Let The Games Begin

Apologies, in-advance, for the brain dump.

The primary games are upon us and the Iowa caucuses are in the rear view mirror.  My takeaway?  110,000+ voters participated in the 2024 state caucuses - the smallest turnout ever.  This represents less than 15% of the state's 752,000 registered Republican voters.

The 2016 turnout was 187,000 - about 70 percent higher.  It is reasonable to conclude that the nasty cold weather conditions resulted in some voters staying home.  Or is it possible something else is in play?  Enthusiasm maybe? 

Without a doubt, Donald Trump, with his power of incumbency and to my eyes at least, the most loyal and motivated base of supporters ever.  His name recognition is off the charts.  His trajectory is that of the inevitable.  Yet he earned only half the votes of only a small number of the most committed GOP voters - roughly eight percent.

Consider this.

There is a population of Republican, Republican-leaning, conservative and independent voters who are unlikely to vote for Trump in the general election.  Nearly half of Nikki Haley's Iowa supporters claim they'd vote for Biden over Trump.  That is not to suggest they like or support Biden's policies - it is the suggestive of the strength of the Never Trump movement in conservative circles.  Polling suggests that twenty-five percent of GOP caucus-goers won't vote for Trump in November.  

I'm not making trouble or picking a fight over any of this; yet some of this polling data has implications for the general election in November.  

A Trump - Biden match-up in November is presently in the margin of error and promises to be a close and fraught election.  A couple of octogenarians going head to head.

A Haley - Biden match-up in November presently has Biden trailing by ten points.  A younger, brighter, aspirational UN Ambassador mops the floor with Biden going head to head.

Sure, I understand polls can get it wrong.  Yet a party platform of retribution, grievance and pay-back is, in my opinion, thin soup.  If the GOP is desirous of taking back the White House, retaining control of the House or taking-back the Senate; or any combination of the foregoing, then something needs to happen to capture the enthusiasm of Republican, Republican-leaning, conservative and independent voters who continue to be indifferent to Trump.  This will be a challenge.

As a recovering financial guy here are a couple of closing thoughts and an admonition to not commit an unforced financial error in 2024. 

• During an election year first quarter volatility in the markets is common as we approach Super Tuesday.  Expect first half weakness. 
  

• Reelection years tend to be predictably solid for investors.  Since 1944 the market has been up almost every year an incumbent president has run for reelection.  Expect second half strength. 
  

• In the absence of a recession the incumbent president wins. 

• If there has been a recession in the prior two years leading up to the reelection campaign the incumbent loses.  
  

Past performance does not guarantee future results; nevertheless, historic patterns share some predictive qualities.  I remain rationally optimistic about the art and science of basic economics and history.

Ponder this:

Where does Nikki Haley go after New Hampshire?

Is the next real race the one for for Donald Trump's VP?