Post-Debate Election Odds Update

The first Presidential debate of the 2016 election is in the books, and I imagine most of the approximately 100 million viewers came away as underwhelmed as I did.  Facebook posts were made, Twitter tweets were tweeted, both candidates were called liars and idiots, “fact-checkers” were working overtime or not at all, and still, the vast majority of the electorate will go to the polls in November and vote for the same candidate they were going to before the debate. 

But, most importantly… the odds moved.  And moved again.  They were on the move the whole night, just like they were before the debate.  And now, with over 24 hours for the money to process the events of the election, we will revisit the odds on Betfair’s exchange, and see how those with money on the line have repriced the odds.

As of 9/28/2016 at 11:26AM Eastern, the odds were as seen below:

Again, I’ll put the numbers in percentage terms of chance to win the election, to simplify.  All percentages are approximates, with priors coming from odds at 9/22/2016 at 11:26AM Eastern:

• Hillary Clinton:  68.0%  (prior: 63%)
• Donald Trump:  30.3%  (prior: 32%)
• Joe Biden:  0.67% (prior: 1.56%)
• Bernie Sanders:  0.43% (prior: 1.25%)
• Tim Kaine:  0.14% (prior: 0.29%)
• Gary Johnson:  0.01% (prior: 0.13%)

Note: Any subsequent election odds updates at Free Market Shooter will no longer include candidates with odds below 1%. 

After looking at the new odds, I asked myself the question: now that the much-hyped first debate is finally over, what are each candidates’ chances to win, and who do the oddsmakers think benefited most from the debate?  Below are my observations:

Hillary was the big beneficiary of the first debate.  Not only did she make it through the whole debate without any coughing or health flareups, she appeared well rested and seemed very well prepped.  She sounded quite rehearsed and robotic, but that was to be expected of her even by her most ardent supporters.  The majority of her attacks on Trump were ad hominem, and she did not focus on attacking his policies.  Instead, she focused on attacking his business practices, refusal to release his tax returns, and several other personal issues regarding past lawsuits against him.  She did an excellent job of deflecting Trump’s quip on releasing his tax returns when she releases her deleted emails, and though her response did not seem genuine, it did not throw potential voters for a surprise, and she faced minimal followup on the issue.

Though Trump avoided any major gaffes, his debate performance was very underwhelming.  While he did well at first, and the move in the odds (to 34+%) initially reflected that, he appeared to be rather unprepared, and it seems his policy of winging preparation and going “off the cuff” finally caught up to him.  I was eagerly waiting to hear Trump’s criticism of the Clinton foundation and the large dollar amount of contributions the Clintons and the foundation have taken from corporate and foreign interests, and I don’t recall hearing any of it.  Also absent was any mention of the President’s recent veto of 9/11 lawsuits against the Saudis, and whether Hillary’s Saudi contributions should disqualify her from running.  Though Trump did deflect from his own tax returns with the query on her emails, his failure to follow up and cite her behavior as criminal, as well as examples of those who have been prosecuted for far less, left a lot to be desired.

Hillary and her team should be extremely concerned that she was unable to win more decisively.  We saw Hillary at her best as a debater; no slip-ups, quick deflections of her own flaws, and most importantly, no real tough “gotcha” questions were asked,  by either Trump or the moderator.  Hillary will almost certainly face much tougher sledding in the following debates, and Trump will likely be ready to ask tougher questions, whether he decides to prepare more extensively or not.  If Hillary was unable to put Trump away with her at her best, and Trump not at his best, it is not a good sign for her in future debates.

While he sounded smooth and polished, Lester Holt was anything but an unbiased moderator.  He asked many questions about Trump’s past, notably his birther story, tax returns, comments about women, and his business practices.  Absent from his questions of Hillary were similar questions about her track record, including queries on the Clinton foundation and corporate/foreign donations to the foundation and Hillary herself, deleted emails (though Trump had his jab on those), her health, and her own votes for middle east wars and military engagements.  ZeroHedge did an excellent job compiling tweets and reactions from outlets of all areas of the political spectrum in response to Holt’s performance, and even those on the left who defended him have been forced to concede that Holt did not ask Hillary the same level of difficulty in his questions as he asked of Trump.

As I previously predicted, the other candidates’ odds for victory have all but evaporated following the debate.  Barring something dire and unforeseen happening to one of the two candidates, one of the two at the first debate will be our next President.  Like it or not, this election really is a two-horse race now.

I think the most important takeaway from the debate is that this election is anything but over.  Yes, the odds moved in her favor, but Hillary has mostly just recouped previous Trump gains from her health episode.  In my opinion, neither candidate really did anything to impress at the debate, and likely left voters more depressed about their choices than anything.  As for their debate performances themselves, Hillary was above average or better at this debate, and Trump was merely average, with his best takeaway from the debate being that he didn’t say anything to make himself look exceptionally bad.

Finally, many people have stated that Trump is underpolling, due to the perceived “shame” of voting for him, and pointed to Brexit as an example of skewed poll results.  This large unknown could be manifest in the election odds being mispriced to favor Hillary.  If this is indeed the case, expect astute professional gamblers to pick up on this, and push Trump’s odds closer to 50-50 in time for the election.  As it is, the gains that have accrued to Hillary will be difficult for her to keep, especially given that the two subsequent debates should see Trump and the moderators ask tougher questions of Hillary.  If they do not, the chorus of voters who view the election as rigged and the establishment/media pushing Hillary to the finish line will only grow louder, just in time for the election itself.  If Trump “shame” is indeed leading to underpolling, I think any future moderator bias will only be beneficial for his odds for victory.