Betting on politics: Trump's impeachment

Political betting guru Matthew Partridge weighs up the odds on US president Donald Trump leaving the White House early.

846-Trump-thinking-634

How long can Donald Trump hold out?
(Image credit: © 2017 Bloomberg Finance LP)

Problems continue to mount for President Donald Trump. Not only is his popularity at low levels, but the decision to fire James Comey has backfired spectacularly, adding obstruction of justice to the list of potential crimes that he could end up being impeached for. So it's a good time to focus on the impeachment or resignation betting.

At the moment Betfair is offering 2.04 (49%) on Trump leaving before the end of his first term, and 1.91 (52%) on him staying. However, if you think he will hang on, Paddy Power is offering 11/10 (48%) on him departing office in 2020 or later. Not only are these better odds, but Trump only has to survive two and a half years for the bet to pay off.

My take is that there is a significant chance that Trump will leave before the end of his time in office. Even he now admits that he can't guarantee that his aides didn't cross the line. What's more, he still hasn't learned that bullying, bombast and bluff only make things worse. However, the big question is whether the betting markets are properly valuing the chances of him leaving.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

After all, even Richard Nixon managed to last 18 months into his second term after the Watergate scandal broke before being forced to resign. What's more, Trump has the big advantage that the Republicans are in control of both parts of Congress (although many don't particularly like him).However, if the Democrats regain Congress after the mid-term election, as I think they will, then they will be the ones in charge of the investigative process, and you'd expect any dirt to come out then.

So, I'm going to suggest that you bet on Trump departing office in 2019 (12/1) or 2020 or later (11/10) with Paddy Power. This works out at combined odds of 55.3%. If you properly weight your bet (as I always recommend that you do), you should put £8.61 of a hypothetical £10 betting unit on 2020 or later and £1.39 on 2019.

Dr Matthew Partridge

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri