Buy Obama!

I noticed today that Electoral-Vote.com‘s composite of national polling is giving Obama a 338 to 185 lead in electoral votes.  The interesting thing about this is that Intrade‘s state-by-state prediction markets have been giving him roughly the same margin for several days, maybe a week — i.e. the prediction markets have been leading the polls.  Right now I think the only difference between EV’s electoral map and Intrade’s is North Carolina: EV calls NC a tie while Intrade gives the state to McCain.  It will be interesting to see if the polling in NC turns back toward McCain in the next week or so.

Looking at Intrade’s market for the overall outcome of the race, it’s worth noting the technical indicators (as I did in the primary).  Obama’s MACD is strongly positive, indicating upward momentum.

Intrade chart for Obama prediction market

Intrade chart for Obama prediction market

The MACD also shows Obama’s momentum went negative just after the Republican convention, and then reversed again around September 20, just as the shit was hitting the fan on Wall St.

One thing I wonder about the state-by-state prediction markets is how much liquidity they can have?  I mean, how many people are trading in these markets?  Are is there really enough volume in the West Virginia, Indiana, or Missouri markets to get accurate predictions?  Those states polls are all within the statistical margin of error (I think).  Florida and Ohio are also pretty close, but I guess those are more liquid, because they’re known battleground states.

Anyway, it will be fun to track this as the election gets closer.

My favorite Obama quote

The thing I think people should feel confident in is that I’m going to make these judgments not based on some fierce ideological pre-disposition but based on what makes sense. I’m a big believer in evidence. I’m a big believer in fact. You know, if somebody shows me we can do something better through a market mechanism, I’m happy to do it.

–Barack Obama in a Wall St. Journal Interview [Seen in The Stump]

It’s been a long time since I heard any politician talking about making decisions based on data and evidence.  Amazon.com’s reputation for data-driven decision making is one of the things that attracted me to them.

Following the election in the prediction markets

One of the most interesting aspects of this election has been the advent of prediction markets such as Intrade and the Iowa Electronic Market as a means of measuring the current trends and positions of the candidates. These markets have been accurate in predicting a lot of events.It’s worth noting that prices in these markets represent the market’s estimate of the probability of a particular outcome. So if the market is giving, say, a 55% chance of Obama winning a particular election, and then Clinton wins, it’s difficult to say that the market was “wrong.” Evaluating the accuracy of these markets is a subtle endevor, but not impossible. Read the rest of this entry »

Obama vs Clinton and the Service Economy

I had to laugh at yesterday’s email of the day, at The Stump (the New Republic’s election blog). It describes one Clinton’s supporter’s experience trying find her local poling place by calling the Clinton and Obama campaign HQs, respectively. When she called Clinton HQ,

A very nice elderly lady answered the phone and I asked her if she could tell me where to vote. She took my address down and then kept me on the line for 10 minutes while she struggled to use a computer to find out where I was supposed to go. She then went to the DC board of elections site and finally, after taking my name and birth date, was able to tell me where my polling site is.

Then she called Obama HQ:

I dialed the 800 number and pushed the option to find out where to vote. A chirpy 20-something answered the phone and within 20 seconds told me where to go.

This experience reminds me of nothing so much as my own experiences with customer service in Pittsburgh (Clinton) compared after moving from Austin (Obama). The most familiar aspect of the contrast is not difference in age or computer skills so much as the general level of unpreparedness for what should be an obvious and expected question. Somehow people in service jobs around here seem to expect everyone to know everything already.

So should I predict from this that Clinton will win Pittsburgh’s pledged delegates?

Lawrence Lessig: “Why I am 4Barack”

Lawrence Lessig, Stanford Law prof and geek hero for his positions on cyberlaw and copyright has a video out:

20 minutes or so on why I am 4Barack Lessig Blog

It has nothing to do with cyberlaw or copyright.  You should watch it.

More Backwards Economic Thinking in Allegheny County

So after a 9-day conference odyssey to both coasts, I returned to a near-empty Pittsburgh airport, and the news that the county plans to raise gate fees in response to US Airways service cuts. Is it just me, or is there an epidemic of backward thinking around here? First, officials spend a ridiculous amount of effort and/or capital trying to woo non-locally owned retail (e.g. Forbes/Fifth corridor), and a non-locally owned casino, and building facilities for sports teams, all of which are at best revenue-neutral for the region, and at worst revenue negative. The casino, when it eventually opens, will certainly take more wealth out of the region than it brings in, as do any profit-making, non-locally owned retail businesses.

Now we have the airport, a county-owned business that’s having trouble selling its services. How does it respond? By raising prices! Under what market rationale does it that make sense? I recognize that they have a budget shortfall, but their goal should be getting airlines to increase operations at the airport, and that’s obviously not going to happen if they increase their rates. What would a privately owned business do? They would: (a) lower prices, (b) cut costs, and (c) take more debt (or, if they’re lucky, investment) to maintain a positive cash position. Meanwhile, they would light a fire under their top salespeople to try and sell more product, with the hope of landing a big contract.  They have a great product — PIT is a very well designed hub airport — it should be an easy sale at the right price.

Some will argue that the airport is desperate and its options are limited, but I have to wonder what PIT officials see for the future?  Do they really think there’s any prayer of replacing US Airways’ business with higher fees?  Do they envision any likely future scenario in which fees would come back down again?  To me the future looks pretty bleak for Pittsburgh air travelers: higher ticket prices, reduced service, and few direct flights to anywhere.

Screw USAirways, PIT should woo JetBlue

Over lunch I was reading the latest in the saga of USAirways slow pullout from Pittsburgh International Airport. Apparently, the CEO of USAirways wrote letters to Senators Spector and Casey after Spector made some harsh comments about USAirways on a recent visit here.

Yawn. USAirways is obviously leaving. It’s time to move on.

The article includes some speculation about Southwest Airlines adding some flights here, but so far it’s just that: speculation. Every time I hear about Southwest in Pittsburgh, I think, what about JetBlue? JetBlue’s hub is at New York’s hopelessly overcommitted JFK International. Their terminal is cramped and overcrowded, and JFK can’t handle all the air traffic it gets, causing JetBlue’s evening departures to get bumped down down the queue in favor of big international departures. It’s a mess. I flew in and out of JFK on JetBlue on a summer trip to Europe (connecting to Olympic Air), and I never want to do it again. Both flights were delayed by hours. It’s too bad, because there’s so much to love about JetBlue as an airline: nice, clean comfortable new planes, great in-flight entertainment, free WiFi in their terminal, and a generally “with it” mentality.

PIT’s midfield terminal was designed to be a hub, and is far nicer than JetBlue’s terminal at JFK. For flyers not originating or terminating in New York, who cares where the hub is, as long as it gives easy access to the same general region? JetBlue could improve their service immensely by routing a portion of their flights through Pittsburgh with its relatively uncrowded runways.

The big question is whether local government has the backbone to offer a truly competitive incentive package. My guess is, probably not, but I can dream.