Little to No Evidence of Market Manipulation on Intrade

There have been a couple of articles on the net about market manipulation of the (OBAMACARE.PASS.JUN10) contract on Intrade. This has all started because of a Business Insider article written by Joe Weisenthal linked here. John Delaney provided this quote when talking about the ObamaCare contract which started a flurry of wild speculation.

..it is a reasonably active market but atypically a lot of the trade is coming from the DC area when normally we might see trade coming from all the major urban areas.

Now it is being used by some as evidence for "market manipulation" when little to no evidence exists of such a manipulation. Intrade is a prediction market and those traders that stand to benefit most are those that have the most accurate information. What a surprise then to learn that those who are betting most on legislation in Washington D.C actually reside and live in Washington D.C!

In this video linked by Midas Oracle, Max Keiser rambles on about how prediction markets are constantly manipulated and how Intrade is a "virtual currency market." He seems to have little understanding about how Intrade actually operates. As anyone who trades on Intrade can tell you, it takes real American dollars.

The Obama-Care contract on Intrade has traded pretty normally from what I have seen and the current escalation in price can pretty much be traced back to the day that Obama announced his final push on Health-Care on March 3rd. It has risen slowly, steadily, and gone through multiple support and resistance levels. The current thinking in Washington seems to agree that passage of the Health-Care bill is likely. Not to mention that Nancy Pelosi and most of the Democratic leadership is claiming that they have the votes. From what I can tell the current price seems to come from the current consensus that this bill is likely to pass.