Paul Christopher of the Wells Fargo Investment Institute told Fox Business host Maria Bartiromo that he expects a “full Democratic sweep” of the Senate, House of Representatives and White House in November.
“We think the House stays with the Democrats and the Senate goes whichever way the White House goes,” Christopher said. “At this point, that looks to be for the Democrats. It would be a single party government, which we’ve had in the past and markets have done pretty well under that scenario, whether Republican or Democrat.”
The strategist, however, did not rule out the possibility that President Donald Trump could win, citing tightening polls in swing states.
“It still could be a continuation of the setup we have now with Republicans in the Senate and the White House,” he admitted. “But our main base case right now is still going with the full Democratic sweep in November.”
Bartiromo pushed back on the analysis: “Are you saying if we have a Democratic sweep with the House, the Senate and the White House going to the Democrats, the market does not sell off?”
“We think whoever gets elected president will have to follow a lot of the implications of those [current economic] trends,” Christopher explained. “If you’ve got an economy that’s recovering but it’s still fragile then whoever is president and whoever is leading in Congress will have to do what is necessary to prop up and support that economy.”
“That’s why we see so many similarities between the two parties,” he continued. “Both want to see infrastructure spending. Both want to get tough on China. There are more similarities than people expect between the two parties.”
“I don’t know that both parties want to be tough on China,” Bartiromo objected. “I haven’t heard a word out of the Democrats on China’s misbehaving and I don’t think the economic policies are the same at all, Paul.”
“Joe Biden wants to raise taxes by $4 trillion,” she complained. “Donald Trump wants to cut taxes. That’s a significant difference. And I imagine markets would trade in accordance with that. It’s not similar at all.”
Christopher offered a measured reply.
“If you’re the Democrats and you come into power, are you going to just raise taxes and if you do so, you’ll crater the economy and you’ll destroy your chances in the 2022 elections,” he noted. “They’re not stupid. They certainly want to keep the economy alive. So would a President Trump. That’s where you have to as an investor start to work off of those similarities and not just focus on the differences.”
Bartiromo seemed to struggle for a response.
“Well, I mean, he should say that then,” she said. “Joe Biden should say that instead of saying, ‘I want to raise taxes $4 trillion.'”
