Democrats open up small leads for today's Georgia elections
Markets wait for post-holiday pandemic surge
U.S. ISM manufacturing index expected to decline but remain in solid territoryDemocrats open up small leads for today’s Georgia elections — The two Democratic candidates for today’s Georgia Senate seat elections have opened up small leads of 1-2% over the past week. However, the margins are very narrow, and the polls themselves are of suspect quality since the big polling companies aren’t even doing polls for the Georgia Senate seat elections. As the markets have learned in recent years, polling data is of limited use in predicting the outcome of an actual election.
In any case, FiveThirtyEight’s poll-of-polls is showing that Democrat Ossoff is ahead of Republican Perdue by the 1.6 point margin of 49.0-47.4%. Democrat Warnock is ahead of Republican Loeffler by the 2.0 point margin of 49.3-4.73% in the other election.
Meanwhile, the betting odds that Republicans will maintain control of Congress have fallen sharply in the past week. The betting odds at PredictIt.org, for whatever they are worth, have fallen to a new low of 56% for Republican control from previous levels of near 70%. By contrast, the odds for Democrats gaining control of Congress have improved to a new high of 48% from previous levels averaging near 30%.
Tuesday’s run-off elections for the two Georgia Senate seats are of huge importance because they will determine whether Democrats have full control of Washington or whether divided government will continue for at least another two years.
Democrats must win both Georgia Senate seat elections to achieve a 50-50 split in the Senate. Vice President-Elect Harris would then cast the tie-breaker vote in favor of the Democrats. In that case, Democrats would have full control of Washington and would be able to pass at least part of the blue-wave agenda.
Even with a 50-50 split in the Senate and a tie-breaker vote by Vice President-Elect Harris, Democrats apparently would still not have enough votes to do away with the Senate filibuster since Democratic Senator Manchin (D-WV) has already said he would not support a vote to eliminate the filibuster. However, Democrats could still pass tax and other legislation through the budget reconciliation process in the Senate, which bypasses the filibuster process and requires only a majority vote in the Senate.
On the other hand, if Republicans win at least one of the Georgia Senate seats, then Republicans will retain their majority control of the Senate. If that happens, Senate Majority Leader McConnell would be in the driver’s seat as to whether he allows any of the Biden Administration’s legislative agenda to come up for a vote in the Senate. Mr. McConnell is not likely to be shy about frustrating the Democratic agenda, meaning not much would be likely to get done in the next two years.
The results of Tuesday’s two Georgia Senate seat run-off elections are not expected to be available for possibly days or even weeks because of slow counting and close races. Also, there will surely be lawsuits and demands for recounts. In the November 3 election, media outlets did not call the Georgia election for Joe Biden for 10 days, and the certification of the results took another week. There were then recounts and lawsuits.
The markets tonight will be paying close attention to the Georgia election results as they emerge, which may show a similar pattern to that of the November election. Republicans may see an early lead as today’s in-person voting is counted quickly, with Democrats then regaining ground as mail-in ballots are slowly counted.
Markets wait for post-holiday pandemic surge — The U.S. stock market on Monday fell sharply as market participants became more concerned about the near-term pandemic picture. The more-transmissible Covid variant is spreading in the U.S. and has already been found in Colorado, California, Florida, and New York.
The number of new U.S. Covid infections on Saturday reached a record high of 299,087. The markets are worried that Covid figures were under-reported during the holiday season. Even worse, the markets are expecting a post-holiday pandemic surge due to traveling and gatherings over the holidays.
There is also disappointment about the slow progress of getting Americans vaccinated. Only 4.66 million Americans have received vaccination doses thus far, according to Bloomberg, which is far behind the U.S. government’s goal of getting 20 million people vaccinated by the end of last month. On the brighter side, Dr. Fauci said on Sunday there is no reason the U.S. shouldn’t be able to ramp up vaccinations to 1 million per day from the current level of only 500,000 per day.
U.S. ISM manufacturing index expected to decline but remain in solid territory — The consensus is for today’s Dec ISM manufacturing index to fall by -0.8 points to 56.7, adding to November’s -1.8 point decline to 57.5. That would be the first back-to-back decline in the ISM index since the recovery began back in May.
Expectations for a decline in today’s ISM index are not surprising since the current pandemic surge is requiring increased restrictions in various areas of the country. However, today’s expected report of 56.7 would still be a relatively strong figure that would indicate that manufacturing executives are looking ahead to later in the year when the pandemic ebbs due to vaccinations.