Today's Hallowe'en countdown post concerns the American election. This is a politically neutral blog, so I will not express preferences for parties or candidates, although I have referred to Trump (here and here) and the Clintons (here, here, here and here).
This year, the Hallowe'en countdown practically wrote itself, because the news and this election have been crazy, the headlines stressful and surreal. There is a political action committee (PAC) called 'Americans against Insecure Billionaires with Tiny Hands,' or 'Donald Trump has Tiny Hands,' for short. It actually made the news that the sale of Hallowe'en masks of candidates has predicted the winner of the American election for the past 36 years, and Donald Trump masks are outselling Hillary masks. The Internet reports a viral nationwide pumpkin-carving trend: the Trumpkin.
Images Source: NBC.
Masks and wigs on sale 27 September 2016, at the Chicago Costume store in the Wrightwood Neighbors neighborhood. Image Source: Chicago Tribune.
Today's post deals with another aspect of the election: predicting the future. It concerns people who make money speculating on who will win. It is illegal in the United States to bet on elections, although people find ways around that in the name of research. Brits, Canadians and Australians are among the non-Americans betting on the American election. This post considers how much money you can make if you suspend all values and opinions and coldly and correctly assess mechanistic outcomes in a system - and this post further considers whether that assessment can actually create the future, rather than predicting it.
In the case of Brexit, pro-EU George Soros accurately anticipated Brexit's effect on the pound and claimed that the "catastrophic" break-up of the European Union is now "practically irreversible." Elsewhere in London, others were less glum. A young hedge fund manager, James Hanbury, personally made £110 million speculating that Britain would leave the European Union. Hanbury works for Odey Asset Management, headed by Crispin Odey, who bet about £7.5 billion of his firm's funds that a majority of Brits would vote for Brexit. Correctly anticipating the drop in the pound, the firm invested in mining in gold, diamonds, and in post-Brexit firms expected to prosper, particularly those in the tech sector; the firm also bet against economic sectors expected to lose value because of Brexit. Odey reportedly personally made £220 million betting on Brexit. Bloomberg observed that the firm's fund gained 15% on its investments on the 23 June 2016 vote. The correct assessment that Brexit would occur was based on a "private poll." According to The Independent:
"[Odey] is one of the richest men in the UK, with a personal fortune of [over] £900m. In 2014 it was reported Mr Odey built a Romanesque stone temple to house his chickens."Brexit commentators in the MSM fixate on class, age, and educational differences between pro-Brexit and anti-Brexit voters; they speak of stresses in the European Union as liberal globalists contend with alt-right or far-right populists. Brexit's critics concluded that the vote was about racism and xenophobia, backward thinking, a retreat to the dark ages, away from a progressive future. Those talking points obscure an underlying trend. While pro-EU supporters argued that Brexit spelt economic cataclysm, the investors who profited from Brexit told a different story. Investors' huge gains involved positive bets on technology; moreover, those betting capabilities were curiously enhanced by that same technology. This result signaled that Brexit was partly about the evolution of the UK economy: Brexit showed that Euro-Britain is morphing into Silicon Britain.