- Nikko Asset Management’s Chief Global Strategist John Vail predicts Donald Trump’s life will now be “miserable for the next two years”.
- He says a Democrat-controlled House could lead to investigations into his affairs and a possible impeachment.
- While this will make Trump’s time as President tough ahead of the next election in 2020, he says it’s not all bad news for the Republican Party given it strengthened its majority in the Senate.
- Vail says today’s result diminishes the prospect of Trump being reelected, should he indeed choose to run again.
While the US Presidential Election shocked many around the world back two years ago, the same cannot be said about today’s midterm election result.
As the polls predicted, the Democrats now have majority control of the House of Representatives while the Republicans have retained their grip on the Senate.
The question now is what will happen next?
There’s no shortage of opinions floating around, but this one from Nikko Asset Management’s Chief Global Strategist John Vail certainly caught our eye.
In his opinion, with Democrats taking the House, Donald Trump’s life will now be “miserable for the next two years”.
“The House will be controlled by the Democrats, which will make Trump’s life miserable for the next two years, with many deep House committee investigations into his affairs, which could well lead to impeachment,” he says.
“Incriminations, however, will likely fly from both sides, as Trump will likely appoint a much more partisan Attorney General.”
However, while this will make Trump’s time as President tough ahead of the next election in 2020, Vail says it’s not all bad news for the Republican Party.
“The GOP increased its majority in the Senate by several seats, which will make confirmations of judges and administration officials easier and overriding his vetoes harder. It will also make conviction of Trump, if impeached by the House, less likely,” he says.
Vail says today’s result diminishes the prospect of Trump being reelected, should he indeed choose to run again.
“The chances of an impeached, but not convicted President being re-elected, seems unlikely, but not impossible in this uncertain world,” he says.
“In such a situation, Trump might not even wish to run again, and in any respect, the chance of GOP Presidential victory in 2020 seem much diminished.”
Given that view, Vail says this may well mean “higher taxes and more business and environmental regulations after 2020”.
For an economy that’s likely to be growing substantially slower in the coming years than what it is today, that will present additional challenges to financial markets, especially should monetary policy settings globally be significantly tighter than what they already are.
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