Signs That Joe Biden’s Terrible Slump May Be Easing

RARELY HAVE WE SEEN A PRESIDENT’S job approval rating fall as dramatically as Joe Biden’s plunge after the inept U.S. withdrawal from Afghanistan in late August. After a 20 point drop in six months, there are signs that the beleaguered president is poised for a comeback.

GOOD NEWS HAS BEEN IN SHORT SUPPLY, but suddenly there are a half dozen stories that may be breaking in Biden’s favor:

1. Economic growth: Last Friday’s blockbuster jobs report eased fears of a winter slowdown; wages should continue to rise. This Thursday’s CPI report probably will be hot, but if inflation begins to cool by summer, the economy could be only a modest negative for the Democrats, not a huge headwind.

2. Covid: Fatalities are still high, but new cases are plunging and we anticipate a major shift by March — the end of mask and vaccine mandates in much of the U.S. Biden won’t declare victory, as he did last July, but he can announce the end of mandates, which are increasingly despised by the public.

3. Voting reform: Sweeping voting reform never had much of a chance in the Senate, but piecemeal measures look increasingly likely. One reform would eliminate any possibility that a vice president can reject election results, and several other provisions have a chance of enactment. This could be a genuine bipartisan breakthrough.

4. ISIS in disarray: Islamic State leader Abu Ibrahim al-Hashimi al-Qurayshi was taken out by the U.S. late last week, a clear victory for Biden.

5. Trump under fire: As we wrote last week, the dam is starting to burst, with more and more Republicans distancing themselves from the former president. Even Mike Pence says Trump was “wrong” in his attempt to pressure Pence to overthrow the election. And the GOP will be mocked for years to come by its assertion that the Jan. 6 riots were “legitimate political discourse.”

6. Russia-Ukraine: This is the Big One. Most Republicans support Biden’s proposed sanctions and his surprisingly effective unification of American allies. There are high hopes that French President Emmanuel Macron’s shuttle diplomacy will lead to an artful compromise on Ukraine and NATO. Highly recommended: This morning’s New York Times article on Macron’s bold gambit.

THERE ARE STILL HEADWINDS FOR BIDEN: Urban crime remains a huge political liability, but at least Biden has rejected the party’s disastrous flirtation with “defund the police.” Illegal immigration remains a major issue on the Southwestern border. Supply chains may stay clogged for months. And the Build Back Better bill has stalled, for now.

BUT A REPUBLICAN LANDSLIDE IN NOVEMBER suddenly doesn’t look certain. We still think the Democrats will lose 15 or 20 House seats, not the 30-40 seats some experts anticipate (the GOP needs only five to take the House). If there’s a Ukraine deal and the economy is solid in November — with moderating inflation — the Biden slump may be a distant memory.

Related: Crackdown on Big Tech May Stall, but Wall Street Regulation Will Heat Up

The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies.

The views expressed in this blog are provided as a general source of information based on information available as of the date of publication and should not be considered as personal investment advice or an offer or solicitation to buy and/or sell securities. Speculation or stated believes about future events, such as market or economic conditions, company or security performance, or other projections represent the beliefs of the author and do not necessarily represent the view of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies. Every effort has been made to ensure accuracy in these commentaries at the time of publication; however, accuracy cannot be guaranteed. Market conditions may change and AGF accepts no responsibility for individual investment decisions arising from the use of or reliance on the information contained herein. Any financial projections are based on the opinions of the author and should not be considered as a forecast. The forward looking statements and opinions may be affected by changing economic circumstances and are subject to a number of uncertainties that may cause actual results to differ materially from those contemplated in the forward looking statements. The information contained in this commentary is designed to provide you with general information related to the political and economic environment in the United States. It is not intended to be comprehensive investment advice applicable to the circumstances of the individual.

AGF Investments is a group of wholly owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments America Inc. (AGFA), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFA and AGFUS are registered advisors in the U.S. AGFI is a registered as a portfolio manager across Canadian securities commissions. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The subsidiaries that form AGF Investments manage a variety of mandates comprised of equity, fixed income and balanced assets.