Sunday, May 27, 2007

Just the Numbers: Week 21

THE NUMBERS

Romney moved up sharply in the week, mostly at the expense of McCain.

Fred Thompson continues to run a solid non-campaign campaign.

Next PresidentPr (%)Chg Wk.bid-ask
CLINTON(H)38.2-0.61%
OBAMA170.33%
GIULIANI11-1.127%
ROMNEY938%
GORE7.4-0.75%
McCAIN7.4-4.755%
THOMPSON(F)7.2-0.811%
2007 Week 21: McCain and Romney trade barbs; Hillary gives first major policy speech (on health care); Supplemental GWOT bill pulls Dems to left on Iraq; Bush warns of al-qaeda at commencement address.
GOP NomineePr (%)Chg Wk.bid-ask
GIULIANI27.3-0.90%
MCCAIN18-8.18%
ROMNEY234.21%
THOMPSON(F)21.95.64%
GINGRICH2.9-1.17%
HAGEL1.2-1.1n.m.
HUCKABEE2.2-0.15%
DEM NomineePr (%)Chg Wk.bid-ask
CLINTON51.1-0.10%
OBAMA28.50.26%
GORE9.70.13%
EDWARDS7.3-0.11%
RICHRDSN2.90.73%
BIDEN0.50n.m.
CLARK0.50n.m.
SenatePr (%)Chg Wk.bid-ask
DEM80-16%
GOP15053%
Next ExecutivePr (%)Chg Wk.bid-ask
DEM55.8-0.22%
GOP41.7-0.80%
OTH2.60.34%
DEM VP NomineePr (%)Chg Wk.bid-ask
OBAMA27127%
RICHARDSON16.20.1104%
GORE10.13.148%
EDWARDS9.3061%
BAYH83.888%
CLARK7.60229%
NUNN5.2092%

src: intrade.com; bid-ask are not points, but spread as a percentage of the bid. Polls comparison, via ealClearPolitics.
IMPORTANT DISCLAIMER: this is just an informational note and not a solicitation or recommendation to buy or sell securities and there is no guarantee implied and people can lose all money on all investments. Numbers are believed to be correct, but do your own math and make your own conclusions or consult with an advisor before making any decisions.

First peek at the 2008 Senate races. These contracts have very little traded volume, currently:

DEM SenatorsPr (%)Chg Wk.bid-ask
Louisiana-Landrieu, Mary L. (D-LA)55018%
South Dakota-Johnson, Tim (D-SD)75013%
Iowa-Harkin, Tom (D-IA)80013%
Montana-Baucus, Max (D-MT)80013%
New Jersey-Lautenberg, Frank R. (D-NJ)80013%
Arkansas-Pryor, Mark L. (D-AR)85012%
Illinois-Durbin, Richard (D-IL)85012%
West Virginia-Rockefeller, John D., IV (D-WV)900n.m.
Delaware-Biden, Joseph R., Jr. (D-DE)900n.m.
Rhode Island-Reed, Jack (D-RI)900n.m.
Michigan-Levin, Carl (D-MI)900n.m.
Massachusetts-Kerry, John F. (D-MA)900n.m.
GOP SenatorsPr (%)Chg Wk.bid-ask
Colorado-Allard, Wayne (R-CO)40025%
New Hampshire-Sununu, John E. (R-NH)55018%
Virginia-Warner, John (R-VA)60017%
Minnesota-Coleman, Norm (R-MN)62013%
Maine-Collins, Susan M. (R-ME)65015%
Oregon-Smith, Gordon H. (R-OR)70014%
Oklahoma-Inhofe, James M. (R-OK)80013%
Nebraska-Hagel, Chuck (R-NE)80013%
Georgia-Chambliss, Saxby (R-GA)80013%
Tennessee-Alexander, Lamar (R-TN)80013%
North Carolina-Dole, Elizabeth (R-NC)80013%
Idaho-Craig, Larry E. (R-ID)80013%
Kentucky-McConnell, Mitch (R-KY)85012%
Alaska-Stevens, Ted (R-AK)85012%
South Carolina-Graham, Lindsey (R-SC)85012%
New Mexico-Domenici, Pete V. (R-NM)85012%
Texas-Cornyn, John (R-TX)900n.m.
Wyoming-Enzi, Michael B. (R-WY)900n.m.
Mississippi-Cochran, Thad (R-MS)900n.m.
Alabama-Sessions, Jeff (R-AL)900n.m.
Kansas-Roberts, Pat (R-KS)900n.m.

Sunday, May 20, 2007

NYC is Turning into a Museum

In his latest provocative thesis, Professor Niall Ferguson suggests the impending doom of New York as a center, just as Venice was turned into a museum in centuries past.

It's not a completely clear thesis. It appears attached to job outsourcing, but not clearly which ones, except maybe financial deals getting done outside of NYC. Some weight is given to a resurgent Asia.

The relative depth and breadth of U.S. consumer markets and the generally stable political environment favor a continuation of the U.S., even under a "great re-convergence". It's not an either/or.

What could happen, however, is the that U.S. policy makers fail to recognize the shifts, besotted of past days of that rare combination of political and financial prowess, and thereby fail to adequately protect the U.S. economy from the pending realignments in economic strength.

In other words, it's not just America's military role that could tip the scales one way or the other. It could be a cultural milieu that fails to adapt. The experience with Japan in the late 1980s and early 1990s is perhaps instructive of how difficult those adaptations can truly be, both in divination and in implementation.

Venice on the Hudson

Saturday, May 19, 2007

Just the Numbers: Week 20

THE NUMBERS

Clinton has moved up sizeably in the rankings, with a strong bid even this week (check out graph via link). McCain's rebound is complete. (I haven't been tracking it carefully, but the volume/interest in the presidential contract has ticked up in the weeks since the last report).

On technical matters, the bid side of the market for the GOP nomination has firmed considerably. Any number of factors might account for this, including sheer buying interest. It may also reflect a sense that no new entrants to the race are likely, beyond those already being ranked, and/or that dropouts among the main candidates are increasingly less likely.

THE STRATEGIES

The prospect of an "independent" doesn't seem much in the numbers, apart from a blip in the 'OTH' category for the party of the next president. Aside from that, there may be something to looking at potential VP contracts (see last table), even though the volume in these contracts is very low and the bid-ask spreads, huge.

Gore, Edwards, Biden and Clark continue to represent 17% of the probability for the Dem nomination. Costs probably prevent bets against on Biden/Clark, but betting against a successful Gore or Edwards run to the tape still has legs, I'd estimate. Another way to bet against is to pick the set of winners (this can reduce trading costs). If one of the top two wins, Obama or Clinton, the payoff is 20% (but the payoff period may linger beyond super Tuesday...).

Hagel, Gingrich, Huckabee and Brownback represent just 9% of the probability for the GOP nomination. Brownback is out of it, but the others continue to offer prospects for betting against, perhaps even including trading costs. The top three (Romney, McCain, Giuliani) will pay off 28% against the field, which is more than the you can get on the Dem side.

Next PresidentPr (%)Chg Wk.bid-ask
CLINTON(H)38.814.58%
OBAMA16.7-5.23%
GIULIANI12.1-2.944%
McCAIN12.10.122%
GORE8.1-0.11%
THOMPSON(F)8-211%
ROMNEY6-1.243%
2007 Week 20: GOP Candidates debate in South Carolina with post debate commentary largely about Ron Paul and FOX News continuing to press 'ticking bomb' as germane to general U.S. counterterrorism policy.
GOP NomineePr (%)Chg Wk.bid-ask
GIULIANI28.2-2.64%
MCCAIN26.15.85%
ROMNEY18.83.46%
THOMPSON(F)16.32.11%
GINGRICH40.92%
HAGEL2.3030%
HUCKABEE2.304%
DEM NomineePr (%)Chg Wk.bid-ask
CLINTON51.23.41%
OBAMA28.3-2.71%
GORE9.6-1.84%
EDWARDS7.4-0.27%
RICHRDSN2.2-0.49%
BIDEN0.50n.m.
CLARK0.50n.m.
SenatePr (%)Chg Wk.bid-ask
DEM8115%
GOP15033%
Next ExecutivePr (%)Chg Wk.bid-ask
DEM56-0.50%
GOP42.5-0.30%
OTH2.31.613%

DEM VP NomineePr (%)Chg Wk.bid-ask
OBAMA262.944%
RICHARDSON16.1-0.1104%
EDWARDS9.34.361%
CLARK7.67.6229%
GORE74.4-100%
NUNN5.2092%
CLINTON(H)5060%

* "Chg Wk" is measured since last report, Week 17.
src: intrade.com; bid-ask are not points, but spread as a percentage of the bid. Polls comparison, via ealClearPolitics.
IMPORTANT DISCLAIMER: this is just an informational note and not a solicitation or recommendation to buy or sell securities and there is no guarantee implied and people can lose all money on all investments. Numbers are believed to be correct, but do your own math and make your own conclusions or consult with an advisor before making any decisions.