Intrade VEEP Forecast: Win One, Lose One (but BIG!)
We all know that Intrade Political Futures got the Joe Biden pick right last week -- how well did it do with the GOP pick?
As it turns out, not so good. THEY COMPLETELY MISSED THE VEEP PICK. Not just off by a little, mind you, but off a ginormous amount.
As we have previously suggested, the political futures markets are essentially poll aggregators. There is very little wisdom amongst the crowd, other than looking at Rasmussen, Gallup, Roper, WSJ/NBC, NYT/CBS, etc. and taking a very rough average.
Just look at how the Palin VP futures Traded only yesterday: You could have bought her VP futures for 4 cents on the dollar! Some wisdom!
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10 Day Chart
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Lifetime Chart
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Note that her lifetime futures chart is only 3 months old. Forget 18 months ago -- as of 4 months ago, SHE WASN'T EVEN ON THE FUTURES TRADER'S RADAR. Over the life of the contract, she was never more 20%.
One week ago, she wasn't even in the top 3:
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Dem VP Front Runners (8/22/08):
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Note that this is not merely a case of the longshot coming in -- Palin was not polling well, so the aggregators did not pay her much attention!
Previously:
Why Prediction Markets Fail (January 2008)
http://bigpicture.typepad.com/comments/2008/01/prediction-mark.html
Presidential Futures Markets: Spurious Predictive Powers (October 2004)
http://bigpicture.typepad.com/comments/2004/10/presidential_fu.html
Political Futures Markets? Bah, humbug (October 2004)
http://bigpicture.typepad.com/comments/2004/10/politcla_future.html
Friday, August 29, 2008 | 11:15 AM | Permalink
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» Yep, Intrade Pretty Much Missed The Palin Pick, But... from The Stalwart
Barry Ritholtz is so sharp, but when it comes to event contracts or prediction markets like Intrade, he seems to have blinders on. Today he takes on Intrade's failure to accurately predict the Republican Veep nominee. Yep, up until yesterday [Read More]
Tracked on Aug 29, 2008 12:40:11 PM
Comments
That's a, truly, inspired pick. She's a good example, from the little I know, of what's right in this 'Country'.
Personally, I didn't think the GOP had it in them.
Posted by: Mark E Hoffer | Aug 29, 2008 11:27:56 AM
McCain is really rolling the dice here, this smacks of desperation to me. Palin has significant gaffe potential. She will appeal to the Republican right wing but they are already on board anyway.
I really cannot see many disaffected Hillary followers voting for this Pro-Lifer, and nor do I think she will resonate with the younger generation that has flocked to Obama's campaign. There is always the chance of some unsavory business connections to trip her up, as well.
I thought last night's speech was magnificent. Echoes of JFK ("ask not what your country can do for you") in some of his calls for increased personal and fiscal responsibility. Obama is the Republicans worst nightmare.
Posted by: leftback | Aug 29, 2008 11:30:05 AM
Disclosure: McCain's Wife was LONG Palin Futures... (Kidding!)
Posted by: SINGER | Aug 29, 2008 11:31:18 AM
So they give up the "He's not experienced" issue and let the Democrats pound the "How can Hillary do foreign policy with Muslims" meme to gain someone who thinks there's ten times more oil in Alaska than the Geological survey believes and is an evangelical?
Bad trade.
Posted by: VennData | Aug 29, 2008 11:33:54 AM
1. Obama is still inexperienced. Palin as VP doesn't change this. The VP nominee is supposed to balance the ticket, not BE the ticket, which a lot of commentators have lost sight of.
2. No one will care about Palin's estimate of oil in place in Alaska. However supporting drilling in ANWAR does at least indicate that she has common sense.
3. Kudos to McCain for keeping this under wraps and thereby wrong-footing Intrade, which obviously expected another white male to drag this ticket down just like Dole Kemp '96.
Posted by: john haskell | Aug 29, 2008 11:44:58 AM
My boss, who is 45-year-old evangelical, was, much to her consternation, thinking about voting for Obama, probably because the pastor of her mega-church has been saying not unflattering things about him.
This, however, will easily switch her decisively to McCain. In Palin, she sees herself — a gloriously devout Christian with expensive taste in clothes and cosmetics.
Posted by: Jim | Aug 29, 2008 11:47:08 AM
Venn,
she's right about the Oil, keep an eye peeled for double-digit Crude prices, coming to a Pit near you, pre 11/04.
lb,
if you think that Gens X&Y are in lock-step behind BHO, think again..
Posted by: Mark E Hoffer | Aug 29, 2008 11:51:21 AM
Actually, early this morning, intrade showed a 73/76 market on Palin. It later dropped to 30/35 after news reports that she was still in Alaska.
Posted by: Elmer Gantry | Aug 29, 2008 11:54:17 AM
But is she hot? I mean, my wife is forty-five and still pretty hot. I hope this chick is too.
Posted by: Donkei | Aug 29, 2008 11:57:24 AM
Something that people repeatedly fail to understand is that 60% probabilities (e.g. Romney) don't pay off 100% of the time. In fact, if Biden and Romney were both at 60%, then the probability that both would be tapped was only 36%. And long shots (Palin) do sometimes come in - and make no mistake, this was a pick straight out of left field.
This is a bad, bad pick for McCain in my opinion. I'm in disbelief right now. Palin, who will only be one heartbeat away from the Presidency, completely undercuts McCain's "experience" line of attack on Obama. And Hillary supporters will not go for an anti-choice candidate, even if she is a women. Like the gas tax holiday, they will view the choice of Palin as a condescending (and weak) attempt at pandering. McCain just lost the election, in my opinion.
Posted by: Skateman | Aug 29, 2008 12:05:59 PM
McCain's new campaign slogan:
"I'm from Alaska, drill me."
Posted by: VennData | Aug 29, 2008 12:06:38 PM
What were Dan Quayle futures trading at?
Posted by: Jeff Skilling | Aug 29, 2008 12:13:43 PM
Re: leftback
"McCain is really rolling the dice here, this smacks of desperation to me."
As a (criminal) defense attorney once told me: "When you are in defense, you are losing your case."
This election was McSame's to lose....and with Palin on board, he now gets a majority of undecided/angry Hillary supporters that the Dems were courting. And there is not a pro-life/family value/soccer mom/Nascar nation woman voter that will not vote for her.
Wow...the year of the woman, and it is not Hillary. I'd be guessing that the Clinton's just realized how lucky they are NOT to running against this package.
The Dems are playing defense, and the Repubs went for the offense. McLame's choice just gutshot Obama's (purposed) bounce.
Checkmate!
As always, your mileage may vary....
Posted by: SR | Aug 29, 2008 12:15:53 PM
"Wow...the year of the woman, and it is not Hillary. I'd be guessing that the Clinton's just realized how lucky they are NOT to running against this package."
If Hillary had won the democratic nomination, McCain would have chosen Alan Keyes as his running mate.
Posted by: A. Nonimous | Aug 29, 2008 12:27:10 PM
FYI,
according to the actuaries, a 72-year old has an average life expectancy of 12 years.
http://osa.leg.wa.gov/Actuarial_Services/Actuarial_Information/Life_Expect_tables.htm
Posted by: everyone's above average on the internet | Aug 29, 2008 12:29:49 PM
I, for one, am very much hoping McCain will win.
I am looking forward to eight more years of the near-universal prosperity and fiscal responsibility that Bush and Cheney have provided us.
Furthermore, the world will respect us more as a nation knowing that we are sticking with wise statesmanship rather than getting seduced by shallow celebrity.
Posted by: Jim | Aug 29, 2008 12:31:39 PM
b-r-i-l-l-i-a-n-t
Posted by: hr | Aug 29, 2008 12:32:25 PM
How could prediction markets possibly know who was being picked by McCain? Only someone working in McCain's inner circle could have made an informed trade. It's equivalent to guessing what I will eat for dinner.
Posted by: Another Jim | Aug 29, 2008 12:36:24 PM
Me-thinks it's O in a landslide. Polls are underestimating motivated voter turnout this year, which is going to much bigger than year's past. Big voter turnout = landslide victory for O. That's the real story the MSM is missing (again).
Posted by: Jeff M. | Aug 29, 2008 12:39:35 PM
SR,
ROTF in disbelief... I have seen her on television and she is an accident waiting to happen.
NASCAR Nation and every other signifier of conservative so-called family values redneck America is already on McCain's bus. This adds nothing.
I guarantee that this pick will blow up in McCain's face. The skills needed to appeal to voters in Alaska are blunt instruments, and not those required in the highly finessed arena of a national election.
My advice to Biden is to tread softly in the VP debates, because Palin is more than capable of tripping over her own feet. My prediction is that by late October she will be hidden away like Dan Quayle was, to prevent any additional gaffes.
Posted by: leftback | Aug 29, 2008 12:40:48 PM
Why not a beauty queen? Reagan was an actor and look at how well that turned out.
"Palin, a former beauty queen, high school basketball star and television sportscaster, began her political career in the 1990s as a city councilwoman and then mayor in her home town of Wasilla. The town's estimated population in 2007 was 9,780, according to the U.S. Census Bureau."
Ok. Enough with the fun. Somebody needs to take the sharp scissors away from America before any more people get hurt.
Posted by: me | Aug 29, 2008 12:44:00 PM
Didn't Palin get caught up in an ethics probe just last month? Amazing to see her get picked anyway. This is going to be in the news over the next few months, only now it becomes big time news.
Posted by: JustAGuy | Aug 29, 2008 12:47:39 PM
@me
Thank you. The sharp scissors comment was HILARIOUS.
Does anyone realize what the rest of the world thinks about this?? Perhaps because I was not born here I did significant due diligence this morning to check that this was not in fact a MASSIVE PRANK.
Posted by: leftback | Aug 29, 2008 12:50:44 PM
Obviously she's the wrong choice, and the economy will suffer dramatically as a result - check out today's market action.
Surely Larry the K will see this, just as he saw the Obama effect a few days ago.
Posted by: fatbear | Aug 29, 2008 12:51:06 PM
If you listen to Kudlow... The market is talking... It was the Obamma stock market run, Vs. the McCain sell off.
you can't deny what the market is saying.
Posted by: Eric Davis | Aug 29, 2008 12:52:12 PM
