9/11 and 11/9: With both dates you will always remember where you were when you got the news.
The fall of the “USA” brand
If you have not received the memo, word is circulating within advertising firms that the “USA” brand no longer holds the same appeal to the international consumers. In fact, companies are advised to stop highlighting the “Made in USA” line in their advertising material.
It does not matter that the annual nation branding index released last April 2016 ranked USA first.
The allure and shining promise of the USA brand started falling last summer, when it was clear who the candidates were and the tones the electoral campaigns were about to take.
In the eyes of most people, USA was that country that used to “export democracy”, lead by example, be politically correct, check on the elections of less developed countries, be reliable and predictable, maintain a balance.
All this is lost. It was lost even before the results came out today.
Trump won. Mr Orange is the new Black.
But let’s face it, in a parallel universe where Mrs Clinton won, there would have been no wow effect, like there was for Obama. For many, she was simply the lesser evil. And it appears today that this view does not resonate with the Americans.
This was a case where the destination was in the journey and, oh boy, that was a terrible (albeit entertaining) journey. Or, as Mr Donald-I-have-only-100-words-in-my vocabulary-Trump would say, that was nasty, nasty. Not great.
The best political analysis is in the jokes
I had promised myself that I would not write any joke, given that this presidential campaign has already launched the careers of so many comedians on the net. But this is exactly the first point I wanted to make: if the only good you can see in a presidential campaign is a source for jokes and having a funny conversation subject for dinner, then your respect for a Country is gone, dead and buried 6 feet under.
I know what I am talking about: as an Italian living abroad I am selfishly happy of the USA presidential campaign, because no one can crack another joke about Berlusconi and the Bunga Bunga. Ladies and Gentleman, there is a new clown in town.
There is no point in discussing which candidate was better, why Trump won, why she lost, a river of digital ink is already available online. What matters is that out of a population of 300 million people, these were the two best candidates that USA could offer.
I share the same view as many that Ms Clinton, who had done a decent job as the Secretary of State (Ministry of foreign affairs), was somewhat respected outside USA.
Again, this view was not shared in her home Country. In fact, most millennials and women of any age who wanted a woman as president, have simply decided that she was not that woman they wanted for the job. They would rather wait. Nasty. Nasty. Great. Great.
This leads to the question of “what the hell went wrong with polls and forecasts?” (Yes, UK, I am speaking about you too!)
I had read 3 different theories, all interesting. Some think that Brexit referendum and US elections were just plain and simply rigged; so the forecasts were correct. Everyone has right to his own opinion, so let’s agree to disagree on this one. Thank you.
CEO Spotlight: Alon Rajic on the Future of UK/EU Trade and EconomicsGo to article >>
The second theory is that survey firms were aware that Brexit and Trump were favourite, but in order to push the outcome in the direction they wished for (after all, they are commercial companies), they simply published other numbers. If that were true, they would be liable for prosecution.
My best guess is the last and prevalent opinion: these research were conducted with the accuracy, care and professionalism of a drunk scammer.
Survey firms cannot keep coming up with justifications like: “we worked professionally, but we ignored the white uneducated people, and the ones who would not go to vote”. Hello? That’s your job to think about it.
“But we only survey on the specific questions that our clients hire us for”. Then what’s the added value in using your services? If I don’t need any advice, then next time I’ll just hire a call centre.
I had no reason to believe that the survey companies did not conduct the survey professionally. This is where the problem lies. There is no added value to a survey company if they cannot think out of the box, if they cannot shed light on forgotten groups of people and fail to provide detailed results that will allow their clients to build a cohesive plan of action.
The survey providers had failed the Clinton campaigns and these are the same companies that you and I hire to run our market researches. If you invest your money according to a research, and then you find out that its 96 percent chance result was actually a 6 percent chance, I bet you would not be happy. So spend your money wisely.
There is no point in highlighting a problem without providing a possible alternative solution. So here is one: the 1973 bestseller “A random walk down wall street” claimed that “A blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by experts.” Should we replicate that?
If you doubt it could work for US presidential elections, well I have news for you: it already has. It happened in China. Check this picture which was shot a few days ago: http://www.japantimes.co.jp/wp-content/uploads/2016/11/f-elexmonkey-a-20161106.jpg
Speaking about China, I asked my colleagues in our Shanghai office why most Chinese people sympathized with Trump. I was expecting an answer like: “because it makes USA weaker on the world landscape, leaving more room for us”.
Instead, they explained that at the government and business level, the Chinese are, in fact, upset, because they fear repercussion in the trade between USA and China. Instead, the man on the (Chinese) street, the vast majority, likes the political man who is bold, willing to take unpopular course of action and have his own point of view. In contrast they see the Chinese government as too mild, too passive and too predictable.
There! I guess this is the answer to the burning question of “How did Trump win”, too.
How this result will translate into trends in the financial markets, I cannot possibly predict, I am no (longer) an analyst and even if I was I would still leave the job to the monkeys.
What I know is, I have several people in my network who are buying physical Gold or contracts, so the present market sentiment is pretty clear. After all, if you vote for unpredictability, that’s what you are going to get.
What is important now is managing the risk, and it is good to see that the most professional players between my clients have learnt their lessons after the Swiss Franc crisis, and have braced for impact by reviewing the leverage offered on their platforms during these most recent surprise events.
In fact, brokers will be happy to see some decent market movements in either direction.
In these interesting times all I can say is: keep calm and enjoy the volatility!