The predictions of GROWTH, INFLATION, and
GOODNEWS for the previous forecast from the US model
(April 27, 2007) were 1.9 percent, 3.3 percent, and 1, respectively,
and the predictions for the current forecast (July 27, 2007) are
2.2 percent, 3.5 percent, and 2, respectively. The data have been revised
back to 2004:1, and in the revised data there are now 2 good news
quarters (2005:3 and 2006:1) instead of just 1. This is the reason that
GOODNEWS is now 2 instead of 1. No more good news quarters are
forecast by the US model through the third quarter of 2008.
The extra good news quarter has a positive
effect on the vote prediction for the Republicans, and the predicted
Republican vote share is now 48.0 percent rather than 46.8 percent before.
The Republicans are thus
predicted to lose the election by 2.0 percentage points given the
new data and the current forecasts from the US model.
The forecasts of inflation from the US model are probably more
pessimistic than the current consensus view, and the forecasts of
real growth are probably more optimistic.
It is possible on this website to enter your own values for the three
economic variables and produce a prediction for VOTE.
(Compute your own prediction
for 2008 using the
2004 update.) For example, if you think a recession is likely in 2008,
you can enter some negative value for GROWTH.