Unhedged Do the markets even care about the US election?
Nov 5, 2024
Amidst election day chaos, the market remains surprisingly calm, raising eyebrows about emotional reactions. The hosts analyze market behavior, emphasizing that specific economic policies matter more than election results. They highlight the unpredictability of political betting markets and how inefficiencies can create betting opportunities. Humorously, they discuss the contradictions of supporting nuclear power alongside environmentalism, all while winding down with quirky tales about bees and a TikTok-famous squirrel named Peanut.
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Markets and Elections
- Markets don't have feelings; they react to various forces.
- The 2020 election's market impact is uncertain, unlike 2016's predictable tax cut rally.
Betting Market Inefficiency
- Robert Armstrong bet on Kamala Harris despite predicting a Trump win.
- He exploited skewed betting odds, highlighting market inefficiencies.
Market Interpretation of Election Outcomes
- The US 10-year bond yield mirrors the dollar's moves, suggesting a Trump win is viewed as inflationary.
- This implies slower Fed rate cuts, higher yields, and a stronger dollar.