Hey Media! Forget the Polls! Look at the Predictive Markets
Two days before the election, I call upon the media to dump the polls. Forget the discussions of the Bradley effect or the reverse Bradley effect and go to something that while not infallible, has proven much more reliable than polls. Look at the predictive markets!
Predictive Markets allow people to put real money on the outcome of the election. The two most popular are the Iowa Predictive Markets and Intrade.
I am going to review two markets from the Iowa Predictive Market over the past two Presidential elections. One is called vote share, where market participants attempt to nail what share of the vote the candidates will get. The other is called Winner Take All. this is simplest, where you put your money on who you think will win.
Two days before the 2000 election
Vote Share Prediction
Al Gore – 49.6%
George Bush – 49.4%
Winner Take All
Al Gore – 27.3%
George Bush – 74.9%
This market had it almost dead right. Al Gore got 48.4%, George Bush 47.9% but Bush won.
Two days before the 2004 election
Vote Share Prediction
George Bush – 51.7%
John Kerry – 48%
Winner Take All
George Bush – 55.2%
John Kerry – 45.3%
Again very close on the vote count which ended up with George Bush getting 50.7% and John Kerry pulling down 48.3%
So where does the current election sit in the predictive market two days before the 2008 election? As of this writing here are the figures.
Vote Share Prediction
John McCain – 47%
Barack Obama – 53.5%
Winner Take All
John McCain – 11.2%
Barack Obama – 88.3%
Remember that the markets only predict what is likely to happen if the vote were taken at that moment. So the day of the election is the day to watch. Of course, it’s possible that the predictive market could suffer it’s first major error. If not, it looks right now, as if Barack Obama will be the next President.
November 2nd, 2008 at 5:46 pm
One can only hope that these results will reflect the Nov. 4th election. However, inaccurate as this method appears, it and other polling methods have improved since the Harry Truman incident. All eyes on November 4th.
November 2nd, 2008 at 6:34 pm
I can only fear for our country if these results reflect the outcome. America cannot suffer a socialist president in Washington who supports killing our unborn children (infanticide), bankrupting our coal industry (http://tinyurl.com/68oyz4), giving up in a war we have almost won, nationalizing our healthcare which will increase hospital waiting times to three months, giving the middle class money the gov’t doesn’t really have then taxing it and using it for the gov’t’s own purposes, raising our gas prices by refusing to drill offshore, and weakening our military along with getting rid of all our nuclear weapons. Obama wants to transform America, a magnificent world power, into a pansy nation who wants to trust liars, deceivers, and murderers (aka our enemies).
Boy does he have a lot of charisma, but what good is eloquence when you have no experience?
November 2nd, 2008 at 8:11 pm
Honestly, I hope that neither of these two make it in. McCain will keep us in a war that we should have never gotten into first place. Obama will cost the government too much money. Neither of them will do what needs to be done:
1. Close all the borders
2. Immediately pull out of all countries we are in, war or peaceful stations and declare an end to our imperialistic goals.
3. Kick the UN out of our states and make them find a new home since we are declaring neutrality from now on.
4. Disallow all political lobbying by corporations.
5. End the war on drugs, make drugs legal, immediately declare anyone in jail on drug charges innocent.
6. All guns are purchasable immediately, no 5 day waiting period and it is legal to have a concealed weapon.
7. Abolishment of the Department of Homeland Security and any laws prohibiting invasion of privacy are immediately stricken down.
8. Abolishment of the Federal Reserve and repeal of the Wall Street Bailout, and back to a gold standard so we can no longer print money at will.
9. Overhaul of the welfare system so people cannot simply stay on it and not get a job.
10. Drill offshore for the time being, while encouraging companies to invest in researching other sources of energy such as wind, solar, etc, etc.
These are only 10 things of many that needs to be addressed. Oddly, Obama is probably closer to this than McCain is. A third party candidate would probably be a better option.
I’m still undecided, but it will most likely be Chuck Baldwin who I vote for. I would love to see a third party candidate overcome huge obstacles and win the white house, but I have doubts. Who knows, if the turn out is as huge as they say it is, 3rd party might make it. The problem with these polls are that they only include 2 out of the 6 or so candidates. Media bias needs to end.
November 3rd, 2008 at 2:22 pm
The polls & predictive markets are not independent.
A lot of the folks in the markets are avid poll-watchers and are betting accordingly.
November 4th, 2012 at 12:08 pm
[…] November 5, 2008 I wrote a post calling attention to the predictive markets. Intrade has since caught a lot of public attention, […]