After Hillary Clinton clinched victory to become the Democratic Party’s presumptive nominee for president on Monday, the U.S. is slated for one of the ugliest general elections in recent history, said a financial industry political analyst.
In the matchup between Clinton and presumptive Republican nominee Donald Trump, personality and temperament will drive the rhetoric, but economic and market conditions could also influence the campaign, said Greg Valliere, chief political strategist with Charlotte, N.C.-based Horizon Investments, said during an interview with Financial Advisor on Tuesday.
“The economy right now doesn’t help Hillary. The strongest thing she has going for her is the growing perception that Trump is not fit to be president,” Valliere said. “This is going to be an exceptionally negative campaign.”
He said that Clinton has the advantage as long as her negative approval ratings remain lower than Trump’s, but an ongoing investigation into her personal e-mail servers and an unsteady economy could turn the tide.
The economy has already thrown a wrench in electoral conventional wisdom, said Valliere. In November, addressing attendees at the Schwab IMPACT 2015 conference, he predicted that Hillary would clinch the nomination after the early primaries and that Trump would fade away.
“If you want an analogy or microcosm of what happened, it was Indiana,” Valliere said. “In Indiana, you had so much anger over big chunks of money leaving the economy to Mexico or overseas that Sanders and Trump were able to take advantage. The anxiety over the economy was greater than I or a lot of people thought, and here we are. This has gone on a lot longer than I had anticipated.”
While economic indicators remain poor, Hillary can’t run on the status quo, which makes her campaign vulnerable to Trump’s populism, he said.
Yet rather than seizing momentum, Trump’s campaign is mired in damage control over some of his recent public statements, said Valliere.
“He’s suffering from self-inflicted wounds,” he said. “Trump’s said outrageous things and he’s squandered his momentum—he could have played off of the weak employment numbers and GDP, but he hasn’t been able to take advantage of it.”
The U.S. economy added just 38,000 jobs in May, according to a Labor Department report released last week that also revised April’s job growth downward. That followed reports of slower-than-predicted GDP growth from the Federal Reserve.