Welcome to Thoughts on the Market. I'm Michael Zezes, head of Public Policy Research and Municipal Strategy for Morgan Stanley.

Along with my colleagues bringing you a variety of perspectives, I'll be talking about the intersection between U.S. public policy and

financial markets. It's Wednesday, October 14th at 2 p.m. in New York.

It would be an understatement to say 2020 has been full of surprises and so investors are constantly checking

their blind spots for the next one.

One potential U.S. election surprise is now being better understood.

With states reporting record-breaking numbers of voters requesting mail-in ballots, investors and the public are awake

to the possibility that the results won't be known on election night.

But while it's appropriate to adjust our expectations about when the result will be known, we need

to be careful not to overreact.

A delayed result could drag on for weeks and be fought out in court, but it doesn't have to be that way.

In fact, there's some fresh evidence that the next 2020 surprise for investors could be how orderly

the election plays out. Consider some recent data from states showing that votes by mail

are not just being requested in record numbers, but also returned in record numbers.

In Wisconsin, over 50% of votes by mail have already been returned.

And while those votes can't be counted until election day,

they can in Florida and North Carolina,

two swing states where 33 and 38 percent of ballots have already been returned.

If this trend continues across the swing states, it substantially reduces the chances that the

vote count could drag out beyond the week following election day.

And while our base case remains that it will still take a few days after election day to

reliably know the result, if things break the right way, a result could even be reliably known

...