Labor Day Weekend 2020 Election Update

Signals:

Flu symptoms as Covid in late September

Riots increasing(NC, MI & PA)

Stimulus Package

Debates

Lockdown vote suppression(colleges, riots)

Outlook

Trump continues his Reopen America strategy, focusing on job recreation and falling COVID numbers. I anticipated a move to target Democratic state’s(Michigan and Pennsylvania) response to the epidemic by ordering data on nursing home deaths by the DoJ. This has not only presidential campaign effects but now touches key Senate races which have moved from leaning democrat to tossups in Michigan and Minnesota. This also puts into question Biden strategy to use Covid data against Trump in the coming flu season by mixing flu symptoms as Covid infection rates. A national mask mandate and threat of new lockdowns by Biden/Harris will ultimately drive centrist voters away in Michigan, North Carolina, and Pennsylvania.

Little attention has been paid to the liberal college vote in swing states, which at this point will be muted since universities have decided to go virtual. These actions will slice away a few percentage points from Biden as vote by mail and address complications will result in confusion by college students who overwhelmingly support Biden. The Research Triangle in North Carolina and Ann Arbor-Lansing corridor are key liberal voting areas where drop in turnout will significantly affect election calculations for Biden. Additionally, the increase in riots and looting will force local residents to flee for the suburbs and other states. This also marginally affects turnout where less than 1% can decide 3 swing states.

The tepid response by Democrats on riots, which are now likely to expand into North Carolina and Pennsylvania, have the Biden campaign struggling to respond with a coherent strategy to show compassion to small business owners and any plan to quell the violence which now is leaking into immediate suburban areas voter concerns. The challenge for Biden is how to balance riot criticism without affecting his BLM support which is key to his black turnout strategy. The RNC convention was entirely dedicated to undermining this minority vote advantage of Biden and bring attention to Law and Order narrative which Trump leads the nation with in voter trust. Battleground polls are now reflecting this as Trump is polling almost 2 percentage points better in this cycle than in 2016.

Democratic Party is in total disarray at the moment with Pelosi discussing Biden shouldn’t debate and Harris going on late night tv shows saying the protests “will and should continue”. They seem to have no adaptable and coherent strategy when early voting in North Carolina, Pennsylvania and Michigan begins in early September. The “Defund the Police” and COVID response narratives are backfiring and has backed democrats into corner that I cannot see how they maneuver out of.

Next 60 Days

As I’ve stated before, early voting in 3 big key states begins in less than two weeks. The news cycle going into Labor Day Weekend is critical for both campaigns but it’s a do or die moment for Biden. Without Barack Obama stepping up his media appearances and actively promoting Biden in the first two weeks of September, Democrats run the risk of Trump media campaign further shifting voter intentions to their side.

I fully expect protests to continue to turn violent in Minnesota, Wisconsin, Pennsylvania, and North Carolina cities all the way up to November driving voters away from Biden and Democrats Senate candidates. Desperation will see Biden allies use flu symptoms as a rise Covid infections, but the economic toll lockdowns have resulted in will only push centrist voters away.

The stimulus package being debated in the House and Senate seems to have its base number just above $1 trillion with only political narratives holding it up. Both sides want to lead the media circus and claim victory, however, Trump can and will use Executive Orders to send unemployment benefits to voters which would severely undermine Pelosi’s claims that only the Democrats look out for the middle and lower class.

At this stage, the likelihood of a Trump victory is hovering around 65% in my calculations. There are too many headwinds the Biden campaign are facing to be able to shift narratives and win back lost voters and increase voter turnout from 2016. I had gone over polling methodologies and properly adjusted issues with turnout percentages and voter registration numbers. The economic concerns are still #1 issue by far and Trump leads that category with 55-60% positive views. As of today, Trump is likely to be ahead with 270 electoral votes with Biden trailing at 218 and 4 states now in tossup category. A significant uphill challenge for Democrats hopes to win the White House and Senate.

The Senate map also is slipping away from the Democrats as it’s likely the Dems can only pick up 2 seats while hoping not to lose the Michigan and Minnesota races. This would be a catastrophe for Democrats and will undoubtedly risk 2022 strategy to win the Senate back.

As of today, the GOP will hold the Senate by 2 seats with the two races mentioned above still up in the air. This outcome will provide Trump with enough political capital to enact economic policies and swiftly replace RBG in the Supreme Court.

Economic Scenarios and Effects

The most dominant Trump victory economic issue will certainly be international trade implications. China will certainly up their agricultural purchases based on Trump election realities but also their need to offset flooding damage to their food supply. The euro has enjoyed a run based on nothing but perceived bailout fund recovery and a US election dominating the global media. This will not last and the realities of Europe’s economic problems will become evident again. An unleashed Trump is a nightmare scenario for Beijing and Brussels with the likelihood of a fully weaponized Dollar.

The market is already experiencing an artificial recovery concocted by Fed and Treasury actions, but will need a new stimulus package agreed too in order for a proper rotation to be enacted. I suspect Powell, Mnuchin and Trump know the package that will be passed and comments by Powell at Jackson Hole are a part of a coordinated effort to push Senate bill passage beneficial to a rotation while undermining Pelosi and Schumer. Senate map favors Trump significantly today, but even in a worst case scenario with the GOP losing majority by one seat, there are blue state Democratic Senators that will vote with the GOP on domestic economic issues. The rural and middle class voters in certain states would pressure the Senate to act with 2022 not that far off. The bigger risk is obstruction for international trade policies concerning tariffs.

Overall Prediction: Trump re-election win, Senate GOP majority +2, 8-10 House seats flip to GOP. Obama inaction first 2 weeks of September will validate my speculations that Biden/Harris was a strategic selection for longer term Senate wins and Michelle Obama White House run in & 2024.

This will be my last published update.