🔮Growing Odds of a Republican Sweep
PLUS: Trump to Rogan? • Meet the CRINKs • Middle East Update
In the past week, Donald Trump has pulled to a 56.7% - 43% lead in Polymarket’s general election odds. He now has the lead in all seven of the swing states except Nevada, where Harris is hanging on to a 51%-49% edge.
While Trump’s lead is the largest it has been since the summer, it’s important not to overstate its significance. A 55-45 prediction market edge is not nearly as strong as a five-point polling lead. One way to illustrate this point is by looking at Nate Silver’s polling average alongside the Polymarket election chart, which makes apparent how small moves in the polls are magnified into large swings in the odds.
Republicans have also been improving their chances to win both the House and Senate, increasing the odds for a unified Republican government (🔮39% chance) that could see Trump enter office with a greater ability to pass his agenda. Odds for a Democratic clean sweep sit at 16%.
Final Stunts
With just 21 days to go, the candidates are planning their final media appearances. Tim Walz went pheasant hunting with an Italian shotgun that some are saying violated the Migratory Bird Act by having a 5-shot capacity.
And although Harris told 60 Minutes she owns a Glock, the market believes she’s unlikely to appear with it before the election (🔮 5% odds). Harris going on SNL is also a longshot (🔮7% odds), as its producers have said that featuring any of the candidates would break election laws.
Trump is favored to appear on the Joe Rogan podcast (🔮 75% odds) and launch a crypto token (🔮 87% odds) in the home stretch.
CRINKs?
On Monday, a series of clashes along the North-South Korea border increased the odds of a North Korean invasion of the South to 7% by year’s end. Meanwhile, Chinese naval exercises around Taiwan also briefly elevated the odds for an invasion of the island (🔮5% odds by end of 2024)
Isolated incidents? Canadian security reporter Colby Badhwar doesn’t think so, and uses the term “CRINKs” to describe what he sees as an axis of China, Russia, Iran, and North Korea. Badhwar argues the West is refusing to recognize what is a clearly emerging military alliance between the states.
Military analyst Ryan McBeth has advanced a similar argument, that World War III may have already started with Russia’s invasion of Crimea in 2014, but that the war will increasingly be fought through propaganda, cyber warfare, and new types of autonomous weapons.
Middle East One Year After October 7
One year after the October 7 attacks on Israel, the Middle East seems on track for an escalation of fighting on multiple fronts, if not a broader regional war. Here’s what Polymarket odds can tell us about the situation:
Israel: Netanyahu is in his strongest political position since the conflict began. Odds for the Israeli parliament to dissolve show the lowest reading since the market was launched. Israeli voters seem to have forgiven (for now) the oversights that led to the October 7 attacks and support aggressive Israeli action on multiple fronts.
Gaza: Israel’s objectives in Gaza are to defeat Hamas, kill its leader Yahya Sinwar, and achieve the return of the 100 remaining hostages. There were rumors that Sinwar was incapacitated in Israeli airstrikes, but the market (🔮85% odds Sinwar stays through October) did not think it likely, and Sinwar was reported to be back in contact last week.
Despite Israel’s ability to control Gaza militarily, there has been no recent progress on the hostages and the odds for a ceasefire in Gaza (🔮78% odds of no ceasefire this year) are the lowest they have ever been.
Lebanon: Israel’s goals are to degrade Hezbollah, eliminate its ability to fire into Israel, which would allow its displaced citizens in the north to return to their homes, and ideally install a more friendly president. Hezbollah missiles and drones have made multiple strikes on Haifa, demonstrating the group’s ability to fight despite the killing of its leaders and the pager attacks which disabled thousands of its mid-level members. There is a 32% chance of an Israel-Hezbollah ceasefire in 2024.
Iran: Israel’s goals are to stop Iran from becoming a nuclear power and stop its arming of proxies throughout the region that threaten Israel. The odds Iran becomes a nuclear power in 2024 have increased to 15% in the past week.
Israel is reported to be in the final stages of preparing an attack on Iran, following US deployment of THAAD advanced missile defense systems. When will they hit?
88% chance of Israeli attack on Iran by end of year
27% chance of Israeli attack on Iran by Friday
🚨As of publication on Monday morning, the odds that Iran strikes Israel again in October have spiked to 43% on no obvious breaking news.
Yemen: Israel and the US want to stop the Houthis from firing missiles and drones at Israel and blocking global trade through the Red Sea. But as decades of ineffective Saudi and now US and Israeli strikes have shown, this does not seem possible outside a wider political deal. There is a 25% chance (and falling) that Israel hits targets in Yemen this month.
United States: The Biden administration is continuing its “bear hug” strategy towards Israel, hoping to maintain influence over Israeli actions by remaining on good terms and avoiding getting involved in the war directly. Markets indicate that direct US involvement or events that would precipitate this are a longshot for now.
4% chance US strikes Lebanon this year
5% chance Israel declares war on Iran in October
9% chance of US military action against Iran in October
30% chance of Israeli attack on Iran’s nuclear facilities by end of year
Disclaimer
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