2 economists say all signs point to Obama

Several recent economic forecasters peered into their crystal balls to predict the president will win re-election.

By The Fiscal Times Mar 16, 2012 5:00PM
By Merrill GooznerThe Fiscal Times

Beware of economists bearing models, especially if you are the presumptive Republican nominee for president.

Several recent economic forecasters peered into their crystal balls to predict President Obama will win the coming presidential election. The latest comes from two economics at Yahoo Labs, Patrick Hummel and David Rothschild, who told IEEE Spectrum that the Hawaii-born son-of-a-Kenyan will be reelected with 303 electoral votes, racking up wins in 26 states including Ohio and Pennsylvania.

But the deal is not sealed yet, not by a long shot, Rothschild warns. “There are at least three states here, Virginia, Ohio, and New Hampshire, which are within just a few percentage points of flipping over from one candidate to the other,” he said. If they flip, so does the election.

The model looks at a number of variables: presidential approval ratings (Obama’s are trending up), specific economic indicators like unemployment (which is trending down), and state-by-state ideological indicators, such as which party holds the lower house in the state legislature (which has been trending toward Republicans).

But those are not the most important factors in the model. “There is a huge incumbency advantage, and that is coming from a lot of different factors including money, name recognition, and of course it is an indication of past election victories,” Rothschild said.

Of course, if you don’t like econometric models, you can always go with single-factor theorists. Robert Prechter, founder of Elliot Wave International, last month published a study that correlated stock market performance with U.S. presidential election outcomes.

He found stock market performance over the past year and past three years was a far more powerful predictor of re-election outcomes than Main Street-oriented economic variables as unemployment, inflation and economic growth. Why? The stock market is a fairly accurate predictor of the nation’s mood, and when people are feeling good (that is, stocks are up), they vote for the incumbent.

Based on the stock market’s performance so far this year and in the three years since its bottom (It has nearly doubled), President Obama wins in a landslide.

Related Links:
The Game Plan That Lets Romney Beat Obama
Obama's Approval Dips on Gas Prices and Economy
Obama Risks $100 Billion If Catholic Hospitals Close


5Comments
Mar 20, 2012 12:28PM
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The above mention, along with the facts that the Republican don't have a winning candidate, and the general public are tried of  Congress lack of progress, all all favorable factors for Obama.  
Mar 27, 2012 3:59AM
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As Norquist said in a televised interview, all the Republicans want is a person that can sign his name. The Republican party will run everything, and their candidate will do what he is told.

Mar 27, 2012 1:23PM
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If pennsylvania votes for Obummer i,ll be surprised, Rothschild one of the corrupt money masters probably already paid for the fix to be in, the whole state despises this turdtard.
Mar 27, 2012 7:16AM
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The republicans can't put anything new on the table. Newt & Mit same old stuff re-hashed, been shown since Reagen that any more revenue generated by tax cuts will be over spent by a corrupt congress in an effort to buy votes. Santorum the flip side of the train wreck now in office, much more interested in an agenda, socially conservative values",  than the good of the country. Ron Paul to damn honest to be elected. It looks really bad for America at this point in history.
Mar 20, 2012 1:34PM
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I don't think the stock market will have as big of an effect on this particular election.

Generally, the stock market has represented our overall economy pretty well. But recently, not so much. Housing is still awful. We don't have jobs. The national debt is staggering. 

The typical American sees the economy more in terms of housing and jobs than the stock market. But corporate profits are soaring, making the stock making seemingly impervious to the woes of the average American.

Just look around and listen to what others are saying. The stock market has doubled over the last 3 years, but most people are still quite concerned about our economy and dubious of the stock market.
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