Throughout the election cycle, we've seen some fairly blatant manipulation of Intrade. And I can imagine that a few months ago it might have made some sense to assume that there were enough surprises in store to be able to make a few quick bucks speculating on the uncertainties of the news, debates, economic announcements, etc.
But now? What is their excuse now?
As I write this, Obama is trading at $6.37 (63.7% chance). His winning Ohio (all but a certainty given the polls) is only $6.51. He is given only 34% chance of winning Florida which seems reasonable, given the polls, but it's downright insane that he's only given a 79% chance of winning PA. PA!
Even stranger is that there are other futures markets that currently give Obama a 77% chance of winning. This is to say nothing of the 85% chance estimated by Nate Silver or the ~99% chance from Sam Wang.
Don't misunderstand me. I think that whoever's driving Obama's price down (and Romney's up) is insane, but my question to the group is: Why aren't more people taking advantage of this? There is arbitrage opportunity here, plain and simple. And if you're wondering why I don't take advantage of it, the answer is twofold: 1) They are a giant pain about producing documentation to set up an account, and 2) My wife doesn't want me gambling.
But to the rest of the folks who seem to think that bidding Obama down will somehow make him less likely to actually win: What are you thinking?