US election “factoids” that you should know:
The US election will be held on Tuesday, November 5th, and is held by state
This is the 60th presidential election to select the 47th president of the US
In Congress, all 435 seats in the House of Representatives are being contested. In the Senate, 34 of 100 seats are being contested
Nearly 70 million Americans are believed to have already voted
In the 2020 presidential election, 165 million Americans voted, which was around two-thirds of Americans eligible to vote. This was the highest turnout since 1900 according to The Pew Research Center
This is the first US election in which people in the US have been able to bet on the outcome of the election (covered in more detail below)
Most of the 50 US states have a tradition of voting Democrat (west coast and northeast) or Republican (midwestern and south), and their electoral college votes are likely to go this way again. So focus will be on the so-called seven “swing” or “battleground” states, which remain too close to call, and account for 86 electoral votes (keeping in mind that 270 are necessary to win): Arizona (11), Georgia (16), Michigan (15), Nevada (6), North Carolina (16), Pennsylvania (19) and Wyoming (3)
The media in various states will declare winners after most election polls close, although the election results could take a few days to verify. In the 2020 election, although President Biden easily won the popular vote, the electoral college votes were not fully verified until the Saturday following election day
The Electoral College: Just a reminder to make sure you understand how voting works in US Presidential elections. Popular vote is not the decision maker, since five times in US presidential history a candidate that won the popular vote did not become president. Two of these have been in the last 25 years. If you want to brush up on how the electoral college system works, check out this article here that I penned on EMC back in October 2020. Unlike the selection of a president, elections for members of the House and Senate are determined by popular vote.
The Betting Markets: Betting on who will be the next president of the United States is now allowed by Americans through select brokerage firms, whereas there are few if any restrictions on betting by people that are off-shore. The major sites available for people based in the US appear to be Robinhood and Kalshi, both of which allow “yes/no” bets on the presidential election, as well as other contracts on things like which party will control the House and the Senate, which presidential candidate will win in each swing state, and various other things like voter turnout, voter demographics, etc. However, the site that has gotten the most attention is Polymarket, a company headquartered in New York that uses the blockchain (Ethereum) to provide betting on all sorts of predictive markets including politics, sports, etc. However, Polymarket is not accessible to Americans in the US – it can only be used by off-short investors.
I have always had slightly more confidence in the betting markets than in polls, that is until I read a recent article about how the odds can and have been allegedly manipulated at Polymarket through both large-size “whale” bets and fake “wash” trading. If you want to understand this better, check this article out in Fortune which was published on Friday.
In any event and for what it is worth, here are the odds as far as the next President, at the time that I am writing this article on November 3rd:
Kalshi: 51% Trump / 49% Harris
Robinhood: could not access
Polymarket: 56% Trump / 44% Harris
In total, I read that around $123 million has been wagered by Americans through October 31st on the US presidential election (source: Axios). For context, $23.1 billion was bet on the last Super Bowl and $2.7 billion on the NCAA basketball tournament, so election betting in the US remains a very fringe market.
The Polls: The various polls vary but indicate that the race for President will be very tight. Even in polls where Trump or Harris lead by 2% or 3%, their lead is not sufficient to rule out statistical errors. I pulled the graph below from opinion poll firm FiveThirtyEight on Sunday afternoon. The firm seems reliable, although not always right (true for any company conducting polls). The graph below is the latest predicted outcome based on national polls, illustrating an election that remains too close to call.
The last New York Times/Siena College Poll for the period Oct 24 to Nov 2 was released last night by the #NYT. Importantly for the upcoming presidential election, the graphic to the right shows how the swing states are currently polling. As I have said repeatedly, both polls and betting odds are way too close to read much into aside from the fact that the election is likely to be close.
The three key issues, if you still have not made up your mind: If you haven’t voted, and are still on the fence as to which candidate to support, this article I wrote a few weeks ago – “Three Key Election Issues: Immigration, Inflation and Abortion” – might help you think through a few of the key platform issues that differ between Republicans and Democrats.
Let’s get through this election, keeping in mind that the world keeps turning no matter who wins. I am ready to get back to focusing my energy on markets!
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