Skip to main content
No. of Recommendations: 0
To Warrl:

I guess my further question is why would the Obama administration spend millions on Intrade to affect the to manipulate the odds between Romney and Obama. I would think spending the money on traditional campaigning would be better spent.

I mean, seriously, what percentage of the population knows about I would guess, a very, very small percentage...not enough to really affect the election. Who is viewing the numbers and allowing it to affect their votes? I'd bet a tiny tiny slice of the population.

Do you think it really affects voter turnout or voter sentiment.....hec, I'm all over the internet all day long, love stats, and didn't know about Intrade until about a month ago.

From MadCap:

You would also expect people who are in it to make money to push the price back down if it's overvalued.

Exactly. That's correct. And I agree...with conditions. You're appealing to the efficiency of a large market. When it's efficient, with plenty of participants, yes, the price of the share (odds that Obama/Romney is elected) should accurately reflect all known information. But Warrl's solid, but arguable point is that it's too small - therefore not efficient.

In a market with plenty of liquidity, MC's point is very valid....anyone trying to jump in to manipulate the numbers, thus throwing it off proper market equilibrium, will be met by willing buyers or sellers which throw the numbers (or odds in this case) back to what reflects reality. In other words, if the price is artificially inflated, buyers will be willing to sell, thus driving down price...and vice versa. That's the market. The question is whether the Intrade market is liquid and large enough to reflect reality in the Prez race?
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.