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July 18, 2020, 10:27 a.m. EDT

Wall Street bankers: We’ll gladly pay higher taxes to get rid of ‘the existential threat’ that is Trump

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By Shawn Langlois, MarketWatch


iStockphoto
Wall Street for Biden?

‘Wall Street’s not this amorphous, unified blob, but the majority of people I talk to on Wall Street think it’s worth taking the hit to get Trump out of office. They view him as an existential threat.’

That’s one Wall Street banker explaining to Vanity Fair in an interview how, from his perspective, his peers are gladly preparing to navigate markets under a Joe Biden presidency.

“They’re saying, ‘We’d like to see Biden crush Trump,’” he continued, adding that he doesn’t want Democrats to take control of the Senate. In his world, legislative gridlock is a good thing and voting for Republicans to keep the Senate is basically “making sure nothing radical happens.”

The Vanity Fair source gave a nod to Biden despite the fact that the deep-pockets of Wall Street would likely get hit by an overhaul of Trump’s 2018 tax plan because it would means higher taxes for the wealthy and corporations, as well as on capital gains.

Biden said at a virtual fundraiser last month that he’ll likely roll back much of Trump’s $2 trillion tax cut “and a lot of you may not like that.” But those words didn’t seem to bother many of the executives, bankers and traders on Wall Street, according to Vanity Fair.

Still, Wall Street is a vote that Trump has been courting for much of his presidency, and his Twitter /zigman2/quotes/203180645/composite TWTR +0.43% feed is filled with tweets touting his influence on the stock market :

Trump continues to use fear as a tactic in the run-up to the November election and earlier this month he warned that any gains investors might be enjoying in their 401(k)s could “disintegrate and disappear” in a hurry if he doesn’t win another four years in the White House.

But JPMorgan Chase & Co. says that’s not the case and that a win for Biden, currently ahead of Trump in recent national polls, would be a “neutral to slight positive” for stocks.

“Given the current economic weakness, business recovery and job growth are likely to be prioritized over policies that could dampen economic growth and perhaps even jeopardize the desired 2022 midterm election outcome,” the team said in the note. “Further, a more diplomatic approach to domestic/foreign policy will likely result in lower equity volatility and risk premia.”

As it stands now, the stock market is giving Trump plenty of ammunition, with the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +1.05% , S&P 500 /zigman2/quotes/210599714/realtime SPX +1.40% index and Nasdaq Composite /zigman2/quotes/210598365/realtime COMP +2.13% continuing their winning ways with a strong push Wednesday.

/zigman2/quotes/203180645/composite
US : U.S.: NYSE
$ 37.44
+0.16 +0.43%
Volume: 11.01M
Aug. 12, 2020 4:03p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$29.49 billion
Rev. per Employee
$776,112
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/zigman2/quotes/210598065/realtime
US : Dow Jones Global
27,976.84
+289.93 +1.05%
Volume: 342.07M
Aug. 12, 2020 5:10p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
3,380.35
+46.66 +1.40%
Volume: 2.25B
Aug. 12, 2020 5:10p
loading...
/zigman2/quotes/210598365/realtime
US : U.S.: Nasdaq
11,012.24
+229.42 +2.13%
Volume: 3.35M
Aug. 12, 2020 5:16p
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Shawn Langlois is an editor and writer for MarketWatch in Los Angeles. Follow him on Twitter @slangwise.

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