'We'll have a stimulus package prior to Biden being sworn in' if Biden wins the Presidency and McConnell remains majority leader: Strategist
Chris Campbell, Duff & Phelps Chief Strategist and Fmr. Treasury Secretary for Financial Institutions joined Yahoo Finance Live to discuss his outlook for the election as results roll in and what the results mean for the possibility of additional stimulus.
Video Transcript
ADAM SHAPIRO: Let’s talk more about, though, how the election is going to impact different kinds of markets and financial institutions. Chris Campbell is a frequent guest of Yahoo Finance Live. He’s with Duff & Phelps, he’s a chief strategist and a former Treasury Secretary for Financial Institutions. It’s always good to see you, Chris, and I am curious.
CHRIS CAMPBELL: [? Good ?] to see you, [? Adam. ?]
ADAM SHAPIRO: So there is uncertainty. We don’t know who the president’s going to be. The people you advise, is it going to make much of a difference if it’s a Donald Trump or if it’s Joe Biden?
CHRIS CAMPBELL: Oh, absolutely. Look, as I often say, people and personnel are policy. And so it’ll really matter if, you know, who Biden or Trump puts the financial regulators or the heads of their departments. And so it really does matter significantly. Of course, this campaign wasn’t really fought over issues as much as, kind of, personalities.
But those personalities have significant amount of issues related to them. And look, I think under a Biden administration, you know, let’s say, assume a Biden win and a Democratic Senate, look, you’re seeing a– you’re going to see a significant seismic shift in the economy and the economic approach to– that we have in our country, and perhaps then a ripple effect worldwide.
SEANA SMITH: Well, Chris, if we don’t see that blue wave, though, and we do see some sort of split scenario, if Joe Biden is elected president and the GOP holds on to the Senate. I’m curious just what you think about stimulus. Because I know in the past you were saying that it was very unlikely that we’ll get some sort of package before the election.
You were right, we didn’t get anything. One of the areas of disagreement has really been the aid to state and local governments. McConnell coming up this morning just saying that there was a possibility that this next package could help state and local governments. How much money do you think should be or needs to be allocated to this?
CHRIS CAMPBELL: Look, I strongly suspect that if Vice President Biden makes his way to the presidency and Mitch McConnell remains the Majority Leader, we’ll have a stimulus package prior to Biden being sworn in. And so I think that, you know, that it’ll be less than $2 trillion and may include some aid to states, that it’ll be a very targeted aid to states, mostly targeting on PPP, perhaps direct payments to Americans who are hurting and other affiliated industries, airlines and others that have really been deeply impacted by the COVID crisis.
So look, I think that that’s probably the likeliest and most likely scenario we’re going to see if Biden does make his way to the presidency. Look, it’s up to– it’ll be up to the House of Representatives to see if Nancy Pelosi wants to deliver on that kind of a bill. But I think, again, at the end of the day, there’s, you know, obviously, the leader has suggested that he is open to some aid to states. But I think it’d be very targeted.
ADAM SHAPIRO: Chris, let’s broaden this out, because depending on who wins, I remember in 2016 there was the expectation, if President Trump won, then candidate Trump, there’d be a boost in things like coal production, oil industry would benefit. But today, we see oil, I think, you know, WTI futures had it around $39 a barrel. Even if President Biden gets in– or if President Trump wins re-election, we have a depressed oil market out there because of a global economy that’s COVID impacted.
So what do you see? Who are the sectors that gain if President Trump retains office?
CHRIS CAMPBELL: Look, I think that if Trump retains office, I would go into technology. I would go– look, I think all of the sectors that were doing well prior to COVID, I would significantly and we will push folks in that direction. I think if, you know, if Vice President Biden becomes president and there’s a divided government in Washington, largely means nothing is going to happen or nothing significant is going to happen.
And in that case, typically when nothing happens in Washington, it’s actually better for business, except if you’re, like, deregulating or lowering taxes. And so in that case, I think that we’ll see a new equilibrium in the market and it’ll stabilize. One thing that’s interesting to note, though, is that the Supreme Court, irrespective of who becomes president, is going to hear a significant case in early November on Obamacare.
Should the court invalidate some or all of Obamacare, that’s going to force a significant and dynamic debate in Washington on health care that will have to have some resolution in this next Congress. And so there is going to be, and it’ll certainly lead into the next Congress– next congressional election, and so on in two years from now. So, you know, that’s something to very be much– be very mindful of, and watch those stocks as that debate unfolds.
ADAM SHAPIRO: Chris Campbell, Duff & Phelps chief strategist and a former Treasury Secretary for Financial Institutions. Good to see you here at Yahoo Finance Live.
