Lease a car before August 26, and if it’s above 96 degrees at Boston Logan Airport on Labor Day, they will make your first 12 lease payments for you (minimum 36 month lease term).

This reminds me a lot of Jordan Furniture’s “free furniture if the Red Sox win the series” promotion, which prompted me to ask if sports betting was now legal if you bundle it with furniture?

A difference with the Jordan’s promotion is that the implied amount of betting here is actually pretty trivial.  First, note that a year’s lease payments are only about 15 percent of the value of the car.  Second, the odds of temperatures that high at Logan are tiny (Logan is surrounded by Boston Harbor, which may help moderate the temperatures).

Weatherbill.com is willing to sell me for $69,000 a contract that pays $1,000,000 per day with a high above 96 at Logan in the 15-day window surrounding Labor Day.  Divide by 15 and you have a market-implied probability of 0.46%.  Weatherbill also tells me that in the last 30 years this contract would’ve paid $33,333 on average, for a historical probability of around 0.22%.  So the actual expected discount implied by this promotion is around 0.033% to 0.069%, compared with 10% for Jordan’s.

One interesting thing about this promotion is how the commercial starts (I’m paraphrasing):  “92 degrees, 90 degrees … it’s been cool lately, but remember those scortching Labor Days …”  They are clearly playing on both the Gambler’s fallacy and its reverse, just at different frequencies.

But my main takeaway is:  could gambling policy in the country be any more screwed up?

P.S.  Some interesting follow up on Jordan’s:  they were sued over the promotion by a man previously convicted of running an illegal lottery, who bought furniture during their 2008 promotion and then sued after the Red Sox did not win that year.  The letter from the Mass AG posted in comment #2 indicated that the AG reviewed the promotion and decided not to take action.  So I guess the answer to my question is that betting is legal if bundled with a product, at least in Massachusettes.

The suits against Jordan’s have (predictably) been struggling.

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Via our chief economist Michael Giberson.

UPDATE: Did the CFTC relax its ECPs requirement for eBOTs?

The world’s largest steel maker.

CORNING
Display Technologies.

Japan’s largest advertising firm.

Voted “most innovative” pharmaceutical company in Fortune‘s 2003 and 2004 rankings.

The US packaged foods giant.

Giant U.S. Pharmaceutical.

Leading provider of objective analysis and effective solutions.

One of the world’s leading providers of outsourcing and IT services.

Europe’s leader in corrugated packaging.

Germany’s global powerhouse in electrical engineering and electronics.

Texas Department of Transportation.

The most complete source for integrated information and technology applications in the global financial services industry.

The No. 1 Internet brand globally.

External Links: RAND – Wikipedia on RAND

The achievements of RAND stem from its development of systems analysis. Important contributions are claimed in space systems and the United States’ space program, in computing and in artificial intelligence. RAND researchers developed many of the principles that were used to build the Internet. Numerous analytical techniques were invented at RAND, including dynamic programming, game theory, the Delphi method, linear programming, systems analysis, and exploratory modeling. RAND also pioneered the development and use of wargaming. Current areas of expertise include: child policy, civil and criminal justice, education, environment and energy, health, international policy, labor markets, national security, infrastructure, energy, environment, corporate governance, economic development, intelligence policy, long-range planning, crisis management and disaster preparation, population and regional studies, science and technology, social welfare, terrorism, arts policy, and transportation. RAND designed and conducted one of the largest and most important studies of health insurance. The RAND Health Insurance Experiment, funded by the then-U.S. Department of Health, Education and Welfare, established an insurance corporation to compare demand for health services with their cost to the patient. According to the 2005 annual report, “about one-half of RAND’s research involves national security issues.”

(((A competitor of NewsFutures has for client a very big non-profit organization.)))

Telephones:
Intrade: 866-303-1929, +353-1-6200-365
TradeSports: 866-303-1927, +353-1-6200-364

Webservers on the same network:
Intrade: 213.200.94.8
TradeSports: 213.200.94.13

Domains registered to the exact same entity, with the same contact details:
Intrade:
http://centralops.net/co/DomainDossier.aspx?dom_whois=1&addr=intrade.com
Trade Exchange Network Ltd
10b Beckett Way
Parkwest Business Park, Clondalkin D22 00000, IE
tech@tradesports.com
tel: 0035316200300 fax: 0035316200301
TradeSports:
http://centralops.net/co/DomainDossier.aspx?dom_whois=1&addr=tradesports.com
Trade Exchange Network Ltd
10b Beckett Way
Parkwest Business Park, Clondalkin D22 00000, IE
tech@tradesports.com
tel: 0035316200300 fax: 0035316200301

Liveperson.com online help the exact same account:
Intrade:
http://server.iad.liveperson.net/hc/49507804/?cmd=file&file=visitorWantsToChat&site=49507804
TradeSports:
http://server.iad.liveperson.net/hc/49507804/?cmd=file&file=visitorWantsToChat&site=49507804

Some questions for John Delaney:

- What was the reason for the split?
- Are Intrade and TradeSports both still owned by Trade Exchange Network Limited? If not, who owns each entity?
- Why is it possible to move funds from TradeSports to Intrade but not vice versa?

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- Are each of the following now executives of Intrade, TradeSports or both?

John Delaney, Chief Executive Officer
Seamus Rohan, Chief Financial Officer
Ed Lenox, Chief Technology Officer
Sinead Kelliher, Exchange Manager – Compliance
Brian Keating, Exchange Manager – Markets
Dan Laffan
Matt Bonner, CMO
Carl Wolfenden, Acting Exchange Manager

- What is the status of the Exempt Board of Trade announced by Mike Knesevich on 13 December, 2005?

“Financial institutions, insurance companies & hedge funds have asked us to help them manage risks by listing contracts not found among current exchanges. Weather, credit risk and macro economic events, to name a few, present risks to portfolios that can not be managed with the current exchange products – we intend to change that by offering unique contracts on these events”, says John Delaney, CEO.

- What is the status of the independent contract arbitration scheme announced by Matt Bonner on 11 August, 2006?

This is why we’re expanding the confirmation sources for similar current events contracts, and why we’re creating an arbitration body to give members a mechanism for the independent review of contract disputes.

The debate has been passionate on both sides, with some asserting that TradeSports is cheating its members by ignoring the obvious, and failing to acknowledge that a small operating problem has mushroomed into a major public relations crisis; the other side asserts that TradeSports is managing a dicey situation as well as one can, and shouldn’t back down to avoid precedent. From what I’ve read and heard, I’m sure there’s merit on both sides. But most of those arguing passionately miss the big issue entirely.
…
That said, however, those of us who run prediction markets (and insurance companies, and futures, options, stock and bond exchanges, etc.) have to do the right thing so that customers don’t feel cheated. This is particularly so if a contract is poorly worded or circumstances that were never imagined completely distort an outcome. This is a judgment call only those in charge can make, it will surely cost money, and thus isn’t easy to swallow. But it is essential to ensure that markets can be trusted. Therefore, at this stage of prediction market evolution, goodwill toward those early adopter market participants is the wiser course, to be sure.

More recently, Numeria CEO Peter Leitner wrote:

Prediction markets are not a panacea, however, at least not yet. They are still evolving and can, like other markets, potentially overshoot on the extreme ends of optimism and pessimism. And one segment of the prediction market space – online gaming, or gambling if you prefer – is demonstrating both the lucre and ire such markets can create.

My Previous Blog Post: I respectfully disagreed on his second piece.