Blog: You, us, everyone

Last Saturday, in an assassination attempt, the former President and present Republican front-runner Donald Trump was wounded. This attack adds a new layer of stress and tumult to an already complex and undecided campaign

Political leaders from all over the world repelled the attack and the high level of violence suffered by politicians. Political violence in the USA is not new, in 1960 and the years afterward, JFK, then his brother Bob, and Martin Luther King got killed. The last assassination attempt on a sitting president was in 1981 when Ronald Reagan survived his wounds. More recent victims include the husband of former Speaker of the House of Representatives, Democrat Nancy Pelosi (hammer attack), the former Republican leader of the Lower House, Steve Scalise (who survived a shooting), Gabby Giffords, ex-Congresswoman (severely disabled by a gunman), and in October 2020, Michigan's Democratic governor, Gretchen Whitmer, was subject to a kidnap attempt by white supremacists. This group chaperons’ people from different courant such as far-right, KKK and néonaizs, anti-vaxers, and proud boys who are primarily misogynistic, islamophobic, transphobic, and anti-immigration.

What is next?

The attempted assassination comes at a highly critical moment in US politics. The presidential campaign is about to start the end phase and is marked by intense rhetoric, significant media coverage, and a divided electorate. The shooting took place just two weeks after the first televised debate between the two candidates. During this debate, President Biden underperformed and voices were raised that he should retire. In the case he does so, Governor Gretchen Whitmer is the best place to step in. But for now, polling suggests a lead for the former President Trump.

Investment ramifications

While investors could attempt to rush into matters and restructure portfolios in response to the increased level of uncertainty, historic events suggest that minor events do not drive the future overall performance. While volatility will stay elevated, investors are advised to look at the underlying agendas and the probabilities of these resolutions getting implemented.

For now, we consider that investors should focus on exposure to individual stocks (high-eps and high-growth stocks) and avoid sectors that could be more at risk in different election outcomes. In the field of fixed income, we continue to like short-term credit (low default ratio) and quality bonds (to cover potential risks of higher-for-longer).