Comey fall­out: The econ­omy votes for Clin­ton

Daily Freeman (Kingston, NY) - - OPINION - Froma Harrop is syn­di­cated by Cre­ators Syn­di­cate. Froma Harrop

Amid all the polling whiplash, one sur­vey con­sis­tently backs Hil­lary Clin­ton, and with en­thu­si­asm. Though not an of­fi­cial poll, it of­fers a rel­a­tively emo­tion-free ref­er­en­dum on the stakes in this pres­i­den­tial elec­tion. And its par­tic­i­pants tend to be high-in­come and highly in­formed.

We speak of the broad fi­nan­cial mar­kets, a daily vote by in­vestors on the di­rec­tion of Amer­ica’s econ­omy. Right af­ter FBI Direc­tor James Comey mouthed off Fri­day about find­ing new emails that could — pos­si­bly, per­haps, maybe or maybe not — have bear­ing on the tire­some in­ves­ti­ga­tion of Clin­ton’s emails, stock prices swooned. Gold prices, which climb at times of eco­nomic anx­i­ety, spiked. And so did the VIX, the so-called fear in­dex, show­ing ex­pec­ta­tion of sharp mar­ket swings ahead.

Never mind that Clin­ton still seemed headed for vic­tory. Never mind that the story of a new Clin­ton “scan­dal” started fall­ing apart mo­ments af­ter Comey hinted that more dirt could be found in a new pile of emails — emails that the FBI hadn’t even read and that may not have been writ­ten by Clin­ton or to her.

Never mind that some nice eco­nomic news still ra­di­ated from ear­lier in the morn­ing. The gross do­mes­tic prod­uct rose nearly 3 per­cent in the third quar­ter — the high­est growth rate in two years. Net ex­ports of U.S. prod­ucts were up. Over a half-mil­lion new jobs were cre­ated, and con­sumer spend­ing got stronger.

The mar­kets clearly dread Don­ald Trump. For in­vestors big and small, a mere chip in con­fi­dence that Clin­ton will pre­vail Nov. 8 raises more red flags than the Chi­nese Em­bassy.

The bot­tom line for in­vestors is their bot­tom line. Un­like con­ven­tional po­lit­i­cal polls, the mar­kets don’t dwell much on ques­tions of a can­di­date’s hon­esty, trust­wor­thi­ness or sex­ual be­hav­ior. With few ex­cep­tions, Amer­ica’s busi­ness lead­ers have en­dorsed Clin­ton’s can­di­dacy. Even the Koch broth­ers won’t sup­port Trump.

The busi­ness com­mu­nity sees a Trump pres­i­dency as an eco­nomic dis­as­ter in the mak­ing. Amer­ica would be elect­ing a cir­cus act, a man both ig­no­rant about the world and held in con­tempt by it. Trump’s nom­i­na­tion by a ma­jor po­lit­i­cal party has al­ready caused global in­vestors to doubt the sta­bil­ity of a coun­try they have re­garded as a safe har­bor.

It’s this sta­bil­ity that prompts the world to in­vest in Trea­sury se­cu­ri­ties of­fer­ing mea­ger re­turns. Lose it and the cost of bor­row­ing will rise, not only for tax­pay­ers but also for Main Street busi­nesses and or­di­nary folks try­ing to buy a house.

The elec­tion-re­lated spasms in broad in­dexes plainly re­flect in­vestors’ be­lief that Clin­ton would be the most com­pe­tent by far to over­see the econ­omy. It does not fol­low, how­ever, that she a close buddy with every­one in cor­po­rate Amer­ica.

One sec­tor that does not thrill to the no­tion of a Clin­ton pres­i­dency is Big Pharma. As Clin­ton’s prospects im­proved, many drug com­pany stocks fell. That’s be­cause she has vowed to curb preda­tory drug pric­ing.

Her plan to end the goug­ing, mean­while, could help com­pa­nies of­fer­ing part of the so­lu­tion. For ex­am­ple, some stock an­a­lysts are tout­ing Ex­press Scripts, a phar­macy ben­e­fits man­ager that makes more profit off cheaper generic drugs. Same goes for Teva, the world’s big­gest maker of gener­ics, which is ac­tive in de­vel­op­ing “biosim­i­lars,” copies of a drug that can be made by an­other com­pany when the patent ex­pires.

Through­out this cam­paign, it’s been stun­ning to ob­serve how lit­tle many Trump sup­port­ers un­der­stand what a Trump pres­i­dency could do to their al­ready pre­car­i­ous fi­nances. In­vestors, on the other hand, seem to get it. That’s why they’re vot­ing with their money for Clin­ton and, even more so, against Trump.

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