So that's where those monoliths have been coming from…can this year get any stranger?
Rabobank: Things Might Get Stormy In The Next 48 Hours In The US Election
Mon, 12/07/2020 - 11:10
Markets are generally trading as if we are all sailing fine seas on finer luxury yachts, basking in the sunshine and drinking gold-flecked cocktails. Guess what? We aren’t. In fact, there may potentially soon be an urgent need to find a safe harbour – if one can.
First, the US election (again). Sensible media say this is all over, and are focusing on Joe Biden’s socks. However, things might suddenly get stormy in the next 48 hours. Tuesday December 8 is so-called “safe harbor” day. Any state’s election outcome that is undisputed by that date is ‘locked’ into the Electoral College ahead of their actual vote on 14 December, which are sealed until read out and then approved by Congress on 6 January. (The figure who reads out those votes and choses which electors to select, if necessary is the Vice-President: worth remembering). Some constitutional scholars contend only 6 January matters, and some say only 20 January, presidential inauguration day. Regardless, there is a strong under-current of activity ahead of tomorrow’s “safe harbor”.
Supreme Court Justice Alito has moved forward the deadline from 4pm on Wednesday to 9am tomorrow for Pennsylvania to respond over appeals over the constitutionality of its vote-by-mail legislation. This could still mean Alito does nothing. However, having acted twice, and to within the “safe harbour”, there would appear a chance the Supreme Court acts. The question is how if so. Again, it may mean nothing; or it might invalidate some or all mail-in-votes, effectively flipping the state to Trump; or it saying that the election needs to be sent back to where the US constitution says power to appoint electors actually lies – the state legislature.
On which, there is a constitutional battle raging in at least three states: Georgia, Arizona, and Pennsylvania. State Republican leadership is refusing to call special legislative sessions to discuss the election results, yet some state legislators appear close to claiming “plenary” constitutional authority over elections to recall themselves unilaterally. All they would technically need, it appears, is a simple majority. If so, they could potentially flip their Electoral College votes, or send competing electors, or not send any at all. This actually has historical precedent. It is unlikely, but far from impossible in the current heated political atmosphere in the US.
Further, with key election court cases still being held in the Arizona, Wisconsin, Nevada, and Georgia state supreme courts, as well as in other courts in those states and in Michigan, it is not unthinkable if still unlikely that the Supreme Court opts to roll several or all of them into one ruling if it acts to try to find a clear resolution, either tomorrow or at least ahead of 14 December. In short, keep enjoying your gold-flecked cocktails - and maybe rightly so. Yet seasoned sailors know that sudden surprises do sometimes happen at sea.
Brexit presents a salient (and saline?) comparison. Since the day in 2016 when markets first choked on their gold-flecked cocktails at the UK referendum result, the assumption has consistently remained “there will be a deal”. With a timetable not much different from that in the US, the outcome is on even more on a knife’s edge. Access to fishing may be sorted, but the core issues of ‘level playing fields’ and ‘UK sovereignty’ certainly are not. Trade talks will continue today, and tonight PM Johnson will have to make a final call…and potentially then a statement to the nation that there will be no deal. (The only alternative will be to say talks continue until the EU summit on Thursday, the final deadline.)
In that case, as UK government analysis leaked yesterday makes clear, we end up with the ‘break-up of the USSR’ style border and supply-chain chaos nobody wants, and some food and medicines will be in short supply as soon as 1 January. At least we had a lot of practice during Covid-19.
These are two market-shocking events we have been flagging for some time: but there are more…
https://www.zerohedge.com/markets/rabobank-things-might-get-stormy-next-48-hours-us-election