What the Stock Market is Predicting Around the Elections

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 13 October 2020

⏱️ 18 minutes

🔗️ Recording | iTunes | RSS

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Summary

Today on the Brief: Market rally to highest point in six weeks BTC and ETH up in part on Grayscale ETH trust becoming an SEC reporting company (Grayscale, like CoinDesk, is a unit of DCG.) CBDCs (and CBDC skepticism) on the rise Our main discussion: How markets are trading the U.S. presidential election in November. A look at what different stock and other market preferences suggests about who Wall Street expects to win, including: Energy Private prisons Student loans Health care Infrastructure Dollar Bitcoin

Transcript

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0:00.0	Frankly, the biggest expectation is that the base case, regardless of who wins, is more stimulus,
0:07.1	more spending, more debt monetization. And really the question is just what people want to spend it on.
0:12.6	That's the difference between the two parties. It's not whether they want to print or not.
0:16.2	It's what they want to use that printing for.
0:19.0	Chimath Palahapitia was on Squawkbox this week and said basically
0:23.4	exactly this and reiterated his case for Bitcoin. The reality is that they have printed so much
0:29.3	money that the likelihood is that we're going to continue to see asset price inflation independent
0:33.8	of who's in the White House. The reality is Bitcoin's fundamentally not correlated
0:38.4	with stock markets because it is underpinned by a set of beliefs that are completely
0:42.4	orthogonal to the orthodoxy that runs the world today, and it is completely the inverse of
0:47.2	how the financial infrastructure of the world operates. Put separately, I think that if you are a Bitcoin
0:53.1	hoddler, if that's your big play, it seems that the forces that are making that an interesting bet are so big that they are independent of which party takes the White House.
1:06.0	Welcome back to The Breakdown with me, NLW.
1:10.1	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
1:16.3	The breakdown is sponsored by crypto.com, nexo.io, and elliptic, and produced and distributed by CoinDesk.
1:24.3	What's going on, guys? It is Monday, October 12th, and today we are talking about how investors are trading the election.
1:34.2	First, however, let's do the brief.
1:36.5	First up on the brief today, a big stock rally this morning, with stocks climbing to their highest level in almost six weeks. The S&P, for example,
1:46.5	was up 1.5%. Big Tech led the way with Amazon in anticipation of Prime Day, Twitter outperforming,
1:55.6	and just in general a real strong showing from tech companies. So what are the narratives on this particular move?
2:03.2	Well, first, we've got earnings season coming up and big bank earnings are kicking it off,
2:08.9	and they're expected to be high, suggesting that we've come a long way in terms of the economic
	...

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