Thanks, Iowa

Glenn poses a puzzle about the Iowa Electronic Market - why the apparent Kerry rally? In Updates, he also notes that the daily closing price graph might not be reflective of the "real" market.

Why someone would want to manipulate this market is beyond me - I would be more inclined to think that someone hated Arnold's speech, or thought the rumored staff shake-ups at Campaign Kerry might turn the tide. But be that as it may, it is clear that the closing price on Aug 31 is an outlier.

This page presents daily high, low, average, and close for August. The Aug 31 close of 50% Kerry / 50% Bush is out of line with previous closes, and with the daily average for Aug 31 (and note the high volume).

This page shows the current market, which, as of 9:45 CST on Sept 1, has moved back to roughly 46% Kerry / 54% Bush. This is back in line with the average price for August 31, and the previous closing prices.

Of course, this does not prove that the last trade was "wrong" - maybe some rumor did not pan out, for example. But I would not take the Aug 31 close too seriously (relative to the religious faith I place in the other closing prices, of course...).

A final note - from the prospectus, we remind folks that Iowa is living on Planet Gore, where the "winner" of their "Winner Takes All" market will be whoever receives the most popular votes. Here under the yellow sun, and at TradeSports, we still have an Electoral College, and the winner will be whoever raises their right hand on January 20, 2005.

At TradeSports, Bush is currently given a 58% chance of winning, which is slightly higher than the 54% chance being traded in Iowa.

UPDATE: From the Time Vault, coverage of the Kerry campaign shake-up from last November. The "near-death, then renewal" electoral process is part of Kerry's charm, I guess.

UPDATE 2: FWIW, TradeSports had two contracts related to the Kobe Bryant situation: (1) will the case go to trial; and (2) will a jury find him guilty. Look under "All Events", then "Legal".

Now, did the case go to trial? Jury selection had begun, but opening arguments had not been made - check the contract!

As to being found guilty, well, no. The market had estimated roughly a 10% chance of that happening.

Comments

[Paul Zrimsek]

Say, isn't the CW still that Bush may do all right on Planet Gore but he's got problems in the Electoral College?

[joe]

i like tradesports better than IEW -- more market liquidity.

[M. Simon]

I like this

LA Times:

http://www.latimes.com/news/politics/election-test-fl,0,1851284.flash

And this is one of my faves an honest Dem site. It is fun to watch them cry as Kerry falls.

http://www.electoral-vote.com/

—==—

Steal this sig:

George Bush never called me “baby killer”.

There is a big difference between William Calley and John Kerry. William Calley is a proven war criminal. For John Kerry we only have his word as an officer and a gentleman.

New Soldier

What is the War Hero Afraid of?
Form 180. Release ALL the records.

The Ads: Video links

[JP]

Since the DNC convention, I've been following the sportsbooks and what they think of the election. I have a post here is you're interested.

Basically, it was dead even coming out of the DNC convention, but Bush has steadily been growing a lead since. In the last week (thanks to the Swifties and the RNC convention), Bush has shot up dramatically. He's at about 55% chance of winning as of today.

[Thom]

I checked the Iowa electronic markets at 12:02 am eastern time this morning, about an hour before the final trade was clocked, and it was at 55 for Bush and around 46.4 for Kerry. Imagine my surprise when I learned this morning that it had closed at about 50/50. Also, the number of Kerry contracts yesterday is way out of whack. Someone is obviously trying to game the market with last minute trades that will only show up on the graph of closingn prices.

[JP]

Since the DNC convention, I've been following the sportsbooks and what they think of the election. I have a post here is you're interested.

Basically, it was dead even coming out of the DNC convention, but Bush has steadily been growing a lead since. In the last week (thanks to the Swifties and the RNC convention), Bush has shot up dramatically. He's at about 55% chance of winning as of today.

[Greg D]

Thank you! I went to the site, and couldn't figure out how to get the current price.

[Thom]

I checked the Iowa electronic markets at 12:02 am eastern time this morning, about an hour before the final trade was clocked, and it was at 55 for Bush and around 46.4 for Kerry. Imagine my surprise when I learned this morning that it had closed at about 50/50. Also, the number of Kerry contracts yesterday is way out of whack. Someone is obviously trying to game the market with last minute trades that will only show up on the graph of closingn prices.

[M. Simon]

I like this

LA Times:

http://www.latimes.com/news/politics/election-test-fl,0,1851284.flash

And this is one of my faves an honest Dem site. It is fun to watch them cry as Kerry falls.

http://www.electoral-vote.com/

—==—

Steal this sig:

George Bush never called me “baby killer”.

There is a big difference between William Calley and John Kerry. William Calley is a proven war criminal. For John Kerry we only have his word as an officer and a gentleman.

New Soldier

What is the War Hero Afraid of?
Form 180. Release ALL the records.

The Ads: Video links

[bob]

The sad thing is Kerry keeps changing his words

[betsybounds]

"The "near-death, then renewal" electoral process is part of Kerry's charm, I guess."

Does this mean that the Dems think they have found themselves another Comeback Kid???

[Greg D]

I'd say the difference between the Iowa numbers and the TradeSports numbers is that some people think he'll repeat 2000. (Unlikely, IMHO. I think what happened in 2000 was because the press called it for Gore while polls were open in half the country, and that affected vote totals).

[Pat Curley]

IEM reflects CW (Conventional Wisdom). CW did not change last night, so it was obvious market rigging. I wonder if there is a way to take advantage of the people doing this; buy around 11:00 PM, sell at 11:50?

[Brad DeLong]

I think it's that the Monday convention did not go as well for the Republicans as the market had been thinking it would. God knows what they're going to think of Wednesday night. Zell Miller certainly drove Andrew Sullivan around the bend: he's nuttier than a fruitbat and shriller than the unnatural genetically-engineered child of Paul Krugman and Michael Moore...

[TM]

the unnatural genetically-engineered child of Paul Krugman and Michael Moore...

But what about the love-child of Sean Hannity and Ann Coulter? Someone should start booking panelists for Crossfire 2020.

As of Thursday AM, Kerry is up to 47%, so maybe Zell didn't sell. (Is it safe?)

[Tim Fergus]

The size of a market, i.e., the number of participants trading and the total dollar value of trading is an important consideration.

Small markets are easy to move. I think the Iowa Electronic Market may be too small to be a good indicator. However, they do not publish their trading volume, so there is no way to know. TradeSports, or Intrade do, and it looks like they have much more volume. But perhaps they, also are too small a market. I invite any thoughts by others on this.