The election in November...

...will come down to how voters in nine swing states feel about the economy. 

That's it. Anything else is just a sideshow. 

Bloomberg had an excellent piece on this yesterday, "Obama Prospects Improve As Swing State Economies Improve" (my emphasis): 

From extra shifts at auto and steel plants in Ohio to office buildings rising in Northern Virginia, the geography of the U.S. economic rebound is providing an edge to President Barack Obama’s re-election. 

The unemployment rates in a majority of the 2012 battleground states are lower than the national average as those economies improve. Coupled with the growth of adult minority populations in those states, the trends create a higher bar for presumed Republican Party presidential nominee Mitt Romney in his quest to unseat Obama. 
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Local economies are “important,” said Xu Cheng, a senior economist at Moody’s Analytics. A model that Moody’s developed based solely on state-by-state economic data and past voting behavior forecast the outcome in 2008, he said. 

A projection Moody’s made May 21 based on the model predicts an Obama victory with 303 electoral voters, with the Democrat carrying Ohio and Virginia and the Republican winning Florida. The economic data for the remainder of the year comes from Moody’s state-by-state forecasts. 

Remember: It's the economy, stupid. Or, more accurately, the economy in the swing states, stupid. All the rest is just noise.