I’ve been talking to a lot of people over the past couple of days about the differences between polls and a market. Of course there is a rich set of academic research showing the superiority of a liquid market over a poll. Additionally, to me it makes intuitive sense: You would never try to price a stock by polling a 100 traders.

Anyway I thought I would do a quick fun comparison between a poll and a market. We are currently running a market on who will be the most followed on Twitter by the end of June.

Cast your votes here:

Place your bets here:

what is this?

The Diggnation Army v The TWiTs: Who’ll be most followed by the end of June?

% chance over time

    Leo Laporte

    Kevin Rose

    Jason Calacanis

    Alex Albrecht

    Robert Scoble

    John C Dvorak

Get this widget

Hubdub - The News Prediction Game

Let the competition commence!

Popularity: 5% [?]

By Diana (General Category Editor)

Every now and then a news story breaks that shakes one’s faith in the integrity of the human race. How a man could rape and imprison his own daughter for twenty-four years is beyond explanation; yet, how Josef Fritzl was able to keep his horrific secret unknown for over two decades is another mystery waiting to be probed. As the days progress, more horrific details surrounding Josef Fritzl’s diabolical double life are being released.

Within the confines of a heavily secured cellar, Fritzl managed to hold his daughter Elisabeth hostage since 1984, fathering seven children with her in his subterranean bunker while leading a conspicuously different life above ground in Amstetten. At this point in the investigation, it is believed that the 73-year-old Austrian exclusively held the cellar’s many keys and codes and neither his wife Rosemarie nor his other children knew of the family beneath their noses. According to Rosemarie Fritzl’s sister, Fritzl would often stay in the cellar all night and his wife was not even allowed to bring him coffee. During this twenty-four year enslavement of her daughter, how did Rosemarie Fritzl not suspect something bizarre was occurring in her house and why didn’t she question the “discovery” of three of Elisabeth’s children on her doorstep?

Perhaps she knew what her husband was capable of doing and that his sexual behaviour crossed the line of normalcy. Reported by Austrian builder, Paul Stocker, the elderly couple was spotted in swingers clubs near Amstetten in the late nineties. Stocker, shocked by the spectacle, watched in disbelief as Fritzl forced his wife into a corner in order to witness him advance upon a young woman. Further investigation may show that Rosemarie Fritzl was always forced into a corner; however it may be discovered that she knew of her daughter’s torture and failed to inform the authorities.

Popularity: 3% [?]

By Ryan (Politics Category Editor)

With the recent upsurge in violence in Iraq and the visible inability of the Iraqi Army to clamp down on Shia militias in Basra and Sadr City, Iraq is still a tense and brutal environment. The power to control the multi-faceted nation has not yet been resolved and the sectarian struggle for true representation is now hampered by more conflict within the religious and political factions vying for control.

But for Americans while the cost of the war grows, its impacts on the presidential campaign present a danger to the GOP, or do they? How has the Mahdi Army violence effected McCain? Well heres a surprise, it really hasn’t. McCain’s price hasn’t really changed since Maliki began his campaign in Basra on the 24^th, as evidenced by his price on Hubdub. Shown here:

So how has a upsurge in violence not decreased McCain’s price?

Some may say that the violence now ensuing southern Iraq and Sadr city is just between Iraqi’s. Therefore it lacks major US involvement on the ground. Unfortunately this analysis lacks the images of a smoke obscured Green Zone under mortar and rocket attack. Not to mention the deaths of US citizens within the Green Zone. It’s true that US involvement in the recently launched campaign against Shia militias is very limited, but the violence has been widely reported in the US media. So what gives? Why would a supporter of an unpopular war, from the party of an unpopular President be able to to stay so high in price?

How about the economy? With a slide into recession still front page news maybe McCain’s more conservative economic policies are holding sway with voters and overwriting opposition to the war, maybe, just maybe. Even if Iraq looks dreadful voters are overlooking that constant reality and worrying about their wallets. Keep in mind the ever wise theme “it’s the economy stupid!” Even if McCain’s conservative economic policies aren’t a hit with voters, the importance of the economy is still overshadowing Iraq. Voters can’t pay attention to a war in a far away country when their pocketbooks are in peril. The war has become so ingrained that the violence there is now an afterthought.

So is Iraq no longer a hinderer for the GOP? Certainly not! Even if McCain isn’t faltering due to the current violence in Iraq, the amount of bad feeling that the war has caused will stick with him throughout this election. The election was the Democrats to lose and increasingly in what was a surefire Democratic win the prospects are much more even. If the Democrats lose this election the November 5^th New York Times headline will read “Blown Opportunity!”

Heres to hoping this campaign was going to be short and sweet…..

Related Questions:

Who will win the Presidential election, Democrats or Republicans?

Who will be the next President of the US?

When will the US pull out of Iraq?

Will the cease-fire order between the Mahdi Army and Coalition and Iraqi forces be rescinded by May 31st 2008?

Popularity: 4% [?]

By Diana (General Category Editor)

Thirty-nine years following the Tate and LaBianca murders, Charles Manson and his notorious “Family” are once again making headlines.
Having served decades behind bars for murder and conspiracy, convicted Manson Family killers are awaiting the exhumation of their past misdeeds—literally.

Shortly following her captivity, Susan Atkins, alias Sadie Mae Glutz, had boasted to a cellmate that the Manson Family was responsible for three unsolved murders. Rumors of murdered hitchhikers and drifters passed with time, yet not until recently had the ghost of Atkins’ jail cell confession prompt a team of investigators and forensic experts to return to Barker Ranch in Death Valley, California, the central setting for the Manson Family’s havoc. In search of unmarked graves, investigators including Sharon Tate’s sister, Debra Tate, seek to uncover the Manson Family’s additional victims in what appears to be a never-ending saga. Their efforts may unearth lost chapters in the grim Manson Family history, but the question remains whether the team will find what they are looking for.

Ordered to life in prison in accordance to California’s abolishment of the death penalty, Charles Manson and company have been denied parole countless times—Manson’s latest parole denial occurring May 23, 2007. Imprisoned Manson Family members are by no means on the verge of release. The results of the current Barker Ranch investigation will make little difference in their condemnation; however, for grieving family member such as Debra Tate, justice is putting the past to rest.

Popularity: 4% [?]

By Diana (General News Editor)

Former football star O.J. Simpson is no stranger to the courtroom and on Friday, March 7, 2008, Simpson’s attorneys will be back in court for a hearing concerning motions underlying his case. Simpson’s most recent judicial exploit is linked to a Las Vegas sports memorabilia robbery from September 2007 in which Simpson had, according to Nevada authorities, led five men to retrieve personal memorabilia including sports collectables and a suit worn by Simpson during his famed murder trial. Twelve charges have been brought against Simpson involving conspiracy, kidnapping, assault with a deadly weapon, and robbery - charges that can easily send Simpson to prison for life.

So what is at stake on March 7, 2008? Earlier in February, Simpson’s attorneys filed court papers claiming that prosecutors did not meet evidentiary standards to prosecute Simpson, now 60. Simpson’s attorneys seek that half of their client’s twelve charges be dropped and have asked for a separate trial from the other defendants. Although these motions are critical in Simpson’s future, the most significant motion surrounds questions involving jury selection and the request to prohibit the prosecution’s potential discussion of Nicole Brown Simpson and Ron Goldman’s murders in Simpson’s current case. Now any objective judge would grant the latter motion; however, how can the memory of Simpson’s infamous murder case be effaced from the memory of the prospective jurors?

If Simpson’s past looms over his current court case, which it will, Simpson can face serious consequences whether the “the glove fits” or not. The legal system holds everyone innocent until proven guilty, but who doesn’t have preconceived notions about Simpson? It is unlikely that Simpson will get a completely non-discriminatory jury and the former football star’s trial, scheduled for April 7, 2008, is just around the corner. What does the future hold for Simpson? You decide:

How many charges will be dismissed as a result of the papers filed by OJ Simpson on Feb 1 2008?

Will OJ Simpson serve prision for the Las Vegas memoribilia case?

Popularity: 4% [?]

The Clinton win in New Hampshire wasn’t only bad for Obama, its also given commentators an opportunity to knock prediction markets. New York Times has a go, as does Slate.

The problem is when the commentators read the markets and deduce that the market is predicting the favorite is the one that will win. However, the great thing about markets is they state the probability with which they make their predictions. And Obama with a 90% chance of winning means that one in ten times he won’t. Desert Vision won the 3:40 at Musselburgh this afternoon. The odds where 25/1 implying around a 4% chance. Does that mean the market was wrong? No, 25/1 shots tend to win around 1 in every 25 races (actually a bit less often due to the bookmakers margin). That just happened to be one of those races.

Basically, the ‘prediction markets where wrong’ commentators are like a bunch of punters at the race track complaining that the market wasn’t right every time the favorite doesn’t win. (In fact they should go to the race track for a probably expensive but very educational day out!)

Chris Masse is diligently following the story at Midas Oracle and the Silicon Alley Insider gives a nice analysis. Of course the only way to measure whether markets are accurate is to look at them over a number of events. Caveat Bettor is keeping the score on the primaries and it is prediction markets 3, Zogby 1 (with one 2-way tie and one 3-way tie).

Popularity: 5% [?]

Prediction market, Intrade, topped the pollster Zogby in predicting the winners of Iowa’s caucus. The forecast taken last night at 9:30 EST shows Obama and Huckabee having clear leads on Intrade. Zogby however while forecasting a Huckabee win couldn’t separate Clinton and Obama (putting both at 28%). Interestingly, neither suggested that Clinton would end up in third place.

Onward to New Hampshire where Obama is favorite on both Intrade (67%) and Betfair (59%) to win the state. John McCain, who appears to be one of the surpising winners of Iowa, has seen his forecast probability of taking New Hampshire has shot up from around 40% to 71% over the past couple of days (Intrade).

Overall, Clinton still remains favorite to gain the Democratic nomination, but only by a sliver (52% on Intrade, 53% on Betfair). For the Republicans, John McCain has now become the front runner for the nomination (32% on Intrade, 29% on Betfair). Despite last night’s win Huckabee trails in third position on a forecast on both exchanges of 16% chance of getting the nomination.

For all you Paulites, both exchanges are forecasting around a 5% chance of Ron getting the nomination.

For me, I’ve got a tenner on Obama to get the Democrat nomination. For him to get such a resounding win in a rural 95% white state I think indicates the strength and breadth of his appeal.

Hat tip to Caveat Bettor.

Popularity: 5% [?]

ReadWriteWeb have analysed traffic from Iowa to candidates web sites and have predicted if the caucus’s follow then Paul will take the stat for the Republicans and Obama for the Democrats.

Analysing web traffic isn’t yet a well recognised election prediction method. I guess in a few hours we will find out if it should be.

UPDATE: Bettingmarket has analysed Google trends which would predict Clinton and Paul being nominated as candidates.

Popularity: 3% [?]

The Wall Street Journal has an excellent article today by Professor Justin Wolfers on Using Markets to Handicap Iowa. Obama is the favorite to win the Democrat vote with Romney and Huckabee neck and neck for the Republicans. Justin Wolfers shows that the markets are an excellent guide to election season.

But steady on says Brett Arends, also at the Wall Street Journal. He notes:

Markets are fascinating. I’m as absorbed by political betting as I am by the stock market — right now, maybe, more so. The prices tell stories. They contain wisdom and folly, clues and surprises. Respect them, by all means. But don’t revere them. The “crowd” isn’t always right.

Both authors note some drawbacks with the current markets (low liquidity and potentially absence of smart money). Either way the election kicks off today and it is going to be one exciting race.

Hat tip to Midas Oracle.

Popularity: 4% [?]

“Making predictions is hard, especially about the future” said Yogi Berra but that doesn’t stop us trying.

ValleyWag and ReadWriteWeb have already announced their predictions for 2008 and they make for fun reading. The first golden rule to making new year predictions is to get the balance right between unobvious (ValleyWag’s prediction that the WSJ goes free didn’t exactly require Nostradamus like powers) but at the same time not too unlikely. There is definite kudos for nailing long shot predictions however you don’t want to end up with a list like Wired’s 2007 predictions (Google hits $1,000, Digg becomes the new Friendster and dads become biologically irrelevant).

John Battelle did much better with his 2007 predictions (YouTube to be integrated, Amazon to move into web services and Google to get significant negative press), which Robert Scoble recently reviewed. Of course he sometimes uses the second golden rule of making predictions which is to keep them vague and/or widely applicable (e.g. one major internet company will screw up on privacy/trust).

My modest suggestion for would be predictors would be that when making predictions ensure they are precise, testable and attached to a probability. The last one means we might be a bit more forgiving if it is a long-shot prediction. So taking ReadWriteWeb’s (RWW) and ValleyWag’s (VW) lists, and adding in some of my own (Hubdub) here are my predictions for 2008:

100% likely: Wall Street Journal to drop the pay wall (VW), Facebook does not get valued in a transaction at greater than $15 billion (Hubdub)

80% likely: Zoho to be acquired (RWW), Digg to be acquired (RWW & VW), SixApart gets acquired (RWW & VW), Facebook to remain independent (VW), Linden Labs to remain independent (Hubdub)

60% likely: YouTube announces HD (VW), AOL gets spun out (VW), Twitter remains independent (VW), Technorati enters the deadpool (VW), Tumblr to be acquired (RWW)

40% likely: Twitter to be acquired (RWW), Facebook to release a browser (RWW), Google Open Social to be a failure (RWW), Yahoo! has a major lay-off (VW), Perez Hilton’s TV show gets cancelled (VW)

20% likely: Facebook to decline in popularity (RWW),  Microsoft to buy Technorati (RWW), Google to hit $800 (VW), Jason Calacanis starts another project (VW), Microsoft buys Yahoo! (Hubdub)

Of course if all else fails and you get them all wrong you can always use the third golden rule: Brazen it out and forget all about your predictions.

Any one want to add to the list (or bid the percentages up and down)?

UPDATE: John Battelle has now published a rich list of predictions for 2008.

Popularity: 3% [?]