Wednesday, October 24, 2012

Breaking News - Naked Dollar Electoral Model Shows Exact Tie!

After a comfortable lead all year for Obama, the Naked Dollar Electoral Model (NDEM) now shows the race at an exact tie in the electoral college, 269-269. Also, the Intrade Obama contract has plummeted to 56%. Naked Dollar readers should have made a lot of money if they read previous posts about the gross mispricing between the "big" presidential contracts and the state-by-state contracts. Interestingly, this arbitrage still exists because the state contracts (on which our model is based) say it's a 50/50 race, and yet the Obama contract is still at 56%. Look for further adjustment soon. Still a lot of easy money to be made on Intrade this cycle.

(To understand the NDEM, click here.)

Here's an historical view of Obama's contract. Note that the "price" can be interpreted as the odds of winning.
By the way, New York Times and media darling Nate Silver still has the president at a 68% probability of winning. In Silver's defense, he nailed the last election, but he's really out on a limb this time. In 2008, he looked smart because he thought Obama would do better than did just about anyone else, pretty much where he is today. But does he simply have a liberal bias? It's hard to look at the totality of what's going on and conclude that Obama is a 68% favorite right now. Silver is making a HUGE reputational bet.

Let's check in with the Naked Dollar Pulse Index:

And the cumulative...
A lot of volatility lately, mostly favoring Republicans. It remains true that while Romney gains momentum, the same cannot be said for Republican candidates nationwide, at least since the Democrat convention.

(To understand the Pulse Model, click here.)

1 comment:

  1. A tie? Please do not even think that, it will be paralysis in extremis.