The CFTC Deadline . . . Wavers

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The Commodity Futures Trading Commission (CFTC)&#8217-s Concept Release on the Appropriate Regulatory Treatment of Event Contracts says, &#8220-Comments must be received by July 7, 2008.&#8221- What deadline does that impose? I played it safe, and assumed that I had to send mine in before midnight, this morning. Today, I learned from Bruce Fekrat, Special Counsel to the Office of the Director of the CFTC, that in fact I had up until this coming midnight to email my comments.

Any lawyer worth his or her salt knows better than to use the ambiguous &#8220-by&#8221- when specifying a deadline. The CFTC should have said, &#8220-Comments must be received before July 8, 2008.&#8221- Thanks to its poor drafting, I rushed my comment out the door, missed the chance to get lots of new signatures, and wasted time swapping emails with various people equally confounded about what the CFTC meant.

Sigh. And to think that some people hope the CFTC will assert jurisdiction over prediction markets and clarify their legality under U.S. law! If the CFTC cannot get even something so routine as specifying a deadline right, I shudder to think what sort of confusion it might impose on prediction markets.

[Crossposted at Agoraphilia and Midas Oracle.]

Previous blog posts by Tom W. Bell:

  • Free Speech in Event Market Claims
  • Let’s Tell the CFTC Where to Go.
  • Let Prediction Markets Fight Terrorism.
  • Protecting Private Prediction Markets
  • Building Exits into CFTC Regulation
  • Insider Trading and Private Prediction Markets
  • Getting from Collective Intelligence to Collective Action

How to make a MILLION POUNDS on the rotting corpse of David Daviss political career (to be used for ethical purposes only)

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1). For the form guide in this two-horse race, please see:

a). THE PRESENT (SHAN OAKES, GREEN):
http://shanoakes.blogspot.com
http://shanoakes.typepad.com
http://www.facebook.com/group.php?gid=33635377720

b).. THE PAST (DAVID DAVIS):
http://www.daviddavisforfreedom.com

2). Mainstream bookmakers such as Paddy Power are not currently putting prices on the Haltemprice and Howden by-election on their website.

Yesterday, however, I emailed [email protected] to ask them what price they would offer for the Green Party to win, and I was given the price of 14-1.
Therefore step one is to email Paddy Power at [email protected] , or call them on
UK – 08000 565 275
Ireland – 1800 238 888
International – +353 1 4040120,

or pop into one of their shops, and ask them to offer you price on Green Party to win.

You can of course also try other mainstream bookmakers.

Paddy Power Politics Website:
http://www.paddypower.com/bet?action=go_disp_cat&amp-disp_cat_id=31

3). If you have been quoted a price, and you wish to (POSSIBLY) make a million pounds (to be used for ethical purposes), divide ?1,000,000 by the price quoted, and lay a bet of that amount. For example, at 14-1, you need to place ?71,428.57. If you do not have such a large amount of money, and are unwilling to risk such a large amount, you can of course bet a smaller amount, depending on the minimum bet rules of the bookmakers you visit. For example, ?10 at 14-1 might make you ?140 back, should Shan Oakes (Green) get elected on 10th July 2008, which looks increasingly likely. Of course, you can maximise your winnings by creating syndicates where you pool your resources with friends, family, and other activists.

4). If you cannot get a price from the mainstream bookmakers, you may be able to put on smaller bets at Betfair. Betfair uses a system whereby you bet against others who bet in the opposite direction, so there are tight limits on how much you can bet based on the liquidity in the opposite direction. Post-credit crunch, liquidity is at a bit of a premium, so you may only be able to put on tiny amounts. However, as an example, ?2 at 40-1 might reap you ?78 (after Betfair have removed their commission) or ?11 at 15-1 might reap back ?154.00.

Betfair&#8217-s matched bets are constantly in flux, so it is worth monitoring it if you wish to use it.

Betfair Politics Zone:
http://politicszone.betfair.com/zone

Betfair Haltemprice and Howden:
http://www.betfair.com/Index.do?mi=21056183&amp-ex=1&amp-rfr=3925suid=3925&amp-bspi=3925

5). Please also use InTrade. I haven&#8217-t worked out how to use this yet.

6). Obviously, it is possible for you to lose your money. If you are not willing to accept that risk, please do not bet. Furthermore, if you believe all gambling to be wrong, or gambling on politics to be wrong, please ignore this advice entirely.

7). If you do bet and Shan Oakes is elected, please consider sending a proportion of your earnings (eg half) to the Green Party. If not, please at least consider sending a proportion to a social or environmental organisation. Please also consider sending me 1% of your earnings at [email protected], as a reward for having come up with the idea. Of course, copyleft ideas cannot be copyrighted, and you are under no obligation whatsoever to send me the 1%, though I would appreciate it enormously.

8). If Shan Oakes is not elected (which looks increasingly unlikely), please do not come after me (at [email protected]) with malice aforethought. Any risks taken are taken on by those betting, and candidates can be unelected as much as elected, just as house prices can (and are) coming down. The housing bubble has burst. So has David Davis&#8217-s so-called &#8216-freedom&#8217- bandwagon, whose wheels didn&#8217-t work after all. Davis supported 28 days without trial and voted for ID cards in 2004, so his &#8216-crusade for liberty&#8217- is, very obviously, naked leadership positioning. Verily the Emperor weareth no clothes. That doesn&#8217-t mean, however, that the voters of H&amp-H are incapable of returning him to rob us off our taxation on his salary, expenses, and second home allowances all over again, and take us into another ill-judged and illegal colonial misadventure such as an invasion of Iran. Hopefully, however, they will see sense and choose not to, and instead reward Shan Oakes&#8217-s positivity by returning her to Westminster with a landslide.

9). To help the flow, please donate as much as you can to the Shan Oakes campaign. You can donate using the online button at http://shanoakes.blogspot.com.

It&#8217-s the ecolonomy, stupid!

ECOLONOMICS INSTITUTE:
http://www.instituteofecolonomics.org/

RAOUL VANEIGEM: CORPSES IN THEIR MOUTHS
http://www.scenewash.org/lobbies/chainthinker/situationist/vaneigem/rel/rel08.html

IAN BROWN: CORPSES IN THEIR MOUTHS:
http://www.youtube.com/watch?v=V4jQf-BeaMA

IAN BROWN: ILLEGAL ATTACKS:
http://www.youtube.com/watch?v=pqfBH1IJkWo

Love from Paddy Hedges
Anti-Hedge Fund Manager (AHFM)

Voodoo analysis of prediction market contracts

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I wonder if the following is a joke:

Events these past few weeks make an airstrike on Iran more likely. The Intrade contract reinforces this view. While the probability remains moderate at 32%, the chart shows a market that is strengthening.

Here is stock-type technical analysis applied to this contract. There is a large &#8220-cup&#8221- going back to the contract&#8217-s inception. The low was 10 in January of this year. Since then, there is an unmistakeable rise. Following standard technical analysis, the drop from 50 to 10 was 40 points. That gives a calculated resistance level at 30. That level was broken this past week on high volume. This confirms the strength. The 40 level presents the next resistance level.

Price for US/Israeli Overt Air Strike against Iran (Rule 1.8 Applies) at intrade.com

The last post mentioning technical analysis at Midas Oracle contains a joke.

Bob Barr markets

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Reason, a libertarian periodical, writes that the Bob Barr effect is &#8220-confirmed.&#8221- Because Obama&#8217-s campaign manager says it is.

Yes, pathetically a pro-market publication heeds the remarks of a political operative rather than markets that say Bob Barr will not make an impact.

Admittedly we have very little signal from prediction markets and lots of noise from political operatives, so writing about the latter makes for easier journalism.

There are now Intrade contracts on Barr&#8217-s share of the popular vote. Perhaps they&#8217-ll provide a little more signal, but I don&#8217-t have high hopes for reasonable trading volume &#8212- or for libertarian politicos embracing markets when the message of market prices might not correspond to their hallucinations.

Who will write to the CFTC?

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CONFIDENTIAL:

&#8220-The Law Professor&#8221-, &#8220-The Brain&#8221-, and &#8220-The Blogger&#8221- are among those who will each send a comment to the CFTC in the coming 2 weeks.

UPDATE: This econ guy will write to the CFTC, too.

UPDATE: Indeed, he did&#8230- brightly.

Why do BetFair Games (regulated in Malta, E.U.) have a timer on games?

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Malta&#8217-s Lotteries and Gaming Authority is a stricter regulator than the UK&#8217-s Gambling Commission on that point. The Malta regulator mandates BetFair Games to display a timer on their games. The timer is visible on screen at all times, and, when the countdown expires, play is interrupted to provide the customer with a reminder of how long they&#8217-ve been playing. (If it didn&#8217-t interrupt play, there wouldn&#8217-t be much point in having the countdown, of course.)

Bob Barr candidacy fails market test.

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Yesterday at about 5:30PM EDT the Libertarian Party (U.S.) nominated ex-Congressperson Bob Barr for U.S. President. Barr’s nomination does not appear to have been certain — it took five rounds of voting, including two rounds where he tied for first and one in which in placed second.

So what do the relevant prediction markets make of this new information? Is Barr a contender, a potential spoiler, or irrelevant?

At Intrade, PRES.FIELD2008 has attracted no trades since May 22, three days before Barr&#8217-s nomination. We didn&#8217-t need a market to tell us a Libertarian Party nominee would not be a contender, nor help the chances of another non-Democrat and non-Republican.

The idea that Barr could be a spoiler is not completely ridiculous on its face (Barr and Wayne Allen Root, his running mate, are both recent ex-Republicans). However, PRES.DEM2008 has attracted no trades since May 24, the day before Barr&#8217-s nomination, while PRES.REP2008 did not trade between 18 hours before the nomination and over 3 hours after.

I think we can conclude that traders believe Barr’s nomination will have no impact on the outcome of the election. And, sadly, that volume on Intrade is pathetic.

IN-PLAY BETTING: BetFair is already compliant with the Gambling Commissions first pointer.

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The UK Gambling Commission is not &#8220-coming after BetFair and Betdaq&#8221-. They&#8217-ll be looking at all operators. Almost all UK-based betting operators (betting exchanges and bookmakers) offer &#8220-in-play&#8221- betting, these days.

The UK Gambling Commission&#8217-s approach (so far) to in-play betting is to insist that bookmakers and betting exchanges tell bettors and traders that &#8220-live&#8221- TV reporting of sports events is actually delayed a bit &#8212-and that some people may be watching the action ahead of them.

Only one betting company in the UK is already compliant with this standard, and displays warnings to its customers: BetFair.

Land-Ocean year-to-date temperatures 0.35 Celsius over baseline

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according to GISS. Assuming the Intrade &#8220-Top 5&#8243- global warming contract expires according to the Land Ocean Index, May – Dec 2008 temperatures will need to average 0.65 Celsius over baseline. The record was set back in 2005, 0.62 Celsius over baseline.

Intrade needs to specify the expiry conditions more precisely.

Still, I&#8217-m remain short the contract:

Cross-posted from Caveat Bettor.

Previous blog posts by Caveat Bettor:

  • Final InTrade v. Zogby Showdown Results
  • Intrade lists Global Warming Contracts!
  • Intrade beats Zogby on Super Tuesday
  • Super Tuesday Showdown: Intrade v. Zogby
  • The Democrat SC Showdown: Intrade v. Zogby
  • Zogby beats Intrade in predicting Nevada caucus winner Clinton.
  • The GOP SC and Dem NV Showdown: Intrade v. Zogby

Conference on Prediction Markets

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I’m in the process of researching Prediction Markets as the main theme of a national conference for the Institute for International Research, the world’s largest conference producing firm. http://www.iirusa.com

I am a producer at IIR and am interested in creating an advisory board made up of a handful of the most knowledgeable and experienced professionals in this industry. I have come across many of the names on this blog through my research and thought this would be the best place to reach to all of you. IIR produces hundreds of conferences ranging from a wide array of topics every year. i.e.: market research, pharma, technologies, financial services, etc. Prediction Market is a topic that we are hoping to tackle this year. I would greatly appreciate any insight and tips experts are willing to offer. I plan to turn this event into an annual gathering that attracts Researchers, Strategists, Project Managers, Venture Capitalists, Entrepreneurs, Researchers, Academics, Policy Makers, and Analysts. I will also be looking to recruit speakers as we move along to the next phase of production. Thank you in advance for your contributions.

Best,
Dawn Olsen

Conference Producer
Marketing &amp- Business Strategy Division, IIR
708 Third Avenue, 4th Floor, NY, NY 10017
646-895-7329 [email protected]