More intrade

The intrade market (intrade.com) now has a market for whether Joe Biden will withdraw from the race. Its last price (as of 9:11 on 9-11) was 7.5, meaning that the market says there is a 7.5% chance it will happen. They also have a market on whether Sarah Palin will withdraw. The price there was 5.8. So suddenly the bettors think there is a higher probability that Joe Biden will withdraw than Sarah Palin. The Bidden market seems to have been added after the Palin market.

And as of this morning, the intrade market thought that John McCain was more likely to win the election, pricing him at 50.6 and Barack Obama at 49.0. Prior to the conventions, the market was giving Obama a 60% chance of winning, and even a few days ago it still gave a narrow edge to Obama. Maybe the lipstick thing moved the market?

Looking at how the various prediction markets at intrade make big moves over time indicates that the future really is hard to predict. The market did not see Sarah Palin's nomination coming. The bettors were pretty sure early on that Hillary Clinton would win the Democratic nomination, but they were wrong. (Maybe--there is still trading in the market that predicts that Hillary Clinton will be the next president, and the market gives that a 3.4% chance of happening.) I think the prediction markets are interesting for giving us an unbiased view of what is coming and that is important in politics because it is too easy to let what we want to have happen cloud our judgment about what is going to happen, something I learned back in the elections of the 1960s. But so much of the future just cannot be predicted.

Update: Intrade has a new contract, betting that Hillary Clinton will be on the Democratic ticket on election day.