Tuesday, July 3, 2012

Intrade Odds: Barack Obama Rebounds

The Intrade market for the presidential election gives Barack Obama a 57.2% chance of winning reelection, while Mitt Romney has a 42.3% chance of victory. This suggests a relatively close race at the moment, but Obama's edge in the Intrade odds has widened since our last review a few weeks ago. Obama now has a lead of 14.9 points; that's almost double the 8.1 point lead he enjoyed in mid-June. Obama's lead had been narrowing until recently.

The shift likely reflects the attitude that the Obamacare ruling will affect the election, and that Obama benefits from his signature program being upheld. Before the ruling, most Intrade investors had assumed the individual mandate would be ruled unconstitutional.

In addition, there has been some slight movement toward Obama in the national polls. That shift is more apparent in the Elephant Watcher average of general election polls, which takes into account the difference between registered voter and likely voter polls. The poll average had shown Romney with a nearly 3-point lead in late June; Obama now has a slight lead for the first time.

The Republican VP Intrade market has also seen some movement since the aftermath of the rumors about Tim Pawlenty for VP. Rob Portman is back on top at 25.3%. Pawlenty is still in second, but has dropped to 14.5%, just ahead of Marco Rubio at 13.7%. Some new players have risen: John Thune, a U.S. Senator from South Dakota is at 7.5%, and Paul Ryan, a U.S. Representative from Wisconsin is at 6.2%. Louisiana Governor Bobby Jindal is tied with Chris Christie at 5.0%.

The VP shuffle suggests Intrade investors have soured a bit on the Pawlenty rumors. Apparently, they perceive that the news about Pawlenty was not met with much enthusiasm, so Romney's campaign is looking for another "safe white guy" to pick. Like Pawlenty, John Thune could fit the bill. Paul Ryan is less "safe," but Pawlenty's loss is presumably Ryan's gain. The same could be said for Bobby Jindal, another of the "young guns" of the party. Rubio has recovered somewhat from the news report that he wasn't being vetted for the position, but it's unlikely he'll rise to his former heights without assistance from another news report.