Betting on a Palin withdrawal

Poindexter

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An online prediction market weighs in on whether VP candidate Sarah Palin will be dropped from the Republican ticket.
By Mina Kimes, reporter
Last Updated: September 2, 2008: 5:16 PM EDT

NEW YORK (Fortune) -- Now the Democrats aren't the only ones who can try to capitalize on the negative buzz growing around Alaska Gov. Sarah Palin, the prospective Republican VP candidate.

Intrade, an online prediction market based in Dublin, created a contract Tuesday morning on the likelihood that John McCain will drop Palin as his running mate. After opening at a probability of just 3%, the odds on Palin being cut from the ticket climbed to 18% around 9 a.m. and have since settled at around 12%.

Intrade is a place for betting enthusiasts to turn a small profit on everything from the latest auction of works by controversial British artist Damien Hirst to Britney Spears' chances of landing in rehab. Contracts on a possible future event are bought and sold by users of the site, like a stock on the NYSE.

Chad Rigetti, Intrade's VP of Business Development, says traders on the site asked Intrade to create the newest market after stories about Palin, including her teenage daughter's pregnancy and her involvement in a group that did corporate fundraising for controversial Alaska Sen. Ted Stevens, flooded the news. The pool has been open for less than twelve hours, but has already attracted more than 950 trades. Intrade estimates that about $2300 has been traded on the Palin withdrawal contract.

Placing a Palin withdrawal at even 12% seems bullish; no presidential candidate has withdrawn his VP selection since Thomas Eagleton left Democratic candidate George McGovern's ticket in 1972.

Intrade has demonstrated some success in predicting political choices (forecasting the selection of Biden), but also volatility: Palin's chances of landing the nomination vacillated wildly in the hours before McCain announced the pick.

Rigetti points out that while some traders are putting Palin on the chopping block, they're still giving her 97% odds in a separate market for the VP nomination. He thinks that many traders are playing both markets, which means they believe a withdrawal won't come until later in the election season.

Intrade monitors its traders' demographics, but it's too early to tell who's betting on a Palin pullout. Some of the naysayers could be Republicans: Rigetti says that, unlike polls, the election markets don't always represent political beliefs. "People have a real money incentive," he says. "They're betting with their head and not their heart."
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Clint

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Wouldn't it look worse to drop your vp candidate and pick a new one than to just keep her? I would think so.
 

vore9000

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No doubt, but I think you could safely say that this VP pick hasn't gone over beautifully.
 
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actually, I think that most people that supported McCain coming into the picking of the VP still think that Palin is a great choice.

I mean hell, she's got more experince than Barack Obama.
 

Poindexter

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Wouldn't it look worse to drop your vp candidate and pick a new one than to just keep her? I would think so.
Yeah, it would look horrible. Even though it won't happen, the speculation itself doesn't look so good - especially when it is considered to be nonpartisan (according to this article). My hunch is that the RNC has basically given up on pulling out the win on this, though it is much closer that I would have thought it would be at this point.
 

vore9000

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actually, I think that most people that supported McCain coming into the picking of the VP still think that Palin is a great choice.

I mean hell, she's got more experince than Barack Obama.
I agree with you about the first part for sure, but I would say that part of the VP pick is often trying to bring in new or swing voters. Or perhaps in this case some new female votes or very fringe Hillary supporters. In that regard I think it hasn't gone over as well as they would have liked certainly.
 

TheBonger

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actually, I think that most people that supported McCain coming into the picking of the VP still think that Palin is a great choice.

I mean hell, she's got more experince than Barack Obama.

in what world Sundance. In what world does she have more expierence that Obama? She has been governor of Alaska for 18 months he has been a United States Senator for 3 almost years. Her only previous expierence prior to that was being on the city council and then mayor of a 6,000 person town, he was a Illinois state senator for 8 years years prior be becoming a US senator and while Illionis may not be California it is definitely no Alaska either. So how does she have more expierence again?

Also that is really a mute point because hasn't McCains whole argument against Obama been he isnt ready to lead he doesnt have enough expierence but then he turns around and says this woman is ready to lead. Because what is the number one qualification to be Vice President? Someone ready to lead. To me he shot himself in the foot with this pick with the only good thing being she is a pretty face but that certainly will not be enough. He should have held strong and picked Leberman like he wanted to that would have been a truly bold move and IMO prolly would have won him the election or atleast made it much closer then it will be. Sure it would have pissed off the far right wingers but what are they going to do take back the nomination or vote for obama? Not hardly.
 

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