CHICAGO Businesses hoping
for more certainty following the U.S. presidential election
might be in for a rude surprise, according to one trade
President Obama and Republican
presidential hopeful Mitt Romney got a "bounce" after their
parties conventions, according to Lewis Leibowitz, a
partner at Hogan Lovells US LLP. "But Romneys was small
and didnt last very long," he added.
If Romney hopes to become
commander in chief he will have to win several tight races, in
particular in Florida and Ohio, Leibowitz said at the 26th
annual AMM Stainless & its Alloys conference in
He declined to predict a winner
given that any number of events could change current
"If you come to a fork in the
road, take itthats the 2012 election," Leibowitz
said, citing a quote from Hall of Fame Yankees catcher Yogi
Berra. "I wish I could be more certain. .... But I think we are
going to be faced with a closely divided government."
The Republican Party needs to
win four of six "toss-up" seats to take control of the U.S.
Senate, Leibowitz said. Current polls suggest the Republicans
are ahead in most of those races, "but only by a whisker."
In the House, the Democrats
would need to take 25 seats to gain control, although polling
suggests the chances of that are unlikely, Leibowitz said.
Still, the election could see the Republicans with a slimmer
majority in the House, he added.
The most likely result will be a
split government no matter who prevails in the presidential
race, Leibowitz said. "Its not clear what policies, if
any, will go through the House and the Senate," he warned.
There is a possibility that
Republicans and Democrats could strike a "grand bargain" on
pressing issues such as infrastructure after the election,
Leibowitz said. But its equally possible that the current
"gridlock" will remain in place, he said.
Leibowitz brushed aside
questions about possible new trade petitions in the stainless
steel arena. "I dont bring them. I just defend against
them," he said, although he acknowledged that there were
"rumors flying around."
Thats, in part, because
trade tensions are on the rise around the world, Leibowitz
China feels that it is being
treated unfairly in trade petitions in the United States and
vice versa, he said, adding that Romney has generally struck a
more aggressive tone toward China than Obama.
In Brazil, higher import duties
on a range of products have upset the United States. But those
duties were boosted partially as a reaction to the increased
value of the Brazilian real that has resulted from a third
round of quantitative easing in the United States, Leibowitz
said. Trade fights have also broken out downstream among big
stainless consumers such as Boeing Co. and Airbus SAS, as well
as upstream in the rare earth metals sector, he said.
But while those disputes are
ongoing, there is also increased talk of free-trade agreements,
for instance between the United States and the European Union,
One certain tailwind for U.S.
stainless companies is low natural gas pricing resulting from
the countrys shale gas boom, Leibowitz said, echoing
comments made by other speakers at the event. "This (the United
States) is a good place to be for an energy-intensive market
like stainless steel," he said.