TDAM Talks Podcast: Trump vs. Biden – Will the 2024 U.S. Elections Impact Your Investments?

Announcer: Welcome to TDAM Talks, your go-to podcast for insightful discussions on investment and market trends. In today's episode, we're diving into a hot topic the U.S. elections and their potential impact on investment markets. We'll explore the critical question on everyone's mind: will the economy fare better under Trump or Biden? We'll also explore an extended RAPID-FIRE session outlining the perceived impact of each winning scenario on the markets segment by segment.

Ingrid: Hey, everyone. My name is Ingrid Macintosh, and today's episode, we are going to turn our focus south of the border to examine one of the most influential events in the financial world, the U.S. elections. Here we are. We are less than six months out. Every four years, the political tides in the U.S. have the power to send ripples or shock waves through the global economy in the investment markets. And whether you are an investor who's looking to safeguard your portfolio, your nest egg against volatility, or you're an investor that's looking to capitalize on some opportunities that might emerge from that volatility. Understanding the implications of the U.S. electoral outcomes is critical. So, on the show today, I have two nominees. I mean, portfolio managers, Michael Craig, head of asset allocation here at TD Asset Management, and Christian Medeiros, member of the Asset Allocation Team, collectively overseeing more than $110 billion in solutions for our clients. So with that, welcome, Michael. Welcome, Christian.

Michael: Thanks for having us here.

Ingrid: So guys, as I was saying, we're about six months away from another historic U.S. election, which looks to have the incumbent J oe Biden, facing off against Donald Trump again in a rematch of the 2020 campaign. So given the economic landscape and the market environment, how might this campaign be different? So maybe I'll start with you, Michael.

Michael: Well, it's very different in the sense that the popularity of both candidates is at a historical low. So another way is that most Americans would rather be voting for two other candidates so that they're both coming in with historic levels of low popularity, which creates very, very, very a very, very volatile backdrop to that. The second thing is our work would show (and Christians) ... in terms of historically the way to look at elections, as you do get a little bit of volatility going into the election, a candidate is chosen and then that volatility dissipates and you tend to get a post-election rally this time around, I think ... ... because you are dealing with a fairly different set of candidates, we would be of the mindset that volatility would likely happen before, and also post-election might be a bit of a knee jerk rally. But I think that this does set the stage for a much different environment and a world that we've been used to to operating in in in previous decades.

Ingrid: So Christian, I was thinking about, you know, we've worked together for about ten years, and I got to know you quite well back in 2016 when we were ahead of the first time Trump was running for office. At that time, even within a short distance to the finish line, the probabilities of a Trump win were being marketed very low. And at that time, we did a lot of work around what might like this tail event of a Trump win look like for markets, for regions, for economies, for sectors, and for our listeners. Make sure you stay tuned because we're actually going to turn a big part of this podcast into RAPID-FIRE (segment) to answer those questions. But with that backdrop, maybe talk a little bit about how this is quite different from where we were back in 2016.

Christian: Yeah, 2016 was fascinating because everyone discounted Trump's chances of winning less than 10% among most of the leading prognosticators on elections. And at the time, too, a lot of his policies were not really well understood. We haven't had tariffs in a long time in America. Up until that point. We didn't have large tax cuts since maybe the Bush tax cuts some large in the early 2000, and no one really knew who would be in his cabinet. So all of the all those things are question marks wasn't really taken seriously. But we've already had four years of Trump and he's been known to us for for quite some time now. So let me go to Trump 2.0. These policies are not we know that he's serious. We know that he means what he means when he talks about tariffs, wage, talks about tax, when talks about deregulation. So he's more of a known entity than he was before. And he's going to come in the office much more prepared, not only with Cabinet members and advisers that are more aligned with his views, but the whole conservative movement in America is recruiting people, educating, educating their members, and they're ready to be able to step in on day one and with executive orders and and roll out their policies.

Ingrid: Yeah, it's not going to be like, “surprise we won.” It's like, “here we go!.” If that if that happens. And really, it's not our role as asset managers to lean one way or the other to even try and predict the outcome. It's to manage our assets, our clients' assets in such a way that is prepared for any outcome. So with that as a as a level set from where we're sitting today, do we think the market has already priced in some of the perceived volatility, some of the potential outcomes?

Michael: Probably not. I actually don't think the market's really going to move until after summer when people get back after Labour Day. I think there'll be a natural reaction to start really focusing on it. But right now, I wouldn't say there's a huge amount of of priced involved. The VIX has been quite low. If anything, the bond markets probably been the one area that's been a bit soft and that that makes sense because I think regardless of who wins, no one's talking about the federal deficit and tackling long term liabilities that are certainly getting starting to grow. But from our perspective, you know, Christine, I will go back and forth and this was likely to change. But I think the most likely outcome of this, there's really there's four outcomes. There's Trump or Biden, and then there's a Republican or Democratic sweep of the House or a split Congress. I think the more likely scenario is either a Trump or a Republican sweep or a Biden victory with a split Congress. And that, I think, gets you to some fairly certain outcomes in terms of policy going forward. So, I actually don't think it's important. Remember, like this, what Trump started, it's not like Biden came in and unwound everything Trump put in place. Biden hasn't rolled back some of the tariffs that Trump has put into place. Biden certainly hasn't changed in the spending side and the rhetoric of Washington towards China has not changed. That is very much a bipartisan issue now, I'll all agree, in their feelings towards China. So I think those are the two kind of, you know, kind of central scenarios. And if anything, right now, if the election was held today, I think it would be a Trump victory. Lots can change between now and November. But as we stand right now, Trump is certainly the favorite candidate.

Ingrid: And again, we have to be prepared for both. And thanks for touching on the piece with the makeup of Congress because to your point, it isn't just a binary outcome. There are permutations of that outcome. So, let's sort of turn to probably what our listeners really want to get a sense on. Let's start going as a class by asset class and understanding implications. So first, out of the gates, fixed income markets from here: Biden versus Trump.

Michael: So, I think with the Trump victory, there might be a knee jerk sell off on fixed income, a Trump sweep would mean that the tax cuts that he put in place in 2017 become permanent. So certainly, on the revenue side, that's a hit to finances. But I also think Trump will take that take the hatchet to a lot of government agencies and a lot of government spending. And so, you know, net-net probably bad for fiscal sustainability, but there's gives and takes on a Biden victory. Again, probably not bullish for fixed income continuing subsidies for green industries and where the big delta is or somebody be mindful of is that you know Biden many in the executive right now have been touting tax hikes without kind of unified government. It’s hard to see those tax hikes come into play. So, in that way, one thing where if you were to see a Democratic sweep, for example, you should expect a pretty negative fiscal impulse because taxes, both corporate and household are likely going higher, which would lead to weaker growth from an investment standpoint and something we'd have to be mindful of.

Ingrid: Okay, so now we're going to do a around the world in equities. And obviously the first impact we want to look at is writ large, the U.S. equity market.

Christian: Yes, I think in an initial Trump sweep, the market would probably rally. They'd be happy about maybe hoping for a Trump play. 1.0 playbook of extending the tax cuts which expire next year that he did in 2017, maybe expecting some more tax cuts. They're hoping for deregulation, especially in energy and financial services. So be bullish initially. But I do worry over the course of the presidency, I think, you know, we really do need to remember the trade war. Trade is the number one policy that he and his advisors care about. And if we remember back to the 2018 period, every tweet that Trump had of a new tariff action really sent the markets lower and injected a lot of volatility into the markets.

Michael: And I might add to with the recent kind of makeup of the U.S. market, you know, this year has really been about the large Mega cap tech. Back in November of 2016 or that last quarter when Trump did win, there was a very violent rally in the U.S. market. Really seeing value-ish type sectors will be energy, financials, utilities, etc. materially outperform. So that's one of the things to where you might see at the top level the market, you know, some movement. But I think the churn underneath the surface quite so severe with the Trump victory too, seeing that because again this year you have seen a market where most, if not all, the earnings growth is coming from a handful of companies. You know, financials, energy have lagged this year, but they would be set up for a pretty significant rally with the Trump victory.

Christian: You have the Trump playbook that was all about domestic revenue sources. So those factors in those companies, the ones that outperform and those that more multinationals had international exposure, they tended to suffer. So, I'd expect the same thing given his views on trade and tax.

Ingrid: So, a Trump win, net positive for U.S. equities, but bifurcation at a sector level.

Michael: Frankly, I mean, this is where could be positive for U.S. equities, but you could see managers materially underperform because of their elevated positions and kind of this year's winners, if you will.

Christian: And the other point I'd want to make on U.S. equities, too, is on the night of the election, again, it was a surprise people thought Trump would be the end of the world. U.S. equity futures absolutely puked, but by the next morning, they're rallying, and they continue to rally into the inauguration and even through the first year of the presidency. So, people were surprised because they didn't expect them to end. But then once they saw....

Ingrid: Sell the fact that, wait a minute, let's think about this.

Christian: This time, I think it might be a little bit different. I think people might go into the election thinking, oh, it's Trump 1.0 playbook tax cuts, great for markets, tariffs, don't worry, he's not serious. Then they'll wake up after inauguration ... we probably what are they get that many tax cuts. Oh, he's really serious about tariffs okay we might have a problem so we won't have the opposite reaction this time where we rally strongly. But then maybe equities might be a little bit weaker down the road.

Ingrid: Let's finish the circle on the U.S. equity narrative. Then a Biden win.

Michael: Biden win means I think, industries that have continued to receive subsidy, remain. Okay. So, you know, was getting to pull away those subsidies would really hurt the green energy sector. You know Biden win I think you get more of the same although again, I don't see a Biden victory with the sweep of Congress. And so, yeah, it quite frankly, it could be a lame duck. They want just in his inability to kind of get things done. I don't think I don't think you have a material market reaction, although I would say that much of that there has been a degree of support over the last couple of years of the economy because of, you know, higher than average government spending. I would expect to see that moderate a little bit. So still seeing budget deficits, but not increasing ones. And so, I think with a Biden victory, I think it's just more of the same. And the increasing regulation over time will reduce the competitiveness of U.S. industry. And that is certainly an area where Trump supporters have been quite upset with Biden presidency.

Christian: And funny enough, I think the Biden sweep would be the worst outcome for markets, especially because of the tax hikes that he's proposed, the recent budget and most that would go to social spending. So markets are not really going to care where. So the other side, if you had a constrained Congress, split Congress, which is much, much more likely that might be the best outlook for markets. It's not really going interfere with anything.

Ingrid: We've talked a lot about tariffs. So, let's expand the conversation because as I said, allocators, you know, just allocating to fixed income equities or you're looking around the world. So, what is the outlook then for global equities? And maybe do a double click, if you would, on like countries like China? When we think about tariffs early.

Michael: You know, there's a few things. There's the initial ... you have to think of this like a couple of steps forward. So, you know, there's already been some degree of tariffs placed on China that will continue, if not accelerate. And it's not surprising to see China aggressively move towards increased trade with South America, Africa, and other parts of Asia. So, I think, you know, there's a short term impact, but longer term, it continues to see some degree of verification of global trade with Europe. You're in an interesting spot right now where, you know, you have a war on the eastern flank and you have certainly within the European circles, a fear of U.S. indifference, particularly under a Trump presidency, which is forcing Europe more so than ever before, to really start to align policy, both fiscal, monetary amongst the core of the EU from a you know, and if you start worrying about the risk of military conflict, which is absolutely there in Europe, I mean, Rishi Sunak is is campaigning in the UK right now, part of his one of the planks of his campaign. Now he will likely lose, but the fact that he's talking about mandatory military service for people turning 18 is a real change of of mindset. And if you're going to start preparing an economy for conflict, you must have a strong if you're going to start preparing a region for conflict, you must have a strong economy. The irony of all this is … actually that is it. On a medium-term basis, it's probably somewhat bullish for Europe because it forces them to make the hard decisions about making their economy more productive than it has been in the past, where they were relying on the kind of the umbrella of U.S. support. And so, day one, not great for European companies exporting to the US, certainly not positive, but longer term does force Europe into making decisions that they've been putting off for some time. Chinas got its own internal challenges right now, so this is certainly not helpful. But China is dealing with a deflating property sector. They're starting to put forward policy. It's a bit more aggressive into dealing with the inflationary forces at play. But I think that with China it's really about their answer to some of their domestic challenges right now that I'd spend more energy on then. And while the Americans are turning to trade.

Ingrid: We often look at I want to talk about gold, right? Because that's one that we look at men and one of a separate conversation on real assets and commodities. But first, maybe take a moment and talk about what does this look like for gold.

Christian: Yeah, I mean, for for gold. I think what's interesting is when we think about let's we usually talk back again about what the trade policies are from Trump. Obviously, both candidates are protectionist. You know, Biden just announced some tariffs this past week on specific technology sectors of China. That will continue to be his policy of targeting specific sectors was Trump takes a much more broad and brash approach. And so, what he's proposed is 60% tariffs on China and decoupling with them on autopilot to do so over four or five years at 10%, tariffs across everybody else. So, these are very aggressive tariffs. This would take us well above tariff rates that we haven't experienced since 1945. So, it's a complete change of the post-World War two trade regime. Why this matters is because when you have such high tariff barriers, you're becoming much more protectionist. That also is going to change global capital flows. So, if you don't have trade with China like you used to, there's less demand for US assets starts to question the US reserve currency. And so, in that world, maybe other central banks, maybe other partners start to diversify their holdings into gold. And what we've seen that has supported gold this year has really been foreign buying, especially from China. So, I think it would probably be positive for gold in that environment been. De-minimis retail participation in the rally in gold. So, if you actually look at shares outstanding of gold, which is a large gold ETF, haven't really changed that much. The decision by the U.S. to kick Russia out of SWIFT and seized Russian reserves on the onset of the invasion of Ukraine really led central banks amongst countries that weren't particularly aligned with the US to start diversifying their reserves into gold. This has been this has been a central bank story. So, if you think about it, if this actually if you actually saw retail participation, gold could go materially higher. Gold still on a real basis on an after-inflation basis is nowhere near its all-time highs. Yes, it is at 2400 and change or whatever, but still has you know in theory if and this isn't a view per se, it's just point is, as we've gotten here on purely the central bank buying for all intents and purposes, also important to note that its gold's poor cousin silver is also broken out. And these are these are markets that if the demand supply dynamics change ever so slightly, you see pretty explosive moves both up and down. If you look at long term chart a silver, it looks like a heartbeat. And so these are again, you know, areas that we watch from a kind of cursory, you know, view. We don't, you know, have huge positions in these assets. But that's certainly interesting because it is a function of people's behavior changing about what is what is a safe asset. Very deep philosophical question because it changes over time.

Ingrid: So, again, I'm going to keep coming back to the way our listeners might be listening to us, which is Biden versus Trump. So, in a Biden win, the outlook for gold is still net positive in a Trump win, given some of these other global concerns, it's more of an accelerated positive for gold. Is that a fair way to think about it?

Michael: Yeah, I would. I would say that's fair. But I also would say that the way that many have looked at gold historically the last 30 years has completely broken down. Gold has rallied in the face of high real interest rates, which and stronger U.S. dollar. So, it's very tricky right now to get a good feel for gold because it's being driven by very ... you know, it's very unclear about until you see after the fact what's driving demand. We know for certain it's been reserve managers or central banks, and we would expect that to continue. But it is a tricky asset class for.

Ingrid: You've led me into a path where I want to do some follow-on questions here. Michael, a couple of years ago you added a commodities capability generally to our asset allocation suite to give us more tools to work with. So, let's carry that conversation in on that. In the commodities space, how do we think about other earth, metals, uranium, things like that in a Biden versus Trump world? Is there a narrative there? Is there a story there? Is there something to think about when we look at relative.

Christian: From an asset allocation perspective, The reason why commodities are really valuable is think of the world as low inflation, high inflation, low growth, high growth. We haven't really experienced many periods. We have high inflation. It's unique. We only experience that more recently after the because … well, we have.

Ingrid: But you're younger so you might not...

Christian: ... But it's in those periods where financial assets really underperformed both fixed income and equities. And so you need something else to diversify the portfolio and commodities is the best asset class for that environment. And so that's why we added that capability. It's part of our toolkit to to deal with those periods. And the periods where we get high inflation really are periods of where the political economy changes. There's some sort of shock, there's sort of different policy decision. Maybe there's pestilence, disease, war. Yeah, that kind of starts to change things where inflation becomes higher and the environment in which we start to change, you know, the world that we've been used to over the last 20 plus years where we've had globalization open and free capital markets, if that goes in reverse, because we have high trade policies, more protectionist policies, things start to look a little bit different. We have duplication of supply chains with a lot of demand for materials to not just duplicate those supply chains, but build, you know, technologies of the future like renewables, green All these all these forces pushing against low supply of commodities, wool, high demand, low supply, much higher prices. So, this is kind of changing the political economy that we've seen, you know, through the first Trump administration, even though today, really is an environment where companies might well have given inflation in the supply demand dynamics of those each commodities.

Ingrid: In a Trump win. That's sort of saying like, would you want to go buy, you know.

Michael: (inaudbible) Yeah, I think whether ... so the two candidates are very different people and from a social perspective, very different candidates. But America Inc, if you will, is pulling up the drawbridge a little bit and really pulling back in terms of its role in the global economy. It's starting to really choose its trading partners. It's trying to detach itself from being the kind of the police person of certain areas. And it's Christian's point. I mean, trade is changing. And I think that just continues, whether it's Biden or Trump. You add that to demand for various commodities, whether it be, you know, building infrastructure in cities to deal with hotter climates, to provide the energy required to run, you know, AI data centers to the fact that we haven't really had any material investment in supply of commodities for the better half of a decade and a half does set up for a to materially move higher in commodities and certain things. We were clever about when we went ahead with this and certain things, we've had a bit been fortuitous. We did believe we did see that supply demand dynamic emerging, but we didn't see was the kind of the speed in which kind of global trade was starting to bifurcate. And what we didn't see is the fact that that underlying interest rates would be this high because commodities strategies today, there's the commodity aspect, there's also the yield you gather from holding collateral against it, not to get too much into the weeds. So, we have this this inflation hedge. If you will, that pays a 6% yield. So, from an investment standpoint, we're quite happy with how it's worked out.

Ingrid: Again, back to our you know, many of our listeners today will either be listening for will my portfolio be okay or how do I make money from the volatility that's coming down the road. I want to drill in again a little bit further on some of the themes that might be differentiated from a Biden versus a Trump. So, let's think about like green energy and the evolution and sort of the differences in a Biden or Trump.

Christian: That's one of the biggest differences. So, if you think about Biden's policies, you know, he's actually been able to pass some legislation, some pretty big legislation. But the biggest one is Inflation Reduction Act, which results in a lot of subsidies and support for green technologies across the board. Trump has nothing but disdain for green technology, renewables, EVs, etc. These are killing the American auto manufacturer. We'll see how much of the Inflation Reduction Act and those subsidies he's able to repeal. Some people argue he won't be able to because a lot of those jobs happen in red states. But if you listen to his rhetoric, he does really dislike green technology. So, I think when we think about the market outcomes for sectors, it's quite negative for renewables. Under a Trump sweep, under a Biden split or sweep, renewables will continue to be fine from a policy perspective. But what Trump really stands out on is conventional energy versus modern. So, if you listen to Trump's speeches of late at any of his campaign rallies, he always keeps saying, drill, baby, drill. He absolutely loves conventional energy and wants us to be self-sufficient, huge exporter, wants increase supply. So, he would want to change, you know, permitting for more drilling rights, deregulation of the energy sector. So that's really a big split between the two. Under Biden renewables, newbies continue to be supported by policy. Under Trump, it's conventional energy. I will get the support and green and EV will be at the detriment.

Ingrid: Big driver of market performance of late has been the generative AI boom ... the move there. Is there a relative perspective slash trade in that space in a Trump or Biden versus win or is that just...

Michael: I think that the amount of investment going into that space continues. I don't think Trump has any urge to go and regulate big tech, if you will, where there might be some in the Biden's cabinet. I mean, we'll figure that out yet how to how to go and regulate that area. But I think just to kind of take Christian's comments and just go, you know, another step forward is Trump is going to deregulate, Trump is going to shrink government. Trump wants, you know, more of the private sector to drive growth, and he wants government to shrink, if you will. And in that in that exercise, he will I'm sure he'll remove some inefficient parts, but he also removes some efficient parts of government. And that I think that's probably where the biggest change is, where Biden's tendency is to be more of a more regulation, if you will. So, the other area that I think that that has very different performance, depending on which candidate will also be financials has been the context continued shift in regulation of financials ever since 2008. I wouldn't be surprised to see by now to see Trump pull that back a little bit in terms of particularly in terms it comes to Basel Three.

Ingrid: I want to touch on two more asset class areas and then I want to pivot the conversation as we get closer to a wrap up to some of the non-market but social issues that may come in, what that might mean for the markets. So first, we didn't touch down on Canadian equities under Trump under Biden bullish bearish what's the view.

Christian: Yeah, I think it's important to note for Canadian investors and the Canadian economy, General, that Trump holds no special love for Canada and a special disdain for Trudeau. And we were too exempt from, you know, renegotiating after last time around. We weren't exempt from tariffs on aluminum and steel. And so, it's hard to believe that kind of will be totally immune from the wrath of Trump and his trade policies, I think is a little bit naive. So, we do need to be worried. I think Canadian politicians and diplomats are acutely aware of this problem and will try their best to renegotiate that world. But you can tell from their comments that they are concerned. So with that being said, I don't think Trump is necessarily going to be a tailwind, maybe a slight had been for the Canadian economy. When we think about Canadian sectors of the TSX, obviously materials and energy are big portions of that and those probably do incrementally better off with deregulation of the U.S. So that way it would be a bit positive for certain sectors of the Canadian economy. But I would be wary about the headline risknon trade from the Trump.

Ingrid: Finally, one of the other tools that we have in our toolkit here at TD Asset Management is our alternatives are private assets. Is there a difference in terms of how we think about a Biden government, a Trump government, when we look at those asset classes and what they can do for portfolios?

Michael: These asset classes tend to be very, very long, long duration holds. We don't trade them per se. We are long term holders of these assets. I'm not totally certain whether either is net pause or a net negative for either of these two. We have a fairly diversified mix of real estate and infrastructure, but a lot of them structure. Some of that's in the U.S., some of its global I don't think globally that transitioning to whether you want to call it the green economy or carbon resistant infrastructure, etc., I don't think that changes under either candidate. So that's fine. And so, I don't think we'd have a strong opinion one way or another. These assets continue to give us the stability within our portfolio. As Christian talked about, the forces, the world that we like to think about and these assets still have a have an important place, whether it's a Trump-Biden unified Congress or divided Congress, I think they still continue to churn along. So that's kind of where we're setting on that. I don't think we're day one. I don't think it's going to be a huge issue. It will be interesting to see where what actual policy emerges and that there might be something there. But that's for a that's a 2025 issue, not so much an election night issue.

Ingrid: For I'm sitting the punch line on that question really is ... we have these tools in our asset allocation toolbox that will dampen the volatility of portfolios for our investors, and that's precisely why we use them, is because you can't control markets and you can't know what's going to happen. Let's flip the conversation now When we wake up on November 6th, have countries going to be unhappy? What does that look like? You know, we talked about what could happen in markets as we approach the election, what might happen to markets from one to the other. What are some of the other things we're not thinking about, you know, relative to policy perspective?

Christian: Yeah. So, I think in terms of election uncertainty and those concerns of arrest, just to give a word of maybe more optimistic thought is that if Biden were to lose the election to Trump, he's not going to try and decertify the results. He'll accept his defeat and move on. And I think that's a little bit different from what happened on January 6th last time and what happened after the election last time. So, with that being said, I think the transition of power would be fine if Biden were to lose from a logistics point of view. But let's keep in mind that half the country is not going to be happy no matter who wins. So is the risk of arrest certainly is a risk of, you know, challenging election results in courts Certainly are the polls extremely close? They are. So that could mean a couple of things. That could mean that it takes days to count ballots and states. So, they'll actually get thrown out. But Bush-Gore actually went to once the courts to decide that could happen again...

Ingrid: “Hanging chads.”

Christian: Yeah, and then the other out result too, is you could even have a tie electoral college of 269/269. And the Constitution does have a solution to this. And it may result in a vice president and president from different parties. So, there's a lot of areas that I think will be worked through, but it's going to be a period of volatility over the month if the results are very close or contested.

Michael: Yes, I would just say that outside of a clear victory, if we if you wake up the day after and it's murky or there's a challenge, it's going to lead to tremendous market volatility as the markets hate uncertainty. And that will be a huge source of uncertainty in terms of of how things play out. And then you're getting into constitutional law, which not many people really are scholars of. And it could be quite unclear how that plays out over the remaining months to January.

Ingrid: So, what I'm hearing is an unclear outcome in November. Is that negative for markets?

Michael: Yes, 100%.

Ingrid: Okay. What else are we not thinking about? What are the risks? What else is keeping you awake at night when you think about th is that we haven't talked about that investors should be thinking about?

Michael: I would say that if you go into a period of uncertainty, it might provide a window of opportunity for the Americans adversaries to take action. And maybe they're planning something in there, like the U.S. is distracted, so let's do it. So again, very much still risk, but be something that if I was involved again in the opposing side, if you will, we might look at that as an opportunity to take a shot at something where it might be in plain view. So, and again, these are just kind of way out there thoughts. But the second thing is, I think it's important just to step back and look at the world we're in. And it's if you haven't got the memo by now, things are changing in a path that we're just not we just haven't lived through in some time. So, and this I think what's happened in the U.S. is very symptomatic of what's happening society in terms of polarization, the inability for societies to align around common themes or common values and continued, you know, you have to two neighbors and they might be living completely different realities based on the information that they're receiving because it's so it's so fragmented or balkanized. So, you know, we as a society will have to just collectively think about whether this is the way we want to proceed or is there a better way, a better way forward. I mean, if there's ever a time for leadership, it's today. I don't know if either of these candidates are really able to do to unify the country, but it will be really critical to see what number who emerges in 2028, because I ultimately believe that 2028 is the reset where the U.S. at least unifies around leadership and goes a certain direction. I don't know what that direction looks like yet, but I my sense is we're getting to the point of exhaustion of this constant animosity across parties.

Christian: My biggest concerns of the foreign policy front, because since the fall of the Berlin Wall, we had a unipolar world where the US would guarantee global security. We had common norms, we had international institutions, and all those are continuously crumbling. And as the US continues to retrench, it's not just on trade, it's also on foreign policy and how much military support they guarantee to the rest of the world. And as we look over what's happened over the last five years, a lot of these geopolitical fault lines that we have between and within countries are starting to fracture (inaudible) can think of all the conflicts that we've seen and there's many other conflicts that are potential and waiting out there that could be taken advantage of by bipartisan either side. If the U.S. is not willing to guarantee security or financial institutions that previously guaranteed security or some sort of peace in those environments start to crumble. So that's a very different world because we've been able to be smart to face geopolitical risk whenever conflicts arise over the last 20 years. But if that's no longer the case, that's a very different environment and I'd expect a lot more volatility and more destabilizing headlines that we need to take more seriously than we did in the past.

Michael: So as in and from an investment, you know, that's some amoral but as from investment standpoint so far or, you know, different world that we're used to operating in, but it provides does provide opportunity. And this is as you listen to Christian kind of lay that out, this is exactly the reason that we've made the decisions we made in terms of allocating to private real assets, to allocating to commodities, to taking a much more diversified approach to investment management for clients. And ultimately, it's led to far superior outcomes to our and to our stakeholders and our clients over the last handful of years.

Ingrid: That really leads me to that last question, because certainly we are going down a path here where I was looking for a ray of good news in here or certainty, and there certainly isn't. So, you know, as I said at the outset, you and your teams manage over $110 billion in combined solutions for our investors. How are you feeling prepared to weather this?

Michael: Oh, I don't think we lose a night's sleep. Yeah, quite frankly. I mean, look, this is we've been in this for a long time. We look at the facts and the outcomes. There are negatives and positives to either candidate, by the way, outside of the individuals, just in terms of the policy. And we are you know, we haven't really got into because this has been about the election, but we are at the, you know, the early innings of almost a fourth industrial revolution in terms of the I what we're doing, in terms of health sciences, robotics, etc. So, on that backdrop and by the way, people are continuing to live longer. So, we because we're inundated with information, we think that the world is horrible. The number of people today in poverty is a fraction of what it was 20 years ago, 30 years ago. So, there's been huge progress. The new challenges, climate. And I have no doubt that that will sort that out. But as we go through it, you know, sometimes you go through these periods of time when it feels, you know, quite uncomfortable. But ultimately, that's sometimes where you need to go until you get you get clear direction. So, I can speak for Christian, too. I don't think we’re really ... fretting about what's going to happen. We're actually quite dispassionate about it.

Christian: And so, I'd like to say to like to people to that, you know, end of the day, policy is just one input into the best of a process. A lot of other things matter much more than policy. And so, when we've looked at, you know, the stats, if you want to look at a Democrat versus Republican president, you want to look at split Congress and let's play Congress.

Christian: There's not a massive difference in performance. There's also that's not going to be the main thing that drives your performance. It's a whole mosaic out there of information that's imported. And this is just one that we'll be paying attention to watching, analyzing. But there's a lot more things that will drive the portfolio. And the way that we build things is to be resilient regardless of the scenario.

Ingrid: That is a great note to end on. Michael Christian, thank you so much for your time.

Michael: It's our pleasure. And good, great to be here!

Christian: Appreciate it!

Ingrid: And for our listeners, thank you so much for joining us today. As we go through this year, you're going to see more information and insights coming from TD Asset Management. You can receive our podcasts on Spotify, Apple, Amazon and Google. You can follow us on LinkedIn or you can go to TD Asset Management dot com. Thanks and have a great day.

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