Political blogger Mike Smithson (ex-BBC News) thinks that it has been the case lately.
His criteria: Number one, when the Gordon Brown contract price becomes cheaper, other contracts (for the Labor party leadership) don’t get a boost. Number two, the price changes while no political news would affect the contract. Number three, each time its price raises after a normal transaction, there’s a speculative attack that make price falls.
I leave it there. Re-reading Koleman Strumpf latest paper (PDF), I spotted his definition of manipulation:
For the purpose of this study, fundamentals are any information that influences the underlying value of the contract. A speculative attack is defined any trade, uninformed by fundamentals, intended to change prices. A (successful) manipulation is a speculative attack that achieves its objective of changing prices. (A successful manipulation is usually not possible unless the trades influence the beliefs of other market participants. An investor’s beliefs are defined with respect to the fundamentals, as well as the future actions and beliefs of other investors.)
For your information, professor Koleman Strumpf will be a post author on this blog. He’s now with the Kansas University, and told me that he will be very busy in the next months, but will happily contribute after that.
