Month: October 2024

Authored by Vivek Sun via BitcoinMagazine.com,

As a longtime Bitcoiner, I had to roll my eyes when I saw HBO release a trailer for an upcoming documentary, teasing to reveal Satoshi’s identity. Speculation arose that it would reveal who is Satoshi Nakamoto. After seeing many half-baked attempts to “unmask” Satoshi over the years, I’m certain this latest one won’t provide definitive proof either.

If you’ve been in Bitcoin long enough, you know the drill — someone claims they know or are Satoshi, theories start swirling, but no convincing evidence ever materializes. Inevitably it ends with embarrassment for the accuser. We’ve been through this rodeo too many times now.

With Bitcoin becoming a $1.2 trillion asset class, the allure of outing Satoshi is understandable. His stash alone is supposedly 1.1 million BTC, worth over $65 billion currently. 

The usual suspects like Adam Back, Hal Finney or Nick Szabo will likely be resurrected as prime candidates.

And the accused will again firmly deny the allegations. 

Our favorite Bitcoin historian, Pete Rizzo, already made $200 bets with Shinobi, Nikolaus, Frank, and I that Back ends up named and denies it.

Yet ideally, Satoshi should remain anonymous as he clearly desired. Bitcoin succeeds on the merits of its decentralized design, not based on any single personality. Unmasking Satoshi risks undermining Bitcoin’s mystique and independence.

As Bitcoin grows into a global asset, the stakes around identifying its creator rise exponentially.

The richest person on earth makes for an attractive bounty. But true proof remains elusive.

These periodic media frenzies claiming to crack the case produce great hype yet always disappoint. They act as amateur sleuths following flawed hunches rather than impartial investigations seeking truth.

So I advise fellow Bitcoiners to take next week’s “big reveal” with a huge grain of salt.

It will likely be more sensationalism than substance, repeating familiar theories that fall short of definitive evidence. 

The only person who can conclusively prove they are Satoshi is Satoshi himself.

Until then, the mystery continues – as it should.

In a massive escalation and unprecedented first since the Gaza War began on Oct.7 of last year, a drone attack launched from Iraq has scored a direct hit on an Israeli base on the northern Golan Heights region. 

Initial reports suggest a mass casualty event: Two Israeli soldiers were killed and 24 were wounded in a drone attack from Iraq, the IDF has announced. The attack appears to have occurred Thursday morning, according to the Israeli statement, but is only being disclosed 24 hours later.

The slain soldiers have been identified as: Sgt. Daniel Aviv Haim Sofer, 19, a signals officer cadet in the Golani Brigade’s 13th Battalion, from Ashkelon;  andCpl. Tal Dror, 19, an IT specialist with the Golani Brigade’s 13th Battalion, from Jerusalem.

An IDF military investigation found that two explosive-laden drones were launched from Iraq by pro-Iran paramilitary groups. The US and Israel believe these groups are controlled from Tehran, as well as pro-Iranian political leaders in Baghdad and influential Shia clerics.

One of the drones was shot down by Israeli air defense missiles, but the other one made it through and struck the base.

“In addition to the two slain soldiers, another 24 were wounded in the attack, including two seriously, one moderately, and 21 lightly,” Israeli media documents based on the military statement. A Friday statement from Iraqi paramilitaries has taken responsibility and warned of more to come:

The umbrella group of Iran-aligned armed forces in Iraq says it launched projectiles against three targets in occupied Golan and Tiberias in Israel.

The Islamic Resistance in Iraq added in a statement that its forces used drones at the targets, with the attacks taking place at dawn on Friday. It promised to continue “operations to pound the enemy’s strongholds at an escalating pace.”

This comes just as Israel and the US are mulling a response to Iran’s Oct.1 major ballistic missile attack. It will likely serve to nudge the Netanyahu government in the direction of a robust direct response. Israel might also target Iran-backed Iraqi militia positions in side Iraq as a result.

This certainly isn’t the first time in recent weeks and months projectiles were launched from Iraq, however, those prior instances proved ineffective as drones and missiles either get shot down or land in open desert areas. On Friday Israeli Army Radio is saying more rocket launches have been detected targeting towns in the southern Golan.

New signs of things spiraling toward bigger regional war as Israel contemplates hitting back at Iran:

⚡️BREAKING:

So far US and Britain launched 14 airstrikes on Sanaa and Hodeidah airport, Yemen.

Meanwhile Israel is attacking Gaza, Syria and Lebanon. pic.twitter.com/uKISCfPuJx

— Current Report (@Currentreport1) October 4, 2024

Also on Friday, there appear to be new air raids on Houthi positions in Yemen by US and British jets, and this new campaign possibly includes Israeli aircraft as well. Yemen’s Houthi Al Masirah TV is reporting that US and British air attacks are hitting Hodeidah Airport, Sanaa and Dhamar City.

* * *

More breaking developments via Al Jazeera [emphasis ZH]:

• The Israeli military continues to pound areas across Lebanon, especially Beirut, in addition to launching deadly strikes on the Gaza Strip.
• Four medics were killed in some of the latest attacks in Lebanon, while two bodies were recovered from Gaza’s southern Khan Younis.
• Iran’s Foreign Minister Abbas Araghchi invited regional governments to display support for Lebanon after arriving in Beirut. He is heading to Syria next.
• Al Jazeera condemned the assault by a member of the Palestinian Authority’s security on its correspondent, Laith Jaar, while covering the Israeli bombing of Tulkarem refugee camp in the occupied West Bank.
• Iran’s Supreme Leader Ayatollah Ali Khamenei said any strike at Israel “is a service” to the whole region and the world.
• The World Health Organization (WHO) received a first shipment of medical aid to Lebanon, with more expected today and tomorrow.

Authored by Matthew Vadum via The Epoch Times (emphasis ours),

The U.S. Supreme Court decided on Oct. 4 to hear U.S. gun makers’ appeal in Mexico’s ongoing $10 billion lawsuit against the firearms companies.

In the lawsuit, Mexico is seeking $10 billion from U.S. gun companies for allegedly flooding that country with firearms. Mexico blames the companies for a violent crime wave, saying their actions benefited criminal cartels.

Although some gun control activists welcome Mexico’s lawsuit, gun rights advocates say it constitutes foreign interference in U.S. affairs and is aimed at crippling the U.S. firearms industry and weakening the Second Amendment protections enjoyed by Americans.

The gun companies say the suit is barred by the federal Protection of Lawful Commerce in Arms Act (PLCAA) of 2005, which was enacted to protect the industry from frivolous lawsuits.

The justices granted the petition in Smith & Wesson Brands Inc. v. Estados Unidos Mexicanos without comment. No justices dissented.

Smith & Wesson had asked the court to expedite its petition on Aug. 8, the day after a lower court threw out the case against six out of eight gun companies in the lawsuit, which is pending in federal district court in Massachusetts. The decision left gun maker Smith & Wesson and gun wholesaler Interstate Arms remaining as defendants.

The appeal concerns the Jan. 22 decision of a three-judge panel of the U.S. Court of Appeals for the First Circuit that allowed the lawsuit to proceed.

Circuit Judge William Kayatta wrote that even though the PLCAA limits lawsuits that foreign governments may bring in U.S. courts for harm experienced outside the United States, Mexico could move forward because it made a plausible argument that the companies committed “knowing violations of statutes regulating the sale or marketing of firearms.”

This is a developing story and will be updated.

At first glance today’s jobs report was indeed impressive: the surge in jobs according to both the household and establishment surveys indicated a strong rebound from recent monthly weakness…

… which coupled with the drop in unemployment rate, and upward historical revisions suggested that much of the recent labor market weakness may have been transitory. The one fly in the ointment was the jump in wage growth which strongly hinted that inflation is also back, just as we have been warning for months (especially now that oil is once again surging) and we will cross that bridge eventually, but not yet.

Instead for now let’s focus on the parts of the jobs report which the BLS has traditionally used to mask headline weakness, such as part-time workers used to mask weakness in full-time jobs, or foreign-born workers surging at the expense of native-born. Well, this month there was little of that as well, and in fact, part-time workers dropped modestly as full-time workers rose…

… while native-born workers actually rebounded from a five year low as foreign-born workers dropped from an all-time high

And yet, it didn’t take long to find what the BLS did this time to make the jobs appear much stronger than expected, a political imperative for the highly politicized agency tasked with making the Kamala/Biden economy appear stronger than it was exactly one month ahead of the election.

The answer, ironically, was in the number of government workers, which exploded higher, and were not only instrumental in pushing the Household Survey print much higher, but meant the difference between a 4.1% and 4.5% unemployment rate.

Here is what happened.

In September, the number of government workers as tracked by the Household Survey soared by 785K, from 21.421 million to 22.216 million, both seasonally adjusted (source: Table A8 from the jobs report). This was the biggest monthly surge in government workers on record (excluding the outlier print in June 2020 which was a reversal of the record plunge from the Covid collapse months before).

While government workers soared by the most on record, private workers rose by just 133K, a far more believable number, and one which however would indicate that the recent labor market malaise continues.

What is odd is that while September traditionally sees a huge jump in not seasonally adjusted government workers (as teachers go back to school), the BLS has traditionally smoothed over this jump using seasonal adjustments.

Only not this time, because as the next chart shows, while historically the September adjusted number has been relatively tame, regardless of how large or small the unadjusted number was, this time something changed as the unadjusted number of government workers absolutely exploded by a record 1.322 million leading to a record September increase in adjusted government workers.

Curiously, it wasn’t just the Household survey that tracked an unprecedented increase in government workers: if one takes the Establishment survey unadjusted print (source Table B1 from the jobs report), one sees the exact same thing. Here, the number of not seasonally adjusted government workers soared by 918K (from 22.541 million to 23.459 million), while the number of not seasonally adjusted private sector workers plunged by 458K!

Why does any of this matter? For several reasons.

As the recent near-record downward revision in employment demonstrated, when some 818K jobs were magically eliminated, economic reports from the Biden admin has become unreliable to the point where even Fed chair Powell was questioning the credibility of BLS data and lamented that had he known how bad the labor market was, he would have cut in July. Well, same thing now, only in the opposite direction (which is to be expected with the election in just one month). So is the BLS now openly political and seeking to game the data to show Biden in a favorable light? That’s a rhetorical question we leave to our readers.

And speaking of politicized government agencies, the BLS had a clear motive to add as many “government jobs” as it possibly could, not just to make the sequential increase in labor appear but to depress the unemployment rate further.

So to answer the question: why jam a record number of government workers in the September payrolls report? Two reasons: Unemployment rate drops to 4.1% instead of rising to 4.5%, assuring the Sahm Rule is indeed triggered and the US is officially in a recession, and also prevent the market from crashing. Both, one would say, pretty critical narrative pieces exactly one month before the election. As an aside, those wondering who is paying for all these government jobs, take one look at the US government debt which just soared to a record high, and that should answer all questions.

One final point: the BLS may have done everything it could to put lipstick on the jobs market (with data which will inevitably be revised lower after the election), but it forgot to change on data set: the number of people who need more than one job to make ends meet, just hit a new all time high as well.

Authored by Peter St.Onge via The Brownstone Institute,

In the wake of the 2008 Financial Crisis, former chief economist of the IMF Simon Johnson warned that the same dysfunctional policies he saw in his basketcase banana republics had taken hold in the United States.

Johnson warned that if America didn’t act fast, we would plunge into a “Quiet Coup” as the American financial system effectively captures the government, bailing itself out until we run out of money.

Well, we didn’t act fast. In fact, we got worse.

And here we are.

Our Bankrupt Financial System

In recent videos I’ve talked about the trillion of distress in the financial system, the common thread being that you, the taxpayer, will be bailing them all out – we saw this in the 2023 bank bailouts, pre-paid in the dark.

Of course, given our $35 trillion in national debt, we can’t afford it. But pay it we will, driving that $35 trillion to, according to the CBO, $50 trillion-plus.

At some point, it gets too big to bail out.

This means either hard default – they stop paying interest. Or the more likely soft default – they let inflation rip, melting away the national debt along with our life savings. And between here and there is a wholesale fleecing of the middle class and the working class who rely on them for a job.

The Ignored Warning

So, first, the ignored warning by Simon Johnson. I’m no fan of the IMF – their role is essentially feeding their client dictators fresh drugs at massive taxpayer expense. But one thing the IMF does know is dysfunctional governments.

In his warning, Johnson detailed the typical pattern when countries collapse – when they come in desperation to the IMF.

First, a small group of powerful elites takes over policy. This is typically the financial elite, or large companies when the country has them. 

Because these elites know they’ll be bailed out, they take excessive risks in good times. An iron law of finance is that risk pays reward. Meaning if you know you’re going to get bailed out, you’d be a moron not to take on too much risk. 

If every hand at the poker game is all-in, inevitably you lose. You pass your losses to the taxpayer and start over with fresh chips, courtesy of the suckers.

The Quiet Coup

Johnson lays out his numbers: from 1973 to 1985, America’s financial sector never earned more than 16% of the domestic corporate product. But by the early 2000s, it was earning 41%. 

It turned a chunk of these profits into lobbying, repealing Depression-era prudential regulations separating banking and investment banking. In other words, freeing banks to gamble with taxpayer-guaranteed funds. 

Then it lobbied to raise leverage – meaning how much the financial sector could borrow. So it could make large gambles with a small amount of money – again, all taxpayer-guaranteed. 

The end result was the 2008 crisis, where banks made trillions in risky loans to people with no income, no assets, and no credit. 

The leverage meant they had bet the farm and then some – keeping all the profits. Then when it turned south they sicced lobbyists on Washington to line up bailouts, using the real economy as a hostage to wring out yet more lobbyist favors. 

The Washington-Wall Street Racket

In return, they gave politicians and their staff plum positions or even outright bribes. 

Ben Bernanke got $250,000 for a single speech at a financial conference. 

Janet Yellen was paid $7 million in speaking fees by Goldman Sachs and other Wall Street banks – hedge fund Citadel paid Yellen $292,500 for a single speech. 

London-based Standard Chartered paid $270,000 for one speech – interesting for a foreign bank when we can only imagine what favors were done in return.

Johnson sums it up: the American financial system is “desperately ill,” kept alive only by an endless series of bailouts, like the ones that headed off bank failures last year. 

He says the only solution is forced recognition of bank losses – which would bankrupt them – then selling them to new management that will not have access to bailouts.

What’s Next

Given their lobbying power, the odds of breaking up America’s megabanks are slim to none. 

Meaning unless Washington reins in the banks, we’re in store for more existential financial crises, more bailouts and national debt, and more running out the clock to financial catastrophe. 

We missed our chance in 2008, and in all likelihood, it will take an even bigger crisis before politicians turn on their lobbyists and the financial coup that has seized our republic.

Republished from the author’s Substack

America’s hospitals are bracing for a shortage of IV fluid, as Hurricane Helene’s devastation has forced healthcare company Baxter International — the top producer of IV fluid — to shut down production at a critical North Carolina facility. 

“The company is working around the clock in close coordination with local, state and federal officials to assess the extent of the damage and implement a plan to bring the plant back online as quickly as possible to help mitigate supply disruption to patients,” said Baxter in a statement.

Deerfield, IL-based Baxter alerted hospitals to expect its provision of IV fluid to plummet by 40% from typical levels, according to Dr. Paul Biddinger, the chief preparedness and continuity officer at Boston’s Mass General Brigham hospital, who spoke at a Thursday media conference call.   

Mass General Brigham is among hospitals that are already implementing measures to make the most of their inventory — such as urging staff to consider using Gatorade or water in situations where that can fulfill patient hydration needs in comparable fashion to an IV drip. The hospital will also refrain from trashing partially-used bags when patients are relocated to new departments. 

“Patients are still getting IV fluids when they need them,” said Biddinger. “We are continuing normal medical services but emphasizing conservation, and we are carefully monitoring this incident to determine how long it may last, how long we may need to conserve, and making sure we identified all areas of our enterprise where services are affected.”

A breached levee was a factor in the flooding of Baxter’s plant in Marion, North Carolina, which typically churns out 1.5 million bags a day. Its return to production will be made more difficult by Helen’s destruction of bridges in the vicinity. The company said it’s unable to set a timeline for the resumption of operations at the facility. Baxter shares fell 2.47% on Thursday, edging up 0.63% in after-hours trading. 

Before the Hurricane, Baxter commanded a 60% share of America’s IV fluid market. Closely-held B. Braun Medical, which accounted for 23%, is pushing to ramp up its own production, telling NBC News it’s focusing on the “most critical products,” including large-volume bags of sodium chloride, sterile water and lactated ringers. 

That will help, but it won’t head off a shortage. “We’re anticipating that there will be major constraints on the U.S. supply of IV fluids as a result of the production outage at Baxter’s North Cove plant,” a Braun Medical spokesman told NBC.

Nor can the U.S. count on tapping European manufacturers because of previously existing global shortages, said Soumi Saha, senior vice president of government affairs at Premier, a group purchasing organization for hospital supplies that serves thousands of medical institutions in the U.S. — WSJ

News of the pending IV fluid shortage comes just after the Biden-Harris administration ducked a bullet in the form of a short-lived longshoremen strike that closed ports from Maine to Texas. Now, the White House — and presidential candidate Kamala Harris — face a rising tide of anger and frustration over its response to Hurricane Helene — and a crisis in hospitals will only exacerbate that dynamic.

By Mary Samonsen of Multifamily Dive

California Gov. Gavin Newsom signed three bills changing renter protection practices in the state last month.

• Under Assembly Bill 2801, landlords are required to take photographs of a unit before move-in, after move-out and before and after any necessary repairs or cleaning, which must be provided to the tenant along with the security deposit disposition form. This bill will take effect on July 1, 2025.

• AB 2747 requires landlords to provide tenants with the option to report their on-time rent payments to credit bureaus, effective April 1, 2025.

• Senate Bill 611 forbids fees on rents paid by check, fees for posted notices or charging tenants in the military more than the standard security deposit amount, effective July 1, 2025.

AB 2801 initially barred owners from using the security deposit to pay for professional cleaning or for any issues not identified during the initial walkthrough. This was removed almost entirely during the legislative process; the only provision that remains is that owners cannot use the security deposit for carpet cleaning unless it is necessary to restore the original condition of the unit. 

The credit reporting bill, AB 2747, only applies to properties with 15 or more units. Landlords will be able to recoup the costs associated with complying with this bill by charging tenants a fee to cover the costs of the reporting, according to a statement provided to Multifamily Dive by the California Apartment Association.

“This bill will not only help tenants, but it will help future landlords know that a tenant has historically paid their rent on time and will likely continue to do so,” said Debra Carlton, executive vice president of state government affairs for CAA, in the statement. 

SB 611 originally required landlords to disclose all optional fees for an apartment in its advertisements. This was removed in a later amendment, leaving the remaining provisions on fees and security deposits for military tenants. The disclosure requirement would have placed a significant burden on landlords, according to the CAA.

The three bills are part of a larger package signed on Sept. 19, with legislation addressing homelessness, housing production, fee transparency and tribal housing. 

Landlord-tenant bills that did not pass in the most recent session include:

• AB 2187, which would have established an Office of Tenants’ Rights and Protections. 

• AB 2216, which would have required property owners to allow common pets on multifamily properties, and not allowed properties to charge pet rent or a security deposit. Later amendments created exceptions for buildings with less than 16 units or households with more than one pet.

• AB 2384, which would have required emergency phones to be installed near pool decks.

• AB 2785, which would have required properties to pay renters interest accrued by their security deposits and set requirements for screening fee limits.

• SB 1154, which would have outlawed revenue management algorithms. 

One major question that remains is the fate of Proposition 33, which would expand the authority of local governments to enact rent control if passed. Voters will decide on this ballot measure on Nov. 5.

The world could be on the cusp of another food inflation shock as the benchmark for world food commodity prices recorded the fastest monthly increase in 18 months in September.

A perfect storm of war in Eastern Europe and broadening conflicts in the Middle East, snarled maritime supply chains, extreme weather across croplands, de-growth climate change policies pushed by the far-left in the West, and rogue central bank money printing have all contributed to sticky food inflation. 

The Food and Agriculture Organization of the United Nations’ Food Price Index, which tracks the international prices of a basket of globally traded food, averaged 124.4 in September, up 3% from August and 2.1% higher versus the same month one year ago. 

Whoops! 

FAO noted in the report that sugar, including wheat and edible oil, was the leading cause of the overall spike.

Here’s the breakdown of FAO’s sub-indices:

• The FAO Sugar Price Index registered the largest increase in September, rising by 10.4 percent. This was driven by worsening crop prospects in Brazil and concerns that India’s decision to lift restrictions on sugarcane use for ethanol production may affect export availabilities from the country.

• The FAO Cereal Price Index increased by 3.0 percent during the month, led by higher wheat and maize export prices. International wheat prices increased due largely to concerns over excessively wet conditions in Canada and the European Union, though this was partly offset by competitively priced supplies from the Black Sea region. World maize prices also climbed, influenced by low water levels on key transportation routes along the Madeira River in Brazil and the Mississippi River in the United States of America. By contrast, the FAO All Rice Price Index declined by 0.7 percent, partly reflecting generally quiet trading activities.

• The FAO Vegetable Oil Price Index increased by 4.6 percent from August, with higher quotations across the board for palm, soy, sunflower and rapeseed oils. The rise in international palm oil prices was due to lower-than-expected production in major Southeast Asian producing countries, while the rebound in soyoil quotations was primarily due to lower-than-expected crushings in the United States of America.

• The FAO Dairy price Index rose by 3.8 percent in September, with quotations up for whole milk powder, skim milk powder, butter and cheese.

• The FAO Meat Price Index increased by 0.4 percent, mainly due to higher poultry meat prices driven by strong import demand for Brazil’s product. World bovine and pig meat prices remained stable, while those for ovine meat declined slightly from August levels.

In July, a separate report from Isabella Weber of the University of Massachusetts Amherst warned, “More regular supply shocks are likely for food,” indicating the dire need for a new stabilization approach involving a buffer system to mitigate price volatility in essential commodities to promote economic stability and growth.

Readers have been well informed about the rising risks of global food inflation re-accelerating. We said in June…

About a year ago, Sara Menker, founder and CEO of Gro Intelligence, warned in a Bloomberg interview that the current global food crisis is ‘much worse than 2008’. 

In late 2020, SocGen’s Albert Edwards started to warn about the Federal Reserve blowing bubbles during the Covid pandemic and how it could spark a rise in food prices and the usually ongoing risks, such as social-economic instabilities. 

“There are only nine meals between mankind and anarchy,” American investigative journalist Alfred Henry Lewis stated in 1906. 

And certainly in the US, when the Biden-Harris administration stoked some of the worst inflation in a generation, making it very painful for consumers (financially crushing low/mid-tier households) to shop at the supermarket, the only solution Marxist VP Harris offered to voters was Communist price controls. 

What a mess. This just reinforces the idea for people to establish their own food supply chains—whether it’s sourcing locally or working with neighbors. If you have the ability, start farming your own land to break free from corporate overlords controlling the toxic processed foods supply chain. Now you see why the government hates the Amish-they’ve become ungovernable.

Authored by Lance Roberts via RealInvestmentAdvice.com,

As the November 2024 election draws near, the election outcome will profoundly affect the financial markets. Whether Donald Trump or Kamala Harris wins the presidency, each administration will bring distinct policies creating investment opportunities and potential risks for investors. With a divisive political landscape, it is crucial to understand how these potential outcomes can shape the stock market and your portfolio strategy.

Let’s break down the key sectors that stand to gain from a Trump or Harris presidency and explore the risks investors should be aware of heading into this election outcome.

Investment Opportunities in a Trump Presidency

Energy & Fossil Fuels

If Trump wins, that election outcome will likely favor the traditional energy sector, with policies designed to roll back regulations from the current Administration that have restricted oil and gas exploration. During Trump’s previous term, he aggressively pursued pro-energy policies, resulting in a boom for fossil fuel companies like ExxonMobil (XOM) and Chevron (CVX). As shown in the chart below from the U.S. Energy Information Administration, crude oil exports surged from 1 million barrels per day in 2017 to 3.5 million in 2020. During a second term, Trump’s emphasis on deregulation and energy independence could lead to a similar boost.

Investors should look for growth opportunities in large oil producers and service companies like Diamondback Energy (FANG), which directly benefit from increased production.

Defense and Aerospace

Defense spending is another area that would benefit from a Trump election outcome. Trump has been a strong proponent of increasing military spending to modernize and strengthen national security. Such policies historically benefited defense contractors such as Lockheed Martin (LMT) and Raytheon Technologies (RTX). These companies will likely see further government contracts and funding for military expansion, making them attractive investments. Given that defense spending increases in Democratic and Republican administrations, such will likely be the case again. Lastly, defense stocks are also typically defensive in uncertain market environments and are generally very stable dividend payers.

Financials and Banking

A Trump election outcome is also expected to favor the financial sector through further deregulation. Trump has already demonstrated a willingness to roll back restrictions imposed by Dodd-Frank, making it easier for financial institutions to operate with less oversight. This would benefit large banks such as JPMorgan Chase (JPM) and Goldman Sachs (GS). However, larger regional banks like Truist Financial (TFC) and PNC Bank (PNC), which have struggled amid higher interest rates during the previous administration, would also benefit.

A stronger economy, reduced regulatory restrictions, and lower interest rates from the Federal Reserve would create higher profitability, reduced compliance costs, and less collateral impairment. Additionally, as discussed in “Tax Cuts And TCJA,” Trump’s policies may favor continued corporate tax cuts, boosting bank earnings and shareholder returns.

Investment Opportunities in a Harris Presidency

While Kamala is not the incumbent, she represents a likely continuation of the current administration’s policies.

Clean Energy and Sustainability

If Kamala Harris wins the election, it will likely create a tailwind for the clean energy sector. Following the Inflation Reduction Act, which allocated more than $800 billion to climate change-related projects, Harris will likely promote policies to increase investment in renewable energy sources. Companies involved in solar, wind, and energy storage, such as NextEra Energy (NEE), First Solar (FSLR), and Tesla (TSLA), would stand to benefit. However, it is notable that more than 100 solar-related companies have filed for bankruptcy in 2024, so investors must remain prudent about individual company fundamentals. Investors could consider clean energy ETFs, such as ICLN (iShares Global Clean Energy ETF), to gain exposure to a broad range of companies that could benefit from government subsidies, tax incentives, and infrastructure projects focused on sustainability.

Healthcare and Pharmaceuticals

Harris’s healthcare agenda is expected to focus on expanding access to healthcare, strengthening the Affordable Care Act, and implementing policies to reduce prescription drug prices. This could benefit both large pharmaceutical companies like Pfizer (PFE) and Johnson & Johnson (JNJ), as well as healthcare providers and insurers like UnitedHealth Group (UNH).

Additionally, with an increased focus on public health, biotech companies involved in innovative medical research and vaccine development could also experience growth. Investors should watch stocks related to healthcare services and medical device innovation.

Technology and Innovation

Harris has consistently supported advancing technology and innovation, particularly in artificial intelligence (AI), cybersecurity, and 5G infrastructure. Companies like NVIDIA (NVDA), Microsoft (MSFT), and Alphabet (GOOGL) are well-positioned to benefit from increased government support for technological infrastructure and research. With a Harris election outcome, investors can expect further investments in tech sectors that improve digital access and data privacy protections. This may also boost demand for cybersecurity solutions, benefiting companies specializing in this area. For further analysis, read our report on the coming demand for electricity needed by artificial intelligence.

Conclusion: Risks and How to Mitigate Them

Regardless of who wins, the election outcome presents certain risks that investors must consider. Election years often bring increased volatility, and this cycle is no exception. Here are the key risks and strategies to manage them:

• Tax Policy Uncertainty: A Harris presidency could bring corporate tax hikes, which may negatively impact the profitability of tech and financial companies. In contrast, a Trump presidency may lower taxes but could lead to growing deficits and potential inflationary pressures. Investors should stay informed of potential tax changes and consider shifting some assets to tax-advantaged accounts or dividend-paying stocks to cushion against negative impacts.

• Interest Rate and Inflation Risks: Both administrations will face challenges managing inflation and interest rates. As the Federal Reserve cuts rates, there is a risk of a resurgence of inflation. Investors should consider diversifying into sectors less sensitive to rate changes and focus on fundamentals and dividend payout histories.

• Healthcare Sector Volatility: A Harris administration may introduce new healthcare regulations that could compress margins for some pharmaceutical companies. While expanded healthcare access could benefit healthcare service providers, introducing pricing controls could create downside risks for drug manufacturers. Investors should maintain a diversified exposure to the healthcare sector, balancing risk with potential gains from policy-driven expansion.

How to Protect Your Portfolio

• Diversification: Spreading investments across sectors that could perform well under either administration—like clean energy, defense, and healthcare—can help mitigate risks tied to the election outcome. Maintaining a balance between growth stocks and defensive sectors can help weather volatility.

• Dividend-Paying Stocks: Companies with strong dividend histories, like Procter & Gamble (PG) and Coca-Cola (KO), can provide income during market uncertainty and reduce portfolio volatility.

• Follow Your Risk Management Discipline: As we often discuss, a healthy regime of taking profits, rebalancing portfolios, moving up stop-loss levels, and increasing cash balances can help mitigate portfolio risk during periods of uncertainty.

I have no idea how the election will turn out in November. However, like every election outcome, investors will have opportunities and face risks. Whether it’s Trump’s pro-energy and defense stance or Harris’s focus on clean energy and healthcare, positioning your portfolio for the post-election market requires careful consideration. Staying diversified, preparing for volatility, and managing risks will be key to navigating whatever outcome lies ahead.