Post-election uncertainty: exactly as foretold

What comes next?

As many of our regular readers and followers know this year we did not go public with our election predictions because we had a few high-paying clients that wanted the results before anyone else. This is why we opened our predictions to anyone who wanted to buy them for as low as $50 or $100 (many people did, which made us very happy that there is an actual market for this).

Those who bought our predictions knew this was coming. This is a quote from our election report available on November 3rd on our website:

If the results stay this way — a closer than expected Biden victory — we are looking at a high probability of post-electoral uncertainty and a contested election scenario. In fact, 64% of our users anticipate a contested election. The reason is simple: if Trump holds on to wins in FL and AZ (with NC also borderline), this will be known already on Election Night which means waiting for vote counts in PA and WI to confirm the winner of the race. In both of these states Biden is in front (and has been continuously since the start of our polling), however it will take time before this is confirmed which could result in continued market uncertainties next week.

And this is where we are right now. Waiting for PA and WI (and even MI) to clear the win for Biden. But it was always going to be a close, nail biting outcome, nowhere near a Blue Wave victory that most were predicting.

Our predictions are so far on the money. We correctly anticipated Florida (which again no mainstream pollster, model or aggregator got right), Ohio, Texas, Iowa, and most likely Georgia going for Trump. We missed thus far only Arizona (called it for Trump but is most likely going to Biden), and probably North Carolina (where Trump is in front).

We also predicted a contested election with a high likelihood of the final outcome hinging on vote counts in Pennsylvania and Wisconsin (and also Michigan). The lead that Trump currently has there is misleading as many main-in votes have not been counted (especially in PA and MI). So we have to wait and see until probably Friday before the outcome becomes more obvious.

Having said that, we are still confident in our prediction that Biden will take at least two of those three states. The Electoral college distribution will look very similar to the one we’ve predicted in our final report:

Read our full Premium report (sent to our high-paying clients) and see what you missed. We explain different possible scenarios, the probability numbers, our method, likely impact on markets, and our comparison to others.

As for the polling error — we’ve also explained this 2 months ago. It’s not the Shy Trump voter that’s the problem, it’s the non-response bias. And you cannot fix this by adjusting models (e.g. towards lower educated voters) which are wrong to begin with.

Oraclum is a data company led by a team of scientists that builds prediction models. https://www.oraclum.co.uk

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