Donald Trump is headed to re-election in 2020, Wall Street believes.
A recent poll of “Wall Street insiders” conducted by investment bank RBC Capital Markets found that the vast majority believes Trump will win again next year. As Yahoo News reported, most of those surveyed believed that Joe Biden would be the best candidate for Wall Street among Democratic candidates, but Trump was still tops overall with 70 percent.
Not everyone surveyed felt so good about it, however.
“Most expect Trump to win in 2020, but there’s still some nervousness around the event,” Head of U.S. Equity Strategy Lori Calvasina said in a note to investors.
Much of that nervousness is centered on the Democratic side of the equation. Those surveyed saw current frontrunner Bernie Sanders as the one of the least acceptable Democratic candidate by the stock market. Massachusetts Senator Elizabeth Warren, who has proposed breaking up tech monopolies, is seen as the least acceptable Democratic candidate.
While Donald Trump may be underwater in his approval rating and losing in head-to-head matchups with most potential Democratic candidates, economic models are still solidly in his favor. As the Independent reported, a series of economic models that have are consistently correct in predicting presidential winners are all indicating that Trump is headed to re-election. As the report noted, the models take into account factors like GDP growth, disposable income, and wage gains instead of political polling.
It boils down to one major factor — unemployment is low, the economy is doing well, and voters tend to keep the president in office when those circumstances are in place.
“The economy is just so d**n strong right now and by all historic precedent the incumbent should run away with it,” Donald Luskin, chief investment officer of Trend Macrolytics, told Politico.
Many of these models also predicted that a Republican could have an advantage in 2016, even as Hillary Clinton was leading the vast majority of polls.
There are other factors against Trump this time, including the fact that he will no longer be able to run as an outsider. Trump is still feeling the effects from the Russia investigation, with only a slim portion of voters saying they believe that the Mueller report clears Trump of all wrongdoing.
There is still a long way to go, with Democratic primaries still nearly a year away and plenty of potential changes in the economy that could come during that time. But if all factors remain the same, by November 2020 the advantage could lie with Donald Trump, regardless of what political polls might say.