuclear first strike.
And while the Russia-China-Iran axis is building their military arsenals at a rate 5 to 6 times that of the U.S. and Europe, the Pentagon is now reporting a shortage of almost everything needed to fight a war – anti-air missiles, torpedoes, ships, and even bullets.
The shortage of adequate weapons may be one reason Biden has drawn a line in the sand demanding that Israel open the Gaza border to more foreign aid or lose shipments of U.S. weapons.
Israel doesn’t seem cowed. The Knesset just banned UNRWA operations and prohibited Israeli government officials from having any contact with the UNRWA. Israel charges the UN agency with being riddled by Palestinian terrorists and their sympathizers and that UNRWA is not a trusted partner in providing aid to the Palestinians who need it, but instead channels aid almost exclusively to Hamas.
