Laws, Churchill said, are like sausages, it's better not to know how they are made. Even opinion polls are not always genuine products. The pollster, who has a company to run, is led to produce a result that pleases the client, so that he will choose it again next time.
And here all the polls commissioned by the major American newspapers, all Clintonian, give the Clinton already comfortably seated in the White House, while those commissioned by Trumpian sites and by Fox give a Trump some chances. We don't know if one, the other or all of them are not very objective. What we do know is that it's nearly impossible to be objective when it comes to guessing whether whoever says they're going to vote will actually vote, or whether whoever says they're undecided leans more to one side or the other.
In America, everything is made more complicated by the fact that, in order to vote, you must first register as a Republican, Democrat, or independent, subject to the right to change your mind at the last moment. Many pollsters start with registered voters when building their sample of respondents (typically a thousand out of more than 200 million potential voters), but in some states you can also register on polling day. In a fluid situation, in which the dispersion and volatility of the polls are at historic highs (yesterday a +14 for Clinton and a +1 for Trump came out simultaneously) and in which the popular vote (one man one vote) resembles only vaguely to the final electoral vote, majority on a state basis (winner takes all), it is good to take everything with caution. It is also reasonable to think that they are still there scandals kept in the drawer which could be pulled out and exploded against the opponent in the last few days, in order to send everyone to vote on the emotional wave.
The markets, rest assured as if voting for the renewal of the school boards of a remote county, they have embraced the scenario of continuity, or rather the yawn, with Clinton as president in Obama's place and at least one branch of Congress still under Republican control. Not only there is no risk premium represented by the two tail scenarios (Trump president or Clinton also conquering Congress) but there's not even the consideration that America will, in the next few years, go through a genetic mutation anyway.
More or less every half century America sheds its skin. It happened after the Civil War, with the New Deal and then again in 1963. After the Civil War, the Republican coalition of northern industrialists and rural Midwest emerged victorious. The Great Depression marked the end of this hegemony and the emergence of the Rooseveltian coalition of the vanquished, the unprotected and the poor (the black and white South, the unionized working class, the Irish, Polish and Italian Catholics, the Jews). The New Deal coalition had its distant origins in Tammany Hall, the party-machine that practiced vote-exchange by promoting irregular gangs of immigrants to status (police, firefighters) (see Scorsese's Gangs of New York again, a splendid summary of American political history), but added a good dose of anti-capitalism to it.
Even with Eisenhower (the conservative Republican who left welfare intact) and Kennedy, America was culturally quite homogeneous. Then, in 1963 (read Murray's Coming Apart), the country began to split no longer along economic and class lines but culturally (civil rights, sense of family, abortion, secularism, national identity, separation between elites and people) and the fracture becomes more and more evident up to the present day.
With the presidential elections this year a new America can be glimpsed on the horizon in which the losers (Evangelicals who have now lost the culture war against secularism, working class, overtaxed white middle class, Jacksonian and individualist Second Amendment America) they take refuge in a republican party (from which the elites have now detached themselves) destined to remain a minority but who is laboriously finding an identity. On the other side it can be seen a democratic party that aims to become the single party of the nation with a coalition apparently similar to that of the New Deal, but in reality profoundly different. Indeed today big business (particularly Silicon Valley and media Los Angeles) and financeunlike the XNUMXs, I am a decisive part of the democratic coalition, which has instead left the workers on the streets (replaced with state workers) and the Jeffersonian and Jacksonian South.
Alongside big business and state-owned companies, they naturally remained ethnic minorities, soon majorities, to which Muslims will be added in the coming years, whom Obama has already decided to no longer count as whites (in order to further weaken the latter) but as Middle Easterners. In between, a land of border and conflict between Republicans and Democrats, the suburban areas of the metropolis, an area of ideological conflict even before economic.
What interests do big business, statesmen, secularists and immigrants have in common? Two things, that is big government and borders wide open. On these two roads Clinton will act even more than Obama. A defeat by Trump (barring surprises) will constitute a historic defeat perhaps irreversible for the Republican coalition, but Clinton will not have an easy time keeping such heterogeneous forces together for a long time. If she succeeds, it will be at the price of more subsidies, more welfare and more taxes (not for companies but for individuals).
If Trump's meteor falls with the same speed with which it took off, the Republican Congress will emerge further divided and weakened and it will not be difficult for Clinton to win a few votes that allow to shift majorities and pass spending laws. All, as you can see, will lead to a serious increase in the deficit. Usually, in the presence of an expansionary fiscal policy, central banks become more restrictive (trouble for bonds). If, however, Yellen will continue to pass her expansive line we will have one steeper curve (again trouble for the bonds) to a weaker dollar.
The boredom on the markets of the last three months does not deceive you. Very interesting times lie ahead.
