The Political Prediction Markets

August 29th 2007. In This issue...

Bulls: Who’s Advancing?

Bears: Who’s Declining?

Most Active: Show me the $!

Benchmark Markets

Gonzales Market Surges before his Resignation. Clinton and Giuliani solidify Control

This bulletin provides a snapshot of the hundreds of important political and related markets on the Intrade exchange.

It highlights the week’s biggest winners, biggest losers and most actively traded markets.

In a world of data overload we aim to deliver succinct, accurate information to keep you up-to-date.

Alberto Gonzales Resignation Market

Embattled US Attorney General Alberto Gonzales resigned Monday after months of heavy criticism from all sides

Within minutes of TV reports of the resignation the price of a single contract on Gonzales resigning had soared to 99.5, representing a probability of 99.5% that he would be gone by the end of September.

Less predictable was the movement in this market early on Sunday, more than 24 hours before the resignation was officially made public. On Sunday the price of a contract for Gonzales to resign by the end of September rallied from 10.0 to 29.0. The contract for a resignation by end of December rallied from 26.0 to 40.0. 

Such early movements in the Intrade markets are not unprecedented. A similar market for Donald Rumsfeld to resign as Secretary of Defence also saw sudden upward movement in the hours before the news became public. The market on Saddam Hussein being captured also rallied just before he was found hiding in his bunker. 

Democratic Nomination Market

Hillary Clinton has a greater than 2/3 probability of winning the Democratic Nomination. While her upward momentum has slowed, it is still upward and her current price of 67.7 is up 1.2 points from last week’s value of 66.5. But this gain is modest when compared to the average gain of 6.0 points made over the previous three weeks.

Barack Obama has managed to arrest his recent freefall. His current price of 16.9 is only 0.4 points down from last week’s value of 17.3. This small dip in value is minor when compared to recent form. In an almost mirror image of Clinton’s gains, Obama’s losses over the previous three weeks have averaged 6.1 points.

Clinton has tacked a further 1.6 points onto her lead over Obama, which is the smallest gain she has made over her nearest rival in the last seven weeks. The 50.8 point cushion she presently enjoys is the largest gap between the two since trading began however.

Al Gore remains unchanged from last week with a value of 7.4. Sitting just 0.1 points behind Gore is John Edwards, whose current price of 7.3 is a 0.2 bump from last week’s value of 7.1.

Republican Nomination Market

No major moves have been made in this market over the past seven days. Rudy Giuliani remains the market leader despite suffering a small loss in value. His current price of 37.0 is a 1.2 point slide from last week’s value of 38.2.

Mitt Romney has lost ground on Giuliani but remains his nearest rival. Romney has seen his value drop to 24.4, which is down 1.6 points from last weeks price of 26.0. This drop in value comes after five consecutive weeks of steady gains.

Giuliani’s lead over Romney now sits at 12.6 points, which is up slightly from the 12.2 point gap separating the increasingly bitter rivals last week. 

Sitting 2.9 points behind Romney is Fred Thompson. His current price of 21.5 is a 2.0 point gain from last week’s value of 19.5. This gain ends a two-week slide that saw a 12.3 point loss in value.

At the foot of the field, John McCain ended a three-week period of incremental gains with a loss. His current price of 5.9 is down 0.6 points from last week’s value of 6.5.

Next President Market

This market has remained basically unchanged over the past week’s trading, with little movement from any candidate. 

Hillary Clinton still sits atop the market in a very healthy position. Her current price of 41.6 is a 0.3 point gain from last weeks value of 14.3. Her lead over nearest rival Rudy Giuliani now sits at 22.1 points.

Giuliani has seen no change in value. His current price of 19.5 matches the same value he enjoyed last week. While lagging some distance behind Clinton, Giuliani is comfortable in second place and sits 8.6 points ahead of Barack Obama.

Obama’s downward swing has levelled off in the last seven days after seeing 8.3 points shaved off his value over the previous two weeks. His current price of 10.9 is only 0.6 points lower than his value last week of 11.5.

Mitt Romney remains steady and has enjoyed a third consecutive week of modest gains. His current price if 9.2 is up 0.2 points from last week's value of 9.0.