- Latest New York Times presidential polls
- The Federal Reserve, the 2024 elections and questionable economic data
- Living longer and the weight loss drug revolution
- Putin’s defense and national security shake-up
The latest New York Times presidential polls
The New York Times just reported on polls in five battleground states (Wisconsin, Pennsylvania, Arizona, Michigan, Georgia, and Nevada). While Biden won all of them in 2020, Trump now leads in all of them, according to the poll, conducted jointly by the New York Times, Philadelphia Inquirer, and Sienna College Poll.
But it is important to note how the poll narrows when you move from “registered voter” to “likely voter.” What we want to see is polls of “determined voters” -- folks who have voted in every election in the last five to eight years, who show up rain or shine. Our view is that really shows who is leading and likely to win at this point.
We also want to see more data on what the Nikki Haley voters are thinking. Looking at last week’s Indiana Republican Primary (yes, there are still primaries going on), 22 percent voted for Haley over Trump. And on May 5, almost 17 percent voted for Haley instead of Trump in Pennsylvania. Trump needs those Republican voters. What are they thinking of doing on November 5th? Vote Biden? Sit at home? Hold their nose and vote Trump? Again, a critical data set to understanding who is winning and likely to win.
The Federal Reserve, the 2024 elections, and questionable economic data
Barrons’ Magazine reports on an issue we have raised with clients for some time now: The credibility of government economic statistics. The report cites how the Bureau of Labor Statistics (BLS) has revised payrolls downward by 124,000 job so far this year – changing the January figure of 353,000 down to 256,000. The initial number gave rise to market concerns the economy was actually overheating while the revised number got everyone to calm down considerably. But what’s up with the wild swing? The answer is not – as we get asked quite a bit about that the government is playing with the numbers – but instead the rapidly shrinking response rates for nearly every major survey conducted by the BLS.
For example, the response rate at the end of 2023, according to Barrons’ for Current Employment Statistics was just 45 percent, compared to 60 percent at the end of 2019.
Our friend and former colleague, Apollo Chief Economist Torsten Slok, is quoted in the piece making the very smart point (everything Torsten says is very smart): This is why the Fed is now talking about the “totality” of the data it seeks to examine in formulating monetary policy.
Where do the elections come into this? Two thoughts: 1) We regularly hear from folks we speak to at conferences and events acros the country that they worry the numbers are being played with, that this is an example of the “Deep State” at work. We don’t think that’s correct – it is just a matter of no one wanting to participate in the BLS and other government economic surveys (but in complete candor, we have no explanation as to why they do not), and 2) This may help explain the significant – and seemingly growing — disparity between why President Biden keeps claiming the economy is doing great but voters are saying the opposite. It is a dangerous fault line, we believe, for the President to be walking around on going in November and an opportunity for former President Trump to hammer on our first point (charging “Deep State” manipulation) while connecting with voters who know and feel the economy is not as good as claimed.
The FT-Michigan Ross Poll released early this week shows the growing concern and negativity of voters about the economy.
And new data published by the Federal Reserve Bank of New York this week shows the number of consumers who expect they will miss a minimum debt payment over the next three months has risen to a four-year high of 13 percent.
This is an issue to keep a close eye on going into November.
Living longer and the weight loss drug revolution
We have been telling clients over the last year to pay close attention to the impact weight loss drugs (which I have personally benefited from – down 64 pounds in the last eight months) is going to have on our way of life.
We would note Financial Times columnist, Martin Wolf wrote recently about the jump in life expectancy in many countries is going to radically change the world as we have known it, adding in critical factors such as the collapse in the death rates among the young, better food and clean water, and the explosive growth of critical medicines that have wiped out polio and smallpox while giving us antibiotics.
The challenge to our savings rates, pensions, and overall fiscal outlook is going to be profound. The weight loss drugs now increasingly being prescribed by doctors is already impacting earnings for fast food companies, grocery stores, and other sectors where health and weight intersect. Wolf has some fantastic charts in his piece. Our world is rapidly shifting – in ways we often find hard to see or even comprehend. This is one of them.
A Short Note on Putin’s Defense and National Security Shake-up
While strictly not a data driven issue, we thought it worthwhile to offer the following thoughts on the news Russian President Vladimir Putin has replaced Defense Minister Sergei Shoigu with First Deputy Prime Minister Andrey Belousov. Putin is also replacing his head of the Russian Security Council, Nikolai Patrushev, but has not named the replacement yet.
Shoigu had been the focus of tough criticism inside the Kremlin for some time and many expected him to be replaced quite some time ago. But he has long been a Putin loyalist, having run the pro-Kremlin United Russia Party from 2001 to 2004 and then moving over to serve as Defense Minister since 2012. The criticism of Shoigu has been over the countless failures of Russian military operations in Ukraine, for the arrest of his deputy, Timur Ivanov, last month for taking bribes, and for blowing up (figuratively and literally) Wagner Group leader Yevgeny Prigozhin. Recall, it was Shoigu whom Prigozhin said he was marching to Moscow to take out, not Putin, in his abortive military drive away from the Ukrainian front lines last year.
But what does this all mean for the Ukraine War and what might markets need to know about the changes? All in all, not much. Putin is still firmly in command, there have been countless changes of Russian field commanders since Russia launched the invasion, corruption is still pervasive (albeit, more carefully conducted) in the Russian military. And Shoigu is still in the game by being kept on Putin’s National Security Council. For Russia Kremlin Watchers, it is another interesting twist and turn in the internal politics of Putin’s regime. But it will not change much going forward.
