Two of three 2020 election models used by Moody’s Analytics forecast that President Donald Trump will win more electoral votes than he did in 2016.
All three models showed the president winning re-election over whoever the Democrats nominate, with two of the models predicting a Trump landslide.
“Under the average of the three models, Trump would hold on to key industrial Midwest states and pick up New Hampshire, Virginia and Minnesota,” Moody’s said in a report detailing the results of its models.
The three models, “pocketbook, stock market, and unemployment,” predict Trump will win even if the economy were to sink to multiyear lows by the end of 2020 and the stock market crashes 9 percent.
“In other words, Trump is expected to win despite a falling stock market and a sagging economy,” Breitbart News noted in an Oct. 15 report.
Moody’s “pocketbook” model looks at three variables: gasoline prices, home prices, and changes in real personal income. Voters tend to see higher gasoline prices as negative, higher home prices, and incomes as positive. Moody’s uses its economic models to predict how these variables will perform in the months leading up to the election.
“Under the baseline economic forecasts, the pocketbook model projects the most favorable outcome for Trump. If voters were to vote primarily on the basis of their pocketbooks, the president would steamroll the competition, taking home 351 electoral votes to the Democrats’ 187, assuming average voter turnout,” Moody’s said.
Trump does worse under Moody’s “stock market” model, in large part because of the firm’s prediction that the S&P 500 will decline 9 percent between now and election day. Still Trump wins in this model with 289 electoral college votes.
“The Moody’s Analytics baseline forecast calls for annualized growth in U.S. real GDP to dip to multiyear lows by the end of next year. Because of this growth slowdown, our baseline forecast calls for the richly valued S&P 500 to decline 9% between now and Election Day. This weighs against Trump, but not enough for Democrats to unseat him,” Moody’s said.
The third model is based largely on the unemployment rate. But even rising unemployment just before the election would not be enough to cost Trump the election, according to Moody’s.
“The baseline forecast for the unemployment rate across most states is for it to remain near current lows through the first half of next year, before ticking upward amid the growth slowdown. As a result, the unemployment model is not nearly as favorable to the president as the pocketbook model, but nevertheless does project a comfortable Trump victory of 332 electoral votes to 206, assuming average voter turnout,” Moody’s said.
Breitbart noted that “Moody’s election forecasts have been very reliable in the past, correctly predicting every election result except 2016. The model undercounted support for Trump because it did not anticipate the increase in voter turnout that shifted the majority vote in crucial states.”