Selling Hillary short
Intrade gives Hillary a 10% chance at winning the Democratic nomination. Tim Russert gives her a 0% chance. Is there an opportunity here?
Hillary has two paths to the nomination. One is for Obama to self-destruct, and it has to be something a lot worse than Bittergate or Jeremiah Wright. The other is to persuade the super-delegates to take the nomination away from the first African-American to get within striking distance of the Presidency. The Democrats couldn’t possibly be that stupid. Or could they?
I’m looking for slam dunks with my Intrade account, and I’m not comfortable betting on the absence of stupidity. A few days ago I sold Al Gore short, of all people. Apparently people thought there was a chance that the Democrats would take the nomination away from both Hillary and Obama and hand it to Gore. I don’t think so.
Today I shorted a Hillary contract. Hillary and Gore can’t both get the nomination, so one or the other bet has to win. If Hillary somehow weasels the nomination away from Obama, my gains on the Gore contracts offset the losses on the Hillary contract and I break even. If Gore gets the nomination, I lose money, since I’ll lose more on Gore than I win on Hillary. If Obama wins, I make money on both bets, and more than if I had bet against only one candidate.
We’ll see what happens. As events unfold, and as the numbers change, I may adjust my Hillary/Gore ratio.