5 Real Risks That Could Derail Hillary Clinton’s White House Bid

Listening to most recent mainstream media reports, you get the sense that former Secretary of State Hilary Clinton is not only a shoe in to win the Democratic nomination for President, she’s also very likely to win the general election.  While most people on the right may view this with varying degrees of trepidation and disbelief, the view is actually well founded in current polls. 

5 Real Risks That Could Derail Hillary Clinton’s White House Bid - z hi


As it relates to her party’s nomination, the top six polling candidates based on poll aggregates are as follows:

  • Clinton – 64.2%;
  • Warren – 12.5%;
  • Biden - 9.8%;
  • Sanders – 7.4%; and
  • Webb – 2.6%.

You get the point.  The current “race” for the Democratic nomination isn’t really a race.  Her current spread over Elizabeth Warren is a staggering +51.7 points.  Fast forward to the general election match up, Clinton holds a sizable lead against various potential Republican nominees.   Her most significant competitors— the GOP triumvirate of Jeb Bush, Rand Paul, and Marco Rubio—all trail over 7 points behind her in the poll aggregates.


The bottom line is that if the election was held today, there’s little doubt Hilary Clinton would be elected President.  The election of course is not today and between now and November 8th, 2016 a lot can, and will, happen.  Without further ado, here are five key factors that could put what currently looks like an inevitable Clinton Presidency at risk.


1. The Clinton Foundation - This risk is the most topical right now given the current scrutiny the Foundation is receiving thanks to Peter Schweitzer’s book, “Clinton Cash: The Untold Story of How and why Foreign Governments and Businesses Helped Make Bill and Hillary Rich.” It is also very likely an issue that will not go away.  On some level, whether the Clintons acted ethically as it relates to the Foundation is irrelevant because there is enough fodder that it will allow Republicans to continue to keep the heat on the Foundation.  To the extent the scrutiny accelerates, the Foundation has the potential to become Clinton’s “Swift Boat” moment.
2. Likeability (and accessibility) – Since announcing her candidacy more than 35 days ago, Hillary has answered a grand total of 8 questions from the press.   Whether this lack of accessibility is ultimately perceived as a lack of a common touch (think Hillary going into Chipotle wearing sunglasses and not leaving a tip) remains to be seen. However,  as the chart below shows, her favorability has taken a steady decline since she left office as Secretary of State in February 2013.  Most interesting, since actually announcing her intention to run for President, her “Unfavorable” rating has exceeded her “Favorable” rating.  

5 Real Risks That Could Derail Hillary Clinton’s White House Bid - z dj1

3. Rubio Emergence – Ultimately for Hillary to not win the Presidency, a front running Republican candidate will have to emerge.  The current GOP crop of contenders is broad, some would even argue deep, but there’s really no one is standing out or breaking out from the crowd.   In the Real Clear Politics chart below, we show the top 14 candidates for the Republican nomination. (Yes, 14!) As the RCP chart shows, there is no clear front runner.  In fact, Bush, Walker and Rubio are all basically in a statistical dead heat.   

5 Real Risks That Could Derail Hillary Clinton’s White House Bid - z dj2

From our perch, it feels like the Republicans need a candidate that is not white, middle-aged and male. In the front runner category, Rubio clearly fits that bill.  Latinos’ lack of support in 2012 (only 3 out of 10 votes) was noted as a key reason for Romney’s inability to win the election, so clearly this demographic will be key for the Republicans. Rubio (and to some extent Bush, given his Mexican born wife and bilingualism) has the best chance of increasing the Latino votes based on their backgrounds and policies.


4. Bill’s Gaffes – While there is no question that Bill Clinton is one of the most talented politicians of his generation, there is also no question he is (and maybe increasingly so) prone to putting his foot in his mouth. In today’s hyper-plugged in digital world, where no one is safe from a rogue iPhone recording a candidate’s every word, this may pose a delicate challenge for the former commander in chief.  Don’t forget that the key negative turning point for Romney in 2012 was his 47% quote:


“There are 47 percent of the people who will vote for the president no matter what … who are dependent upon government, who believe that they are victims. … These are people who pay no income tax. … and so my job is not to worry about those people. I’ll never convince them that they should take personal responsibility and care for their lives.”


Remember, Romney said this in the friendly confines of a Republican fundraiser. The lesson? No environment in the day of iPhones and social media is off limits in terms of quotable material.  Bill Clinton may have the political acumen to not have a major gaffe, but his historical penchant for the spotlight makes it difficult for him to stay out of the media.  


The most recent gaffe was his response to NBC’s Cynthia McFadden after she inquired about his enormous speaking fees ($500,000 and above). Clinton responded, “I gotta pay our bills.” That’ll play well in Peoria. While this quote won’t sink Hilary’s campaign, it does offer a taste of what may come from his mouth in the months ahead. It will certainly be used over and over by the Republicans to portray the Clintons as rich and out of touch.


5. Benghazi (and general track record) – In aggregate, Hillary Clinton’s role as Secretary of State is regarded favorably and without much controversy with one big elephant-in-the-room exception – Benghazi.  This was of course the unfortunate turn of events that led to the deaths of U.S. Ambassador J. Christopher Stevens and three other Americans when the U.S. diplomatic mission in Benghazi, Libya was attacked.   We are going to reserve analysis of the events, but believe this will become a major thorn in her side, especially as it gets into the nitty-gritty of the campaign post the nominating conventions.   The downside of having a track record is that in can and will be scrutinized under a microscope and Benghazi remains a major issue.


Despite these five key challenges to Clinton’s candidacy, make no mistake about it: this remains her race to lose.


Daryl Jones is the Director of Research at Hedgeye Risk Management.


Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

read more

7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more