2 implications of assassination attempt on Trump: Analyst

The assassination attempt made against former President Donald Trump has raised questions about the impacts over how it will affect the polls.

BTIG Director of Policy Research Isaac Boltansky joins Morning Brief to discuss the impact the attempt will have on both candidates' polling.

Boltansky believes there are two political implications of the attempt."The first is Donald Trump was the favorite before this and he's the favorite after this. And the second is, I think that Joe Biden will still get the nomination on the Democratic side. I think that the shift of attention away from the infighting in the Democratic party to Donald Trump and to the RNC convention that's going on this week, makes it easier for Biden to get that nomination in a couple weeks."

He continues, postulating what could happen in the markets if Trump wins: "If Trump comes in, you will see a change in the heads of the FTC and the DOJ's antitrust division. You'll have a much more hospitable climate for M&A. So what does that mean? I think that's positive for boutique banks like Lazard (LAZ) and Moelis (MC) and Evercore (EVR). I think you're also going to have more volatility, right? So that's something from a equity markets perspective that you can focus on companies that are exposed to more equity market volatility, like the exchanges like Virtu (VIRT) and Cboe (CBOE)."

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Nicholas Jacobino

Video Transcript

Well, many election polls conducted prior to the attempt on former President Trump's life showed Trump with a slight edge over President Biden.

Now, many investors are considering how the events over the weekend and that attack might affect either candidate's chances of victory here with more.

We've got Isaac Boltanski BT IG, Director of Policy Research, Isaac.

It's always great to speak with you.

I just want to start on what your conversations were like over the weekend.

What were clients asking you and what were you telling them?

Sure, look after we got past that initial moment of, of shock.

I think the conversations focused on, on trying to understand what the next few days are gonna be like and then how we should think about what this means for the 2024 election.

And so I think the initial round was trying to get your bearings because this isn't something that you see here, right?

This is new for most investors and new for most of us, this level of political violence isn't something we're accustomed to.

So, trying to get our arms around what that means for society at large and then trying to understand the 2024 election because I, I really think there are two main implications from this, from a purely political perspective.

The first is Donald Trump was the favorite before this and he's the favorite after this.

And the second is, I think that uh Joe Biden will still get the nomination on the Democratic side.

I think that the shift of attention away from the infighting in the Democratic Party to Donald Trump and to the RNC uh convention that's going on this week makes it easier for Biden to, to get that nomination in a couple of weeks.

Isaac, what's particularly interesting is, and, and I wrote a story on this actually last year talking about the number of executives that were anticipating a very vitriolic election season.

And within that, you kind of got the sense that there was going to be less corporate donorship, there was going to be less playing in at least the top line of this general election.

How does that also impact if you saw less from the corporate Super pacs contributing into the top of ballot?

How does that also impact what comes to fruition in November?

Yeah, look, I think, I think first of all, we're still early and so I think that there's gonna be a lot more money that comes in after uh the conventions.

And so I, I want to make that point at the top.

I think that we will see a flood of large donations.

I would just note that Ken Griffin, for example, has said he's waiting to see who Trump's VP would be before he commits to making any, any donations one way or the other.

So we're going to see money spent.

I'm not worried about this.

They, they will have that uh continued, I think for me, what's, what's notable here from the corporate side is that um we have seen, I think like a shift, at least in sentiment to starting to focus on down ballot races.

And so on the Democratic side, for example, you've seen a step back from donations to President Biden's re-election, at least on a relative basis.

And instead those donations are moving towards uh competitive house races or even some of the very competitive Senate races.

So the money will still find its way into politics.

I don't think that's any that's going to change.

It's just exactly where it goes and the amount that I think can have some volatility to it.

We've had a lot of guests on this morning, obviously talking about this and the potential increase.

This has in terms of the possibility of a red wave come November.

If we do get a red wave, what does that mean for financial markets?

Yeah, look, I think there are a lot of ways to, to talk about this and I think that we're already now going into sort of the, the second tier uh impacts.

I think everyone understands or at least has, has some understanding of the impacts of that continued spending will have on uh on bond markets that the Trump tax cuts would be reauthorized.

I think we're getting our arms around that my clients are starting to focus on sort of the second order the next layer down ideas.

And so one of those that we've focused on a fair amount is is consolidation.

If Trump comes in, you will see a change in the heads of the FTC and the DOJ S Antitrust division, you'll have a much more hospitable climate for M and A.

So what does that mean?

I think that's positive for, for boutique banks like Lazard and Molis and, and Evercore.

I think you're also gonna have more volatility, right?

So that's something from a uh equity markets perspective that you can focus on companies that are um exposed to, to more equity market volatility like the exchanges like virtue and, and CBOE.

I also think there's going to be a pronounced push to get Fannie and Freddie the mortgage signs out of conservatorship.

That's something that uh you have seen, not only Donald Trump focus on but really the entire Republican party has gravitated towards that view.

So I think we're, we're now we're all still trying to figure out the macro because look, there are real puts and takes to a Trump two presidency from the macro side.

My clients are starting to focus on more acute themes because those are areas that I think still have room to run how many of the themes are, are tied back to even if former President Trump is saying that he didn't author project 2025 and that plan, but there are still elements of that, that he looks to enact how many of those themes are your clients trying to best decipher exactly where that would be either beneficial or actually a major risk to their portfolio.

Sure, I mean, look, we're all, we're all trying to get smarter on, on a constantly evolving situation.

A lot of those themes and even frankly, a lot of the the GOP party platform that you're going to hear a lot about over the next few days are things that aren't exactly investable one way or the other, right?

There isn't much you can do on the the Trump policy position that we shouldn't pay taxes on tips, right?

That's a position that he is pushing in large part because it plays well in Nevada, right?

So that's not exactly something that you can, you can have an investable thesis around.

You can look at the GOP party platform and say, my goodness, this is darn good for the digital asset ecosystem.

It's good for Bitcoin.

It's good for all of the companies around there from um you know, exchange like Coinbase to um to miners like uh riot.

So those are things that I think you can sink, sink your teeth into, whereas there's a lot in the party platforms and in project 2025 that, that are about the culture war and those aren't things that exactly lend themselves to investable ideas.

All right, Isaac Boltanski, who's the BT IG director of policy research, as you mentioned, a lot of time between now and the election.

We'll see how much weight these events continue to carry historic as they are.

Thanks so much for taking the time.

Isaac.

Thank you.