Insights and perspectives from Brunswick's senior advisors.

David Brown on WJLA

Brunswick’s David Brown discusses the highlights of the third and final presidential debate on WJLA news channel 8, Washington, DC.


The full clip is here.  

George Little in Defense One

Brunswick’s George Little publishes commentary on Defense One ‘What President Trump Meant to Say’

‘What President Trump Meant to Say’

Brunswick’s George Little publishes commentary on Defense One

In Shakespeare’s Hamlet, the king laments, “Words without thoughts never to heaven go.” If we elect Donald Trump president of the United States, “words without thoughts” might well become our new foreign policy mantra – and that would be a nightmare for our nation’s security.

Robert Moran on CCTV

Moran CCTV

Brunswick's Robert Moran joins Xie Tao, professor of political science at Beijing Foreign Studies University and Timothy Hagle, professor of political science at the University of Iowa the day after the third presidential debate. 

Peter Shafer - Three Things to Watch: Record Turnout for Early Voting

As my friends in Louisiana say, “Vote early…and vote often.” Maybe that’s Donald Trump’s hope – that a "rigged" election system leads to early and multiple voting...just kidding.

Over 15+ million eligible voters have cast their ballot to date – which is approximately 12% of the total number of votes cast in 2012 when 121 million people voted (55% turnout) and about 4% ahead early voting totals at this time in 2012. The largest voter turnout was 63% in 1960.

Early voting is not predictive of an election outcome. But it does portend three important things to watch over the next 11 days:


1.      If this record pace of casting early ballots keeps up, actual voting on November 8th might be lower than in the past – meaning that the 20% “undecided” has actually shrunk and those people have voted. In addition, turnout on election day may not influence the outcome as much as the campaigns anticipated because of the record turnout for early voting;

2.      Early voting will likely adversely impact “exit polling” results.  Exit polls have been under attack since 2000. Recent "erroneous" results from exit polls have called into question its' reliability.  But early voting is not subject to exit polling which means results from election day will not be as reliable because of lower turnout and disproportionate turnout of certain groups;

3.      Early voting results might not “clearly prove” the candidate’s “get out the vote” apparatus – or lack thereof – is working. Motivated voters and strong partisans make up the large majority of the early voting constituency.  And with Trump’s record turnout in the Republican primaries and Clinton’s extensive “get out the vote” organization, it will be hard to discern how votes are cast or if these respective organizations are effectively getting people to the polls.

One note of caution – in many states, it is being widely reported that Democrats have been voting in higher amounts than Republicans – but both only make up about 60% voters. Independents are not being reported which, in this election, could make a big difference. 

The assumption is that these voters will toe the party line and vote for their party. This is not always the case, as crossing the aisle has been more prevalent in the past two decade.

One final note – early voting may speed up how states report final vote tallies on election night – meaning that we could have a declared winner much earlier in the evening.

Stay tuned.

Shafer on Quartz

Donald Trump is prepared to make this election last forever

November 7, 2016

“Unless this is a blowout for Clinton, he’s not going away quietly,” Peter Shafer, a polling expert and partner at research firm Brunswick Insight, tells Quartz. “Trump is known for legal maneuvering that furthers his agenda … if he doesn’t feel that the rules are leaning toward where he wants to go, he will sue.”

Deborah Solomon: Trump’s Victory Is A Win For Banks (Sort Of)

The upshot for financial services firms: A Trump administration will take a kinder, gentler approach to regulation but Wall Street may still come in for some punches when politically expedient.

by Deborah Solomon

As the dust clears from the complete annihilation of Hillary Clinton’s presidential campaign and the stunning upset by Donald Trump, a few things are starting to become clear.

Chief among them: Banks and other financial services firms, which have spent the past several years chafing at post-crisis rules and regulations, may finally get some relief, including from what they see as the most burdensome parts of the 2010 Dodd-Frank Act.

President-elect Trump has not yet detailed his policies but has indicated he plans to take a largely de-regulatory approach to business and will look to roll back or weaken laws that he believes burden business. That includes Dodd-Frank, which he has identified as ripe for dismantling.

In a brief statement on its website, President-elect Trump’s transition team said it will work to “dismantle the Dodd-Frank Act and replace it with new policies to encourage economic growth and job creation.”

Put simply, the statement said, “The Dodd-Frank economy does not work for working people.”

That view will find strong support from Republican lawmakers, who retain control of both the Senate and the House, and have consistently tried to push through legislation to repeal major portions of Dodd-Frank. (More on this in a minute.)

That said, it’s too soon for financial services firms to take a big victory lap. How a Trump administration will actually approach bank and financial regulation is largely unknown and President-elect Trump’s positions are, to say the least, not always in line with traditional Republican orthodoxy. For instance, he has expressed support for reinstating Glass-Steagall, the Depression-era law that separated commercial banking from investment banking. Such a move would essentially require many of the biggest banks to break up their operations and is an approach pushed primarily by Democrats, not Republicans.

Further, President-elect Trump routinely criticized Secretary Clinton’s ties to Wall Street, suggesting she was going to help the big banks who paid her for speeches before her presidential run. Among the few policy ideas he did trot out was ending the preferential tax treatment of “carried-interest” — the share of profits that some investment managers get — and treating it as “ordinary income,” which is taxed at a higher rate.

And while a Trump administration is likely to embrace fewer, not more, rules for banks, he will need to tread carefully given the populist fervor that helped propel him into office. Working-class voters fueled much of that sentiment and continue to believe Wall Street has enriched itself at the expense of everyone else.

As a recent Brunswick Group survey (conducted prior to the election) found, just 27% of U.S. respondents said they place a high level trust in banks, though this percentage is greater than trust in the media and Congress. More troubling for banks, 63% of individuals surveyed from the general population in the United States say the government should break up the banks into smaller operations, while 74% say they expect another financial crisis to occur within the next five years. Nearly 40% of those surveyed said they’ll blame politicians for the next crisis.

This view is exacerbated by a global perception that most economies and individuals have not fully recovered from the last financial crisis and that banks have done more to help their own executives and the wealthy over the general population.

President Trump and the Republicans in Congress will need to avoid the perception that they are simply handing the keys back to the same reckless drivers who careened the economy into a recession from which many have yet to recover. And while Democrats don’t control Congress, there continue to be loud and powerful anti-bank voices on the left, including Massachusetts Sen. Elizabeth Warren, who will remain a potent adversary of the financial services industry and target those who champion their policies.

Don’t forget — while we just got through this election, the mid-terms are just around the corner.

Still, the climate for financial services suddenly got a lot brighter on Election Day, given the regulatory approach many expected Secretary Clinton to adopt if she won the White House. There is pretty much zero chance that a President Trump will implement a bank tax — a bugaboo of many Democrats. And many expect he’ll repeal additional financial service rules, including the Labor Department’s Fiduciary Rule, which has been criticized by Republicans and the asset management industry as unnecessary government overreach that penalizes middle- and lower-income savers, investment advisors and small businesses.

And if personnel is policy, President-elect Trump’s approach so far should give some comfort to financial services firms. His transition team — and those mentioned for top posts within his administration — include Wall Street financiers and free-market champions who favor less regulation over more.

President-elect Trump’s rumored top pick for Treasury Secretary is a former Goldman Sachs executive, Steven Mnuchin, who spent 17 years at the bank leading its mortgage-trading department and as the bank’s chief information officer. Among those advising him on the transition for the Treasury Department and economic issues are David Malpass, the former chief economist at Bear Stearns and Paul Atkins, a former Republican member of the Securities and Exchange Commission, who favors a hands-off approach to regulation and has criticized Dodd-Frank.

Much will depend on whom he taps for key positions, including Treasury Secretary, chairs of the SEC and Commodity Futures Trading Commission, the head of the National Economic Council and Council on Economic Advisors and the Federal Reserve. While Fed Chair Janet Yellen’s term lasts until February 2018 there are two existing vacancies on the seven-member board of governors, giving President-elect Trump the opportunity to appoint members with a less bullish view of bank regulation than many of the current Governors, including Daniel K. Tarullo, Stanley Fischer and Lael Brainard. And, given President-elect Trump’s relentless criticism of the Fed’s monetary policy, he could publicly call on Chair Yellen to resign, though she is under no obligation to comply.

So what policies can we expect a Trump administration to target?

With regard to Dodd-Frank, there are a few areas Republicans want to address and that could be in line with a Trump administration agenda:

  1. Restructuring the Consumer Financial Protection Bureau to replace the agency’s single director with a bipartisan commission and to make its appropriations subject to Congressional approval.
  2. Raising the threshold for tougher bank regulation, including annual stress tests and additional capital buffers, above its current $50 billion asset level.
  3. Diminishing the role of the Financial Stability Oversight Council by either disbanding it, rescinding its ability to designate companies as Systemically Important Financial Institutions or giving the Treasury Secretary increased power.
  4. Repealing the Volcker Rule, which prevents banks from making risky bets with their own money but which critics, including bank executives, say is exacerbating market volatility and preventing banks from lending.
  5. Requiring all financial regulatory agencies to abide by heightened cost-benefit analysis standards that critics have argued are designed to slow or halt the rule-writing process.

Among the areas he may not touch:

Heightened capital requirements for U.S. holding companies of foreign banks.

Given President-elect Trump’s promise to “Make America Great Again” and to stop putting U.S. firms at a competitive disadvantage, President-elect Trump could well oppose any effort to rescind the Dodd-Frank rule that requires large foreign banking operations to comply with the Fed’s stress tests and establish separately-capitalized U.S. corporations.

Of course, in keeping with how little we know about how President-elect Trump will proceed, he could decide FBO’s should get relief given his ties to foreign banks. President-elect Trump and his business have long worked with Deutsche Bank, which has been among the biggest lenders to the Trump empire, according to The Wall Street Journal. While Deutsche’s investment bank reportedly no longer works with President-elect Trump “its private bank has continued to lend his businesses hundreds of millions.”

The upshot for financial services firms: A Trump administration will take a kinder, gentler approach to regulation but Wall Street may still come in for some punches when politically expedient.

This post was first published on Medium.

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