President Romney? Gamblers Say Don't Bet on It

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Mitt RomneyWith just a few hours before Election Day, America's polling industry has gone into overdrive. A handful of colleges, a slew of media outlets, and a mass of polling companies have made a business out of asking Americans who they plan to vote for, while a crop of celebrity statisticians (who ever thought those two words would go together?) have made a cottage industry out of analyzing the survey results.

While the election cycle has made virtual rock stars out of analysts like Nate Silver and Real Clear Politics, even these most famous mathmagicians and pollsters are missing one key element in their predictions: money. After all, while poll respondents are often happy to give their opinions, they rarely have anything at risk -- and certainly don't seem especially willing to put their money where their mouths are. Thankfully, a few overseas betting sites have taken polling to the next level: they're allowing customers to place wagers on outcome of tomorrow's election.

At Ladbrokes, one of the top British betting sites, a £5 wager on Obama will yield £1 if he wins. In other words, users of the site strongly believe in Obama's chances, to the extent that they aren't willing to offer attractive odds. Romney, on the other hand, offers a much bigger payoff: a £2 wager will pay out £7 if he wins.

Across British sites, these odds are fairly consistent. Betfair has 2/7 odds on Obama (a £7 wager pays £2), and 100/30 odds on Romney, while William Hill is offering 1/5 for Obama and 7/2 for Romney. And Intrade, a Dublin-based prediction market that allows users to buy "shares" in a potential winner, is predicting a 67% chance that Obama will be the next president.

Admittedly, there are a few problems with relying on British bookies to determine the odds in an American election. To begin with, Obama has a much higher profile overseas -- a factor that is sure to skew bettors. Beyond that, Romney's stunning gaffes during the London Olympics are likely to have dimmed his star among the British. Finally, it is possible to manipulate prediction markets -- in the short term -- by placing huge bets on a particular candidate.

In the long run, however, prediction markets tend to be quite accurate at determining the probability of a certain outcome. Because money is involved, bettors are careful about their choices, and are likely to research the possibilities as much as possible. And, while it is possible to skew the odds for a brief period, a robust market with a lot of bettors tends to correct itself fairly quickly.

With only a few hours left until the polls close, we won't have to wait long to find out if Ladbrokes, Intrade and the other betting markets are accurate. And the information may prove really useful -- they're already handicapping the 2016 Presidential election. Hillary Clinton versus Paul Ryan, anyone?

Bruce Watson is a senior features writer for DailyFinance. You can reach him by e-mail at bruce.watson@teamaol.com, or follow him on Twitter at @bruce1971.

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gyvckrs

PLEASE GOOGLE: Mitt Romney ,Tax Avoidance Scams and read, yes read ! ! ! ! So many of you radio talk show robots out there hate Obama so much that you know next to nothing about Mitt Romney.Getting your information from SEAN HANNITY ,the college dropout ny/Jersey "street" kid and Russ Limbaugh ,the college dropout USED CAR SALES MAN is just shameful and academically LAZY on your part.

November 06 2012 at 6:37 PM Report abuse +2 rate up rate down Reply
1 reply to gyvckrs's comment
barikffaarik

Please Google Barry Soetoro, Frank Marshall Davis and Barack Obama. Will the real Barky Obama please stand up

November 06 2012 at 7:10 PM Report abuse -2 rate up rate down Reply
Charlie

Romney would be a sucker bet.

November 06 2012 at 3:31 PM Report abuse -1 rate up rate down Reply
leandercannon

ronmey has his money on obama......

November 06 2012 at 3:06 PM Report abuse rate up rate down Reply
jahlaen

The inability of Mitt Romney to break Pres. Obama's stranglehold lead in Ohio and in most of the "key battleground states" is a sign that the incumbent will win re-election.
In 2004, Pres. G.W. Bush was facing a far more treacherous situation than Pres. Obama i9s facing in 2012; and pulled out a squeaker over Sen.Kerry in Ohio.
So give the wagers in Europe some credit in handicapping this election. The Zogby polling organiztion confirmed that they anticipate a scenario where MItt Romney could win the popular vote, but lose the election in an Electoral College landslide.
The hurricane was a gift to Pres. Obama -- talking about Mother Nature's "October Surprise" -- because sufficient the Independents broke away from Romney towards Obama in these final days leading up to Election Day. Obama campaign gives huge props to Gov. Christie for a great photo opp and a global ringing endorsement!
Obama truly has the: "Luck of the Irish", bestowed upon him from his "Irish progenitors" on his Grandf-parents' side.
History will note that Pres. Obama will perhaps be the luckiest president in U.S. history! In 2008 you had the Bush Admin Economic Collapse; and in 2012 the HUGE favorable employment numbers breaking for him in successive months before the election; plus the gift of Hurricane Sandy to derail Romney's campaign and sink his candidacy!
OH, what a lucky Man he was (is)!!!

November 06 2012 at 11:25 AM Report abuse rate up rate down Reply
1 reply to jahlaen's comment
Linda

I would say HE had much to do with the re-election of President Obama. This is not LUCK this is pre-destiny ordained by Our Father.

November 06 2012 at 12:08 PM Report abuse rate up rate down Reply
pfjw

Looking at all the red-rooted drivel out there - figures may not lie. But liars sure do figure.

Just one question: How is it possible for any sane person who draws (and presumably earns) a paycheck to vote for an individual who has sent more jobs overseas than he has ever created in the US? At the same time, how is it possible for that individual to claim to know about growing (domestic) jobs when his entire working history has revolved around extracting maximum profit from any company he has touched - without any expectation of survival.

November 06 2012 at 11:17 AM Report abuse +1 rate up rate down Reply
2 replies to pfjw's comment
vandation

You DO realize that your Messiahs "Jobs Czar" is Jeffrey Immelt, right ? The top Exec at GE ... the same GE that pays little to no taxes and has sent THOUSANDS of jobs out of this country .... You DO realize that, right ?

Perhaps next time you should swallow the hypocrisy your Messiah feeds you .... cause you got a little dribblin down your chin there Tater.

November 06 2012 at 11:45 AM Report abuse +2 rate up rate down Reply
Linda

Exactly!

November 06 2012 at 12:08 PM Report abuse rate up rate down Reply
carlson321

If obama gets voted back in who can he blame for all the problems now?

November 06 2012 at 11:16 AM Report abuse rate up rate down Reply
1 reply to carlson321's comment
Linda

It would still be the Bush administration because none of you seem to realize just how huge his missteps were; get with it already!

November 06 2012 at 12:09 PM Report abuse rate up rate down Reply
drmaxchartrand

There are going to be some thinned wallets when the announcement is made that we now have a President Mitt Romney, and the dark night of the past four years is coming to an end.

November 06 2012 at 11:09 AM Report abuse -4 rate up rate down Reply
3 replies to drmaxchartrand's comment
Sandy

arena, it "does not matter who is elected"??? Therefore YOU are not permitted to vote. YOU are not permitted to even enter a polling place. People like you should just close their mouths and crawl back inside their caves.

November 06 2012 at 11:02 AM Report abuse rate up rate down Reply
arenadood

Does not matter who is elected, The mess we are in is going to take much longer then four years to clear up. May never be totally fixed. All we can do is hope and bend with the Punches. As a Nation we can come back, just going to take time.

November 06 2012 at 10:51 AM Report abuse +3 rate up rate down Reply
Randy

Can you imagine the economic disaster and mess Romney is going to inherit? Much, much worse than what Obama inherited from Bush! $6TRILLION more in National Debt, 17,000,000 more added to food stamp program, 32% increase in welfare taxes, less people working than the day Obama took office, smoothing out all the scandals and coverups Obama created in Benghazi, Fast and Furious etc.., the higher food, fuel taxes on the middle class, the health insurance mess?? Romney's going to have his work cut out for him! He'll fix all Obama's failures!

November 06 2012 at 10:34 AM Report abuse -1 rate up rate down Reply
2 replies to Randy's comment
hows03

randy, you are stating the reasons why obama is getting re-elected. welfare and food stamps are the new lifestyle that certain parts of the population has chosen for their standard of living. what was welfare 20 years ago is no comparison to what it is today. today its a easy lifestyle. as far as adding to the debt, what does he care, he wont be president in 4 years.

November 06 2012 at 10:50 AM Report abuse +2 rate up rate down Reply
Linda

See, but that is NOT going to happen!

November 06 2012 at 12:11 PM Report abuse rate up rate down Reply