Romney Rising

I was reading Scott’s latest post over at World in Motion when I saw his update:

An added tidbit – Ezra Klein of the Washington Posts note that traders have been putting massive Romney bets in intrade to try to manipulate the market and make it appear Romney is rising.   Usually those upswings are short term as real investors recognize the chance for some ‘easy money’ off the manipulators.

I haven’t been over to Intrade for a few days so I thought I’d hit ’em up.

Here’s how Romney is doing since the 2st debate on October 3rd:

Romney has gone from 26 to 45 and rising.

What did Ezra have to say about the manipulation?

Here’s the backstory: On Monday night, after the debate, Barack Obama was leading Romney on Intrade by around 60 percent to 40 percent. But at around 10:00 a.m. on Tuesday morning, Romney had surged to nearly 49 percent. Was this evidence that the conventional wisdom was wrong? Had Romney actually won the debate handily? Or, alternatively, was the nosedive in the stock markets putting a dent in Obama’s re-election chances?

Or maybe it was something else. As economist Justin Wolfers pointed out on Twitter, the huge swing toward Romney appears to have been driven by a brief burst of trading, with someone spending about $17,800 to push Romney’s chances on Intrade up to 48 percent. But the surge only lasted about six minutes before other traders whittled the price back down to what they saw as a more accurate valuation. Romney’s odds of winning are, as of Tuesday morning, back at around 41 percent:

Ezra, at the writing of the article, points out that manipulation had boosted Romney’s numbers.  But even Mr. Klein acknowledges that the manipulation was corrected in 6 minutes.  It leads us to believe that the current value is the result of normal market forces.

But continuing to read the full column today, we see that Ezra has updated his post:

Update: Over at the Atlantic, Carl Wolfenden, the exchange operations manager for Intrade, says, “We checked this out for potential manipulation—it certainly fit the pattern at first glance.” But, he says, that doesn’t seem to be the case this time around. The Romney blip was apparently driven by a number of traders during an early-morning period when the market was very thin, rather than just one person.

Interesting.

5 responses to “Romney Rising

  1. And intrade is back to having Obama with an over 60% chance of victory. Earlier today it was down around 55%. Not sure if it was manipulation efforts of some sort or what, but certainly it hasn’t been that volatile for quite awhile. I tend to check it daily – I’m addicted to polls and data about the election now – the horse race stuff!

    • And intrade is back to having Obama with an over 60% chance of victory. Earlier today it was down around 55%.

      I like Intrade a lot. It seems to be the most clear “where we really are” of all of them. In the others, the polls, I like looking for trends.

      For example, Intrade should react to the debates real time while polls take a few days.

      I tend to check it daily – I’m addicted to polls and data about the election now – the horse race stuff!

      It’s a blast, isn’t it?

  2. Sort of an update on this old story here

    • Sort of an update on this old story here

      So #1, I like the archived mind you have for my site! 😉

      #2 – I saw the post over at your place – fascinating.

      And yes, the logical conclusion is that if things like Intrade matter, people will try and game the system.

      I hate people.

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