Intrade is meaningless right? Reassure me

[GoesTo11]

A week ago Obama was at 60 down from mid 60s. Right now, he's dropped to 46. So people trading there think he's not very likely to win. I don't want to hear about how Intrade is just gamblers. People on this site sound confident. I myself cannot envision how a fool like McCain (and Palin) can win.

So is it that people trying to make money gambling don't see something that we understand, or is it that we don't see something that they understand?

[AllentownJake]

1. Its speculation

The last week McCain was ahead in the polls so intrade moved. Intrade follows the polls. Enron was at $125 a share before dropping like a rock.

[angstlessk]

18. I bet intrade can be manipulated just as the new york times best seller list is

people with money ready to throw it at anything so their guy gets in....ITS THE TAX CUTS, STUPID...JUST LIKE EVERY PUNDIT..THEY ALL MAKE OVER $250,000 PER YEAR SO THEY HAVE A VESTIDED INTEREST IN MCSAME

[mth44sc]

2. How meaningless it is

is up to you

[RichGirl]

3. Gamblers live in the moment.

That's how they feel TODAY. If any of them watched Palin's interview they'll see it differently tomorrow.

[whistle]

4. They understand that U.S. elections are fixed

[Marsala]

5. Obama was up to 98 percent to win the New Hampshire primary

And then he lost the primary. Intrade is meaningless.

[Drunken Irishman]

6. .

[GOPNotForMe]

7. You just said a week ago he was at 60. Either they were wrong then or they are wrong now.

Or they are wrong on both counts. It matters in no way to the actual election. I wouldn't get too upset about it.

[NYC_SKP]

8. I'm no expert, but....(two things)

First, I think it's not terribly scientific; a few large dumb bets could skew the results and who knows what kind of political acumen these bettors have.

Second, I was always loving Obama's high numbers there and might not have criticized results, now I find it easier to dismiss them.

Isn't that telling? :shrug:

Anyway, fuck intrade, watch the electoral college count, state polls, stay away from national trends...

:patriot:

[FrenchieCat]

9. You should go ahead and buy then......

this may be your chance to make a buck.

[Boz]

10. The market is now being manipulated by speculators. Its no longer tied just to the challenge.

Much like oil.

[Bleacher Creature]

11. I heard somewhere that it's 43 for 43 picking the winner 54 days out.

Sorry -- couldn't resist.

[denverbill]

12. Worthless. Heavily tilted towards people who are likely to bet on crap.

I used to think it might have some relevance. The CIA types and others seem to think there might be some relevance to using stock/bond/option trading as a predictor to terrorist attacks, because of the airline puts prior to 9-11, and which pushed the same sort of 'market-driven' prediction as useful for everything.

But if you only sample the sorts of people who bet on this type of crap, it's like only sampling people who play Keno and using that as your polling sample. Overwhelmingly, for this market, the 'players' are internet savvy, younger white male yuppies. If you want to sample how that group is feeling at any given time, use Intrade.

[mcg]

15. Even the performance of most so-called experts like stock brokers

is quite unimpressive. Most of their portfolios do about the same as the general stock market.

[mcg]

13. The Holland tulip bulb mania, 1929 crash, dot com bubble,

the recent housing bubble, etc.

Examples showing that speculators are often irrational.

Some of these gamblers are betting on McCain, some are betting on Obama.
Are they all experts? Are they all correct? Are the gamblers betting
on Obama not seeing something that the gamblers betting on McCain understand?

Even professional traders like options traders on the floor of the exchange
get very emotional. Quite a few lose their shirts. I read a book that described
a trader who remained cool while there was rampant buying or panic selling.
When he sensed a peak, he would do the opposite. Others would notice that and
imitate him.

I learned the hard way that most gamblers don't have a clue about what they are doing.
I saw stock prices fluctuate wildly for no rational reason. Often people will buy a
stock simply because the price is increasing.

Intrade is certainly about gambling. It's not long-term investing.

http://en.wikipedia.org/wiki/Tulip_mania

[scheming daemons]

14. Intrade represents the CURRENT mood...... but after tonight, watch for Obama to get a "bump"

[carpetbagger]

16. Intrade is not an independent indicator.

Intrade tends to extrapolate current changes in polling trajectories (in calculus, it would be the first derivative of the polling trends). That's all they tend to go on, though.

But this is my guess: All Obama has to do is keep Kerry's votes together. Demographic changes will turn the tide from there.

[techtrainer]

17. Intrade is based on "The Wisdom of Crowds"

http://www.realclearpolitics.com/articles/2008/05/government_stifles_the_wisdom.html

[nebenaube]

19. no such thing...

The title of that tomb was "Popular Delusions and the Madness of Crowds"...

[Awsi Dooger]

20. Correct, it's the consensus of the masses, the likelihood at a given point in time

And I love the clueless comments in this thread and elsewhere.

Let me put it this way, political gambling was much more simple and profitable in the days before Intrade. You had goofball websites putting up homemade odds that didn't reflect true probability at all. Right now there are occasional bargains to be had but you have to anticipate. Anyone who waits for a state poll is going to be swamped.

Intrade has actually demonstrated great wisdom the past few days, moving statewide prices in anticipation of adjustment in individual states. If it were up to goofs here, they would want to believe the margins in the states have never changed, even when the national mood moved many points.

You think I don't want that mindset to run Intrade?

Plus, this is what non-gamblers never seem to realize about betting, particularly this far removed from an outcome: It's all about beating the price and positioning yourself in advantage position. These speculators aren't necessarily betting on McCain to win. Many are betting that the price will move his way, that the current line is out of whack. Then they are holding tickets worth more than the current price. It's all about consistently making good bets. I bet basketball teams all the time that I expect to lose and blow the spread, but if you're giving me +9 when the wisdom of the masses says the line should be +7.5, I'll take my chances and come out ahead in the long run.

Many of these contracts being sold on Obama tonight at 47, or whatever, are backed up by guys who have already played McCain at 35 or 40. So you're telling me that's stupid, a guaranteed profit regardless of which side wins? Take your ignorance somewhere else. :rofl:

[ContinentalOp]

21. I haven't gambled with intrade yet, but here's my ultra cynical theory:

Put as much money as you can afford down on John McCain. That way if Obama wins you'll be ecstatic because Obama won and you can think of the money you lost as a campaign contribution. If Obama loses the utter crushing depression you'll face will be somewhat lessened by winning a bunch of money. I haven't decided yet if I'm actually going to go through with the idea or not but it sounds like now is not the time to do it.

[TheKentuckian]

22. If McCain wins then we're screwed well beyond

a happy little windfall.

I'd advise investing in guns, ammo, supplies, outdoor gear, solar panels, and batteries, if that's the plan.

That or foreign real estate.

[Frank Booth]

23. Intrade is HORRIBLE at predicting results. And I was saying the same thing when Obama

was up 65-35.

If you looked at Intrade at all during the primaries, it was wrong more often than right. Pennsylvania in particular stands out. Intrade had Penn. as a strong Obama state for a long time. Intrade also had Obama way up in California.