Broader Presidential Power

The policy proposals of Harris reflect a belief system that has historically been negative for the economy and markets.

While much of Harris’ aspirations should require the cooperation of Congress, recent history indicates a broadening of Presidential power. For example, the White House has been able to increase the population by several million by neglecting to enforce immigration law. Similarly, the White House first paused repayment of Federal student loans and then cancelled the debt of some borrowers.

The willingness to selectively enforce laws or creatively interpret them has greatly expanded the power of the President, so a President Harris may be able to implement more of her plans than expected. Increasing demand while decreasing supply is a reliable recipe for stagflation, which is historically a bad backdrop for equities and bonds.

A Harris victory in November now looks to be a market negative event.

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