Happy New Year!

Well, it looks like the new year is finally upon us. 2009 was a pretty interesting year and even though there were not that many political elections, I was still able to find stuff to consistently trade and blog about. 2009 was terrible year for the economy and even though we got out of the recession (officially) we lost a lot of jobs and are making a slow recovery. 2010 looks to be an interesting year with mid-term elections to look forward. We will have a couple of interesting primaries to trade and ponder on until November.

I have no Box Office predictions this weekend because there are no movies opening this weekend. Next weekend, we have Youth In Revolt and Leap Year. Youth in Revolt looks kind of funny and I'll probably be watching it when it comes out.

Good Riddance 2009. May the next year prove to be infinitely more fun and enjoyable!

P.S Apparently, we are supposed to say it's Twenty-Ten, Not Two-Thousand-And-Ten. I don't really care but, it kind of sounds better to me, so I'll be using it.

Merry Christmas

No predictions for this holiday weekend. I got a new computer and was too busy moving everything around to do any meaningful predictions or bets for this weekend.

No Favorite in the Florida Republican Senate Primary

Bettors on Intrade are giving both Gov. Charlie Crist (REP.FL.SENATE2010.CRIST) and Marco Rubio (REP.FL.SENATE2010.RUBIO) a 50% chance of becoming their party's next Senate candidate. Marco Rubio continues to grow in popularity and if Charlie Crist doesn't do something to win back conservatives, he could find himself losing a primary a lesser known candidate in a state where he is the Governor. The latest Rasmussen poll of the race shows how dire the situation is for him right now.

Governor Charlie Crist and former state House Speaker Marco Rubio are now tied in the 2010 race for the Republican Senate nomination in Florida.

A new Rasmussen Reports telephone survey of likely GOP Primary voters finds Crist and Rubio each with 43% of the vote. Five percent (5%) prefer another candidate, and nine percent (9%) are undecided.

Crist’s support has fallen from 53% in August to 49% in October. Rasmussen Reports noted at the time, “The fact that Crist has fallen below 50% in a primary against a lesser known opponent suggests potential vulnerability.”

Rubio’s name recognition has grown in recent months and he is now viewed Very Favorably by 34% of Likely Primary Voters. That’s up from 18% in August. As his name recognition increased, Rubio’s support in the polls has jumped from 31% in August to 43% today....

Crist angered many conservatives in the state when he embraced President Obama’s $787-billion economic stimulus plan. While the Republican establishment has endorsed Crist, many prominent GOP conservatives including Mike Huckabee, South Carolina Senator Jim DeMint and former Bush adviser Karl Rove are backing Rubio.

Marco Rubio is on a roll right now and just needs to continue focusing on campaigning and spreading his conservative message. He got a nice boost in recognition and publicity when Doug Hoffman the conservative candidate was almost able to win NY-23RD Congressional District. Rubio definitely has the momentum on his side right now and considering how early it is in the race, he has a very good chance of winning an election against a very formidable candidate.

Weekend Box Office Results (12/18/09)-(12/20/09)

This weekend was pretty frustrating. The blizzard that hit the northeast may have cost me some serious money and ruined my prediction. At the same time, I feel I only have myself to blame because a good prediction takes into account all possible variables that can affect the outcome and I did not take into account the weather. Ironic, considering one of the main messages of Avatar is nature and the power that it contains. Another weekend gone by and another lesson learned.

Avatar did amazing this weekend and despite the blizzard, it almost beat the December Opening Weekend record held by I Am Legend. It also had a Sunday percentage decrease (-3.1%) that was lower than it’s Saturday one (-4.6%). This helped push Avatar over $75 Million and helped me cut some of my losses by going long on a couple positions on $75 Million Monday morning. I think the Sunday decrease also showed the true potential that Avatar had this weekend without the blizzard.

Percentage wise, I still did very good this weekend and had a Absolute (%) Difference below 15%. It’s just too bad I bet on the wrong way. As long I can continue to make predictions within 20% of the actual, I’ll feel very good about my chances of winning on Intrade. Winning and losing can often come in streaks and in the summer I felt I was on a really hot streak that I would be paying for later. The good thing about betting on the box office is that you always have another opportunity the next week.

	Prediction	Actual	Absolute (%) Difference
Avatar	$86.58 Million	77,025,481	12.4%
Did You Hear About the Morgans?	$7.35 Million	6,616,571	11.08%
Movies Bet On Average	--	--	12.4%
Total Average	--	--	11.74%

Weekend Box Office (12/18/09) - (12/20/09)

Update 3:34 PM EST

Well, it looks like my midnight prediction was way too high. Avatar made around $3.5 Million at midnight. Still good but lower than I was anticipating. Avatar feels like it is going to be big and with so many 3D screens, the number that my model spit out just kept making sense. I'm using some new variables and I'm pretty much trying them out this weekend.

Daily Chuck Predictions

Avatar: $86.58 Million
Did You Hear About the Morgans: $7.35 Million

I couldn't get the prices I wanted but I still think I'm getting the better side of things. 3D surprised everyone with Monster Vs. Aliens. 3D movies from my experience, seem to do better than expectations most of the time.

I Am Legend made $77.2 Million Opening Weekend in December 2007, without 3D. James Cameron is one of the few directors that carries a lot of weight around them. Avatar may not made the above numbers without 2D but 3D is a whole new different ball game.

Daily Chuck Intrade Positions

AVATAR.+$80.0M - Avg @ 50% - Long
AVATAR.+$85.0M - Avg @ 45% - Long

Avatar Has Finally Arrived

By tomorrow morning, we should know what Avatar will have made at midnight tonight. I'm expecting a bigger than expected number. I'll guess somewhere around $7-$10 Million. Tomorrow, I will post predictions for both Avatar and Did You Hear About the Morgans? Avatar is getting some pretty insane buzz and I think it could have the potential to be enormous.

Below is the latest Time and Sales price chart from Intrade. It appears that traders believe an $80 Million+ Opening Weekend is very likely. If the prediction turns out to be true, than the Opening Weekend record for December held previously by I Am Legend at $77.2 Million will be broken.

Here are some news articles on how tickets have sold so far.

L.A Times: Movie projector: 'Avatar' headed for $200 million-plus worldwide opening

One of the most expensive movies of all time is poised for a huge box office debut this weekend, though nowhere close to the biggest ever.

"Avatar" will likely gross about $80 million from Friday through Sunday in the U.S. and Canada, according to several people who have seen pre-release public surveys. Thanks to largely positive reviews, however, the people said the movie could easily outperform what polling currently indicates and end up even higher.

People close to the studio said executives are concerned about managing expectations for their costly picture going into the weekend. Fox's domestic distribution president Bruce Snyder said he expects the movie to open to $50 million to $60 million.

"Avatar" will benefit from surcharges at theaters with digital 3-D projection. About 60% of its theaters in the U.S. and Canada, and 30% internationally, are showing the movie in 3-D. Because Cameron shot "Avatar" using new 3-D technology, which has been a heavy part of the movie's publicity and advertising, the vast majority of its grosses are expected to come from screens that can display it. IMAX large-format 3-D screens are expected to be particularly lucrative.

Forty-four percent of advance ticket purchases at online ticket seller Fandango are for Imax screens, 43% are standard-size 3-D and just 13% are 2-D. At competitor MovieTickets.com, 55% are IMAX 3-D, 31% are regular 3-D, and 14% are 2-D.

Nikki Finke: 'Avatar' Now 78% Of Online Tickets Sales

UPDATE: That's as of this morning, according to the big online movie ticketseller Fandango. MovieTickets.com says Avatar currently accounts for 70% of all its ticket sales this week and is reporting 350 sold out Avatar performances. Both services say between 68%-78% ticket buyers are male. And that 75%-89% of all Avatar ticket sales are for 3-D or IMAX 3-D screenings.

Fandango also just surveyed more than 2,000 Avatar ticket-buyers and found:

* 76% consider themselves fans of James Cameron
* 45% say that "James Cameron's return as a director" was the main draw
* 72% say the positive advance reviews have increased their interest in the movie
* 70% say they do not care about the film's budget
* 72% had seen STAR TREK in theaters
* 62% had seen TRANSFORMERS: REVENGE OF THE FALLEN in theaters
* 48% had seen TERMINATOR SALVATION in theaters
* 15% are ages 18-24
* 37% are ages 25-34
* 33% are ages 35-49

Weekend Box Office Results (12/11/09) - (12/13/09)

Well it feels good to have a successful weekend once again. I feel like a weight has been lifted off of my shoulders and will be able to concentrate better on Avatar coming out this weekend. I don't have any idea how it will come out yet but I'm definitely going to go watch it this weekend. I won all my bets this weekend, not by much but I'll take it. Here are how my predictions fared this weekend.

	Prediction	Actual	Absolute (%) Difference
The Princess & the Frog	$22 Million	$24,208,916	9.12%
Invictus	$12.5 Million	$8,611,147	45.16%
Movies Bet on Average	--	--	9.12%
Total Average	--	--	27.14%

Here's tracking for this weekend including Avatar.

	MTC	RS
Avatar	$72 Million	Almost High 60’s ($66 Million)
Did You Hear About the Morgans?	$6 Million	Mid Teens ($15 Million)

Weekend Box Office (12/11/09) - (12/13/09)

After talking to some of my professors, I've decided to keep working on my box office model but will not be using the results until I can get it the way I want. These estimates below came from the information I have but have been adjusted by me since my model is not completely ready.

Daily Chuck Predictions

The Princess and the Frog: $22 Million
Invictus: $12.5 Million

Daily Chuck Positions

PRINCESS.FROG.+$25.0M - Short - Avg 75%
PRINCESS.FROG.+$27.5M - Short - Avg 60%

Bettors say Tiger Woods is Likely to Lose Sponsorship

When it rains, it pours. More bad news for Tiger Woods, who is having a public relations nightmare over his many alleged affairs. Bettors on the Intrade Prediction Market are currently giving Tiger Woods a 63% chance of losing a major sponsorship deal by March 2010. The four sponsors in question are Nike, Gatorade, NetJets, and Accenture.

The (TIGER.SPONSORSHIP.MAR10) contract on Intrade has been a roller coaster as of recently and has reached a high of 90%, and then fallen quickly to 50% twice. This may be due to Gatorade announcing it has dropped the drink "Tiger Focus." Gatorade is still a sponsor and may have caused the large variance in prices.

The Federal Reserve, Ben Bernanke, and Stephen Colbert

Jesse Livermore over at Wiser than the Crowd, has a really interesting theory on Ben Bernanke's confirmation not going over easily. He thinks Volcker might be a potential candidate to try and replace Bernanke.

Stephen Colbert had a sketch last night on the Federal Reserve. It’s pretty good and I like seeing the Federal Reserve getting more attention. Stephen Colbert can make some really strong arguments that appeal to both Democrats and Republicans.

The Colbert Report	Mon - Thurs 11:30pm / 10:30c
Fed's Dead
www.colbertnation.com
Colbert Report Full Episodes Political Humor U.S. Speedskating

Here is the latest closing price chart for the Bernanke contract on Intrade.

Weekend Box Office Results (December 4-6, 2009)

Well, after this weekend's results, it looks like I went a little overboard trying to use my model. The model is still in it's beginning stages and does not have that many observations. I tried to use what data I had to get meaningful predictions but I misinterpreted the information and ran with it. This weekend, I am going to be more conservative in my bets and in reading the data. As I get more information, observations, and experience, I will get bolder and more confident in my predictions.

	Prediction	Actual	Difference (%)
Armored	$13.9 Million	$6,511,128	113.48%
Brothers	$7.5 Million	$9,527,848	21.28%
Everybody’s Fine	$4.8 Million	$3,852,068	24.61%
Movies Bet on Average	--	--	113.48%
Total Weekend Average	--	--	58.12%

Box Office Tracking (12/07/2009)

	MTC	RS
The Princess and the Frog	$22 Million	Mid 20’s ($25 Million)
Invictus	$10 Million	Mid Teens ($15 Million)

Weekend Box Office (12/04/09) - (12/06/09)

Well this week, I am putting my model to the ultimate test. The results for two movies were around the expected range, one was not. When I first saw these results, I was surprised by the number for Armored. Right now, I don't have enough observations to be very confident in these predictions but I will have more as time passes. The good thing is that I don't have to risk too much to test out my prediction.

I wanted to have these predictions out sooner but I wanted to finish establishing my position first. So, don't try and get me to buy some Armored contracts at higher prices, I'm done buying for this weekend.

Daily Chuck Predictions

Armored: $13.9 Million
Brothers: $7.5 Million
Everybody's Fine: $4.8 Million

Daily Chuck Positions

ARMORED.+$8.0M - Long - Avg 50%
ARMORED.+$9.0M - Long - Avg 25%
ARMORED.+$10.0M - Long - Avg 22.3%
ARMORED.+$11.0M - Long - Avg 19.2%

Traders Betting on Bernanke

Bloomberg: Bernanke Has Support of Majority on Banking Panel (Update2)

By Scott Lanman and Alison Vekshin

Dec. 2 (Bloomberg) -- Ben S. Bernanke has the backing of a majority of U.S. senators on the Banking Committee for a second term as Federal Reserve chairman.

Committee Chairman Christopher Dodd, a Connecticut Democrat, said yesterday that Bernanke has “done a pretty good job,” and that anger in Congress over the Fed’s role in the financial crisis is “misplaced.” Judd Gregg, a New Hampshire Republican, said Nov. 20 he will “absolutely” vote for Bernanke.

Criticism of the central bank has mounted in Congress since President Barack Obama nominated Bernanke in August, with many lawmakers blaming the Fed for lax supervision of banks and for taking part in taxpayer-funded bailouts of companies including Citigroup Inc. Some senators said those concerns won’t stop them from backing the former Princeton University economist.

“He’s been far from perfect,” Senator Sherrod Brown, an Ohio Democrat, said in an interview yesterday. “He was not quick enough responding last year to many of these issues that we care about, particularly in housing. I want him to focus on jobs. But I think he’s generally done a decent job.”

Traders on Intrade, an online futures exchange, give Bernanke a 90 percent chance of Senate confirmation, up from 89 percent yesterday.

The Fed under Bernanke has slashed interest rates almost to zero and pumped more than $1 trillion into the financial system to battle the deepest recession since the 1930s. The Standard & Poor’s 500 Index has jumped 64 percent from its 2009 low on March 9 as the economy showed signs of revival.

Policy makers last month repeated their pledge to keep rates low for an “extended period” to bring down an unemployment rate at a 26-year high. A government report Dec. 4 is likely to show that companies reduced payrolls for a 23rd straight month, according to a Bloomberg survey of economists.

Not much liquidity though on Intrade.

Box Office Tracking (11/30/09)

	MTC	RS
Brothers	$7 Million	Mid Single Digits ($5 Million)
Armored	$6 Million	Mid Single Digits ($5 Million)
Everybody's Fine	$4 Million	High Single Digits ($7.5 Million)
Translymania	Less Than $2 Million	N\A

Box Office and Math

For a while now, I have been getting more and more frustrated with trying to figure out how much a movie will gross on opening weekend. It seems to me, that most people doing predictions are merely making educated guesses. Some are better than others, usually comparing a movie that is coming out with movies that have similar genres and release dates. While this comparison method is better than just guessing, and can give one a general idea of where the movie will end up, surprises at the box office are all too common.

So I thought to myself, that there has to be some other way. A way to take all this information that is available on movies and put it to good use to predict how movies will open. This led me to try and build a mathematical model that incorporates real world variables that I believe are correlated with how much a movie will gross on opening weekend.

Currently, I only have 50 observations which statistically speaking isn't that many. I certainly wouldn't trust a poll with only 50 observations. However, with all the variables put together, I have been able to identify some general patterns and have been able to make some sense out of the limited data that I do have.

Out of the seven variables that I currently have, one of the least useful seems to be the rotten tomatoes score that a movie gets. I think this probably has more to do with the way rotten tomatoes aggregates and scores reviews from critics, then the actual effect that reviews have on OW. Over time with more observations, the rotten tomatoes score might become more significant with regards to opening weekend gross. As of right now though, I am not too hopeful.

I certainly don't expect this model to be perfect, some movies will always remain unpredictable. Next week, I will start using this model to predict movies and I confident that I am going do better than before and be surprised a lot less.

Weekend Box Office Results (November 20-22, 2009)

Looks like Twilight: New Moon completely broke through pretty much everyone's expectations. It did amazingly well at the box office and broke the midnight opening record as well as the opening day record. My initial reaction when seeing the preliminary tracking numbers was that this was really, really, huge. I toned down my expectations because I have had a history of predicting way too big. This predicting stuff is just so hit and miss. The good news is my inaccuracy helped me with Twilight, but hurt me with Blindside. Someone was offering odds that were "too good." I don't feel that bad though, pretty much everyone was off except the mysterious trader who came in late Friday and was able to get some easy money. Cost me most of my profits. I'm going to follow a new rule for myself. No trades on Friday after 3:00PM.

Daily Chuck Results

Twilight New Moon: $104.7 Million - Actual: $142,839,137 - 36.4% Off
Blindside: $16.5 Million - Actual: $34,119,372 - 106.8% Off
Planet 51: $10.5 Million - Actual: $12,286,129 - 14.5% Off

Movies Wagered on Average - 71.6% Off
Total Movie Average - 52.57% Off

Daily Chuck Positions

TWILIGHT.SAGA.+$100.0M - Long - Avg: 60% - Win
TWILIGHT.SAGA.+$105.0M - Long - Avg: 49.8% - Win
TWILIGHT.SAGA.+$110.0M - Long - Avg: 33.3% - Win

BLIND.SIDE.+$18.0M - Short - Avg: 63.3% - Loss
BLIND.SIDE.+$20.0M - Short - Avg: 60% - Loss
BLIND.SIDE.+$22.0M - Short - Avg: 50% - Loss

Here is tracking for next week. I am going to start regularly posting tracking numbers from now on. I have been doing a little bit of statistical anlysis on past tracking numbers. Nothing to serious yet. But MTC is definitely better than RS. MTC can still make big mistakes though and had predicted Blindside at $17 Million. These tracking numbers are ultimately provided by notfabio as always.

MTC (5-Days)

Old Dogs: $33 Million
Ninja Assassin: $18 Million
The Fantastic Mr. Fox: 16 Million

RS (5-Days)

Old Dogs: $40 Million
The Fantastic Mr. Fox: $17 Million
Ninja Assassin: $15 Million

Weekend Box Office Predictions (November 20-22, 2009)

Twilight opened midnight last night and crushed the previous midnight opening by Harry Potter beating it by 18%, grossing $26.27 Million. This weekend is going to be huge for Twilight: New Moon and many estimates have Twilight going over $100 Million. You can count me as one of those who thinks that Twilight will cross the $100 Million mark, even though the movie will be extremely front-loaded.

Daily Chuck Predictions

Twilight New Moon: $104.7 Million
Blindside: $16.5 Million
Planet 51: $10.5 Million

Daily Chuck Positions

TWILIGHT.SAGA.+$100.0M - Long - Avg: 60%
TWILIGHT.SAGA.+$105.0M - Long - Avg: 49.8%
TWILIGHT.SAGA.+$110.0M - Long - Avg: 33.3%

A Fork in the Economic Road

Currently, the United States seems to be doing better economically and recovering from the financial real estate collapse that occurred last year. Even though, GDP is finally going up and the stock market is making a rally, signs from the economy seem to be mixed. Unemployment reached over 10% and gold is rising in price dramatically from fears of future inflation.It's price is currently at $1151.80, after finally breaking through $1000 after hitting it twice and backing away.

What this all means, I really do not know. With all the money that the Federal Reserve has just been putting into the system, inflation seems to be and should be a legitimate worry. Buying gold and other commodities, may not be a bad play. However, there doesn't seem to be any inflation right now or in the very immediate future. Banks aren't lending and that may be because of fears of another real estate crisis. This time in the commercial sector and not the retail sector. The Federal Reserve has already shown some concern and has announced new regulations to help them deal with the situation. Unless the commercial real estate crisis hits us, I think we will make a slow recovery and jobs will recover after a long time of stabilization.

Personally, I think stocks will continue on this rally for a little while with unemployment hitting 11%-12%. How likely this all is, if at all, I really have no idea. I mostly try and just keep my ear to the ground and try to get a "feeling" for how the economy is performing. I'm starting to really believe that GDP is not an accurate measurement of the economy anymore.

Currently, I have two small positions on Intrade regarding the economy.

10 Contracts going long on (DJIA.NOV09.>10500) at a price of 33.8%
10 Contracts going long on (US.UNEMPLOY.DEC09.>10.50%) at a price of 21.0%

As you can see, these are pretty speculative bets, but I like my chances. I think the prices on Intrade may reflect current expectations but don't account for a high amount of variation. I'm hoping this variation comes in my favor.

Twilight: New Moon Crushing Online Sales

Looks like Twilight: New Moon is selling online at a record breaking pace. Early estimates have New Moon breaking $100 Million for the weekend.

From Movietickets,

"NEW MOON" OUTPACING TICKET SALES FOR "TWILIGHT" BY 4-TO-1 AT MOVIETICKETS.COM

"New Moon" sellouts top 1,300, with thousands of tickets still available

(Los Angeles - November 11, 2009) - More than a week prior to its Nov. 20 release, “New Moon” has sold more than four times as many tickets as “Twilight” at MovieTickets.com at the same point in the sales cycle.

MovieTickets.com reports more than 1,300 sold out performances for “Twilight” sequel “New Moon”—including 900 midnight performances—with a large number of tickets still available.

“The fact that ‘New Moon’ is outpacing ‘Twilight’ at a 4-to-1 ratio really speaks to the incredible fan base the film has built in just the past year,’” said Joel Cohen, executive vice president and general manager for MovieTickets.com. “That, combined with the increasing number of consumers buying their movie tickets online, could put this film in a position to be one of our top advance ticket sellers of all-time.”

“New Moon” also accounts for 74 percent of all ticket sales at MovieTickets.com this week.

From Fandango,

New Moon Strikes Down Dark Knight, Harry Potter and Star Wars to Become the #1 Advance Ticket-Seller in Fandango History

(Los Angeles, Nov. 15, 2009) With five more days before its November 20 release date, New Moon has already leaped over previous record-holders to become the top-selling pre-release title in Fandango's ten-year history. The new record for Fandango's fastest-selling film was set on Saturday night, November 14, shortly after 8:00 p.m.

The Top 5 Advance Ticket-Sellers on Fandango (as of November 15, 2009) are now as follows:

1.New Moon (2009)

2.Star Wars: Episode III - Revenge of the Sith (2005)

3.Harry Potter and the Half-Blood Prince (2009)

4.The Dark Knight (2008)

5.Twilight (2008)

The latest chapter of The Twilight Saga is currently wolfing down 86% of weekly ticket sales on Fandango, the nation's leading movie ticketing destination.

Thousands of Thursday night midnight showtimes for New Moon are already sold out across the country, from Albany, Georgia to Yuba City, California. Yet New Moon tickets continue to be available. To meet the fan demand, the nation's top theater owners are regularly posting brand new showtimes on additional screens.

"For many fans, it's clearly the year's most anticipated film event," says Fandango Chief Operating Officer Rick Butler. "Ever since tickets went on sale on August 31, it's been among our top five weekly ticket-sellers, as New Moon has a strong pull on audiences. We're seeing a higher-than-usual number of tickets per transaction for this film, suggesting that moviegoers will show up en masse at theaters this weekend with their friends and family."

Here are some fun facts from a recent Fandango survey of more than 2,000 New Moon ticket-buyers:

•98% say the action in New Moon looks better than the action in Twilight.

•72% plan to see the movie with a group of three friends or more.

•52% of survey respondents say they dream about vampires.

•22% are mothers and daughters planning to see New Moon together.

•10% plan to show up at the theater in costume, dressed as characters from the saga.

Nothing to Trade, Nothing to Blog

There hasn't been much to blog about now since the elections have passed. Box office contracts have basically no liquidity right now and I am not going to bother to do predictions if I can't profit from them. Hopefully, that will change by December. I can't imagine Avatar will suffer from the same lack of liquidity. Currently, I have most of my account in cash right now with a very small amount in some long term positions.

So, I've decided to ask you guys what I should talk about. Feel free to write in the comments what you would like to see from this blog and what Intrade contracts you want me to analyze and assess.

Usually, some contract that seems uninteresting right now will pop up on the radar and will become traded much in a short amount of time. What that contract is, I don't know right now.

The Health-Care Debacle on Intrade

Currently on Intrade, the US.GOVT.HEALTHPLAN.DEC09(Public Option) contract is trading within 0%-10% with the last trade at 4.9%. Many opponents of the democrat's health-care plan would think that this is very good news. However, the truth of the matter is, that the health-care contract on Intrade, has little to do with the health-care bill which recently passed the House that contains the "opt out" public option.

This is because Intrade decided to change the wording of the contract regarding the public option. The result being, that the contracts on Intrade have little to no ability to predict whether or not the public option is passed or not.

Originally, US.GOVT.HEALTHPLAN.DEC09 contract looked like this.

This contract will settle (expire) at 100 ($10.00) if a US federal government run health plan (a public option) is approved in the United States before midnight ET on the date specified in the contract.

The contract will settle (expire) at 0 ($0.00) if a US federal government run health plan (a public option) is not approved in the United States before midnight ET on the date specified in the contract.

A federal government run health plan will be considered approved once legislation establishing the plan has been passed into law. Expiry will be based on the passage of the required legislation into law, as reported by three independent and reliable media sources.

This contract covers only the creation of a government run health insurance plan that is an alternative to private health insurance. It does not cover existing health insurance programs such as Medicare or Medicaid, or any changes made to these programs or the cover they provide.

Due to the nature of this contract please also see Contract Rule 1.7 Unforeseen Circumstances.

The Exchange reserves the right to invoke Contract Rule 1.8 (Time Protection) if deemed appropriate.

Any changes to the result after the contract has expired will not be taken into account - Exchange Rule 1.4

Please contact the exchange by emailing help@intrade.com if you have any questions regarding this contract before you place a trade.

At first, the contract seems pretty clear and simple. If there is a public option, the contract will expire at 100%, if not it will expire at 0%. The problems started when Intrade decided to add some clauses to the contract unbeknownst to anyone who had already acquired a position on the. Below are the clauses that were added to the above contract.

A co-op system of health care provision is not considered a government run health plan and will not result in an expiry of 100 (added 28/07/09).

A system involving a "trigger" would not be considered an absolute establishment of a government run health plan as it may never be used. Therefore the contract will not expire at 100 should this system be introduced (added 04/09/09).

For the purposes of this market any public option must be national for the contract to expire at 100. If it was offered in certain states then not others then the contract would not be expired at 100 (added 08/09/09).

If a system is established that allows states to opt-in or opt-out of a government run health care plan the contract will not be expired at 100. (added 09/10/09).

The first revision about co-ops seems to be a very smart addition. I certainly wouldn't consider a national co-op a public option. It seems to have been added because co-ops were a hot topic at the time and Intrade wanted to cover all basis by making it crystal clear that the contract is specifically about the public option.

The 2nd revision is about the "trigger" which was basically a compromise that stated that the public option would only take effect if the private insurance industry did not meet some type of standard for health-care coverage. I can kind of understand why Intrade decided this would not expire the contracts at a 100%. The public option does not automatically come into effect anywhere and might never happen. The "trigger" might not even qualify as the public option under the original wording of the contract.

The next two revisions are where I and many others have had problems. Intrade decided that only a very specific definition of the public option would lead to the US.GOVT.HEALTHPLAN.DEC09 expiring at 100%. The "opt-out" version of the public option will not qualify and as a result, there has been much confusion and frustration by frequent users of the Intrade prediction market.

User WonkoChan wrote

Can someone please explain why this contract has dropped to 8.1 even though most commentators are now suggesting that a bill with some kind of public option will be passed before the end of this year?

Perhaps Intrade will clarify whether an opt-out public option still qualifies?

User MC_Pundit wrote

That scenario brings me to my principal complaint, which is that the timing and notification process for contract revisions needs to be improved and spelled out. Although Intrade regularly posts "News" about new contracts, they evidently make no attempt whatsoever to inform anyone, including members who own affected contracts, when they change the definition of existing contracts. Thus someone who happens to check the "Contract-Specific Rules" sooner than another member has a huge advantage. Worse yet, someone who requests and receives a clarifying change in the contract knows in advance to keep an eye out for this.

User John Remington wrote

There's really no way to guess how a ruling is going to go. It's basically however Carl Wolfenden feels on the day a question is asked.

Okay, I can understand the ruling on a co-op, because that would not meet the definition in the original contract of a "US federal government run health plan." Same for a trigger, because in all likelihood the trigger would never be used. But an "Opt Out" plan still wouldn't cause an expiration at 100? It's a health plan run by the federal government. There's no requirement in the initial text of the contract that the plan be available to all states. That was made up out of thin air.

Intrade -- remember the Guantanamo closure contract? Remember the -10%.GDP.CUM disaster? And now health care. Every time someone gets an arbitrary ruling against them, it sours them on Intrade. You guys need to fix how contract writing and interpretation works, or you're going to alienate your entire customer base.

Luckily for me, I never got involved with the US.GOVT.HEALTHPLAN.DEC09(Public Option) contract on Intrade, but I feel sorry my fellow users who are getting more and more alienated by the actions and judgments of Intrade's management. The most unfortunate aspect of this whole ordeal is that once Intrade added those clauses to the contract, they can't really take them off without pissing even more people off. Now they are stuck with a contract the gives no useful information to the casual users and political pundits who browse Intrade simply for the predictions it makes.

Florida Senate Primary

With NY-23rd as the Bunker Hill for tea-party conservatives. The hard-core base of the republican party is soon going to go after more moderate candidates. One of them will be current Gov. of Florida Charlie Crist who is running for the Senate. He is currently facing a primary challenge from Marco Rubio. This is a very interesting for many different reasons. Crist is a very strong candidate, has vastly out-raised Rubio and is much more well known around the state. However, Marco Rubio is young, charismatic, latino, and has won straw poll after straw poll. He reminds me very much of Barack Obama and that right now is giving me great pause in dismissing him as a legitimate threat.

Marco Rubio's been getting the best of the news media recently and he desperately needs it. TPMMuckraker: Crist Denies Close Ties, But Accused Fraudster Was A Friend Who Even Sponsored Crist's Birthday Cake.

Florida Gov. Charlie Crist's assertion that accused fraudster attorney Scott Rothstein was nothing more than another campaign supporter is starting to look even thinner.

A Florida source familiar with the situation tells TPMmuckraker that Rothstein often bragged about his closeness to Crist, now a candidate for US Senate. The source says Rothstein once remarked: "It's one thing when you've got the governor on speed dial. It's another thing when the governor has you on speed dial."

"They were friends," the source tells us. "To say anything else is ridiculous."

Crist said Wednesday: "Well, he had supported me like he did to many others. ... And that's about the extent of it."

Charlie Crist(REP.FL.SENATE2010.CRIST) has recently traded at 59% while Marco Rubio (REP.FL.SENATE2010.RUBIO) has traded at 40%.

Remember, Remember, the Fifth of November...

Remember, remember the Fifth of November, The Gunpowder Treason and Plot.
I know of no reason, Why the Gunpowder Treason, Should ever be forgot.

Guy Fawkes, Guy Fawkes, t'was his intent. To blow up the King and Parli'ment.
Three-score barrels of powder below. To prove old England's overthrow;
By God's providence he was catch'd. With a dark lantern and burning match.

Holloa boys, holloa boys, let the bells ring. Holloa boys, holloa boys, God save the King!
And what should we do with him? Burn him!

Election Day Results

I was going to post this earlier but I've been having some technical difficulties with my computer recently. Thank God, it didn't happen yesterday.

It looks like the political elections were very kind to me. My predictions for New Jersey and Virginia came through, but the one for New York 23rd did not. The good thing about that is when Dede Scozzafava announced she had endorsed Owens, I retreated out of my Hoffman position and didn't get back in because I thought Hoffman had become much over-valued. Not getting back in turned out to save me a lot of trouble and when the first results were coming in and showed Owens in the lead. I quickly went long on Owens at better than 2 to 1 and cleaned up.

Special elections are "special" for a reason and everyone should realize how hard it is to forecast them. Turnout is low, candidates are not that well known, polling is difficult and swings can occur quickly. With so many things happening so quickly, traders should have realized that polls still including Scozzafava's name shouldn't have accounted for much.

I'm surprised New Jersey wasn't closer but i'm not going to complain. Seems that Corzine's comeback was merely due to Daggett doing better and when his support fell through, so did Corzine chances of winning.

Overall, I'm happy that I did my research and that nothing surprised me on election day. I was prepared for anything and was able to take advantage when the opportunities show up.

Hoffman Now a Four to One Favorite!

Hoffman is a on a huge wave of momentum and is now trading at 80%, a 4 to 1 favorite to win New York's 23rd District. He has to be feeling good about his chances right now. For more information, see yesterday's post, Intrade and New York's 23rd District's Special Election.

Intrade and New York's 23rd District's Special Election

Personally, I had sold all of my NY23.SPECIAL.OTHER(Hoffman) contracts because I thought that the race was too difficult to accurately assess. At first, I had shorted Hoffman because he was a third party candidate and there were news stories out that he didn't know much about the issues facing New York's 23rd District.

I figured as a third party candidate, he didn't have a chance. But when Sarah Palin endorsed him and he came out ahead in two "polls." I realized that his momentum, some of which was artificially manufactured, made him a viable candidate. I switched positions at a loss but before Scozzafava dropped out. When hearing about her endorsement of Democrat Bill Owens, I decided to get out while I was ahead and come out with a little profit. This was before two more polls came out and showed Hoffman in a huge lead. One by PPP(Public Policy Polling has Hoffman +17 and another by Sienna showing Hoffman +5.

Scozzafava's endorsement of Owens seems very spiteful and only justifies conservatives' beliefs that she was a RINO(Republican In Name Only). She isn't the type of republican that conservatives want. Conservatives are sick of their party not representing them in Washington. For too long, the republican establishment has not been as deficit reducing as their campaign rhetoric would have everyone believe. The last thing they want is another republican who is practically a liberal.

I wish I hadn't gotten out of my position and had kept Hoffman, but I am definitely not willing to pay more than $7 to win less than $3 on a candidate in a special election. I currently give Hoffman a valuation from 60%-65%.

New Jersey Gubernatorial Election, 2009

After waiting and watching the race in New Jersey, I finally decided to take a position late in the race against democrat Corzine when he looked overvalued compared to his position in the polls. The polls keep going back and forth between Corzine and Christie and the latest batch of polls seem to be in Christie's favor. The latest poll by SurveyUSA has Christie +3, Quinnipiac has Christie +2, but Monmouth/Gannett has Corzine +2.

With Christie appearing to have reversed the trend in favor of Corzine, I think New Jersey is a complete coin flip. Most of the polls are within the margin of error and show that this race is simply too unpredictable right now. New Jersey is not known for its clean politics and with so much on the line, certain voting "discrepancies" might come about that could change the outcome of the election. Voter turnout and enthusiasm will also be a significant factor.

I currently have 35 contracts shorting NJ.GOV2009.DEM(Corzine) at 61.7%. If it's going to be a coin flip, I'm going to get the undervalued side of the coin. Personally, I think it will come down to Daggett voters changing their minds and strategically voting for Christie to put him over the top. Whatever happens shouldn't be a surprise though. Polls and pundits are all over the place on this one.

Virginia Gubernatorial Election 2009

This race was over more then a month ago. Deeds went way to negative and tried to make the college thesis written by McDonnell into a bigger negative story then it actually was. They used it to attack him to often and never really offered the voters an alternative choice. Such a negative campaign might have worked against an incumbent with low approval ratings but that is not a good strategy against another when the other candidate is trying to win the seat for the first time.

McDonnell has stayed in the lead from the beginning and avoided making any large mistakes. Whatever he did to manage the thesis crisis worked and republicans will now be able to get back a state which has been turning more and more blue. The republicans will use it as propaganda that the American people are turning against Obama and the democrats. It will be true to some extent. Obama and the democrats are losing some public support but it will not be as much as republicans would have you believe.

I had to wait a while for my prediction for Virginia to come true, but that was the price for getting in on the action when it was still good. I have 34 contracts of VA.GOV2009.REP(McDonnell) at a price of 62.1 going long. I fully expect this to expire at 100%.

Intrade Election Wire (November 2, 2009)

These are the current prices on Intrade representing the probability of the candidate getting elected.

Bid = Best Buy Offer

Ask = Best Sell Offer

Last = Last Offer Agreed to by Buyers and Sellers

New Jersey Gubernatorial Election	Bid	Ask	Last
(D) Corzine	41%	50%	54%
(R) Christie	50%	54.8%	49%
(I) Daggett	1.1%	1.8%	1.1%

Virginia Gubernatorial Election	Bid	Ask	Last
(R) McDonnell	96.6%	98.5%	98%
(D) Deeds	1.5%	3.8%	2%

NY-23rd Congressional Election	Bid	Ask	Last
(D) Owens	35.5%	44.7%	35%
(C) Hoffman	60%	65%	60%
(R) Scozzafava	.5%	4.5%	4.4%

Republican Scozzafava Endorses Democrat Bill Owens!

Here is the statement according to Watertown Daily Times.

I want to thank you for your support and friendship. Over the past 24 hours, I have had encouraging words sent to my family and me. Many of you have asked me whom you should support on Tuesday.

Since announcing the suspension of my campaign, I have thought long and hard about what is best for the people of this District, and how to answer your questions. This is not a decision that I have made lightly.

You know me, and throughout my career, I have been always been an independent voice for the people I represent. I have stood for our honest principles, and a truthful discussion of the issues, even when it cost me personally and politically. Since beginning my campaign, I have told you that this election is not about me; it’s about the people of this District.

It is in this spirit that I am writing to let you know I am supporting Bill Owens for Congress and urge you to do the same.

It’s not in the cards for me to be your representative, but I strongly believe Bill is the only candidate who can build upon John McHugh's lasting legacy in the U.S. Congress. John and I worked together on the expansion of Fort Drum and I know how important that base is to the economy of this region. I am confident that Bill will be able to provide the leadership and continuity of support to Drum Country just as John did during his tenure in Congress.

In Bill Owens, I see a sense of duty and integrity that will guide him beyond political partisanship. He will be an independent voice devoted to doing what is right for New York. Bill understands this district and its people, and when he represents us in Congress he will put our interests first.

Please join me in voting for Bill Owens on Tuesday. To address the tough challenges ahead, we must rise above partisanship and politics and work together. There's too much at stake in this election to do otherwise.

Afghanistan: Now A Complete Mess

Well, now after having forced Hamid Karzai to a run-off he didn't want. The U.S has let Afghanistan fall apart by not making sure that Dr. Abdullah Abdullah competes in the run-off election. I had predicted that Dr. Abdullah would have won a run-off but now he won't even participate, which is a shame for Afghanistan and its "democracy." This bet was always a longshot but I figured that Abdullah might have been able to change the political situation due to Karzai's incompetence and fraud. Which is what I thought the U.S and its allies wanted.

Here is a rundown of the situation by the Christian Science Monitor.

NEW DELHI - The challenger to Afghan President Hamid Karzai announced Sunday that he is withdrawing from the Nov. 7 runoff election, casting deeper doubts about the foundations of support for the next government in Afghanistan as well as the ability of the international community to influence it.

Abdullah Abdullah said he would not participate in the runoff because a "transparent election is not possible." But he did not call for a boycott of the vote.

Before dropping out, Dr. Abdullah lobbied unsuccessfully for a number of changes to the election process aimed at curbing the widespread fraud seen in the first round. He called for the replacement of several of Mr. Karzai's top appointees within the country's election commission and a decrease in polling centers in areas where insecurity prevented oversight. Instead, the commission sacked only lower-level workers and actually increased the number of polling centers....

The prospect of a less legitimate government that's less disposed to reform complicates the ongoing debate over whether to send more troops to Afghanistan on a counterinsurgency mission. Even the chief proponent of the strategic shift, Gen. Stanley McChrystal, admits that more troops won't help if governance doesn't improve.

Afghan supporters of Karzai point out that the president is on record promising that he will crack down on government corruption and the illegal narcotics trade.

"Hopefully he will honor his word," says Khalid Pashtoon, a Member of Parliament from Kandahar. "If not, we will have the same circumstances we had in the last five years."

Mr. Pashtoon, however, expressed more urgent concern not about the next five years, but the next five days. In that time it will become clear how Abdullah's supporters react to his withdrawal.

Intrade Election Wire (November 1, 2009)

These are the current prices on Intrade representing the probability of the candidate getting elected.

New Jersey Gubernatorial Election	Bid	Ask	Last
(D) Corzine	41%	50%	65%
(R) Christie	30.1%	38.7%	38.7%
(I) Daggett	1.1%	2.2%	1.1%

Virginia Gubernatorial Election	Bid	Ask	Last
(R) McDonnell	97.2%	99%	97%
(D) Deeds	.9%	3%	1.5%

NY-23rd Congressional Election	Bid	Ask	Last
(D) Owens	30.1%	34%	30%
(C) Hoffman	66%	69.9%	70%
(R) Scozzafava	.9%	1.9%	.8%

Missed Opportunity by Intrade

It's too bad that Intrade never decided to make a contract about Zelaya returning to power in Honduras. It would have been interesting to follow. If Intrade had made a contract, it probably would have expired today at a 100. The New York Times has an update on the political situation there.

By ELISABETH MALKIN
Published: October 30, 2009

MEXICO CITY — A lingering political crisis in Honduras seemed to be nearing an end on Friday after the de facto government agreed to a deal that would allow Manuel Zelaya, the deposed president, to return to office.

The government of Roberto Micheletti, which had refused to let Mr. Zelaya return, signed an agreement with Mr. Zelaya’s negotiators late Thursday that would pave the way for the Honduran Congress to restore the ousted president and allow him to serve out the remaining three months of his term.

U.S. Secretary of State Hillary Rodham Clinton confirmed on Friday that Mr. Zelaya and Mr. Micheletti had approved what she called “an historic agreement.”

“I cannot think of another example of a country in Latin America that, having suffered a rupture of its democratic and constitutional order, overcame such a crisis through negotiation and dialogue,” Mrs. Clinton said Friday in Islamabad, where she has been meeting with Pakistani officials.

Nate Silver Weighs In on Intrade Price

Nate Silver has decided to weigh in on the race in New Jersey and the split in the polls where some of the polls show Christie in the lead and others show Corzine in the lead.

By Nate Silver

There's a rather strange split in the polls in New Jersey's gubernatorial race: those conducted by live interviewers have Jon Corzine leading by an average of 4.2 points, but those conducted via IVR (automated scripts or "robopolls") have Chris Christie leading by an average of 3.0 points...

An automated poll tends to be associated with lower response rates, since an automated script can't do as much a human to coax someone into an interview, and therefore sometimes tends to reach a more enthusiastic set of respondents (in effect, it may serve some of the same functions as a very tight likely voter screen)...

For that matter, I'm not yet ready to make a forecast for New Jersey; I certainly don't see it as self-evident that Jon Corzine ought to be as much as a 2:1 favorite, which is where Intrade has him now.

Intrade Election Wire (October 29, 2009)

Giving you the latest predictions on Intrade for you.

New Jersey Gubernatorial Election	Bid	Ask	Last
(D) Corzine	65.5%	70%	67.1%
(R) Christie	34%	35%	34%
(I) Daggett	1%	2.9%	2.1%

Virginia Gubernatorial Election	Bid	Ask	Last
(R) McDonnell	96.1%	97.9%	98%
(D) Deeds	2%	4.5%	5%

NY-23rd Congressional Election	Bid	Ask	Last
(D) Owens	50%	52%	50%
(C) Hoffman	46.5%	47.5%	47.5%
(R) Scozzafava	5%	9.9%	5%