A Disputed Election And An ‘Institutionalized Powell Put’
A few weeks back, I documented the extent to which Wall Street is preparing for the possibility of a disputed US election outcome.
At the time, Donald Trump was assailing mail-in ballots on a daily basis, going so far as to tell Fox's Maria Bartiromo that "if we don’t make the deal [for more virus relief], that means they can’t have universal mail-in voting".
That comment (among others) raised eyebrows. To the president's critics, it was evidence to support the contention that recent organ
I don’t know what the odds were in September 2000, but something did in fact go awry in November 2000. Election day was Nov 7, and the US Supreme Court’s ruling that decided the election came down December 12, ahead of the scheduled electoral college vote on Dec 19, 2000. Now fast-forward to the presidential election of 2016. In that election, about 40% of votes were cast early, absentee, or mail-in (over 57 million votes) according to EAC.gov. Mail-in voting is not new, and it is not only a Democratic tool. As with everything else, we (via the media) are falling over ourselves giving legitimacy to Trump’s bluster, which from the very beginning should have been drowned in a tidal wave of factual rebuke (it took the media a long time to get the courage to do this with any force). We need a clear electoral result before the electoral college votes on December 14, 2020, and it is very likely that we will get it, one way or another. We know how this will go: nobody will concede on November 3, 2020. But nobody will be able to claim victory either, though Trump will try. Trump will certainly say some outright outrageous things as the initial Republican lead turns Democratic (as the more Democratic-leaning mail-in ballots are counted). This is not irregular, not cause for alarm, not cause to riot in the street, and certainly not cause to listen to Trump’s bellowing about elections being fraudulent or rigged, unless there is clear evidence. There will be a lot of eyes watching this year, certainly. As this plays out over days, people will get used to the uncertainty, and with repetition in the news, will come to understand the process. Did anybody know about hanging chads before November 2000? Yet everybody knew about them by December 2000. We don’t need the military to escort Trump out of the White House on November 8. All of the hand-wringing about the upcoming election seems to neglect how motivated the anti-Trump contingent is. Trump’s win in 2016 was based on a combination of many things, but above all it was based on poor turnout from those who might have voted against Trump. That will not happen this time. 2018 was not an accident, and 2020 will likely play out the same way.
If stock markets fall amidst the “uncertainty,” then that is understandable, and I don’t see why that should prompt any specific action from the Fed. In fact, wouldn’t the Fed be in uncharted territory if it takes actions specifically to control market response to electoral results? Not that we aren’t already in uncharted territory, but this would be quite a different thing, I think.
If anything the worry level has risen to shrill levels. What I have observed in the last 4 years is that Trump prefers to be sneaky instead of direct. He will try to undermine the process through classic voter intimidation when we are looking at his propensity to litigate and our fear he will just stay in office.
I agree that riots are counterproductive. I recall that early the concern was the bugaloo bois breaking into stores and seeding the sidewalks with goods prior to moving on. Now it seems possible the left is doing the breaking but it is clear the right is getting a pass whilst the left is getting the gas. Restraint is hard in times like this but Martin Luther King, Nelson Mandela and Ghandi understood the importance of non-violence. Why in this country are we descending into the abyss with no perspective from historical leaders? Are we doomed to acting as the lowest common denominator?