My colleague Casey Flavin and I are up in Alberta (my home province), visiting a number of our Canadian clients. Writing a note about the recent decline in President Obama's approval rating from Alberta seems somehow appropriate. Many people refer to Alberta as the Texas of Canada. As a native Albertan I tend to agree, except for one thing, Albertans are more conservative than Texans!
In the last Canadian Federal election, it was considered a watershed moment when the leftist New Democratic Party won one seat in Alberta. The Conservative Party won all 27 other seats.
But enough about these Alberta rednecks (since I'm both, I'm allowed to say that!) and on to Obama. As we've outlined in the chart below and have been highlighting on the morning call to that clients that subscribe to the call, Obama's approval has taken a sharp decline in the past couple of weeks. Yesterday, according to the Rasmussen Tracking poll, Obama's approval ranking, the difference between Strongly Approve and Strongly Disapprove, was at +1, which is close to the lowest of his Presidency.
Some other data points that suggest that President Obama's influence may be waning and that Republicans may be gaining ground include:
- Rasmussen poll from last week indicated that 49% of respondents disagreed with President Obama on closing Guantanamo and 38% agree with the decision. Given that this was a key focus for Obama during the campaign and a key recent decision he has made, this poll has relevance on the electorate's view of the President;
- In a CNN Opinion poll from last week, former Vice President Dick Cheney approval rating was 37%, which was up 8% points from when he left office. Cheney is likely one of the most vilified politicians in the nation, so a dramatic increase in his approval rating, even if still low over all, likely indicates a marginal shift towards the Republican party
- Rasmussen did an online poll Friday of last week that indicated that 70% of respondents, out of ~2,300, said they did not believe Tim Geithner would be Treasury Secretary by December 31, 2009. This is likely a decent proxy for how the electorate thinks about Obama's economic policy so far, although, admittedly, it is also a vote of disapproval on a particularly ineffective Treasury Secretary.
While broadly speaking, President Obama's approval is still high based on the Real Clear Markets poll summary, which shows that based on an average of polls his approval rating is at 60.5%, even that is near the lowest of his Presidency. In aggregate, the confluence of events relating to foreign policy, domestic economic policy, broad based "socializing" and the burgeoning debt balance are starting to pierce the armor of President Obama. It seems likely that over the coming months, he could see a more broad based correction in both his and his party's approval rating.
Perversely, this could actually be positive for the U.S. Dollar as both global currency and debt investors begin to realize that President Obama has less influence to promote legislation that could be perceived as socialistic.
As Keith has said since the inauguration, "the REFLATION trade really works when Obama threatens to socialize the country to smithereens" (meaning Dollar Down = Stocks UP). If the Republicans keep picking up points, that could signal the last stand for a currency that is trending towards crisis.
Daryl G. Jones
Managing Director
