By H. B. Ducasse, analyst.
If you like numbers, the impending elections in the United States are a must-see aphrodisiac for looking at lots of statistics, graphs and trivia. Polls, bets and markets speak for themselves, and those indicators cannot be avoided by the candidates. In that dialogue, for now, it is Democrat Joe Biden who finds better answers. He leads bets, also polls and markets don’t seem to look at him wrongly. But current president, Republican Donald Trump, already knows about bumps and also understands that national polls are a relative indicator (in 2016, he lost the global election to Hillary Clinton, but he won more states and stayed with the presidency). His sharp, sometimes brutal rhetoric will always say that polls consistently underestimate millions of Americans. On November 3rd, we will finally know. This time, the difference seems to be 8 points and not 2, as in 2016. Also, the underestimated assumptions are not seen in the betting, where Trump is below his rival. Most bookmakers agree: Biden will be the winner.
THE FORECASTS OF THE BETTING SITES
The numbers provided by the Real Clear Politics website, which averages real-time bets, (https://www.realclearpolitics.com/epolls/2020/president/us/general_election_trump_vs_biden-6247.html) show that the distance between the two candidates would be narrowing. Last October 19th, Trump was losing 60 to 40. Now, he is down 50 to 43, but discounting Biden’s advantage. However, on September 1st, they were running head to head. In the best-known agencies, the hit to Trump is lethal: they pay US$1.45 to Biden’s bettors and US$2.70 to Trump’s.
On sites like bwin, for example, they already receive bets for 2024: Mike Pence and Joe Biden are almost in draw, Trump appears lagging even for his daughter Ivanka, and Kate Harris and AOC (Alexandria Ocasio Cortez), the former Puerto Rican waitress, Democratic representative for New York, are rising strongly. Among other aspects, this election in the United States is marked by the pandemic effect and the enormous political-economic consequences that are beginning to emerge. Pollsters, gamblers, and stockbrokers know it. Trump has not approved his lesson on the pandemic’s management. Even so, current president continues to insist with the idea that “if I get closer, I will win.” It builds on the antecedent of his previous victory, sure, but the odds are much slimmer in 2020. It is true that polls are increasingly mistaking, but, in the US, they operate within the margin of error. Four years ago, in the 2016 elections, there was what we could call a ‘triple error’: polls, bets and markets expected a victory for Hillary Clinton, but Trump won. Markets also considered that Trump would be a risk for the stock market, but it will be enough to look at the graphs of these years in office to calculate that, even under a pandemic, the economic numbers are not bad. Trump does not want noise in the markets before the elections, but the perception of investors about the electoral result seems to have taken an important turn in recent days, and the concern about possible turbulence comes from some unlikely, but not impossible, scenarios that depend on Trump.
WHAT THE LATEST SURVEYS SAY
In these elections, in the midst of the pandemic, it is expected that early voting (in person or by mail) can reach a historical maximum and, therefore, be decisive in the final count. On several occasions, Trump insisted that there could be scams and fraud, making it clear that he does not trust the vote by mail and that he could go to the courts of different states if he needs it, even before the Supreme Court itself. Faced with this scenario, nobody wants to think what will happen if the results of November 3rd are tighter than expected.
Either way, in the run-up at least, Biden seems to like all three scenarios: markets, polls and betting. In the past three weeks, since the debate between the two White House candidates and President Trump’s subsequent convalescence from COVID-19, Biden has regained the advantage he had lost. Average polls can be followed on the FiveThirtyEight site (https://projects.fivethirtyeight.com/polls/president-general/national/). As I write this article, Biden leads Trump by 8.5 points. Polls are known to put pressure on markets and betting. The markets, as we said, do not misread a possible change in the helm of the country.
When it comes to betting, we know that there are changes related to Big Data, and that political bettors are becoming more and more professional and are studying voting patterns better and better along with trend modifications. Sooner rather than later we will see parties and candidates appoint advisers and consultants from the world of online gambling. We also know that betting on elections is very limited in the US. There are curious exceptions, like the Predict It site (https://www.predictit.org/markets/detail/3698). On the other side of the Atlantic, in Europe, there are hundreds of online gambling sites that play squarely in the White House succession. Betfair, Bovada, Smarkets and Spreadex, all from the UK; as well as bwin, Betsson and Unibet, among others. All maintain that the volume of bets on the probable winner of the political contest of November 3rd does not stop growing. For the most part, with very smaller margins, they coincide in the result. Will they be wrong again, as in 2016? There is very little time left to know the answer to this question.