Wall Street Is Worried as Trump Is Delaying Transition of Presidency

Disrupting the elections by manipulating the election laws and electoral college may or may not result in the goals that Trump seeks but is certainly scaring investors of "constitutional mayhem", writes C.J. Atkins

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With their plan to steal the election by having ballots disqualified failing in court after court, President Trump and his legal team are switching gears. His lawyer Rudy Giuliani is now pivoting to a strategy of delaying the final vote count and certification in as many states as possible in order to cast doubt on President-elect Joe Biden's decisive victory.

Giuliani has reportedly told Trump and a team of advisors that the new goal is to pressure Republican lawmakers and public officials in key states to stall certification and create the image of a "failed election." This would then, theoretically, prompt GOP state legislatures to ignore the voters' verdict and appoint alternative slates of pro-Trump electors.

By disrupting the Electoral College and the formal declaration of a winner, the hope is to create confusion and encourage the idea that there was fraud, even if Biden's win is ultimately upheld.

The outgoing president pushed his followers in that direction with lies about ballot-box stuffing in Michigan on Wednesday. Claiming that the state has more ballots than it does voters, he said "Democrats cheated" and, therefore, Michigan "cannot certify the election."

Just like the previous focus on tossing out ballots failed to produce any evidence of vote tampering and ultimately hit a legal wall, experts expect the "alternative slates" strategy will also flop. Reportedly, even Giuliani believes it is nearly impossible to pull off.

Election law in two of the key states in contention—Pennsylvania and Wisconsin—provides no role for state legislatures to appoint electors. And in other states, most GOP lawmakers are showing little appetite to go down that path. In almost all of the states in contention, Trump's team is challenging election rules that were actually written by Republicans.

Close Trump advisers have anonymously told The Washington Post that although Trump is still looking for any way possible to hold onto power, he's also beginning to give more attention to keeping his voting base angry and mobilized for a possible 2024 comeback run. It appears to be working; a new poll from Monmouth University shows 77% of Trump voters believe Biden only won thanks to fraud.

Trump is stoking those false beliefs and leveraging them to raise money from supporters to fund his future endeavours. Near daily emails from the campaign direct supporters to donate to his new PAC.Ry

Trump's strategic re-orientation is driven by a string of losses over the last few days. In Georgia, a hand recount of ballots left Biden still holding an insurmountable lead over Trump of 12,000+ votes. In Allegheny County, Pa., a judge threw out two Trump requests to have nearly 3,000 ballots tossed for technicalities like a voter not writing a date on an envelope or signing on one line instead of two.

The Trump campaign even tacitly admitted its allegations about fake or faulty ballots were untrue when it agreed Wednesday to a stipulation in a Bucks County, Pa., lawsuit that there had been no fraud.

Behind the scenes, Giuliani is apparently being closely guided by right-wing media figure, white supremacist, and former Trump adviser Steve Bannon. While Giuliani directs the failing efforts in the courts, Bannon is rallying the troops on the outside. He told listeners to his podcast that Trump has a clear path to victory if the appointment of electors to the Electoral College can be short-circuited. "You can't certify Michigan," Bannon declared. "You don't have to put up a slate of electors."

After the Pennsylvania Supreme Court rejected the Trump claim that observers were not allowed to watch the counting, Giuliani has amended their lawsuit revealing a plan to argue in federal court that the state's entire election results should be declared "defective" and that the GOP legislature should be allowed to appoint electors.

State law directs the governor, in this case, Democrat Tom Wolf, to appoint electors based on the popular vote. Thus, Giuliani's claim will almost certainly be thrown out by the courts, but he's charging ahead anyway.

In Wisconsin, meanwhile, the Trump campaign wired $3 million to elections officials to pay for a recount of two counties—another effort to delay certification.

Speaking to the Post, voter protection lawyer Laura Fitzsimmons says the Trump campaign is getting desperate. "They probably know better than the rest of us that their allegations are unfounded, and they're just seeking a delay" for tactical reasons, not legal ones.

This latest attempt to overturn Trump's defeat faces the same poor chances of legal success as the first, but the president's determination to destabilize the entire process is starting to make some on Wall Street worried about a chaotic and unpredictable outcome.

The investor class saw massive gains from the tax cuts and anti-regulatory crusade that's been pursued by the Trump administration, but the president's total failure to manage the COVID-19 pandemic and the blockade on more economic stimulus in the Senate tempered support for Trump in the waning days of the election campaign.

The expectation of a return to stability under Biden and hopes for a GOP-controlled Senate has calmed some of the market's recent volatility. The stock rally that happened following the projection Biden had won and investors' lack of interest in Trump's frivolous lawsuits reflected the market's confidence in the certainty of the outcome.

But with Trump's ongoing purge of top defence and election security officials, Attorney General Bill Barr's abuse of the Justice Department to chase down voter fraud claims, and the attempted electoral coup in Michigan, some financial analysts are revisiting the possibility of further Trump chaos upsetting the already fragile economy.

JPMorgan Asset Management's Michael Cembalest warned clients in a Wednesday report that he's increasingly concerned about the "remote risk of an American horror story" and "constitutional mayhem." Cembalest oversees $2.2 trillion in assets for the bank. He conceded that "a lot of unorthodox things" would still have to happen for Trump to keep power, but said, "I'm not ruling anything out."

Not knowing who's going to be president would send investors scrambling and possibly spark a sell-off. "Markets might react negatively if the U.S. is seen as sliding down a path toward electoral illegitimacy due to post-election maneuvers by political parties."

"The nightmare for markets," Cembalest warned, would be if Senate Republicans overturn existing law and abet the alternative slates strategy, resulting in "duelling inaugurations."

The dire scenario outlined by Cembalest was paired with a firm statement by JPMorgan CEO Jamie Dimon on the same day that Trump has to accept the outcome. "We need a peaceful transition. We had an election. We have a new president," he declared. "You should support that whether you like it or not."

The signals from some of finance capital's most influential figures are telegraphing a clear message to Trump: It's over. Lack of full-throated support from Wall Street is not dampening Trump's efforts, however.

Never in U.S. history has there been this type of effort to stop the certification of votes in the states or such intense talk of engineering the appointment of alternative slates to the Electoral College. There are growing signs that the chaotic tactics of the president are causing splits to open up within the GOP and between the party and some of its big business backers.

Some are prepared to accept a Biden victory, even if they are already planning how to block him from implementing his agenda at every turn—especially if the Republicans can win in the Georgia Senate run-offs. Mitch McConnell will be happy to benefit from the illegitimacy of the election caused by Trump and his close followers and will court support from capital in preparation for 2022 and 2024.

Many of them may be ready to turn the page on Trump, but the outgoing president displays no intention of moving on. (IPA)

(C.J. Atkins is a journalist based in USA. Views are personal.)