Will the winner of the upcoming presidential election be declared before midnight on November 4, 2024?
Probably not.
A Republican city commissioner in Philadelphia told CNN that the odds of declaring a winner on Election Day is “probably zero.”
The Democratic chair of Wisconsin’s election commission says the state’s votes probably won’t be counted until November 5…
This could be a problem.
Both Pennsylvania and Wisconsin seem likely to post delayed results because both states are not allowed to start counting mail-in ballots until Election Day. And even then, these votes have to be hand-counted…
In 2020, it took Pennsylvania 4 days to get a final tally. Michigan’s results weren’t finalized until Thursday, November 6.
Of course, these delays are procedural and don’t take into account the potential for recounts and court cases to decide what could be a very tight race…
Florida and the Hanging Chad
For what it’s worth, we have an example of a delayed election result to look back in the 2000 election between George Bush and Al Gore.
That presidential race was incredibly tight. A total of 101,455,899 votes were cast. Bush got 47.9% and Gore got 48.4%. Just 500,000 votes tipped the Electoral College in Bush’s favor – he got 271, one more than the 270 needed to win the presidency.
But it wasn’t easy to get to 271.
The vote in Florida was so tight the state required a recount. There were lawsuits and the case eventually ended up in the Supreme Court where a 5-4 decision ended the recounts.
It took a month and the final tally for Florida showed that Bush won the state by 537 votes. And ultimately it was those 537 votes that decided the entire election.
Yikes.
Seems pretty clear to me that if the upcoming election comes down to 537 votes in one of the swing states, the outcome will end up getting decided by the courts again. And who knows how long it will take…
That will be bad for the stock market.
Stocks and Uncertainty
In 2000, there was no Santa Claus rally. Instead, the S&P 500 fell from 1,440 on election day to a low of 1,255 right before Christmas Eve.
That’s a 12.8% drop. A similar move after the 2024 election would take the S&P 500 down 754 points. That would be below the Aug 5 lows, to around 5,000 on the S&P 500:
Nearly all of the gains of 2024 would be gone…
Now, I’m not telling you that the results of the 2024 election will come down to a Supreme Court ruling that will take 5 weeks to decide. There’s no way to know that we’ll see a stock market crash of nearly 13%.
And it could certainly be argued that the S&P 500 was already in a bear market during the 2000 election after the DotCom bubble burst…
It could also be argued that politics was a whole different animal 25 years ago. Pretty hard to imagine either of these candidates conceding to the other.
Stocks do not like uncertainty. Gold, however, does. From low to high, gold rallied 20% in 2000. And given the underperformance of silver compared to gold this year, it could do even better than gold after an undecided election.
If you need any more reasons to own precious metals, you can add election uncertainty to the list.
Cheers,
Briton Ryle
Chief Investment Strategist
Outsider Club
X/Twitter: https://twitter.com/BritonRyle
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