Investors love him, polls were surging in his favour, and his ad spending was off the charts. Yet, by all accounts, Democratic presidential hopeful Mike Bloomberg didn’t impress in his first debate yesterday. While we do not have polling data, betting markets have made their judgement, seeing his odds of winning the Democratic nomination falling from 33% to 20%. Meanwhile, the odds of Bernie Sanders winning continues to rise (Chart 1) – we discussed his policy platform in an earlier note.
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Investors love him, polls were surging in his favour, and his ad spending was off the charts. Yet, by all accounts, Democratic presidential hopeful Mike Bloomberg didn’t impress in his first debate yesterday. While we do not have polling data, betting markets have made their judgement, seeing his odds of winning the Democratic nomination falling from 33% to 20%. Meanwhile, the odds of Bernie Sanders winning continues to rise (Chart 1) – we discussed his policy platform in an earlier note.
Back to Bloomberg. It would seem that when challenged in a debate context he has fallen flat. Of course, he could smooth his rough edges, flesh out his policies, and showcase his Democratic credentials before Super Tuesday (3 March). But even then, he might struggle. If anything, he appears to be following the path of previous surging candidates like Kamala Harris, Pete Buttigieg, and even Elizabeth Warren. They all rode high, but eventually gravity pulled them down (Chart 2).
Chart 1: Sanders Gains, Bloomberg Falters
Source: Macro Hive, Predictit
Chart 2: Bloomberg Following Path of Harris & Buttigeg?
Source: Macro Hive, Predictit
As this Democratic soap opera plays out, the clear winner appears to be Donald Trump – who is enjoying a bump in his polling support of late while betting markets see him as the winner in the November elections (Chart 3). That was not the case before the Democratic caucuses and primaries. What makes matters worse is that the chances of the Democrats retaining the House appear to be slipping (Chart 4). Of course, there is still much time for things to turn, but Democrats appear to be stumbling.
Chart 3: Betting Markets Expect Trump to Win
Source: Macro Hive, Predictit
Chart 4: Could Democrats Lose the House?
Source: Macro Hive, Predictit
Bilal Hafeez is the CEO and Editor of Macro Hive. He spent over twenty years doing research at big banks – JPMorgan, Deutsche Bank, and Nomura, where he had various “Global Head” roles and did FX, rates and cross-markets research.
(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)