UBS panel: The election is Hillary Clinton’s to lose

Experts suggest the House of Representatives will probably remain Republican, the Senate is a toss-up and the economy will remain much the way it is now.

Many American voters are filled with rage over stagnant wages, poor job prospects and a gnawing anxiety that the country is adrift in a sea of free-market globalism.

And Donald Trump has so successfully tapped into this widespread angst that it could propel him into the White House.

But a panel of election and investing experts who gathered in New York on Thursday generally agree that Mr. Trump needs a lot more than voter anger to win (like money, organization and policies).

That said, it’s Hillary Clinton’s election to lose.

The nation is facing “electile dysfunction,” said David Wasserman, election analyst for The Cook Report at the UBS CIO conference.

Behind the contest between two highly unpopular candidates: Economic displacement by technology, said Tom McLoughlin, co-head of fundamental research for UBS. A recent Oxford study said 47% of all jobs in the U.S. could be replaced by automation.

“We’re in a position where if you’re a middle-aged machinist in the Midwest, your job is going away and it’s never coming back,” he said.

The result: A wage and earnings gap.

“The economy is making voters mad and anxious,” said John Savercool, head of the UBS U.S. Office of Public Policy. “It cuts across all age groups.”

Bernie Sanders, in his failed bid for the Democratic nomination, rode this wave of fear — but none more boldly and effectively than Mr. Trump.

“Trump voters feel that no one else is helping, and that everyone else has passed them by,” said Andrew Friedman, principal at The Washington Update. “Democrats have been helping the very people who are threatening their way of life.” And Republicans, he said, haven’t been able to do anything to help, either.

And both sides have dug in, with very little likelihood that one side will be swayed by the other.

“The best quote I heard from a Trump supporter was, ‘The only way he won’t get my vote is if he breaks into my house and murders me,’” Mr. Friedman said.

Nevertheless, it will be a tough election for Mr. Trump to win. Assuming he wins all the states Mitt Romney won in 2012, he would still have to conquer Michigan, Ohio, Pennsylvania and Florida.

“In order to win, Trump has to sweep the swing states,” Mr. Friedman said.

On Mr. Trump’s side, however, there are a couple of things that could work to his advantage. Ms. Clinton could get indicted over her State Department emails, and some traditional Democratic voters — think autoworkers — could listen patiently to union leaders endorse Ms. Clinton but then walk into the voting booth and pull the lever for Mr. Trump, panelists said.

The most likely outcome: A Democratic president, but a Republican house. The Senate could well go Democratic as well, they said.

For investors, a Democratic win in the White House would mean reforms to Social Security and other so-called entitlement programs are unlikely, Mr. Friedman said. But it also would mean that, with a Republican House of Representatives, any expansion of social programs would be unlikely. In essence, the economy would remain much the way it is now, he added.

Mr. Trump doesn’t support Social Security reforms but does support lower taxes and higher defense spending. This could boost stocks and the economy in the early going, but would cause the U.S. budget deficit to balloon, Mr. Friedman noted.