As stock market-friendly Joe Biden slips in the polls against Elizabeth Warren, centrist candidate Michael Bloomberg is itching to dive into the fray for the 2020 election. The three-term New York Mayor and multi-billionaire looks certain to run for president if Biden’s run peters out,…
As stock market-friendly Joe Biden slips in the polls against Elizabeth Warren, centrist candidate Michael Bloomberg is itching to dive into the fray for the 2020 election. The three-term New York Mayor and multi-billionaire looks certain to run for president if Biden’s run peters out, and that could be great news for the Dow Jones.
Donald Trump started his presidency with the stock market-friendly moniker after the “Trump Bump“, but after a mass of tariffs, the Dow has been moving sideways for more than a year. Faced with continually weak polling, Donald Trump is having to double down on his core rural voter base (who love seeing him being tough on China) rather than the 401k crowd. These disenfranchised moderates are Biden’s demographic, that Mike Bloomberg would love to poach.
The rise of left-wing Elizabeth Warren has centrist Democrats worried. Joe Biden’s prior failed presidential runs have demonstrated he is by no means a natural candidate. There has been evidence of weakness in the Dow Jones as Warren has gained in the polls, and stocks would likely continue to feel pressure if this trend continues. Both Trump and Warren (and Bernie Sanders) support protectionist tariffs leaving free trade advocates clamoring for Bloomberg to come in and restore a globalist agenda.
For those who want a President who runs the United States like a business, Michael Bloomberg is a compelling option. With an eye-watering net worth of $50 billion, even by the most generous estimates, he is 15 times wealthier than Donald Trump. The Dow would love his “lower taxes” agenda, while his distaste for the NRA and pro-environment views might be tolerable to some of the more left-wing democrats.
Where Bloomberg could stumble is his age (another candidate over 70) and his view on China. There is strong bipartisan support for the US taking a more robust approach to trade abuses. While the Dow Jones might like a soft line on China, saying things like “Xi is not a dictator” is not a popular approach in 2019 with the eyes of the world still locked on protests in Hong Kong.
Only if Joe Biden quits is this going to be more than an interesting conversation, making a stock market reaction unlikely. However, the prospect of a Trump vs. Bloomberg election in 2020, with two self-described “pro-business” candidates, could not be ignored by the Dow, with the latter arguably the more bullish option for the stock market.
Trump officials have talked about the Dow at 30,000 under his presidency, but protectionism removed that possibility before 2020. The removal of trade barriers under Bloomberg could make hitting 30,000 a chip shot. For now, the probability of Bloomberg entering the election remains relatively low, but a Biden implosion at the next Democratic debate might change that significantly.
This article was edited by Samburaj Das.