The Wild World of Intrade
The idea behind prediction markets is collecting the a wide variety of information and opinions to predict events. The gathering of scattered bits of knowledge is suppose to result in better predictions. The macro result might be based on reason but digging into the individual grains of emotions and rumors show people have their own unique take on events. The Presidential election on Intrade being a fine example:
To the end, some McCain supporters argued that Intrade users had been hoodwinked by the mainstream media and polls. Two days before the election, one user started a thread called “How John McCain Won the 2008 Presidential Election” and included state-by-state expected electoral vote totals. Another announced that while he’d been able to turn a small profit on Obama, he sold his contracts on him the week before the election and invested again in McCain. He admitted he’d lose his shirt, but “it just doesn’t sit right with me to have any financial gain if such a destructive candidate like Barack Obama wins the election,” he confessed. Most forum users weren’t this vocal, but all seemed to agree that traders couldn’t reach across the aisle; one user crowed after the election that it’s “an absolute pleasure taking money from conservatives!”
“Gambling on Democracy”
