Prof. ST Hsieh
Director, US-China Energy Industry Forum
October 15, 2022
The US midterm election is set for November 8, and it is less than 24 days away. US political history tells us that the incumbent administration always loses in the midterm election. President Biden’s performance measured by public poll is miserably low. So Democratics are expected to lose this election, the only uncertainty is how badly they would be defeated.
Of course, Biden’s White House understands the predicament and it is natural for the administration to take a stand. However, if Biden’s tactics were solely focused on winning the election, they may not work. Some actions may backfire, not only hurts the Democrats and even the US, but the worst case could also be inviting retaliation from foreign powers against the US. The long-term consequences would have to be dealt with by future administrations.
- It is a globalized economy, and it cannot be decoupled quickly. Any attempt to interrupt the supply chain already weakened by the pandemic will only cause more inflations.
- Under Biden’s watch, the Russia-Ukraine war is into seven months already without any sign of cease fire. Biden leads the west keep supporting the Ukraine war machine. Unfortunately, now even nuclear weapons are on the table.
- The Russia-Ukraine war has already caused Europe plunging into an energy crisis. Global recession is almost certain to follow, US economy will suffer too. Biden oversees US economy for the next two years: Is there any vision or strategy that Biden will help us dodge the recession bullet?
- Biden’s approach of global relations is talking tough but without specifics. Biden is interfering global trades with unilateral actions more than Trump did.
Republicans are waiting on the sideline till November 8th to take over the congress majority. We shall wait and see how a divided US government moves forward!
The White House is taking a tough stance against global rivals ahead of midterm elections. Here’s how that’s impacting US gas prices and the broader commodity market.
George Glover Sat, October 15, 2022 at 1:15 AM
- The Democrats are trying to prove their markets and economy track record ahead of upcoming midterm elections.
- The White House has emphasized declining gas prices and its tough stance on China.
- Joe Biden is also weighing up banning Russian metal imports as the war in Ukraine drags on.
President Joe Biden and the Democratic party are battling to demonstrate their track record on markets and the economy ahead of the midterm elections.
Voters will assess Biden’s performance on issues including soaring prices at the pump, trade relations with China, and the economic impact of the war in Ukraine on November 8.
Here are three markets stories that will be top of mind for the Democrats ahead of the midterms:
Gas prices and OPEC+
Gas prices spiked above $5 a gallon in June as western sanctions against Russia squeezed crude oil supplies. They’ve fallen to $3.91 a gallon as of Thursday, according to data from the American Automobile Association – but started rising again for the first time in 99 days last month.
The White House has repeatedly emphasized falling prices at the pump, which have brought much-needed relief to American drivers at a time when inflation is running red-hot.
Biden pushed for OPEC+ members to raise their crude production levels in a bid to keep gas prices low. But the cartel – which counts Russia and Saudi Arabia among its most prominent members – instead voted to cut its output by around 2 million barrels a day.
That could push prices at the pump higher on the east and south coasts, as well as in the northeast and the Rockies, GasBuddy strategist Patrick DeHaan said last week.
China and semiconductors
Biden has also cracked down on China ahead of the midterms.
His administration introduced export controls last week that will limit the sales of semiconductors made with US technology to companies that have a special license.
The Philadelphia Semiconductor Index, which tracks the 30 largest US chipmaker stocks, has slumped just under 44% this year – meaning it has significantly underperformed even the 25% loss suffered by the benchmark S&P 500.
Biden’s export controls could fuel further sell-offs, analysts have warned.
“It’s as if the market is implying the last two years of semi growth were a mirage, engineered by central banks, and need to wiped clean,” Bank of America said in a research note this week.
Russian metal sanctions
Democrats’ next major policy move could be imposing further sanctions against Russia – as Biden looks to show he’s cracking down on Moscow.
The Biden administration is weighing up restricting imports of Russian aluminum, Reuters reported Wednesday, citing sources familiar with the matter.
Having already banned imports of Russian oil and gas, that policy would aim to choke off another potential source of income for Russia and Vladimir Putin.