What was Max Keiser doing at InTrade HQ two years ago? -> due diligence…!??…

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Max Keiser:

[…] I asked John Delaney and his tech team when I was doing my due diligence on InTrade a couple of years ago in Dublin – about the firm’s own participation in making markets – and the potential to ‘manage’ prices in ways that were outside of the normal price discovery mechanism. I came away from that meeting not convinced at all that adequate checks and balances were in place to protect against manipulation. […]

Details, details.

I am calling all my Deep Throats. Contact me. Tell me more.

Next: Does InTrade participate on its own prediction markets?

Nate Silver: InTrade probability on ObamaCare is quite right.

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Nate Silver:

I&#8217-m not sure if you should particularly care about the little 5 or 10 point hedges (usually to the pessimistic side) that I&#8217-ve periodically been recommending around the Intrade contract on the chances of reform passing. Even if you staffed a whole room full of the smartest vote-counters, modelers and analysts and had them work 24/7 on trying to beat the Intrade contract, I&#8217-m not sure if they could come up with anything sufficiently rigorous to provide them with a real advantage. (That doesn&#8217-t necessarily mean the market is &#8220-efficient&#8221-, but we&#8217-ll save that conversation for another day.) But for what it&#8217-s worth, the Intrade contract, which is trading at 75 percent right now, now looks about right to me or perhaps even a hair pessimistic.

Prediction Market Chart

ADDENDUM

More info on health care reform on Memeorandum, Politico and Slate.

Does InTrade participate on its own prediction markets?

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One (anonymous) InTrade trader:

I am utterly convinced Intrade participates in its own markets. Every few hours some kind of API hits the bids on the GOP 2012 nomination contract when the bids sum to more 100. It will even short bids at 0.1, which is a money losing proposition when you figure the transaction cost alone of 0.3 (since the price is below 5). Also, the amount of margin required to short all of these bids is in the millions of dollars.

So the actor has to a) not care about the transaction fee and b) have limitless margin. Intrade fits the bill for both of these. a) they don&#8217-t care about transaction fees because they are ultimately collecting them and b) if you only short when the bids are summed to over 100, it&#8217-s essentially an arb.

The trader also tells me that, on the InTrade forums where those questions were asked many times, InTrade never denied that they trade on their own prediction markets.

Previously: What was Max Keiser doing at InTrade HQ two years ago? –&gt- “due diligence”…!??…

Next: Does InTrade participate on its 2012 Republication Nomination prediction markets?

OBAMACARE PREDICTION MARKET WAS BRIEFLY MANIPULATED YESTERDAY EVENING SO IT WOULD ARTIFICIALLY CLOSE AT $35. – [CHART]

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IT IS NOW BACK TO ABOVE $60.

See Jason Ruspini&#8217-s comment. UPDATE: Carlos Graterol. Joe Weisenthal. Gawker. Max Keiser.

Prediction Market Chart

ADDENDUM

More info on health care reform on Memeorandum and Politico.

BRITISH CRETINERY: The Financial Times features the InTrade probabilities -not the BetFair ones.

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This is really stupid. The decerebrated journalos at the FT chose to feature the illiquid, Ireland-based, un-regulated InTrade prediction markets instead of the very liquid, UK-based, regulated BetFair prediction markets on the next British congress.

Makes no sense at all.

The BetFair PR boys have an omelet on their face. They should work harder.

DISAMBIGUATION: The &#8220-illiquid&#8221- adjective refers to the UK political markets on InTrade &#8212-not the US political prediction markets.

Why does the CFTC allow the Cantor Exchange and not InTrade?

Joe Weisenthal has a small opinion piece on why the CFTC allows real-money prediction markets on movie business, and bans those on politics or sports. The problem in the piece is that Joe is 100% wrong.

  1. Joe says that there can&#8217-t be hedging in politics. Wrong. You can hedge your political ads on InTrade.
  2. Joe says that there can&#8217-t be hedging in sports. Wrong. Businesses that operate inside a stadium could hedge the risk of the home team losing (which means less business for them).

So. why does the CFTC shy away from hedging on sports and politics? &#8211-&gt- Politics. The CFTC is afraid of the US Congress, who would object to politics and sports &#8220-gambling&#8221-.

The CFTC is a weak institution, in the DC sphere of power. In the recent past, the CFTC lost one important battle against other parts of the US government &#8212-even though it was the CFTC that was on the right side of the issue at the time. With politics and sports betting, the CFTC does not want to lose another battle. It is a question of survival.

Max Keiser weighs in on potential insider trading and hypothetical manipulation in the ObamaCare prediction market at InTrade.

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Max says that the political prediction markets are &#8220-routinely manipulated&#8221- and we often see &#8220-price rigging&#8221-&#8230-

9:57 into:

Previously: What has been the best InTrade prediction market ever? Has the ObamaCare prediction market at InTrade been “ahead of the commentary”?

What has been the best InTrade prediction market ever? Has the ObamaCare prediction market at InTrade been ahead of the commentary?

Jason Ruspini (who feels that the health care reform proposal might well be adopted) wanna feedback from you, folks.

  1. Which InTrade prediction market(s) has/have been ahead of the Press (rather than the other way around)? What is/are the best (most divergent from the commentary, and correct) InTrade prediction market(s) in people&#8217-s memories?
  2. Do you sense that the ObamaCare prediction market at InTrade fits these 2 criteria?

UPDATE: I asked The Brain whether he meant generalist media or political media, and he meant &#8220-generalist&#8221-. That makes all the difference in the world.

Prediction Market Chart

ADDENDUM

More info on health care reform on Memeorandum.

Previously: Insider trading in the InTrade prediction market on health care reform?