Betting windows are open on Palin withdrawal
Place your bets, ladies and gentlemen. The Sarah Palin commodiy market is open.
NEW YORK (Fortune) -- Now the Democrats aren't the only ones who can try to capitalize on the negative buzz growing around Alaska Gov. Sarah Palin, the prospective Republican VP candidate.
Intrade, an online prediction market based in Dublin, created a contract Tuesday morning on the likelihood that John McCain will drop Palin
While the odds have been rising, they still are pretty low.
After opening at a probability of just 3%, the odds on Palin being cut from the ticket climbed to 18% around 9 a.m. and have since settled at around 12%.
Intrade says traders requested the contract as controversial news continued to surface about Palin. It cited Palin's daughter's situation and Palin's involvcment with a group that raised corporate funds for Sen. Ted Stevens (R-Alaska).
Placing a Palin withdrawal at even 12% seems bullish; no presidential candidate has withdrawn his VP selection since Thomas Eagleton left Democratic candidate George McGovern's ticket in 1972.
Intrade has demonstrated some success in predicting political choices (forecasting the selection of Biden), but also volatility: Palin's chances of landing the nomination vacillated wildly in the hours before McCain announced the pick in the late afternoon.
However, she still fares excellently in another area, where traders have her at 97% in the GOP VP nomination market. The head of the trading firm speculates many traders are playing both markets.
Intrade monitors its traders' demographics, but it's too early to tell who's betting on a Palin pullout. Some of the naysayers could be Republicans: Rigetti says that, unlike polls, the election markets don't always represent political beliefs. "People have a real money incentive," he says. "They're betting with their head and not their heart."
At close of business on Tuesday:
Palin will be withdrawn 14.2 (+11.2)
Obama will win presidency 61.3 (+1.2)
McCain will win presidency 38.5 (-1.3)
Hurricane Hanna to make first Landfall as Category 2 or Higher in South Carolina 15.0 (-15.0)