As a result, their PageRank is still 5/10 — Midas Oracle is 6/10 (and we don’t have any budget).

As real-money prediction markets become legal in the US, there’s surely going to be a lot of money in writing about them and driving rich readers to them.

Total bullshit.

Carlos Graterol [*] and Ben Shannon both tried to popularize their prediction market blog (featuring InTrade 95% of the time), and they never managed to take off. The fact that InTrade needs websites to drive people to its betting operation does not mean that readers will appreciate prediction market journalism.

Prediction market journalism (which sums up news and probabilities harvested from newspaper sites and from InTrade) does not produce any scoops. You need scoops to draw readers into your blog. No scoops, no readers.

[*] He is a smart and sociable young man with a bright future.

P.S: I am not picking on Joe, who is a good web curator, and a nice chap. Just disagree with him (and Andrew Golberg) that prediction market journalism is easy to do. Good prediction market journalism is very hard to do. Requires scoops and pertinent analysis. Scrapping exchange probabilities and aggregating it with re-written news is not enough.

ADDENDUM

More info on health care reform on Memeorandum.

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

More on Memeorandum.

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

1. Joe should mention whether there is volume on each market.
2. Joe should cite BetFair, not InTrade, for any UK-related event.
3. Joe should be aware of InTrade’s long history of fucking up contracts and settlements on non-sporting events. (Type “North Korea missile InTrade” in Google, and review the various InTrade forums for traces of past fights.)

New Year Update

Posted by Jesse Livermore on Sunday, January 3, 2010

I’ve been gone for a while. There just hasn’t been that much happening on Intrade, and I’ve been focusing on neuroscience.

Intrade has definitely gotten tougher over the past year. I think the 2008 election drew in a lot of people who weren’t very good at politics or gambling. By now those people have either lost their money or gotten better. Hopefully the 2010 elections will draw in a new crop.

In the mean time, Intrade’s management has not done a great job in developing the brand. My impression is that volume is off by more than 50% compared to last year. Chief difficulties:
- Absolutely no advertising whatsoever.
- Diminished interest in politics in an off-year.
- Getting money onto the site requires a lot of determination and a visit to a gas station to buy a Netspend card.

Future updates on this blog will be less-than-daily, basically when I have an opinion about politics that I feel like sharing.

[] I’m not sure how much benefit I get from running this blog. I haven’t really made any money on Intrade since starting the blog this spring. In retrospect, at least part of my motivation for making the Olympics bet was to write about it here, which certainly is a distorting influence on my decision-making. The Slate article I was interviewed for in the summer got spiked. And apparently my readers are a bunch of dicks.

This is sad.

1. Ben Shannon has developed an original form of (subjective) prediction market journalism, and I was interested to see where it would go.
2. If blogging distorts your inner decision making, that’s because you can’t keep your ego in check. Ben Shannon (who is in his twenties) is probably yet too green.
3. It is an error to blog in order to make money. Your business model should be dual: With the left hand, you give away something for free (e.g., your prediction market analysis), and with the right hand, you sell something else (something that has scarcity) to a bunch of customers.

Previously: Could we have divined that Chicago was a lemon?

Let’s take a risky bet. I bet that he is a neuro-scientist from this institution. We will see.

The probabilistic and statistical method won’t be used when one reports about the expiry of one prediction market. People want to know how that prediction market fared. You have to report it in a binary way (right/wrong, correct/false, failure/success). Then, in a second leg, you can report “the historic average of similar markets”.

1. I am a fan of Panos Ipeirotis’s scientific approach on prediction markets. It is all right.
2. However, I (obviously) won’t use the statistical and probabilistic approach when reporting about the expiry of one (or two) prediction market(s) in particular.

Let me explain why.

1. Panos Ipeirotis is a professor whose job is to instruct young people about the scientific approach. Fine.
2. On Midas Oracle, I abide also by the marketing approach. That is, I try to understand how people view things. Sensing how people can understand or mis-understand prediction markets is what I try (hard) to do. Turn out when I talk about prediction markets to people, the first question they ask me is, “How did prediction markets fare with Barack Obama (or George W. Bush)?“.

My observations:

1. People don’t want to be fed with statistical series about multiple historical prediction markets.
2. People want to know whether one prediction market did or did not forecast the outcome of an event —in terms of yes/no, right/wrong, correct/false.
3. People treat a probabilistic prediction just like any binary prediction.

Now, let’s take a look at how Nate Silver did communicate with the public on The Oscars 2009:

1. Nate Silver gave a set of probabilistic predictions.
2. However, when he blogged his failure, he acknowledged it in the binary mode (yes/no, right/wrong, correct/false) —”four hits and two misses“.

That’s how I do it, too. When one prediction market expires, I assess its past prediction as if it were binary (and not probabilistic) —in terms of success/failure. Which makes me an idiot in Panos Ipeirotis’ book. – (I can take it.)

Now, my challenge to Panos Ipeirotis, is this:

1. Do blog the next expired prediction market (on any topic).
2. Do apply your scientific approach.
3. I bet that your blogging will be as boring as a fruit cake, because, by essence, you can’t say anything, scientifically, about one expired prediction market —or if you abide by the statistical and probabilistic approach, then you won’t really report on that expired prediction market.

Don’t get me wrong. Midas Oracle should publish scientific assessments about multiple historical prediction markets. But to report about one expired prediction market, and to have a bit of fun, it is necessary to put (temporarily) science on the back burner.

As an addendum, remember that Emile Servan-Schreiber told Robin Hanson that science is not all.

NEXT: The prediction markets chalk another one up, as Susan Boyle is sent packing.