Having sat in countless lectures by the people who quite literally wrote the book on tactical voting and collective action, I can assure you that academia doesn’t have the answers to voting outcomes especially under circumstances of manipulated voting. It’s not failings on their part, rather it’s the entropic nature of humans – we just can’t accurately predict what voters will do.
Yesterday brought further UK headlines about voting alliances and tactical voting. Nigel Farage, leader of his newly formed Brexit Party, former UKIP leader and notable UK MEP, announced yesterday a no-contest alliance with the Tory party in constituencies in which they already hold representation. That equates to 317 electoral seats that the conservatives won’t face a dilution of their vote share as a result of contestation from the clear-cut single-issue harder-line Brexit Party. The alliance is huge for Johnson’s electoral prospects as in large parts of his core seats his candidates will now frequently represent the only leave-focussed party increasing exponentially the share of the Eurosceptic vote that Johnson is counting on.
The Pound liked the news yesterday morning during Farage’s press conference. The improvement in prospects for a governmental majority – something the UK has only enjoyed for three years in the last decade – saw investors flock towards the Pound as political uncertainly seemed to fade slightly. Countless tactical voting websites also entered conversations concerning political wizardry. Notably, the new website by Gina Miller – a constant thorn in the government’s side – who offers members of the public advise on who they should vote for to avoid a Conservative Johnson government once again and secure a second referendum.
Having studied the site, the crudeness of its algorithms attests to the complexity of organising political outcomes – at least I’ll put it down to this rather than calling the website and logic under-baked. The logic is simple, take the voting outcome of your constituency in the last election averaged with any polling data and suggest that you vote for the most successful non-Conservative; DUP; Brexit; UKIP party. Not exactly a work of genius or art, the election would be far more meaningful and interesting if people vote for their preferred candidate rather than (fail to) manipulate the outcome with tactical voting. GBP lost some of its momentum during the US session having found resistance at 1.29 earlier during European trading.
A flare up in Hong Kong protests yesterday with new viral videos and police shootings cast a risk-off tone in markets yesterday with cyclical currencies and emerging market currencies losing ground. Speculative bets continue to wreak havoc in the HKD forward market whilst the spot peg still holds firm and even drifted lower in its fixed range.
Discussion and Analysis by Charles Porter
Click Here to Subscribe to the SGM-FX Newsletter
Related Insights
Morning Brief – European Interest Rates
Humphrey Percy
Wed 6 Dec 2023
European Interest Rates More momentum on rate cuts in the Eurozone as expectations grew for cuts starting in March and totalling 140bps in 2024. Equally in the UK cuts of 130bps starting in June are being pencilled in to market calendars. What this means is that GBP/EUR is looking more than especially good value at […]
Morning Brief – UK
Humphrey Percy
Mon 4 Dec 2023
UK With 2 year mortgage rates less than 4% and 5 years at 4.39%, the implication for the housing market which has responded by a modest 0.2% rise, is that rates are soon going to fall and that the UK economy is stabilising. While there will doubtless be setbacks to this rose tinted scenario, for […]
Morning Brief – UK Labour market
Humphrey Percy
Wed 29 Nov 2023
UK Labour market The Bank of England yesterday broke cover to drive the message home that due to the UK’s labour market remaining tight, it was premature to start talking interest rate cuts and it was not just Governor Bailey who was calling for higher for longer interest rates but also his MEPC colleague Jonathan […]
