The current electioneering in the US and UK is making interesting media frenzy material and a buzz on social media. Is it just me, or were Boris Johnson and Donald Trump separated at birth? Are they not “brothers from another mother”? One is a larger than life comedian with the strangest hair on the planet and the other is….. no, wait a minute, actually, that description could go for both men!
One is now voting for BREXIT – or Britain to leave the EU – and the other is promoting MEXIT – or Mexico to have a big fence between itself and the good old US of A.
Does all this have any material impact on our global investment strategies? It’s a pretty sad indictment of the political talent in the world when the short answer is “not really”.
Donald Trump’s campaign to become the Republican Party’s candidate of choice in November’s Presidential election has gone from the preposterous, back in June last year, to a very real possibility. His string of controversial statements about Mexican fences, Muslim badges, insulting the Pope and the attacking the highest capitalist altar of them all, Apple Inc, borders on madness. However, his performance in maintaining approximately 30% of the vote in the first two primaries (easily winning Nevada), whilst now infuriating the blue blood establishment, shows he has enough support from the masses to win not only the Republican spot, but potentially become the next leader of the free world.
Not to be outdone, Boris ‘the boxer” Johnson has decided to directly oppose the Tory establishment and lead the BREXIT campaign. As the Mayor of London, shouldn’t he probably be looking to help his major employers, the big banks and financial institutions of the City, or is he is also aiming for the popular controversial vote? His lobby will no doubt be influential.
Back to the question of the material impact on our investment strategies, then: politicians have been finding it increasingly difficult to implement policy decisions for years. President Obama, for example, has been frustrated at every turn on the implementation of his healthcare initiative and despite an election promise to close Guantanamo Bay prison upon becoming president, eight years later he is having one final crack before he leaves the Oval Office.
One thing I like about both Trump and Johnson is that they are atypical career politicians and call a spade a spade. But the nature of the two party system, in both the UK and US, is becoming more and more confused around the edges and therefore a quagmire of getting nothing done on a practical level means they have less and less influence on investment markets than they ever before. The Central bankers are the new market movers and leaders of the free world!
Political Leaders of the Free World