The Betting Markets Do Not Like Joe Biden

Let’s start with everything from the beginning of the year until, say, March 29th at 4pm:

Joe Biden is leading in the polls.  (Which polls?  All of them, Mr. Cohen).  He has the highest head-to-head numbers versus Trump in the general (better than Bernie’s!).  Several sources have indicated he’s almost certain to run, announcing in April some time.

The PredictIt markets are keeping him near the lead or in it, and yet it’s sort of reluctant.  No one there likes Joe Biden.  They’re all BernieBros or YangGangers or Buttigeeks or what have you.  (Some of us dabble in Kamala shares but no one talks about it).  He’s the “establishment” candidate, which means he’s the one standing in the way of their preferred candidate from winning.

But there are also substantive reasons to mistrust his poll position.  Can he really sustain a donor base that can compete?  Will his record withstand the scrutiny of the campaign?  And what about all those “off” montages of him being a bit too familiar with women?

And that brings us to 4pm on March 29th, when The Cut published Lucy Flores’ account of a non-consensual Biden sniff-and-smooch encounter she had in 2014:

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The resolution for the chart on the right is hourly; data for the entire 4-pm hour is presented at 4pm.  In reality the reaction took place slowly, not starting in earnest for about half an hour.

Soft Support Means Big Moves

Yikes!  He fell 15c in his odds of running on this one story alone and lost a quarter of his equity in the overall horserace.  What are the lessons here?

  • When the traders in the market are already cautious about a candidacy, a story that plays directly to a major negative narrative surrounding that candidacy is going to do some damage.

 

  • This effect is amplified when the candidate in question has a history of waffling on Presidential runs.

 

  • The timing (shortly before the month of announcement) adds to fears.  “Oh god, what if he realizes this just isn’t worth it to him.”  This creates good conditions for panics (the “will he run” market saw low 50s, at one point).

 

  • There are plenty of other women who have been photographed in similar situations.  Everyone knows reporters have to be working on that story.  These kinds of stories are known for having multiple shoes dropping, and that history also plays into traders’ decision-making.

What happens next?

The month of April will be quite consequential in the DNOM market.  Last week, I wrote about trading strategies for that market.  I would urge you to be particularly cautious over the next few weeks!

If Biden does drop out, reasonably unexpectedly, the whole table gets flipped.  Bernie probably goes to 28c, and might see 30c+ amid the chaos.  Kamala, Buttigieg, Beto, Warren… honestly everyone will get a bite out of the slice of pie that Biden has on his plate right now.  You do not want to be caught holding expensive NO shares in this scenario.

Of course, that scenario is (according to the wisdom of the crowds) not as likely as the one where Biden does announce as expected.  Here, he’ll regain some of his equity (and maybe even re-take the lead?) although I suspect the Flores story will create a lingering fear that will weigh his price down for a few weeks at least.

And what about the Biden contract itself?  Should you play it?  Well, I dunno.  Do you feel lucky, kid?  I’m treating it like a hot potato for the time being, but that doesn’t mean I won’t trade a few shares back and forth either.  Good luck out there, traders!

How to Bet on Who Will Win the Democratic Nomination

If you’ve found your way here, chances are you already are a PredictIt trader or are curious about betting markets and might become one in the future (if so, please use this referral link which may or may not still be working; if it is working it will match up to $20 of your initial deposit and benefit this blog).  And further, you’re probably curious about the smartest way to trade on who will win the Democratic nomination.  So here are a few thoughts to guide your way:

The Market

Click >>here<< for the most popular and heavily-traded market on PredictIt for the next year.

DNOMss.png

You’ll see a list of contracts for who will eventually win the Democratic nomination; not all candidates are listed but at some point PredictIt will get around to adding them all (hopefully).  For each candidate you can either buy YES shares (that they’ll win) or NO shares (that they’ll lose).  You can of course choose not to buy shares either way for certain candidates.  You can buy YES shares for multiple candidates if you’d like.  You can buy NO shares on multiple candidates (more on this below).  You can sell these shares at any point for profit or for loss.  And come July 2020, any position you still hold will either resolve $1 or $0 per share depending on who wins.

Okay, so how can you make money doing this?  A few simple strategies:

1) Just pick who you like and hope they win

This is probably the most common strategy.  You like Bernie Sanders.  You see that it costs $0.21 to buy a share of Bernie.  You throw down $21 for 100 shares and go on about your life.  If he wins, you get $79 in gross profit less $7.90 in fees (10% of your profit) for a net profit of $71.10.  If he doesn’t win, you lose your $21, or maybe you dump them for pennies at some point next year.

You can make this more complicated if you like of course.  Maybe you think it’s for sure either Bernie or Kamala, so you add $15 worth of Kamala (another 100 shares at $0.15 each).  Now you profit if either wins but not as much as if you had just correctly picked the only one to win.  Or maybe you decide it’s definitely not going to be Andrew Yang, so you bet $88 to win what you feel would be a free $12 on him falling short.  Each contract is its own decision to make.

2) Neg-risk

One of the most popular strategies in these big high volume markets is achieving something called “negative risk”.  You can do this in any “linked” market; if a market offers more than one contract where only one can win then that market can be neg-risked.

What is negative risk?  Neg-risk is achieved when you buy NO shares in multiple contracts.  Because at least one set of your NO shares has to resolve NO, PredictIt will credit you with some money back when you purchase the second or more contract’s worth of NOs (conversely; they will debit you for increasing your risk if you sell them back).  For example, let’s say you bought NO at Joe Biden’s peak of 27c, meaning that you spent 73c per share, and let’s say you’re a relative high roller and spent the most money per contract that you can, $850.  Now say you turned around and also bet the max limit (“maxed”) Bernie Sanders when he hit the same 27c peak.  Your risk table would look something like this:

BernieBidenriskchart.png

You have 1164 shares of both, and the value of your shares is just shy of the $850 betting limit.  Yet the most you can lose if either of them takes the nomination?  $566.87.  That’s because while you lose $849.72 if one of them wins, you also win $282.85 from your NO shares on the other contract winning, meaning your total loss is reduced.  Now let’s continue and say that you’d played the market perfectly after starting just after the midterms last year and maxed every contract at its YES peak (getting the cheapest NO to date for all of them).  Your risk table would look like this:

FullDNOMrisktable.png

Whoa.  Yeah.  The worst you could do?  Win $1039.86.  In fact, PredictIt will have already credited you that amount, so for walking into the game with $850 just after the midterms and patiently (and perfectly) entering each contract, you’d be able to withdraw $1k just like that, with nothing decided and your shares still live.  And if John Hickenlooper wins (not listed yet)?  Well then all your NO shares pay – meaning you get an additional $1100 or so.

If you’d like to play around with this to try different combinations of prices and so on, please feel free to copy from this spreadsheet (hopefully the formulas will copy for you).

3) Flipping and playing the swings

The 2020.DNOM market (here I’m using the ticker name for abbreviation) is the highest volume market on PI.  It routinely trades over 3M shares a week, and that volume is likely to pick up.  Further, you might notice just by following the market a bit that prices move up and down as the hive mind decides who’s winning and who’s losing.  Polls, endorsements, announcements, armies of Yang supporters, you name it.  Anything can move the market.

One way to capitalize on this volume is to simply buy shares at one price and sell them for a teensy bit higher.  Then repeat.  And repeat.  And repeat.  Oh and don’t get caught on the wrong side of a price drift!  With enough volume on your end (and with enough time and patience on your hands) you can slowly accumulate a reasonable profit this way.

This is how I play, and despite doing a rather poor job of it I’ve managed to get up to about $440 in profit in this market alone, most of which has come from that same post-midterm period where the absolute perfect neg-risker could have walked away with $1k by now (and we’ll touch on this below, but getting perfect neg-risk ain’t easy).  Here’s what that kind of grinding looks like (again noting that I consider this to be relatively poorly played thus far):

DNOM trade history through midmarch.png
A crummy $440 in profit on about 77k shares sold (meaning at least that many were bought) so far.  But even with this I’ll eventually pass the best neg-risk position.  Hopefully anyway.

4) Miscellaneous play-style thoughts

  • Not every style works for every trader.  Are you hopelessly addicted to PI and spend way too much time on the website?  You might as well flip shares, or get neg-risk and flip shares within neg-risk.  If you’re low time-commitment, then best to just pick a position and stick to it or enter neg-risk and stand pat.

 

  • What’s your bankroll?  Neg-risk can be a perfect way to build a bankroll up.  If you start with $100 you can probably walk away with $110 by the end of a week if you’re patient.  Then you can take that money and reinvest in more shares until you get all the way up to $850 or more (which you can then go spend elsewhere on the site or withdraw).

 

  • If you do neg-risk, don’t be too much of a perfectionist.  There’s probably always going to be a better neg-risk that you can get later, so don’t be afraid to sell off a position that you think might spike so you can rebuy cheaper (and with more shares).  It’s really really hard to get perfect neg-risk.

 

  • You can stay in neg-risk and still own YES shares, depending on how many and at what price, etc.  Getting neg-risk and then buying a “kicker” is a pretty popular way to play, but your YES bracket(s) will probably end up being very cheap contracts that are unlikely to win.  Then again, if the market really swings enough, you never know what kind of an amazing position you could get.

 

  • You can flip more shares on the YES side, but of course it takes longer and makes you a little less nimble if you need to switch.

 

  • The most money is to be made by making solid predictions about who will move and by how much, maxing, and collecting your profit.  For instance, you could have maxed Bernie at 12c and sold him for 25c already if you correctly predicted that he’d run and show strength early on.  I’m shit at making predictions, but you might be good at them!

 

  • The market won’t be static forever.  (Indeed it’s moved quite a bit, even just this year). If you’re a penny-flipper, like I am, you would be wise to monitor your positions closely during the first debates and as the first post-debate polls come out.  Momentum can shift in the summer, and the market I expect will react – it will take more skill to maximize profit on these swings.  And who knows what kind of boomlets the fall will bring.

 

  • The market will be insane by the Iowa caucuses, and on caucus night.  It’s likely PredictIt’s servers will crash then, so don’t get caught holding shares in someone who will be worthless at the end of the night (Klobuchar, perhaps).

 

  • The market will be virtually over by the end of Super Tuesday (probably, anyway).  But in the event that things continue to the convention (and perhaps past the first ballot) this market will become insanely fun.

 

  • These strategies don’t just apply to DNOM.2020 (see also USPREZ, the Iowa market), but that doesn’t mean they’re all applicable everywhere.

 

Disclaimer: I probably have positions or intend to take positions in just about all the markets I discuss herein.  You should always do your own research prior to making any investment decision. You should consider my advice and knowledge I share to be fundamentally biased in its presentation and selection by my own financial incentives.  While I do not knowingly lie I certainly do knowingly omit information that I think gives me an edge.

When Prediction Markets are Overrun – The YangGang Arrives

See anything funny about this chart of candidate prices in DNOM at PredictIt?

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Note that this was created on Sunday prior to Beto’s release of fundraising numbers and Buttigieg’s addition to the market.

Yeah, uh, why is Andrew Yang at 13c?  And if I told you he’d later hit 17c, how the hell did that happen?  What are his actual chances anyway?

Prediction Markets: How do they work?

The Yang pricing is so ridiculous that pretty much everyone is dunking on the market for it.  Nate Silver asks ironically “Not just Yang but now also Buttigieg ahead of Warren, Booker and Klobuchar on PredictIt, which definitely isn’t biased toward candidates that young white dudes who spend a lot of time on the Internet like, why would you ask a thing like that when markets can’t be wrong?”

Are the markets wrong?  If the price is so obviously bad, why isn’t it being corrected by smarter money?  What’s going on here?  The take-home is that basically Nate Silver is right.  But let’s explore a bit why that is.

Prediction markets are supposed to distill the wisdom of the crowd in numerical form.  Hundreds and thousands of traders each wager whether or not an event will happen.  Some will think it will, some will think it won’t.  One person says “I think this has a 25% chance of happening” but because they’re smart, they throw out an offer for 15c shares.  Another person says “No way this happens, but let’s see if I can get some 65c NO shares” and they put up an offer there.  Some more traders come in and, leapfrog those offers by just a bit, hoping someone will bite.  The process repeats until the market reaches equilibrium.  When events transpire that influence the odds of the contract resolving one way or the other, people will trade their shares and new people will enter the market.  Thus the movements in price represent how much the market thinks a given event influenced the odds.

Okay so that’s the theory.  The reality?  People bet on who they want to win, mostly, and then form an emotional attachment to those shares and hold them til the bitter end or glory.  And the online betting markets?  Yep, Nate is right.  Mostly a bunch of extremely online dudes, which means the “crowd” doesn’t represent the full range of relevant human input that it could.  And Andrew Yang…

The Power of Memes

Yang is the meme-candidate (see this subreddit).  And we’re just coming off a meme-candidate winning in 2016.  So why not again?  Same huge field of opponents, right?  He has a dedicated semi-ironic fanbase and that means new money and people willing to throw away a little bit in order to secure the bag.  Additionally, he was added to the market just as he started getting mainstream media traction.  A huge influx of new money all coming on to one candidate?  You’re going to get a bubble.

Is the Betting Limit Distorting his Price?

People like to argue that if there weren’t a max bet of $850, more smart money would be able to come in and quash these bubbles before they get started.  And there is a case to be made for that.  But let’s also not underestimate just how much demand there was for Yang.  And how much money is betting against him too!  The data:

Slide27.PNG

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Yang has attracted HUGE volume.  Overall, as of this writing, 820k shares of Yang have been traded at a price average of around 11c.  In only one week, he went from 0 active shares (that is, shares that are still held by traders) to nearly 480k, the most in the market.    By my estimate, around $50,000 is currently bet on him, and over $400,000 against him.  How much better could the market have performed without a limit?  Sure, there’d be more smart money to bet against (substantially more than $400k?), but don’t forget that there’d also be more stupid money to bet on him at those prices too.  Though I wasn’t a trader back then, people that were can attest that there were plenty of idiotic whales on the Intrade markets.

Eventually, the Bubble Bursts

Yang’s price peaked two days ago at 17c and the air has been slowly deflating from the balloon since (he now trades at 11c).  I don’t think he’ll go much under probably 7 or 8c as hopeful/fearful bettors will wait to see how he does in the first few debates, but I don’t think he’s revisiting 15-17c anytime soon without some sort of polling bump or something.

Then again, I didn’t think he’d make it over 10c and I’m holding 94c NO shares so what do I know?

So What Are Betting Markets Good For?

If transient influxes of biased new money can distort their pricing, if the population of bettors is skewed such that it favors certain candidates over others, what can we even learn from betting markets anyway?  This is the thrust of Silver et al.’s criticism of the markets.

And basically, the critics are right, but only narrowly.  Market pricing doesn’t tell you the actual odds of something happening.  It tells you what the crowd of extremely online dudes thinks the odds are, and that’s about it.  But!  The movements in price, the way bubbles come and go, when volume goes up or down – that stuff is informative.  It tells you what sorts of things the crowd thinks matter.  It tells you how much the crowd thinks those things matter.  And that information, if you study it, can help you make money off the crowd when those things happen again…

2020 DNOM – 6 weeks into 2019 and 6 official (plausible) candidates

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As we begin the sixth week of 2019, where do things stand in the race for the Democratic nominee to be President?  Last we checked, in mid-December, Beto rode high atop the field, but a lot has happened since then!

When considering market pricing of a wide-open event happening in the distant future, it’s probably wise not to get too hung up on the exact numbers it spits out.  (That is, who cares right now whether Kamala really has a 25% chance or a 20% chance).  Betting markets are distillations of conventional wisdom in numerical form – and that means the changes in price can actually tell us something about how that conventional wisdom is shifting as well.

In this post, I discuss the fluctuations of this market and what might happen next.  In general, the story it tells is that Kamala has pulled just a bit away from the rest, with the Three White Dudes in the chase pack and the rest of the field bunched up together within plausible striking distance while Gillibrand has started to fall off the pace a bit.  So let’s review what’s happened to each of the top nine candidates since the beginning of 2019:

Kamala Harris – 21c

Slide1.PNG

I wrote initially of Kamala:

When I think of Kamala, I’m struck by how little organic interest there seems to be in her.  Maybe I don’t follow the right people on twitter – but where is the buzz?  Her tweets kind of suck too?  She’s got a sharp, aggressive wit but seems to keep it restrained.  Her public speaking is okay.  But really she needs a Moment or two.  People need to be inspired by her (the person) such that they talk about her, want to work for her, want to vote for her.

And this I think is the take that’s aged the least well.  Her strong rally numbers (it helps to announce in a major city of course) and relatively large one-day fundraising totals post-announcement vaulted her into front place in the market, a position she hasn’t relinquished since.

To be sure, her value also been aided by perceptions in mid- to late-January that maybe Beto and Biden wouldn’t run after all, and her price more recently has declined as the the white dudes gain back their value ahead of what look like more and more likely runs.

Joe Biden – 17c

Slide2.PNG

Is he gonna do it or what?  If he does announce to run, and soon, I expect his price will clear 22c at least on the initial announcement.  He is, after all, the leader in the polls.  But if he doesn’t?  Well then it will be very very interesting to see which candidates get his value and which don’t.  For now, his price has been steadily increasing in anticipation of an announcement.

Beto O’Rourke – 16c

Slide3.PNG

Gone are the heady days of 24c Beto, but so too are gone the sad and bleak days of 11c Beto.  If you look closely at his graph, you can see his price begin its descent a few days after his cloyingly Medium-documented road trip began (Kamala’s strength in her announcement hurt him as well), and things especially fell off when he said he was considering going into teaching instead of running.  And then you can also see the big spike up after his Oprah interview where it seemed more and more likely that he does jump in after all.  What I wrote last time still holds, although I’d maybe give a bit more credence to the idea that his family might keep him back:

Beto is clickable, likable, electable, _____able.  He knows it (he loves it).  The media want him to run (my god, the clicks).  He wants to stand in front of the crowds again (but maybe he doesn’t say this out loud).  His wife is probably against it (but what do I know).  He will probably run (the betting markets will go insane if he doesn’t).

Bernie Sanders – 15c

Slide4.PNG

Ah, Bernie.  He’s supposed to be running by now, and yet no official announcement.  I’m very curious to see what his price does if and when he does.  While I’m pretty bearish on his overall chances, he does (or did) have quite the legion of loyal followers, the proportion of whom is over-represented among market participants (most traders are young, male, white).  Could he spike to 20c?  Note that he’s already well off his lows of 11c when we had no reporting at all that he might run, so some of the spike might be already built in at this point.

Elizabeth Warren – 10c

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What I wrote about Warren seems pretty true still:

Her path – Put out lots of policy proposals thinking they’ll matter and drop out on March 11.  No, uh, let’s see.  Win NH and knock out Bernie, hoping he endorses her (their politics are close enough).  Carry MA and hold her own in CA/TX on Super Tuesday.  Hope the field is bunched enough that she can grind it out for a plurality at the convention.

She’s obliged by putting out several policy proposals, and, to her credit, drawing reasonably impressive crowds all over Iowa.  She acquits herself well in the town hall format and I still maintain that she’s the smartest candidate in the field.  In the market, she really benefited by being first – her price ballooned when folks saw the response she got in Iowa.  But the air started going out as more and more people jumped in and it became clear she was benefiting, in significant part, from just overall heightened interest on the part of the Democratic electorate (note as well she had a coincident dip in value as Klobuchar’s stock rose on initial reports the Minnesota senator was running).

If she can keep up this level of engagement, I think she could catch the chase pack, but I doubt she threatens the leader of the market until she proves herself with some real votes.

Cory Booker – 8c

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He’s in, he’s hungry, he had a great announcement video.  And yet his price really hasn’t done much aside from the announcement spike.  Of course, still a long way to go.

Amy Klobuchar – 8c

Slide7.PNG

I actually didn’t really expect her to run, but here we are!  She’s going to work her Iowa-centric path hard, but she faces the same sort of price barrier that the rest of the people in the thick of the pack face.  Her announcement spike was quite large though, suggesting that the market is receptive to the possibility of elevating her to the next tier at some point.

Sherrod Brown – 7c

Slide8.PNG

If he runs (a reasonable possibility) I expect an announcement bump and not much else.  He might eat some of Klobuchar’s value but really he’s in the same position as everyone else in this group (the initial rise in his value from 0c comes from when PredictIt added him to the market).

Kirsten Gillibrand – 5c

Slide9.PNG

She just really hasn’t caught on, and has taken on all kinds of water as more and more people have entered the field.  Her best shot (beyond a viral moment or two) is to hope the entire field flattens out and she can catch enough delegates to hang in there through to Super Tuesday.

The Big Unanswered Questions

Are the Three White Dudes gonna run or what?

If one of them decides not to run, who gets their value?

If they all run, do they take value from the rest of the field or from each other, leaving things roughly as is?

If and when PredictIt finally adds Julian Castro to the market, where does he end up?  If Tulsi is added, would she even see 3c?

Good luck out there, traders!

 

PredictIt Weekly Preview – Week of January 14, 2019

Oh god, do we have to bet on Brexit this week?

No seriously, after two great weeks to start off 2019 we’re now suddenly thrust into a situation with three out of the four tweet markets already dead or on life support and nothing else seemingly going on (save us Mike Pence).  The latest OPM shutdown market is now petering out after some rather amazing weather-related gyrations over the weekend (don’t ask if you haven’t been following that one) ending in a classic rules debate with smart people split on both sides.  You can still place a wager there that Trump and Congress sort this thing out by Friday (or that PI chooses to pay out January 14) but it seems fairly well-cooked at this point.

There’s always polling markets?

538 TA | RCP TA

True.  And at least this week we are due for some polls on the shutdown.  As I write this, Quinnipiac is set to release their latest in about an hour.  For the rest of your Monday, you have Scott Rasmussen / HarrisX, YouGov daily, and any other surprises like the Civis Analytics that got posted around 12:30 pm.  So there’s still some life!  RCP TA has fewer polls to look forward to (as usual) but with relatively few polls on the board at least each update will move the average a lot.  I honestly can’t believe I have to bet more heavily than usual in there to make money this week…

So yeah.  Brexit?

MP’s voting for May’s plan?

The vote (or first such vote) on Theresa May’s Brexit plan apparently takes place tomorrow, and we have a market on how many MPs go for it (in what’s apparently expected to be a losing effort).  So a good little one-day research project, if you’re up for it, as there’s still a bit of money to be made here!  So yay learning new things or something?

2020 stuff

2020 DNOM | 2020 USPREZ

You can always churn shares in the 2020 markets of course.  We should be getting the latest installment of the CNN/DMR Iowa poll soon, and I’m watching that to see how much pop Warren gets out of her early visit there (and for being the first big one to declare).

Trump is also down to a recent low in the overall 2020 market, sinking sub-30 for the first time since the market opened.  This I would expect to recover into the mid-30s after the shutdown is resolved and his approval stops taking on water.  Or of course keep falling if the slog of poor news continues.  (And/or if any economic indicators start to actually show real evidence of recession).

PredictIt Weekly Preview – January 7, 2019

Did you miss 2018?  The midterm markets?  That time that Rick Scott didn’t become a Senator on January 3rd?  The surprise December 24th OPM site update?  How about that last-minute Mattis market potential flip?

Well that’s all behind us now… the 2018 markets are settled and we’re one week into a brand new era.  Impeachment.  Democrats in Iowa.  The government is shut down.  And the weekly preview is back!

Will they impeach the motherfucker?

Probably not – I think everything I wrote about this last year still holds true.  Yet!  There’s clearly an appetite there among House Dems and there’s always the risk that Trump does something that gets Republicans to turn on him (or that Mueller finds more than it seems he’s found).  The biggest risk factor for his impeachment might be Mick Mulvaney – the new chief of staff is reportedly taking a more hands-off approach when it comes to managing Trump, and that’s already resulted in letting two of his impulsive decisions go through (Syria withdrawal and shutdown).  In theory, anyway, if given enough leash Trump could run himself off a cliff with Republicans (maybe by firing Jerome Powell?) and make impeachment a political possibility.

Elizabeth Warren isn’t that bad on the stump?

I think I’ve underrated her charisma in my initial take on 2020.  That – or she’s just the only Big Name out there currently doing any campaigning.  Either way, she’s up to the low teens in the market while traders wait to see what happens in the next edition of CNN’s monthly Iowa poll.  (Note also that she’s doing reasonably well in an early NH poll, especially among the more informed).  In the meantime, read Dave Weigel.

Shut.  It.  Down.

What day are we on now?  Who knows.  But the shutdown is starting to get real and Donny is looking for ways out.  For now, his favorite pet idea is to just declare a national emergency and use DOD money to build a portion of the wall (if he doesn’t get a deal with Democrats).  This seems… far-fetched?  But remember the main point of the wall for him is to be able to stand before his base voters and say that he delivered on it, so whatever gets him to the point where he can deliver that rhetoric he will take.  There’s also been some back and forth on “oh they didn’t want concrete so we’re giving them steel” which I believe is an attempt to build support for the Artistically Designed Steel Slats among the base more than anything but who knows.  Meanwhile Pence is getting nowhere with Democrats, as Democrats don’t see any point in providing any funding for the wall.  Anyway, let’s just hope we get a market where we can bet on when the shutdown ends, no?

Tweets and polls

RDT | PT | VPT | WHT | 538 TA | RCP TA

Well Trump, at least, is tweeting healthily.  The other accounts are in some weird pattern as they come back from the holidays and try to find a rhythm again.  Of course, WHT and VPT are agenda-driven and there’s basically no agenda during this shutdown beyond miscellaneous “Wall Good, Democrats Bad” stuff so maybe they’ve kind of thrown their hands up.  And lord knows what Scavino is up to.  Apparently we don’t retweet WHT anymore?  And we’re back to retweeting Donny, but only in sprees?  And then sometimes taking days off?  Be careful out there, folks.

We ought to get a few national polls this week what with the shutdown and all.  Something new, please!  The weeklies and dailies do get a bit boring after a while.

2020: It Begins

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Happy holidays folks!  It’s that time of year where we go home, spend time with the family, and decide if we’re going to run for President.

The skies are darkened by trial balloons, the magazines clogged with profiles, and Instagram saturated with Relatable Kitchen Content.  Voters in Iowa dutifully wait by their telephones to be polled.  Yes, the 2020 cycle is officially upon us.  And so we must Predict:  who will win the Democratic nomination for President?

I’m struck, at this stage, by how many people don’t really like their choices.  People kind of want newness, but also someone good, and probably the candidate should really be a woman (oh, but not that woman I can’t stand her), and maybe the candidate should be good in the Midwest, but oh I don’t know.  There’s no Barack Obama out there, basically.  That said, there are like 40 people thinking of running and one of them has to win, right?

And so let’s take a look at the field.  I won’t make an attempt at categorizing them (read Dave Weigel’s meta-synthesis of groupings others are using).  Instead, I’ll rate them on the two things that I think matter: charisma and identity.  (As opposed to all the bullshit that we tell ourselves matters like political ideology, electability, and so forth.  Don’t kid  yourselves, folks.  You use that stuff to justify the decision your gut already made.)

As ranked by pricing in the PredictIt market, as of December 19, 2018:

Image result for Beto O'Rourke congressional pictureBeto O’Rourke – 21c.

Charisma – very high.

Identity – mixed bag.  Young, new, hot.  But annoyingly also a white male.

His path – win Iowa, take second at least in NH.  Finish respectably in SC/NV and come away with enough delegates from TX/CA/MA on Super Tuesday that he can ride momentum throughout the rest of March to emerge with the clear lead.

My take – Beto is clickable, likable, electable, _____able.  He knows it (he loves it).  The media want him to run (my god, the clicks).  He wants to stand in front of the crowds again (but maybe he doesn’t say this out loud).  His wife is probably against it (but what do I know).  He will probably run (the betting markets will go insane if he doesn’t).

Beto isn’t Obama.  (I mean, seriously, can you imagine Obama ever writing prose this self-indulgent?)  But he can draw a crowd, hell he can fill a stadium, he can raise money.  He probably has policy positions too?  Not that I know what they are (and not that they would matter).  We’ll know if Beto is going to win when we see his first fundraising numbers.  If he’s maintained his support from his Texas run, look out.

Senator Harris official senate portrait.jpgKamala Harris – 17c.

Charisma – moderate.

Identity – strong.  New (enough), diverse background, black, female.

Her path  – Respectable finish in Iowa/NH.  Win SC/NV.  Win CA by a good margin (will be hard!) and emerge as the consensus choice for black voters by the end of Super Tuesday (i.e. get Booker out of there).  Then grind it out and make sure to win enough superdelegates in case she needs them.

My take – When I think of Kamala, I’m struck by how little organic interest there seems to be in her.  Maybe I don’t follow the right people on twitter – but where is the buzz?  Her tweets kind of suck too?  She’s got a sharp, aggressive wit but seems to keep it restrained.  Her public speaking is okay.  But really she needs a Moment or two.  People need to be inspired by her (the person) such that they talk about her, want to work for her, want to vote for her.  We shall see, but I don’t think you can play it safe and expect to win versus a huge field.  Sit down with Brian Schatz and learn how to tweet.  Something!

Official portrait of Vice President Joe Biden.jpgJoe Biden – 17c

Charisma – very high.

Identity – weak/moderate.  Old (really, a bit too old). Very much a white guy but also the kind of white guy that other white guys think will beat Trump easily because he will appeal to those Obama-Trump white guys.  A bit handsy with women in photo-ops in a way that will be a nagging Topic of Discussion and turn-off for many D voters (women are the Democratic base in the end).

His path – Swat that punk Beto kid aside by stepping on his spotlight.  Win two of the first four.  Emerge as the Establishment Consensus heading into and out of Super Tuesday.  Mop up by the end of March.  (By the way, with how front-loaded the calendar is, this won’t happen.  Some will drop out mid-March, but really there could be four or five candidates at that point jostling for delegates and no one will see a point in dropping out until April).

My take – If he were ten years younger, he’d be the Anointed One.  Half the Senators running this year wouldn’t bother.  But he’s not and so here we are.  People like Joe Biden (except for a not-to-be-ignored chunk of mainly female voters that find him creepy, with some justification).  He has the highest name recognition right now, his favorables are consistently good, and his experience will make him stand out on any debate stage.  I actually think he might be the closest thing we have to a front-runner right now, but there’s plenty of time for Things to Happen.

Bernie Sanders.jpgBernie Sanders – 14c

Charisma  – high.

Identity – weak/moderate.  Old (but also that’s kind of part of his brand?).  Already lost!  Very, very white dude.  Retains a hardcore lefty base though.

His path – top three in Iowa, win NH (anything less is an embarrassment) and finish top three in SC/NV.  Don’t get blown out on Super Tuesday.  Hope the other White Dudes have faded and that the black vote gets split.  Scrape by with a plurality of delegates by fighting hard in caucus states vs a big field and win it at the convention.

My take – I mean, he’s run before!  (So has Joey B.)  And he lost!  Brutally!  To Hillary!  He’s charismatic and he maintains (some) of his original lefty base the same way Ron Paul held onto his libertarian base.  But he won’t be the non-Hillary like he was in 2016.  And honestly I wouldn’t be surprised if he chose not to run, actually.  But if he does run, and (as I lay out above) no one separates themselves from the field by the end of March, he is stubborn enough to stick around and try to win some caucuses and fight it out at the convention.  Which would be an amazing outcome as far as betting markets go, anyway.

Amy Klobuchar, official portrait, 113th Congress.jpgAmy Klobuchar – 10c

Charisma – low/moderate.

Identity – strong.  Female, midwestern-moderate-white (to win back WI/MI/PA), nice, new(ish), the anti-Trump.

Her path – Actually run, win IA, top three NH, survive SC/NV, survive super Tuesday, hope to emerge atop the field by mid-March or at least be among the top three going into a split convention and hope the superdelegates pick her.

My take – why not Klobuchar?  That seems to be what people say when they’re reaching for a candidate they might like (but don’t know much about) because the others aren’t really doing much for them.  I like her – who doesn’t?  But my sense is she’ll struggle to raise money, stand out from the crowd, and catch fire.  Maybe I’m wrong, I don’t know.  She certainly stands a chance in a crowded field where anything can happen – and she also certainly might decide not to run at all.

Cory Booker, official portrait, 114th Congress.jpgCory Booker – 8c

Charisma – moderate/high.  He really likes the stage but has a way of extemporizing his way into wide-eyed word salads.

Identity – moderate/strong.  He’s black, but that doesn’t mean he automatically gets the black vote.

His path – hope that he pops.  Hope that he wins SC/NV.  Hope that the field is unsettled by the end of March and that he’s still in the picture.  Win a split convention, or, in some cases, actually win outright if the right combination of candidates quit early (Kamala, Beto, and Biden).

My take – He’s really not Obama, which is the inescapable (and clearly racist) comparison that he’ll have to deal with.  But also kind of true!  He has the potential but his delivery isn’t always there.  He exudes passion but not vision.  And I don’t think he has a national base.  His biggest strength is that he’s really hungry, and unlike the somewhat more cautiously predisposed Kamala/Klobuchar/Warren he will take the risks needed to get himself into the spotlight.  I can see him enjoying the campaign in a way that others won’t.  I’m skeptical that he wins, but I think he will have his moments.

Elizabeth Warren, official portrait, 114th Congress.jpgElizabeth Warren – 8c

Charisma – moderate.

Identity – moderate.  She’s a she, but she’s also not well-liked.

Her path – Put out lots of policy proposals thinking they’ll matter and drop out on March 11.  No, uh, let’s see.  Win NH and knock out Bernie, hoping he endorses her (their politics are close enough).  Carry MA and hold her own in CA/TX on Super Tuesday.  Hope the field is bunched enough that she can grind it out for a plurality at the convention.

My take – People dislike Warren in a way that’s quite reminiscent of the sexist ways they disliked Hillary Clinton.  Men will bring up the sound of Warren’s voice (just like they did Clinton’s).  And she does have an anxious energy at times.  Yet she’s probably the smartest potential candidate out there (though unlike Obama she ain’t a cool academic).  Put Warren’s ideas in Bernie’s mouth and his ideas in hers and people will take whatever comes out of Bernie over whatever comes out of her every time (this is my central theory of politics in a nutshell).

I think Warren runs but I hope she runs like an underdog because she is one.  Fuck the cautious HRC approach, meetings, slogans, debating policy ideas.  Go hard.  Own the intensity and carve out an identity from it.  Eschew the overproduced videos, write your own tweets, embrace your inner narcissist and see where it goes.  Of course, none of this will happen.

 

The Rest

Oh, who knows.  Mike Bloomberg?  Yeah I dunno.  Tom Steyer?  Ugh.  Oprah?  This would be amazing (and she’d vault to the top tier).  The Rock?  No, but lol.

I have an eye on Kirsten Gillibrand, Sherrod Brown, Martin O’Malley, and Julian Castro but really it’s tough to win from nowhere at this point.  Trump at least had national name recognition and brand.  For contenders to emerge from this tier they need to somehow get above 1% in the national polls, get on the debate stage, and make something happen.  Or maybe that’s too 2012 of a path.  Maybe they need to do some crazy shit on Instagram?

 

How to gamble on this mess

Honestly it’s December 2018 why pick a winner and marry that position?  Play the swings and churn shares during the lulls; there’s not even a point to starting on a big neg-risk position now, in my opinion.

January/February/March is decision and announcement time, so expect those markets to find their resolutions (and for candidates’ prices to pop a bit when they’re in the news).  After that, watch the polls and social media.  Is someone catching fire?  Building a loyal, Bernie-bro-like fanbase?  Expect their price to become inflated.  But ultimately it’s gonna take until September before we start getting a clear idea of what’s happening, so settle in folks.