State of election markets: 352 Days

I cut the Republican chart down to five candidates this week; four of them have a non-negligible chance of winning the nomination and, because many consider him the front-runner, Ben Carson. On the Democratic side of the election, Hillary Clinton went from dominate to nearly unbeatable as polls showed her insurmountable lead over Bernie Sanders growing. The attacks on Paris dominated political news in the past week; the effect on the markets is weakened by continued uncertainty of their eventual impact on the political scene.

The Republican front-runner (in the markets), Marco Rubio, extended his lead this week by staying relatively quiet. He compared Islam to Nazism, but otherwise appeared moderate relative to Ted Cruz, Donald Trump, and Ben Carson. His ability to weave through the issue, look tough to the GOP base, but not say anything that will be too extreme for the general public, will only reinforce his image as the electable choice for the establishment. Jeb Bush, clinging to 9% likelihood, condemned some of Trump’s more inflammatory remarks, but then noted (along with Cruz) that he would let in only Christian refugees, with a somewhat characteristically floundering commentary.

The Republican front-runner (in the polls), Trump went for the extreme view on Islam in America. He, at times, called for (1) a database of all Muslims (or just immigrant Muslims?) (2) closing down mosques (or just spying on them?) (3) shutting down all refugees (no clarifications). While these comments will certainly be used as ISIS propaganda around the world, it is not clear how they will affect Trump in the GOP or even the general election here in America. While there is a strong liberal and centrist coalition that supports unfettered freedom of religion and helping refugees, judging by quick polls, that position likely represents a minority of the voting population. For instance 53% of Americans told Bloomberg they want no refugees, while a further 11% said we should accept on only Christians. This number mirrors earlier crisis; in 1938 67% of Americans opposed letting in any refugees from Nazi Germany and Austria.

Cruz also took a hardline this week, but was somewhat hampered by his own family’s immigrant status. 71% of Americans wanted no Cuban refugees in 1980, concerned about the mix of Catholicism and Communism. While his father immigrated some time before, it made for an awkward defense of eliminating immigration. Again, there is no reason to assume this will hurt him in the GOP primary, but like Trump’s stance, it will worry the establishment further about his electability in the general election. And make it more likely to will push hard for Rubio, who did so well by saying so little this week.

In general political news, the governor of New Jersey, Chris Christie, took a strong stance against orphans this week. He wants to ensure the government blocks Syrian orphans from being united with family in America. This follows his strong stance against nurses who went to help with the Ebola crisis in Africa. Seriously, he is still running for president and is the only other candidate not a 0%, but he is close!

Vertical Lines: November 10, 2015 debate.

Sources: Betfair, Hypermind, PredictIt, http://twopointoh.predictwise.com/politics/2016RepNomination

Barring a major catastrophe, Clinton will be the Democratic nominee for president.

Vertical Lines: November 14, 2015 debate.

Sources: Betfair, Hypermind, PredictIt, http://twopointoh.predictwise.com/politics/2016DemNomination

The next debate is the Republican debate on Tuesday, December 15. The Democrats will meet on Saturday, December 19; I will be unable to watch (just like Debbie Wasserman Schultz wants!) …