#Episode21 Daily Updates with Sridhar – Just how close is the Presidential race between Trump and Biden?

Sree Iyer: Hello and welcome to come daily updates with Sridhar. I am your host Sree Iyer, it is PGurus Channel, it is 6:30 P.M. Indian Standard time. Thanks for joining in, we know that this is a new time format because the United States fell back by 1 hour. So, we had to do this adjustment or one end or the other. We felt perhaps 6:30 P.M. is a better time for Indian viewers to watch it. As always it’s a pleasure to welcome Sridhar ChityalaJi. Sridharji Namaskar and welcome to PGurus Channel.

Sridhar Chityala:  Namaskar and good morning to all, good evening to people in India.

Sree Iyer: Yes, indeed good evening, good afternoon, Good night, wherever you are.  The most important thing that’s on everyone’s mind, the United States elections, it is really really close. It is closer than what is being depicted in the most of the media approach the United States, which is a very regrettable thing, but, to make sense of what is going on who’s trending. Let’s asks Sridhar ChityalaJi. SridharJi, take it away.

Sridhar Chityala: Thank you so much, sir. Well, we have had another hectic weekend of campaigning by both parties Biden and President Trump. President Trump travelled across 11 states made hectic kind of very targeted campaigns and Biden focused very much around the battleground states of Michigan and Wisconsin And also Pennsylvania. He spent time actually stayed overnight in Pennsylvania. Where are we today? When you read all the polls, the polls whether you call it a subjective or objective, whatever the methodologies that they use them to samples. There’s been a consistent theme, the consistent theme that comes out is, Biden is leading by 10 percentage points across the country is leading. In most of the battleground states, + 2%, +3% +6 %. So, that’s the general thematic that the media is advocating. Now, when you look at the campaign-specific data that is coming out from the Republican party, which is one of the reasons why the Republican party has stated, look you know, media is against me, but, people are with us, right that is the sentiments. They seem to think that they got Arizona, they got some of the states which still the Democrats contest is borderline. So the election is too close to call, last year it was 107000 votes, that made the difference in three states with Florida and North Carolina is in the hands of President Trump and Pennsylvania, Michigan and Wisconsin are 107000 seats which gave the Electoral College votes as the clinching majority to President Trump. I think this election will also go along the same way, the battleground states will be again, they will boil down to Florida, North Carolina, Pennsylvania, and Wisconsin will go down to the same states. Arizona was at play and Georgia was at play, because of the changes in the population. It’s population made some of the Democrats moving into those specific States.

Having said that general indication are that based on what we saw in Arizona the big 96 mile kind of support, blasting away in Arizona and some latent in silent voters sitting by the side-lines all kind of coming to the fort, there is an indication that those two states very much in the hands. Iowa, which also seems to be in the hands of Republicans, very strange over the weekend President Trump, making a mention even Minnesota is at play which is historically a Democratic state. So, my sense of the elections is it’s too kind of close to call. There are two things that are going on, one is President Trump has stated that he is sending his lawyers to all the kind of battleground states in the case of contest around the differences at margins and recounting and so on. I think second which is a very unfortunate factor is the potential violence that could come out and so, people in certain states have organized themselves to mitigate the violence that would come up. So that’s my overall read of the situation. I’m not giving you a clear-cut answer because there is no clear-cut answer. If you talk to Newt Gingrich, Newt will tell you this is going to be not borderline, it’s going to be a huge victory for President Trump. If you ask similarly to the Democratic people, they will say, with especially Obama campaigning that, it’s in the bank already; the Presidential race has already won by then. So, this is where we are across the two sides. The media has not helped, so, there’s no objective data coming out.

Sree Iyer: Sir, I want to ask you three questions. The possible answers are Republican or Democrat and please, I won’t hold your feet to the fire if in case, your estimates don’t go the way we are predicting it today. But, I just want to put it out there because that’s the summary of the whole thing.

And I am going to ask you – Congress.

Sridhar Chityala: Congress will be Democrats.

Sree Iyer:  Senate

Sridhar Chityala:  Republicans, they hold Senate

Sree Iyer: White House

Sridhar Chityala: White House is very close to call, but, I feel President Trump has an edge and my conclusions are based on only one, the market data sentiments that I’ve seen.

Sree Iyer: Well sir, one interesting thing that you diverse today, which is that you think Senate will be still in the hands of Republicans. I’m not so sure about that again, you and I, we’ve been going over this. The media seems to have a mind of its own and narrative of its own, it has diverged from what is reality a long time ago and in fact, that’s what opens the doors for people to come and watch Channels like PGurus where we are just trying to tell you as we see it. Now, the next thing sir, across the world you’re having a lot of challenges, China is fighting the export market going really really hard, the economy-wise in the United States you have hundred thousand coronaviruses covid positive patients in one day. For the first time in the United Kingdom is going into a lockdown for a month and maybe you can just take a look at China because right now the activity, like you said is around three or four countries the United States, China, India and perhaps one or two countries from Europe. So what do you see in terms of how China is going to get or dig itself out of this Whole?

Sridhar Chityala: Well, I think, China has a tenacious power; it’s the second-largest economy in the world, it has risen quite rapidly to that state. It’s closed-door policies and a centralized command structure gives it a set of rules and a framework and power that cannot be compared to the conventional democracies. For example, you have agitations and problems that occurred here, quietened down before the elections, probably sensing it would be disadvantageous to one party versus the other. You saw the issues around in Paris, around the beheadings that happened and Emmanuel Macron’s effigies being burnt around the case.

You take, China, for example, Uyghur situation, they’ve done lots of things which is in the public domain, which I don’t need to comment on, but you don’t see any kind of outburst or anybody burning effigies of Xi Jinping, because, they know any country which does that, there is a kind of what we call as collateral damage and a consequence. So China cannot be compared either on a global front or on a domestic front. How it deals with issues is quite kind of decisive and very forceful in terms of its response. So that’s how I see China, whereas you have elections in the United States, you have the covid situation in the rest of the world, you have Azerbaijan and Armenia battling for this borderline state, then you have Shinko issues in Belarus, you have constant kind of irritations in India, for example, the train blockage in Rajasthan which is preventing grain movements and other stuff that is going on plus you have the borderline issues with China. So you can see that the world is divided into China, China affected, then of course covid affected region and the United States with elections and markets. So it’s very much divided along those thematic lines.

Sree Iyer: Sir, a couple of things about India, one is that Mike Pompeo called on India to name who they think is the aggressor for some reason the official statements from the Ministry of External Affairs as well as the Ministry of Defence doesn’t take China by name. What do you make of this sir? And I believe the United States is going both feet into the helped India and for some reason, we know more than what is being told in the news in India. And how does this reflect on what’s going to happen in the next few months because winter is set-in, it’s really cold in Ladakh and we don’t know how well equipped the Chinese Army is, we know India’s Army because they mostly comprised of Tibetan, Nepali, they have front divisions that are mostly used to this kind of weather and India has been guarding Siachen and all these very high Himalayan Peaks for donkey’s ears. So India knows this terrain very well. What do you make of this?

Sridhar Chityala: One thing that one has to acknowledge is that we put Trump into power because he is forthright, he is unpredictable. He’s very very decisive. He’s a business guy. He doesn’t carry any kind of niceties and political etiquette. He doesn’t have baggage. So one of the things that the world has witnessed under President Trump, an option, it can be misinterpreted or it can be construed in an adversarial way. He has been very decisive about China upfront, be it on the security side, be it on the trade side, be it on the compliance to the international rules and regulations, United States under President Trump is the only country in the world which has been forthright and decisive and he has brought a whole bunch of nations together. So it’s no surprise that Mike Pompeo goes to India. But remember this is just one week. They were there last week and Tuesday is the election here, and he made it forthright, he made an explicit press statement, which is India must be much more forthright in naming China as the aggressor and all the evidence points out to that especially. It looks like and it does not look like, it is that they are somewhere occupying in the Leh region, in the buffer zone close to 60,000 soldiers or some number is hunkered in. Why India is not very open about it is again a reflection of whether it is, one can construe it as a soft state, one does not know political softness but decisiveness in it’s intent and it’s preparedness in terms of not losing an inch of ground that maybe they are ultimate kind of strategy. We don’t speak, we don’t say but we know what we are doing, in terms of preparedness, it very much reflects that.

Sree Iyer: Thank you, sir. And we’ll take a quick look at the markets before we wind down today’s show. The markets are saying a different message than what the media is saying. The Futures are up today by about 1.7%, for Dow. Why don’t you break down the numbers for us? And what do you think the market is listening to?

Sridhar Chityala: It’s fascinating because when I look at the markets and the market commentary, they don’t synchronize and that’s the reason why I said that there may be an underlying tone between the messaging that you see in the media with the way the markets are responding. The markets are up today, Monday, one day before the election – 1.7% Dow 1.3% SNP. Now, these numbers can change as we speak. But at least the last time I looked at about 15 minutes ago, the NASDAQ is up 1.3% the crude is at $34. When I look at these numbers and when I see the reports of the sentiments, oh there is a coronavirus, maximum numbers, there is lack of stimulus prior to the elections, there are issues around employment, payrolls, we have done week after week or last six weeks extremely well, so when you actually look at the press coverage it is dichotomous with what the markets are saying. If President Trump is going to lose, what would be the Brent crude prices. We’ll be going through the roof particularly the futures if there is a clear indication because the reason is Biden has been very emphatic in saying what is position on fracking and the energy industry and spending $400 billion on in a Paris Accord and putting the EPA down. And also when I look at JP Morgan’s latest today morning’s report, should Trump win go back to the 2016 fundamentals and put money on financials because the reason is he is not going to make any changes on taxes there’s going to be no regulation. They’re going to be no kind of compliance costs in terms of unwarranted things. All these points out to the banking stops potentially. So when you see some of these commentaries and the market moments, it is dichotomous to what the media is reporting which is extremely unfortunate, very very unfortunate. Today media has become a self-inflicted and self-opinionated activism arm directly engaged and involved in politics rather than being objective, right? It is possible that many of these organizations are owned by political parties or big dollars, right? So that’s very important, the connectivity between what I see in the markets and what I see in the political narrative that is coming out of the media.

One last point to conclude is, it’s also very clear how the nation is divided in terms of political contributions. All top tech companies and their employees have put their money and the numbers are in public, people can go and see it, it’s called responsible politics. You can go and see they are all with Trump, sorry, with Biden whereas the defence agencies, defence establishments, and the other kinds of services and common people seem to be contributing towards Trump and Trump has made it very clear, I don’t want tech money. I do not want banking money. I don’t want Wall Street money, I want people’s money. That also is an indication in terms of how some of these things are playing out.

Sree Iyer: Wonderful sir, and that brings an end to today’s program. We’ll be back tomorrow at 6:30 p.m. Indian Standard Time. As always Namaskar and do subscribe to our Channel. Thank you, sir.