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  • By Paul Krishnamurty | Apr 01, 2020 | Opinion

    US Election: Cuomo Gamble Is Merely the Latest Speculative Punt Without Substance

    US Election: Cuomo Gamble Is Merely the Latest Speculative Punt Without Substance Whilst the Democrat delegate count points towards a Trump v Biden run-off in November, gamblers are looking at alternative candidates. Paul Krishnamurty weighs up the likelihood of a surprise change at the top of each ticket.
    Whilst the Democrat delegate count points towards a Trump v Biden run-off in November, gamblers are looking at alternative candidates. Paul Krishnamurty weighs up the likelihood of a surprise change at the top of each ticket.

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    Normally at this stage of a US Presidential cycle, we would be fully focused on a head-to-head race between the presumptive Republican and Democrat nominees. The former blocked primary challenges to ensure Donald Trump had a clear run. The latter's primary remains ongoing but the scorecard overwhelmingly favours Joe Biden.

    The betting signal, however, less clear-cut. Using Betfair - the biggest, most liquid exchange - as a guide, Trump and Biden's odds only account for 88% of the book. In other words, there's a 12% chance that somebody else will become President. A few days ago, that rose to 18%.

    This trend is actually not unprecedented and mirrors events of 2016. There was plenty of money around for alternative candidates to Trump and Clinton right up until November. Wild speculation and fake news are now part and parcel of any election campaign. In this year's particular context, it is inevitable.

    Coronavirus adds new layer of uncertainty

    Most obviously, coronavirus has placed a cloud over every aspect of world affairs. Leaders are falling prey to the virus. Aged in their seventies, Trump and Biden are theoretically more vulnerable than most. Moreover as the crisis escalates, with casualties rising daily and other countries in lockdown, it isn’t entirely clear how American life will cope with a general election. Ladbrokes are even offering 8/1 that no presidential election takes place in 2020. 

    Then there's the nature of the likely candidates. Trump's uniquely divisive persona has always and probably always will lent itself to speculation that he'll be removed. Although the Republican-controlled Senate already demonstrated it is unwilling to do so after he was impeached - odds up to 1.14 on him surviving a full-term are still available on Betfair and there is still some money around for alternatives. 

    Mike Pence is 25/1 (Betfred) to be the Republican Nominee, 50/1 for President (General) whilst Nikki Haley is 47/1 and 149/1 in those respective markets on Betfair. Were such a scenario to unfold, I would much rather back Haley. She is infinitely more electable than Pence and relatively untarnished by association with Trump. 

    In fact, were Republicans to panic in the face of grim polls - their average deficit in the generic ballot is 8% - Haley could be their saviour. A woman leading the ticket would transform the dynamics and could win back the droves of white women that deserted them to ruinous effect at the mid-terms. Nonetheless, this is a longshot!

    Cuomo is the latest anti-Biden gamble

    Betting-wise, the Democrat race seems likelier to get interesting. Last time I strongly recommended we ignore the market hype surrounding Hillary Clinton. Since then, a monumental gamble about Andrew Cuomo has gathered steam. In recent week his odds for the Democrat nomination have crashed from 999-1 to a low of 14/1 on Betfair. He’s currently best-priced there at 25/1 and at 35/1 to become president.

    There is some logic to this gamble. As Governor of New York, Cuomo’s public performances as his state struggles to cope with coronavirus have won admirers across the nation. His hands-on approach, attention to detail and willingness to take responsibility not only contrasts well with Trump, but has usurped the Democrat front-runners for public attention.

    It coincides with relentless attacks on Biden’s competence - albeit from the usual suspects. He hasn’t been anywhere near so visible at this time of national crisis. As during the primaries, his campaign lacks energy. He is prone to making gaffes - which are meat and drink to the social media-savvy Trump and Sanders campaigns and their short, context-free videos.

    Some of their messaging is co-ordinated, powering a narrative that Biden is in ‘cognitive decline’. Both have been amplifying sexual harrassment allegations from a former Biden staffer. That master of nicknames Trump is hammering home the ‘Creepy Joe’ tag.

    Tara Reade’s allegations lack consistency and are unproven - I have no desire to credit them until they are. From what I see, they are being amplified by the same army of social media accounts that amplified countless fabricated accusations against Clinton throughout 2016, and conveniently ignore the multitude of sexual harrassment allegations against Trump.#

    Disinformation moves markets and can affect outcomes

    Nevertheless, the lesson of 2016 is that, true or false, we can’t discount their effect. There was money to be made during that campaign from betting on the swings in Clinton’s odds, plus a range of alternative candidates. It is highly probable that the smears worked, and cost her the presidency by at the very least, suppressing enthusiasm and turnout on the Democrat side.

    These attacks and speculation won’t stop, so expect more betting drama. I regard Biden’s chance of being the nominee as better than the 1.16 available on Betfair but another drift wouldn’t surprise me at all.

    In practice, however, it is very hard to see a route to finding another candidate, besides Biden withdrawing of his own volition. He is well on course to win on the first round of voting at the convention. He can only be replaced via a brokered convention if falling short of that majority, thus enabling new candidates - e.g. Cuomo, Clinton - to enter in the second round.

    No way will Bernie Sanders win a majority in the first round. His persistence in continuing the race, failing to endorse Biden, is making no friends. He won’t have enough pledged delegates and following a rule change following the divisive 2016 process, superdelegates can’t vote in the first round unless the result is not in doubt. (I’d be amazed if they backed him anyway).

    Nor is there any signal that Cuomo wants to run - he’s repeatedly dismissed the idea. These gambles are a combination of fake news, Team Trump trying to divide Democrats and, perhaps, too many people taking House of Cards literally. 

    If you want to oppose Biden on the grounds that his health may fail later in the race, it makes better sense to back potential running mates at much bigger odds, because that person would already be on the ballot. For example, VP front-runners Kamala Harris and Amy Klobuchar are both trading around 250/1 for the presidency.
     


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