UNFCCC | Midas Oracle .ORG

Archive for the tag 'UNFCCC'

HOW THE HELL CAN YOU TRUST A PREDICTION EXCHANGE THAT CAN’T SPELL CORRECTLY???

Chris F. Masse December 13th, 2007

6 DAYS LATER, SAME TYPO:

UNFCC 3

[*] There are 3 “C”s actually. Those Irish bozos are not even able to spell it correctly. –> UNFCCC (United Nations Framework Convention on Climate Change). Look at the logo, below.

UPDATE: They have corrected the spelling on Saturday, December 15, 2007.

Previously: The London School of Economics chose InTrade-TradeSports over BetFair-TradeFair for floating event derivatives on global warming. + InTrade’s global warming prediction markets are more socially interesting than BetFair’s ones.

Tags: climate change, global warming, InTrade, UNFCCC, United Nations Framework Convention on Climate Change

The London School of Economics chose InTrade-TradeSports over BetFair-TradeFair for floating event derivatives on global warming.

Chris F. Masse December 9th, 2007

The London School of Economics’ Centre for Economic Performance (CEP), located at the center of London (nearby the Waterloo Bridge), chose not to partner with BetFair-TradeFair, the world’s #1 prediction exchange (betting exchange), located west of London (near the Hammersmith Bridge). Instead, the CEP went with Ireland-based InTrade —North America’s illegal market leader, and the best actor of what I call the “prediction market approach” (as opposed to BetFair’s “betting exchange approach”). This sadly shows, once again, that BetFair-TradeFair is a laggard in the field of prediction markets. (I hope that this will change in the future, since David Jack seems to want to belong to the field.)

Yesterday evening, Saturday, I blogged about InTrade’s global warming prediction markets, just opened. Today, Sunday afternoon, I have just found out, thanks to a tip from Ralf Martin, that the InTrade global warming prediction markets were actually set up in collaboration with the London School of Economics’ Centre for Economic Perfomance.

What will happen to global efforts to limit greenhouse gas emissions when the current commitment period of the Kyoto protocol ends in 2012? There are hopes that the United Nations (UN) climate change conference that started on 3 December in Bali will outline a road map for a successor agreement that might be reached in late 2009.

To know what is going to happen in 2012 and beyond is not only relevant for future generations but for a wide range of investment decisions today:

Should you buy that flat in a riverside building?

Should companies invest in R&D on carbon capture and storage technologies?

Should governments provide more money to wind farm development or rather improve flood defences and relocate people living close to the coast?

Should an energy intensive company relocate its production from an industrialised country to a developing country unlikely to be covered by a pollution target?

To make these choices wisely, we need forecasts on the likely outcome and design of any post-Kyoto agreement. There is no shortage of opinions on what is going to happen. But whom should you trust? Opinions will be influenced by wishful thinking and strategic positioning alike as well as being based on different insights into parts of the puzzle. For example, living in the rich world, you might have a good sense of what the typical voter in your country thinks about pollution targets, but what about Indian voters or the Chinese communist party?

If the UNFCC [*] – the UN body in charge of the climate change negotiations – was a publicly listed company whose profits depended on the climate change reduction targets it achieves, a good way of getting an idea on what’s going to happen is to have a look at its share price rather than public statements of its bosses or shareholders. This is obviously not a possibility. But what is possible now might be even better. [...]

[*] There are 3 “C”s actually. For Christ’s sake, be careful. –> UNFCCC (United Nations Framework Convention on Climate Change). Look at the logo, below.

UPDATE: They have corrected the spelling on their blog.

Tags: climate change, global warming, InTrade, UNFCCC, United Nations Framework Convention on Climate Change

InTrade’s global warming prediction markets are more socially interesting than BetFair’s ones.

Chris F. Masse December 8th, 2007

InTrade has just opened (and not publicized yet on their site feed) a set of global warming prediction markets —more exactly, event derivative markets on whether the world’s biggest national governments will soon agree to reduce CO2 emissions under the UNFCCC treaty. They are, in my view, more interesting than the pitiful BetFair’s prediction markets on global warming (2 out of 3, I mean) for the same two reasons (but which work positively, this time):

Uninformed traders will be able to trade their opinions. Most of the US citizens have an opinion (positive or negative) on the US Congress politics and the federal legislations.
Informed traders (hopefully, the market makers) will be able to follow some advanced indicators (in the Washington D.C. media, for instance) pertaining to this upcoming legislation (if any).

Once again, it shows that John Delaney’s InTrade is the King of the Prediction Markets —and that BetFair-TradeFair is painfully playing catch-up.

Here’s the InTrade contract statement for the US — (USA agrees before end of 2009 to reduce CO2 emissions by 10% or more by year 2025):

A contract will settle (expire) at 100 ($10.00) if the United States agrees before the end of 2009 to reduce CO2 emissions by the amount specified in the contract by the year 2025 (relative to the 1990 emissions baseline).

A contract will settle (expire) at 0 ($0.00) if the United States DOES NOT agree before the end of 2009 to reduce CO2 emissions by the amount specified in the contract by the year 2025 (relative to the 1990 emissions baseline).

Any reduction target must be part of a United Nations Framework Convention on Climate Change (UNFCC) [*] agreement reached before the end of 2009. Any agreement to reduce CO2 emissions made outside of the UNFCC will not be considered for expiry purposes.

A reduction target does not have to be ratified for the contracts to be expired - only agreed to under the UNFCC. [*]

Expiry will be based on official and public announcements from US officials or the UNFCC Secretariat, as reported in three independent and reliable media sources.

Due to the nature of this contract please also see Contract Rule 1.7 Unforeseen Circumstances.

The Exchange reserves the right to invoke Contract Rule 1.8 (Time Protection) if deemed appropriate.

Any changes to the result after the contract has expired will not be taken into account - Exchange Rule 1.4

Please contact the exchange by emailing help@intrade.com if you have any questions regarding this contract before you place a trade.

Important:
Please contact the Exchange if you have any query or uncertainty (including how it may be settled) about this Contract, the Rule above or the Contract Rules before you trade.

There are 4 other contracts (E.U., Russia, Japan, and China+India).

[*] There are 3 “C”s actually. Those Irish bozos are not even able to spell it correctly. –> UNFCCC (United Nations Framework Convention on Climate Change). Look at the logo, below.

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UPDATE: Mike Linksvayer’s comment…

They’d be even more interesting if offered in combination with electoral outcomes and more yet if offered in combination with climate outcomes. I’m happy to see BINLADEN+MUSHARRAF contracts recently added, but volume is almost nil. Intrade (or someone new) will need better technology to be really socially interesting — be a source of many contingent probabilities. Many explicit combination contracts is just unworkable. I’m also happy to see Intrade offering several multi-year contracts, of which the climate ones are a good example. I believe the Google Lunar contract is currently the longest term one, expiring in 2012. I’m rooting for Intrade and for something better to come along, simultaneously.