Wednesday, November 9, 2016

After Action Report on the 2016 Election

WOW! Confounding all of the pollsters and the experts Donald Trump has become the President Elect. He relied on the voters willingness to "stick it to the man" (the global elite), the emergence of a bloc of white voters who acted as an "oppressed" minority, and he did much better than expected with suburban and Hispanic voters. Simply put nationalism is back. For whatever reason the Trump campaign sensed an opportunity in the upper Midwest and pounced. If anything this election represented a big loss for high-priced political consultants.

Shulmaven's forecast was pretty close we had Clinton winning on the electoral college by 288-250. We had Michigan going for Trump, but Florida going for Clinton. That was are big mistake because with Florida Trump in our model would have ended up with 279 electoral votes. It now looks like he will get around 300. We had Clinton winning the popular vote by 3 points; she will end up winning it by 1 point.

We were very close to the mark with the House and Senate races. We had the Republicans ending up with 51 seats; it now looks like they will have 52 or 53 seats. In the House we had the Republicans losing 12 seats which is about double the 6 or 7 seats they will end up losing. Not bad.

Where we are most surprised we thought there would be a major stock market sell-off. We got that overnight, but as of 11AM Eastern Time, stocks are off modestly with the bond substitutes, hospitals and auto parts suppliers bearing the brunt of the selling while defense, infrastructure and pharmaceutical stocks are soaring. I guess the market believes that Trump's reckless fiscal policy will be pro-growth and his barks on trade and immigration are just that with no follow through.

We will have more comments later in the week.

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