President Donald Trump has tweeted about the financial strengths of the U.S. markets under his leadership. According to the POTUS, markets would certainly crash and the U.S. economy would suffer over the long-term if he was impeached.
Barclays Plc disagrees with the President’s assessment and says the economy’s forward momentum won’t be deeply affected.
In a blog post for Barclays Investments Solutions in London, Head of Investment Strategy William Hobbs writes:
“We doubt that capital markets would collapse if President Trump’s administration was endangered, either electorally or indeed legally. The forward momentum of the world economy, and therefore its capital markets, has little to do with the actions of the White House, past, present or future, in our opinion.”
Barclays has been an outspoken critic of the President’s economic success claims. The company previously noted that U.S. equities were strengthed before the 2016 presidential election and that oil’s recovery and looser policies in China helped propel the economy forward.
The investment firm further notes that U.S. markets are currently a safe-haven for investors who are pulling money from other markets to invest in what they consider to be a safe bet.
Hobbs points to previous administrative troubles with Bill Clinton and Richard Nixon, noting, “The lesson from all this is that the wider economic context matters most for capital markets.” Clinton’s impeachment and Nixon’s resignation had a far less important effect on the U.S. economy than inflation during Nixon’s tenure and the tech bubble during Bill Clinton’s time in office.
Indeed, Donald Trump has watched as many of his associates have been indicted and pled guilty, including the President’s former personal lawyer and “fixer” Michael Cohen. Despite Cohen’s guilty plea and Paul Manafort being found guilty on eight felony counts, Eric Zitzewitza professor of economics at Dartmouth told CNN that the S&P 500 Index has continued to climb higher, reaching a new record in recent weeks.
Larry Hatheway, the group chief economist at GAM Holding AG, also chimed in, reiterating to CNN that the primary driving forces fueling the U.S. economy were well underway before Trump took office.
Trump likes to play the fear card among his devoted followers but in reality, the U.S. and worldwide markets are going to be fine, even if Trump is impeached.
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James Kosur is the former Editor-In-Chief and co-founder of Hill Reporter. He recently served as an editor for Business Insider and various other publications. James and his partners sold Hill Reporter to a new owner in July 2019.