Whom prediction market journalism should be aimed at?

My thoughts on Justin Wolfers’ WSJ output on Rudy Giuliani’s demise:

1. He uses (and links to) the play-money WSJ prediction exchange, instead of InTrade (whose prices are actually at the heart, thru a cross-exchange market maker, of the WSJ prediction sub-exchange). Prediction market journalism should report first and foremost on real-money prices, in my view.
2. I personally favor using the “event derivative” descriptor, as opposed to “stock”.
3. Only one PMJ module is developed —prediction market event study (prices history versus news history).
4. Justin Wolfers’ claim is that “[p]rediction market prices can help” understand better the recent political events —that is, lead to a more pertinent interpretation of the recent political history. To prove this point, one should make a survey of political experts, ask them to read Justin Wolfers’ piece in the WSJ, and ask them whether they spotted superior analysis there. By competing against political analysts with his prediction market tool, Justin Wolfers is up against the Mount Everest. Has Justin Wolfers’ prediction market analysis interested the political news junkies (who are pretty picky people)? Google Analytics and Technorati should be the judges, here.
5. If prediction market journalism could be such a great read for political news junkies, then big blogs like InstaPundit or DailyKos would have already embraced it and generated tons of pageviews with batches of prediction market analysis. That is not the case, which could be a gloomy omen.
6. I see three easier-to-win-over audience segments: the free-market believers (who are locked in anyway, and would suck anything), the helicopter-view people (who are so busy professionally that they don’t have time to dive deep into news reports, but would scan a prediction market chart if put under their very nose), and the event derivative traders (who would be more interested in other PMJ modules).
7. Justin Wolfers may be a secret admirer of JFK, who chose to do things “not only because they are easy, but because they are hard“, …and succeeded.

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ADDENDUM

Dynamic chart from real-money InTrade (not from the play-money, robot-infested WSJ prediction sub-exchange):

Static chart (for reference for our future long-tail readers, who may not see the dynamic chart above, in the future, since it will disappear off the InTrade site, after the 2008 elections):

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NEXT: No blog reaction about Justin Wolfers’ prediction market piece in the WSJ.