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Anyone doing this? There's enough non-volatile bets to work on right now that I expect I can make a good profit on the midterms.
You can currently nab "The Democrats to control the Senate after 2010 Congressional Elections" at 56.5.
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If you change that to "any meaningful legislation that isn't the budget..." I'd adjust that to .0001%
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quote:Originally posted by Samprimary: Anyone doing this? There's enough non-volatile bets to work on right now that I expect I can make a good profit on the midterms.
You can currently nab "The Democrats to control the Senate after 2010 Congressional Elections" at 56.5.
It's even lower now. An amazing deal, if 538 is to be believed.
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I'm tempted to start actually using Intrade, but is it possible to actually deposit money from the US? They've made it so hard with online gambling.
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It's fallen even more. You can now buy "Democrats to control the Senate after 2010 Congressional Elections" at 43.9.
Confusingly, the price for "Republicans to hold 50 or more seats after 2010 mid-term elections" is at 45.7. Which seems like an arbitrage situation. Unless 1) I'm reading it wrong or 2) there's non-trivial weight on the GOP getting to 51 and then convincing Lieberman AND Nelson not to caucus with the Dems.
I think Nate Silver's predictions are pretty good at the moment. There are 4 seats that are relatively safe GOP pick-ups (PA, AR, IN, ND), 3 more that I would be surprised if they didn't win (WI, CO, WV), and 2 that could go either way (NV, IL). Even if they sweep all nine of those, they'd need an unlikely pick-up in WA, CA or CT (or a party defection) to get to 51 and I just don't see any of those things happening.
Still, going from 41 to 49 is huge. And I think it's a pretty good bet the GOP will control the House with margin to spare. It'll be interesting to see how the WH reacts to the new reality. Will they make concessions and compromises or not? And how demanding will the newly empowered GOP be? Will they be open to concessions, or will they spend their time flexing and strutting rather than getting things done?
quote:Originally posted by SenojRetep: Will they be open to concessions, or will they spend their time flexing and strutting rather than getting things done?
As opposed to all the work that's been getting done now?
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quote:It's fallen even more. You can now buy "Democrats to control the Senate after 2010 Congressional Elections" at 43.9.
Ok, but why do you think this is a good bet?
As I pointed out: because 538, which has been very reliable in the past, says it's a good bet.
Seriously, does anyone know a halfway-convenient means of buying into Intrade from the United States?
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quote:Originally posted by SenojRetep: Will they be open to concessions, or will they spend their time flexing and strutting rather than getting things done?
As opposed to all the work that's been getting done now?
There's a political difference between obstructionism as the minority party and engaging in posturing and retribution as the majority party. I thought the Dems in 2006 showed a remarkable amount of restraint (some would argue too much restraint). I hope (but doubt) that the GOP will similarly focus on pushing pragmatic legislation rather than settling political scores.
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quote:It's fallen even more. You can now buy "Democrats to control the Senate after 2010 Congressional Elections" at 43.9.
Ok, but why do you think this is a good bet?
Because, as I explained, even if the GOP runs the board on the currently close elections (a somewhat big 'if') and defend all their own territory (a much smaller 'if'), they still need at least one more Senator. That means coming from behind in WA, CT or CA or convincing Ben Nelson or Joe Lieberman to switch affiliation.
What I don't get is what's preventing someone from buying a bunch of shares of both "The Democrats to control the Senate after 2010 Congressional Elections" for 45.0 each and an equal number of shares of "Republicans to hold 50 or more seats after 2010 mid-term elections" at 48.0 each (the numbers were somewhat more favorable earlier today).
If the Republicans hold 50 or more seats and the Democrats don't control the Senate, each share pays (100-48)-45 = 7. If the Democrats control the Senate and the Republicans don't hold 50 or more seats, each share pays (100-45)-48 = 7. I don't see how Democrats could reasonably be expected to control the Senate and Republicans hold 50 or more seats (this would mean at least one Republican caucuses with the Democrats), so it seems there's a risk-free wager available.
If I could buy 1000 shares at those prices I could guarantee myself a $7000 payoff.
<edit>Maybe InTrade transaction fees are sufficient to cover the difference. But assuming frictionless trades, this market is currently not at equilibrium</edit>
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I also put in California marijuana legalization initiative to be passed in Nov 2010 ballot when it was at 38, but that's a side bet compared to the senatorial races and governorships.
Here's the short copy as to why Intrade offers me such great payoffs: 538 exists and airs the previously secretive testable methodology by which elections can be predicted with a great degree of accuracy. In addition to that, there's a lot of people who reflexively distrust polls and consider them to be little more than haughty guesswork. It often falls in line with having a poor individual apprehension of science in general (look for dismissal of poll methodology from the very same people who claim anthropogenic global warming is all a farce, or use the 'watchmaker argument' in defending creationism, etc), and they will usually default to this position reflexively when they're too emotionally invested in believing what they want to believe is likely above believing what's actually empirically likely.
These people are whales. They use intrade too (so far), and they feed intrade and create incredibly profitable scenarios for the people who follow the real data. Nate Silver's stewardship of 538 also involves culling the worst pollsters from his calculations, and pointing out why and how terrible polling operations are terrible. Strategic Vision is a little mercenary op that creates made-up number poll figures for the people who pay them to create made-up poll figures, and they are frequently hired by republicans to present numbers that say that their candidates are competitive, and/or to drive voters to the polls under the auspices of a 'close race.' Silver also accurately weights the utter worthlessness of polls by operations like Zogby, who has terrible methodology and testably produces horrible margins of error.
All these combine to form a wonderful means of profit. I can't make money betting in intrade without a sizable population of people who are politically gullible. The 2008 presidential election had scores of mccain supporters pumping tons of cash into betting that he would win even though it was obvious by the beginning of October that the odds of mccain being able to win were statistically negligible.
people who don't understand the polling by state / electoral college prediction system didn't know that. people who refuse to believe valid, reliable polls would refuse to concede that. people actively misled by pundits on their side would be blind to that.
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