jipkin’s PredictIt Preview – Week of 10/1/2018

What an exhausting week.  Profitable for my readers – I hope – but also just emotionally draining.  Let’s re-charge a bit and have a look forward as the Kavanaugh process plays out for one week (and those midterms draw ever closer).

Kavanaugh

I wrote the following in my preview post for the hearings (where you can still find links to all the markets):

My guess is that she, as a professional academic, is going to be fine speaking.  I doubt she’ll be overly emotional, but who knows.  As for the markets, assuming that she does come across as sincere, I expect them to drift in favor of Kavanaugh NOT being confirmed (and for the committee vote to be delayed, etc).

The reverse is true when Kavanaugh speaks – is he sincere?  Does he get flustered when asked about drinking in his youth?  If he comes off well, the markets will drift back into his favor.  If he doesn’t, then GG.

I didn’t expect that markets would take Kavanaugh to 60-65c before Dr. Blasey began testifying.  But then as I predicted, they flipped against him during her testimony.  And again as I suspected, flipped back in his favor when he spoke.  (But I am not going to even pretend I thought it would be because he would testify like that.)  G. Elliott Morris has a nice graphic summarizing price changes in the Economist, or see his tweet with the image here.

What’s going to happen this week?

Republicans are afraid of more shoes dropping.  I give this a relatively low chance, but you never know.  More likely we get stuff akin to the recollections of his college classmate Lynne Brooks, who states quite definitively that he drank a lot more than he let on.  We might get reporting from what classmates of Kavanaugh really thought the terms Devil’s Triangle and “boofed” meant.  All of these things will directly attack his credibility, but I’m unsure how much they ultimately weigh on the senators deciding his fate.

What those senators do care about are polls – and we will get several.  Now – it’s an open question how far Kav’s numbers would have to move before Collins, Murk, and Manchin decide against him.  Right now, they plan to vote for him assuming that the FBI investigation won’t turn up anything they don’t know (and they can hide behind that fig leaf).  To shift them away requires either a major new shoe to drop, some kind of indisputable ding to his credibility, the FBI investigation to find something that indicates he lied under oath, or a substantial drop in public support.  Otherwise, he’s on the court.

Midterms!

So next week is, like, October already.  Democrats remain the favorite to take the House, and the Republicans the favorites to retain the Senate.  We’ll get into various races and election night strategy and planning later in the month, but for now I’ll just share my spreadsheet with links  to all the markets, their odds, and the odds indicated by other forecasters.  Though it won’t be a huge factor this week, pay attention to what happens if and when a lot of the money being bet on Kavanaugh wins and gets spent around the site.

Tweets

RDT – He doesn’t tweet much when big things are going on and he’s needed to be silent.  He also can’t bear being silent forever.  Unfortunately he’s dug himself into a pretty massive hole to start this week off.  Barring a Category 5 Retweetstorm we’re not making it out of B1, I’m afraid.

PT/WHT – The official communications apparatus of the WhiteHouse has continued churning out content (they were quite diligent with UNGA material) at a reasonable rate.  Yet as we get into October and there are fewer and fewer items on the agenda and the one thing they DO want to tweet about is Kavanaugh (whom they can’t tweet that much about)… I’m basically expecting them to be a little bit lighter and hoping I’m wrong.

VPT – Pence is in a similar spot as WHT and PT this week.  He’s largely in campaign-mode and there’s no agenda to press.  The one thing to watch for is if he returns to retweeting WHT diligently of if that was just a temporary UNGA-related phenomenon.

Polls

As I mentioned above, we’re going to get some to measure Kavanaugh reaction.  I think weekly RCP TA will be the one to play this week, as 538 TA ends a bit before the deluge would begin and 538 Ballot just barely moves these days no matter what.

Requiescat in pace

In memoriam: the “Will a SCOTUS nominee be confirmed in September?” market.  Given a fatal diagnosis two weeks ago, it nonetheless carried on bravely until the end, with a peak of 120k outstanding shares.  The veterans of PredictIt thank you, YES holders, for your collective donation of (at minimum) $20k.  Remember, you can always deposit more to win it back on the midterms!

 

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.

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