BetFairs Mark Davies (the Prince of betting exchange PR) has just gotten a second omelet in the face.

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First, the Financial Times —-and, now, Freakonomics.

The journalistic rule should be that, if you cite one prediction exchange, you should cite the one that is the most liquid on the market you are writing about. For UK politics, it is clearly BetFair.

BetFair has clearly a PR problem.

Geo-Engineering Planet Earth – The Super Freakonomics Solution To Global Warming

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Narrator: “Every year, more and more ice must be dumped into the ocean to cool the earth, thus solving the problem forever.”-

Little Girl: “-But . . .”-

Narrator: “-Forever!!!”-

- The SuperFreakonomics Global-Warming Fact Quiz

- Read all the comments there.

UPDATE: Climate Progress + AP

UPDATE: Harvard Business Review

Are good blogs driven by author personalities or by well drilled topics?

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Justin Wolfers has escaped the Overcoming Bias purge, it seems. Justin Wolfers’-s 4 posts (published in 2007) remain archived on what is now Robin Hanson’-s QUOTE personal blog UNQUOTE. By contrast, Eliezer Yudkowsky’-s posts written for Overcoming Bias now redirect to locations at Less Wrong.

Justin Wolfers now blogs at Freakonomics (which is under the New York Times umbrella). By comparison to Overcoming His Bias, Freakonomics is a real group blog success. Years later after his creation, Freaknomics has a high degree of participation by his co-bloggers, and some brand-new guest bloggers were recently invited. Freakonomics is a sustainable group blog which develops one unique thematic —-economics. Sorry to burst our Master Of All Universes’-s bubble, but Freakonomics is the case-in-point that debunks the hypothesis that says that “-blogs are best defined not by topic but by lead author personalities”-.

As for Midas Oracle, who cares about Chris Masse’-s personality, as long as one gets his/her prediction market dope on a daily basis?

UPDATE:

Robin Hanson:

Chris, Eliezer was not “purged.” He requested to have his old posts moved to Less Wrong. No one else has made any similar request.

Eliezer was not “expelled”- he choose to move in order to build a community at Less Wrong using fancy comment karma software. The folks who wrote software for his new site also wrote the code at my new site.

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Is InTrade being manipulated? Why does InTrade give a discounted probability for Barack Obama as US president?

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A quick link panorama.

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#1. Is InTrade being manipulated?

- Nate Silver shows that there are abrupt downward pressures on the Barack Obama event derivative, while we also see some abrupt upward pressures on the Hillary Clinton event derivative.

However, you can see by yourself that InTrade is resilient enough and does a great job of going back to normal [*], after just a few hours of trading:

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- At Portfolio, blogger Zubin Jelveh blows the incidents out of proportion.

- Professor Lance Fortnow has a more careful analysis and notes that the price of the Barack Obama bounces back quickly enough.

- Quick thought: Maybe the media should use an average of event derivate prices for the last 5 work days…- so that the abrupt perturbations would be eliminated.

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[*] UPDATE:

Professor Eric Zitzewitz:

I’m not sure you can conclude from Silver’s graphs that the market goes “back to normal.” You can conclude that it moves back in the opposite direction of the impact those large trades. Back when the Hillary for President market looked like it was being manipulated, it appeared that the manipulator was both placing a large purchase and then placing limit orders to provide price support and slow down the reversion of the price.

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UPDATE: Are we witnessing manipulation attempts on the “-Florida to vote Republican”- prediction market at InTrade?

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#2. Why does InTrade give a discounted probability for Barack Obama as US president?

- As you remember, Emile Servan-Schreiber of NewsFutures believes that it’-s a Republican conspiracy all over.

- Professor Justin Wolfers puts up an hypothesis: it’-s legally impossible for US traders to arbitrage on BetFair.

- InTrade put up a crappy excuse: the industry is still too “-young”-. How lame. How stupid. The industry was younger in the previous elections, where arbitrage opportunities didn’-t exist according to professors Justin Wolfers and Eric Zitzewitz (see their 2004 paper and their other publications).

- Blogger Zubin Jelveh swallows the InTrade P.R. line, and adds another crappy InTrade P.R. line: More arbitrage opportunities are being exposed in open air because much more observers are hunting down arbitrage opportunities in 2008 than in previous elections. That’-s a second blatant cretinery, uncorrected by the Portfolio blogger. Re-read Justin Wolfers’- blog post. Professor Justin Wolfers states that:

The current variation in price is larger than I have ever seen in my years of studying prediction markets. The forces of arbitrage that would typically eliminate these differences have been handicapped by the legal restrictions preventing U.S.-based traders from using overseas markets.

- Finally, professor Lance Fortnow says nothing about the arbitrage opportunities between InTrade and BetFair, but does offer some technical points about the issue of polls versus the prediction markets, centered around the question of state correlations. Read on.

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UPDATE: Eric Crampton (a Canadian exiled in New Zealand) says he has managed to turn a buck by arbitraging between InTrade and iPredict New Zealand. He also makes 2 theoretical points. Go read it.

UPDATE: Greg Mankiw just linked to Nate Silver.

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Marginal Revolution vs. Freakonomics vs. Overcoming Bias vs. Midas Oracle

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Here are the stats about the feed subscribers to these blogs who use either Google Reader or iGoogle.

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To interpret these data, you should know that:

  • The web visitors are not counted.
  • The PC-based feed subscribers are not counted.
  • The Web-based feed subscribers who use other feed readers than Google are not counted.
  • In the case of Marginal Revolution, which was one of the defaults proposed by Google Reader until recently, many feed subscribers do not actually read this blog.
  • A vertical blog like Midas Oracle, which deals only with prediction markets, is necessary far less popular than more horizontal blogs, which can publish about everything (including sex, as it has been the case in the past with those 3 economics blogs).

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STEVE LEVITTS FREAKONOMICS HIJACKED BY HACKER – FAMOUS ECONOMICS BLOG TEMPORARILY DEFACED – ANTI-SPORTS BETTING BILE VOICED

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Freakonomics, the famous blog on economics, is powered by WordPress, which is known [*] to have grave security vulnerabilities. Yesterday, a dangerous hacker managed to get access to their blogging software, and published an opinion on the regulation of prediction markets, which represents the total opposite of what Steve Levitt believes in. No doubt the hacker (who signed as “-The Australopithecus“-) will get caught by the Police. No doubt Steve Levitt will get out of his torpor soon and re-establish the truth. We will then give airtime to Steve Levitt’-s arguments, on Midas Oracle. We’-re with you, doctor Levitt.

[*] I know that for a fact. Midas Oracle was hijacked yesterday by a dangerous hacker who signed as “-The Barbecue”-. I’-m not responsible for what he said.

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If I had to guess, I would say about 50 percent of the “name pros” you see on television on a regular basis have a negative net worth. Frightening, I know.

No GravatarPhil Gordon on Poker

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Previous blog posts by Chris F. Masse:

  • No need of enterprise prediction markets to boost intra-corporation communication
  • Inkling Markets is included in the 2008 list of “Cool Vendors” by Gartner.
  • BetFair-TradeFair has won its second Queen’s Award for Enterprise in its eight-year history.
  • Inkling Markets is one of the “Hot Companies To Watch In 2008″, according to Forrester.
  • Plenty of great news coming from Inkling Markets in the coming weeks
  • ??? charity-driven prediction markets OR social issue prediction markets ???
  • That can’t be Nigel Eccles of HubDub.

STRAIGHT FROM THE TRUISM DEPARTMENT: Money buys happiness.

No GravatarThe richer people and countries become, the happier they get.

Wow, that’-s what I call a discovery.

Freakonomics – #2 – #3

New York Times

CNBC video

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Previous blog posts by Chris F. Masse:

  • Just like the armchair generals (presented on television as “military analysts”) carry the Pentagon’s propaganda, are our economics professors (who need the exchange data to pursue their academic career) in fact John Delaney’s unofficial P.R. agents, hidden behind an appearance of objectivity, and whose agenda is to generate favorable news coverage for InTrade? Is the symbiotic relationship between the prediction exchanges and the economics researchers dangerous for the truth?
  • Can we still trust Betfair? Should we trust Betfair? Or indeed, any betting exchange?
  • Prediction Markets at Google — by Peter A. Coles, Karim R. Lakhani, Andrew McAfee
  • Is that HubDub’s Nigel Eccles on the bottom left of that UK WebMission pic?
  • Collective Error = Average Individual Error – Prediction Diversity
  • When gambling meets Wall Street — Proposal for a brand-new kind of finance-based lottery
  • The definitive proof that it’s presently impossible to practice prediction market journalism with BetFair.