NY Giants @ Washington

Giants @ Redskins

The Redskins and Giants recently played the Saints just seven days apart. Washington controlled New Orleans in a road win in Week 15, while New York was humiliated in a home loss the following Sunday. But comparing results against common opponents is always problematic, since that method doesn't account for desire. And there should be little doubt that the Giants are the team that enters Saturday's matchup with a stronger will to win, not to mention the fact that the G-Men are simply more talented than Washington. For all the offense's faults, Manning and Barber should have little trouble out-producing Campbell and Betts, a couple of guys who started the month of November as backups. Now that the Giants' backs are truly up against the wall, they'll come out fighting.

NY Giants: 15-5 Under off BB games allowing 25+ points
Washington: 7-0 ATS revenging a road loss

JEDI THOUGHTS: This is a BIG game for my fellow friend Jeff Bonds. He'll be playing at 10dimer on this game. This will be the biggest play for him this year. I'll be glad to cash this in with him. I strongly agree that you play this game. I love that trend that says 7-0 revenging a road loss, no Strahan, no Shockey that sucks. Redskins win this game and knock off Giants in making the playoffs PERIOD!

JEDI PICK: Washington +3

Sports vs. Non-Sports Divestiture

I don't really like this development, because it appears to bifurcate capital and traders into separate, smaller universes at any given instance of time.

However, it makes sense to me, in that the sports side of things is at greater legal risk than the non-sports prediction markets. The conspiracy theorist in me thinks we've got the casino, horse racing, and state lottery interests trying to shutdown the sports trading.

I think that the sports contracts may not create the economic value that the non-sports contracts do. However, traders can hone their execution and risk management skills trading the sports, and bring this expertise to the non-sports, thereby improving the predictive power of the information markets.

Your comments, please!

UPDATE: My good friend in the Pit, Todd73NJ, has asked some really good questions and received good answers.

UPDATE: Cross-posted on Midas Oracle.

Trade Exchange Network has agreed to divest its sports related business

From https://www.tradesports.com/aav2/news/newsIndex.jsp

Trade Exchange Network Reorganizing

Thursday, Dec 21, 2006

Dublin, December 21, 2006: With effect from January 1st, 2007, Trade Exchange Network, owner and operator of TradeSports and Intrade, has agreed to divest its sports related business to a newly formed company, TradeSports Ltd., for an undisclosed sum.

The companies will cooperate fully to make sure there is no inconvenience to members and have agreed an initial two month timeframe to complete the transaction.

Commenting on the transaction, John Delaney, CEO of Trade Exchange Network said..."After growing our combined sports and non-sports markets aggressively for five years, this development represents a significant transaction for the company. We are very thankful to our loyal sports traders and assure them that the transition will be both painless and positive for them. We are certain that TradeSports Ltd. will build on our achievements and that sports traders will receive a peerless service."

Trade Exchange Network, through its www.intrade.com platform, will continue to offer the broadest selection and deepest liquidity in real money prediction markets. Intrade will now look to aggressively extend the prediction markets and services it offers. The company will reorganize its trading and related services activities into two separate business units.

According to Delaney... "Non-sports prediction markets have amazing further potential, where we have a leading position and where we offer maximum value. We are convinced that traders and data users will see benefits very soon."

TradeSports Ltd., through the www.tradesports.com and www.tradebetx.com platforms, will continue to offer all the sports markets currently available on TradeSports, and more besides. TradeSports will only offer sports related markets. Non-sports markets will only be available on the www.intrade.com platform after 28th February 2007.

How will this change affect our members and affiliates?
As TradeSports and Intrade will be operated as separate independent platforms, members will need to have an account on each platform in order to continue trading both sports and non-sports contracts. Members will automatically get a second account if they have traded on both categories on or before February 28th.

We will publish a special edition of our customer newsletter during January, and it will include more specific details but for now, it is business as usual.

Equities trading closed Tue Jan 2, in honor of President Ford

WSJ reports that Nasdaq will be closed (subscription required). NYSE still hemming and hawing.

UPDATE: NYSE follows Nasdaq.

Obama's Hockey Stick


alt="Price for 2008 Democratic Pres Nominee(Others on Request) at TradeSports.com"
title="Price for 2008 Democratic Pres Nominee(Others on Request) at TradeSports.com" border="0" />

I do like Barack more than Hillary, but have no idea who would govern better in the White House. But I do believe he is in a honeymoon period right now, and am not sure it will last until next November. My recommendation is to buy the dips, sell the rallies on this contract.

I enjoyed Obama's senatorial campaign (e.g. free trade advocate in an industrial region) and his DNC speech (One America, not Two), but find that he also (like almost every other serious candidate) must compromise to get along with the party machinery.


My best memory of Gerald Ford?

This quote:

A government big enough to give you everything you want is a government big enough to take from you everything you have.

UPDATE: Greg Mankiw agrees.

Rest in Peace President Ford

While not yet living while he was in office, there is always something bittersweet about the passing of an ex-president. The passing away of a great man who rose to the highest pinnacle of the world's most powerful democracy mixed with healing and resolution that both sides of the aisle can appreciate. The most recent example besides Ford was the passing of Reagan (who never seemed to get his full due recognition until after he was gone). I was surprised to learn Ford actually survived two assasination attempts in a span of three weeks. Talk about not being hugely popular, especially after pardoning Nixon. But a nice, eloquent roundup of Ford can be found at RedState here. Rest In Peace Mr. President.

Merry XMAS; Jets @ Miami

NY Jets @ Miami

The Jets are 8-6 on the year (9-5 ATS) and in a wildcard battle with three other AFC clubs. Miami has lost two-of-three straight-up and ATS to fall out of the race at 6-8 (5-9 ATS). It can play spoiler versus the Jets though.

NY Jets: 9-2 Over off a win
Miami: 2-9 ATS vs. division opponents

JEDI THOUGHTS: This spread seems a little fishy. This game is just to important for the NY Jets, and I don't see them ruining their whole season losing to Dolphins. They are in Miami and it will be tough there. This game is just too IMPORTANT for the Jets. Jets come big with a win today, just like they have been doing just to get to the playoffs, and i'm sure they won't end it here. Philly comes up big against the Cowboys also. So it's the two underdogs tonight!

JEDI PICK: NY JETS +2.5

NFL Cincinnati @ Indianapolis

The last meeting of the Indianapolis Colts and Cincinnati Bengals wasn't that close with the Colts winning a season ago in Cincinnati 45-37 as a five-point choice. At the time the Colts were 9-0 and the Bengals 7-2. The Colts would eventually get to 13-0 before losing and then lost their lone playoff game at home to Pittsburgh. This year the Colts started 9-0 but now have lost three-of-four including a 44-17 blowout last week in Jacksonville. Cincinnati has won and covered four straight to climb out of a 4-5 hole and get back in the playoff hunt at 8-5. The Bengals won their last two on the road, beating New Orleans 31-16 and Cleveland 30-0. The Colts are 6-0 at home (4-2 ATS) with their last a 45-21 trouncing of Philadelphia as a 10.5-pt. chalk.

Cincinnati: 7-0 ATS away off a win
Indianapolis: 9-2 Under at home vs. conference opponents

JEDI THOUGHTS: 7-0 ATS away off a win...doesn't that just look too good? Hey what about them Colts? The only trend I see is the 9-2 UNDER and home. I've uncovered a bunch of angles and a couple of other trends to back e'm up. And using my system I'm still at the same team. Using my line movement technique I'm still on the same side, over and over and over again. Not only do I keep picking the same team over and over again, I've been backed up by alot of the great cappers at the forum, or should I say, "I'm following them, and can't find a reason that the Bengals are going to win this game." The only thing that I can come up with that Bengals will win this game is that Ronniedizel is on it.

JEDI PICK: Indianapolis Colts -3

Kyo-huh?

From the Volokh Conspiracy:

"EU vs. USA on CO2:
European nations have assumed the mantle of global leadership on climate change while the United States sits on the sidelines. This standard narrative contains some truth, but it also grossly overstates Europe's demonstrated commitment to reducing greenhouse gas emissions. The reality is more complex."

NFL Dallas @ Atlanta

Bushwhacked Two teams that both lost their last home games to the New Orleans Saints meet this week in a Saturday night edition of NFL Football. The Atlanta Falcons, 7-6 on the year and winners of two straight on the road, play host to the Dallas Cowboys. The Cowboys were run over by Reggie Bush and the Saints Sunday night at home, losing 42-27 as a touchdown choice. That snapped the Cowboys four-game win streak and dropped them to 8-5 on the year. They have won two straight on the road, beating Arizona 27-10 and the N.Y. Giants 23-20. Atlanta's road wins came at the expense of Washington (21-14) and Tampa Bay (17-6) after it dropped four straight including home losses to Cleveland (17-13) and the Saints (31-13).

Dallas: 25-12 ATS off a loss by 14+ points
Atlanta: 6-18 ATS at home off a win by 10+ points

JEDI THOUGHTS: When Dallas loses a game, they come back the next week with a huge win. I don't want to name e'm all but you can look for yourself. Atlanta hasn't won more than 2 consecutive games this season. Alot of injuries on Atlanta, considering Warrick Dunn won't be in the back field with Vick. This is going to be a game that both teams need to win...but the better team will win. Atlanta won their last two games by two teams that won't even make the play offs, Tampa Bay and Washington, both teams are with losing records. JJ and TO will be helping Romo alot today. Dallas is avg 26 points in their last 3 games. Atlanta avg 18 points in their last 3 games...that should tell you a little something. Considering the fact that Atlanta overall avg yards out rushes Dallas by 60 yards. Some of it goes to Dunn, but most of it goes to Vick. If they can contain him, they will have no problem tonight, but even if they if they dont, how much more do you actually think they'll score over their total avg maybe three points more? 3? maybe 6? who knows.

JEDI PICK: Dallas -4

Mother Russia

After reading this, it is becoming quite apparent that Russia is returning to her old ways. For those that have followed Russia's consolidation of once private energy companies into state-owned ones such as Yukos, this is nothing new. As mentioned in the article, Russia cut off supplies to the Ukraine in the past and has tried bullying western-leaning Georgia for a number of years now. I fear this is only going to continue to grow as a problem for the world as Russia and/or Iran will try to blackmail the world to meet its political objectives. Russia has long supplied countries such as Iran with nuclear expertise and conventional weapons and sells arms to the number 1 buyer of weapons today (Venezueala). Neither of these US friends. It should also be noted that Russia provided intelligence information to Iraq before the US invasion. This is disturbing to me especially as we try to stabilize the fragile Middle East (as best as we can).

An interesting read for people that are interested in the growing ties between Russia and the Middle East should read Joel Rosenberg's book Epicenter. I have read the book myself and it is a fascinating read (he looks at today's current events and analyzes them with Ezekiel 38-39) regardless of your spiritual preferences. He is a smart man: worked for the Heritage Foundation, Benjamin Netanyahu, and Steve Forbes' presidential campaign. Joel Rosenberg also was the one who originally wrote about terrorists using planes as weapons and the invasion of Iraq before they happened.

Weekly European Soccer Picks for 12/13/2006

As I said I will post once a week before big soccer days on games that I have money on to try to help increase liquidity and interest in European Soccer. Since posting I have fortunately gone 2-0 by taking the over for the Man U/Man City game (3-1 Man U) and taking the away Derby for the win at Leeds (1-0 Derby). Now tomorrow and Thursday comprise the last round of group play before going on to the knockout stage of the tournament. Now to educate, this is not the same as the Champions league. The Champions league has almost the same kind of format but the Champions league have higher caliber teams due to their final placement in their respective club leagues from the year before. However, in the knockout stage, the third place finishers from group play in the Champions league get to drop down to the knockout stage in the UEFA tourney which spices things up. Alas, here are my picks for tomorrow:

UEFA Group F
In the matchup of Zulte-Waregem v Ajax Amsterdam I have taken the over at 56.5. I like Espanyol to win in the same group but not for the mid-70s.

UEFA Group G
In the matchup between last placed PSG v first place Panathinaikos I have taken the under at 41.5.


Those are my pics for tomorrow where I have money at stake. Let the matches begin!

Update:

English Premiership
I have taken Arsenal for the away win at Wigan for 54.6. Go Gunners!


Final Conclusion for Day's Events:
My posted pics today went 2-1 (posted pics are 4-1 overall). I sincerely apologize for getting the under so wrong, it was in fact my biggest position but a 4-0 win by PSG blew it out of the water. We got lucky with Arsenal's goal in the 88th minute to win and they now move up into 3rd in the standings. There is also another round of UEFA games tomorrow for you to look at.

NBA Dallas @ Utah

I've been hot at basketball all season. I haven't been posting here because I didn't want to jinx myself. (seems like everytime I post here with my plays, alot seems to go wrong) But I do have another blog which I update DAILY. I've posted the link here before. But if you don't have it i'll post it again after my pick (below) If I get a good read on tonights MNF i'll be sure to post that here also.

Dallas @ Utah

Dallas: 24-7 ATS away after scoring 105+ points
Utah: 14-4 Over after allowing 110+ points

JEDI THOUGHTS: Utah ran into a bump on the road against Minnesota losing by 7; 110-103. But now they're back home against a very hot Dallas team, they just came off a big win at Denver at home, and is now ready to play Utah on the road. Despite the fact that Dallas is 24-7 ATS away after scoring 105+ points is a great ATS record, Utah hasn't loss a game after coming from a 2 day's rest! I believe that Utah has a great advantage at home, and looking to come up big by testing their will to win this game against Dallas. Stackhouse will be out tonight, which is now more in the favor of UTAH!

www.pregameconsensus.blogspot.com I'll also be playing Chicago Bears on a small play tonight. I won't post it here on caveatbettor till I get a more clear picture of the Bears tonight. But you can check out my other blog for other picks for today.

More bad news for bears, good news for Americans

Ed Prescott, the 2004 economics Nobelist, talks about five macroeconomic myths in today's WSJ (subscription required). I have excepted two of them for those readers looking at stock trends:

Myth No. 3: Americans don't save. This is a persistent misconception owing to a misunderstanding of what it means to save. To get a complete picture of savings we need to investigate economic wealth relative to income. Our traditional measures of savings and investment, the national accounts, do not include savings associated with tangible investments made by businesses and funded by retained earning, government investments (like roads and schools) and business intangible investments.

If we want to know how much people are saving, we need to look at how much wealth they have. People invest themselves in many and varied ways beyond their traditional savings accounts. Viewing the full picture -- economic wealth -- Americans save as much as they always have; otherwise, their wealth relative to income would fall. We're saving the right amount.

Myth No. 5: Government debt is a burden on our grandchildren. There's no better way to get people worked up about something than to call on their sympathies for their beloved grandkids. The last thing that I want to do is to burden my own grandchildren with the sins of profligacy. But we should stop feeling guilty -- at least about government debt -- because we are in better shape than conventional wisdom suggests.

Theory and practice tell us that the optimal amount of public debt that maximizes the welfare of new generations of entrants into the workforce is two times gross national income, or GDP. This assumes 1% population growth, 2% productivity growth, 4% real after-tax return on investments, and that people work to age 63 and live to age 85. Currently, privately held public debt is about 0.3 times GDP, and if we include our Social Security obligations, it is 1.6 times GDP. In either case, we could argue that we have too little debt.

What's going on here? There are not enough productive assets -- tangible and intangible assets alike -- to meet the investment needs of our forthcoming retirees. The problem is that the rate of return on investment -- creating more productive assets -- decreases as the stock of these assets increases. An excessive stock of these productive assets leads to inefficiencies.

Total savings by everyone is equal to the sum of productive assets and government debt, and if there is an imbalance in this equation it does not mean we have too little or too many productive assets. The fix comes from getting the proper amount of government debt. When people did not enjoy long retirements and population growth was rapid, the optimal amount of government debt was zero. However, the world has changed, and we in fact require some government debt if we care about our grandchildren and their grandchildren.

If we should worry about our grandchildren, we shouldn't about the amount of debt we are leaving them. We may even have to increase that debt a bit to ensure that we are adequately prepared for our own retirements.

English Soccer Picks for 12/9/06

In an effort to build liquidity and interest in soccer I will attempt to post soccer picks for each Saturday that I have money on. They are as follows (I could take another game tomorrow depending on how Phoenix does tonight against Boston):

English Premiership
I went with the early, early game of Manchester United vs Manchester City. I took the +2.5 over at 52.1.

English League Championship (the lower class of English soccer)
I went with current 4th place Derby for the win at lowly Leeds at 34.1.

I don't explain my pics I just make'em. Let the good teams' strikers be high-flying!


Update:
Those picks went 2-0, unfortunately someone needs to remind me to stay away from orange balls that bounce.

Hearings for the Secretary of Deference

A blessed blogging bonanza today, with Diem and bmili each weighing in. On the heels of bmili's post, I provide a snapshot of an Iran airstrike contract


alt="Price for US/Israeli Overt Air Strike against Iran at TradeSports.com"
title="Price for US/Israeli Overt Air Strike against Iran at TradeSports.com" border="0" />

followed with this Lileks post. He is just amazing.

Thanks to Captain Ed, who provided the following excerpt:

• Syria’s full adherence to UN Security Council Resolution 1701 of August 2006, which provides the framework for
Lebanon to regain sovereign control over its territory.

• Syria’s full cooperation with all investigations into political assassinations in Lebanon, especially those of Rafik
Hariri and Pierre Gemayel.

• A verifiable cessation of Syrian aid to Hezbollah and the use of Syrian territory for transshipment of Iranian weapons and aid to Hezbollah. (This step would do much to solve Israel’s problem with Hezbollah.)

• Syria’s use of its influence with Hamas and Hezbollah for the release of the captured Israeli Defense Force
soldiers.

• A verifiable cessation of Syrian efforts to undermine the democratically elected government of Lebanon.

All conducted under the watchful eyes of Unicorns, of course. Imagine a government report on organized crime, demanding the following:

* The Mafia’s full adherance to the RICO and IRS statutes concerning independent contractors, including but not limited to Social Security contributions, FICA regulations, as well as compliance with state and federal laws concerning murder, extortion and kidnapping

* The Mafia’s full cooperation with all investigations into the deaths of Artie “Two Sheds” Palini, Ricky “The Squid” Piscatori, Jackie the Gaspipe, Tommy Shoes, and 16,302 others

* A verifiable cessation of Mafia contributions to local law enforcement officials

* The Mafia should use its influence with the Russian and Irish mobs to find out what the hell happened to that poor guy who wandered into the back room when they were all having a sit-down

* A verifiable cessation of Mafia efforts to undermine and circumvent the laws in the states of New Jersey, New York, Ohio and Chicago, as well as Nevada and portions of Kansas City which Johnny Mook swears he has no control over, but some of those hits just have his style written all over them

If those things are done, well, the price of garbage hauling in selected municipalities might decrease. But I wouldn’t count on them happening, and I certainly wouldn’t argue that we should give the Mafia Staten Island in the hopes some age-old territorial grievance will be settled for good.

Happy infamy day, by the way.

History Repeating Itself? Iran vs US

This an absolutely MUST READ provided by Jim Geraghty on his blog TKS over at National Review Online. I never knew this, but in 1987-1988 the US and Iran were in an undeclared naval/air war in the Persian Gulf. The link provided has each account in detail. Absolutely fascinating. Anyone that thinks the Iran situation can be solved through talks is naive. Including those on the panel of the ISG report (Bringing in Syria/Iran for talks!??). And in no way will a Palestinian/Israel peace deal amount to anything. The Palestinian people have been hijacked by their Arab neighbors for political purposes and I know of at least one of those countries kept the original Palestinian land for their own (cough...Jordan...cough) after one of the first Israeli/Arab wars. Bottom line: Look for Russia to continue to expand its influence in the region and try to undermine the United States.

http://tks.nationalreview.com/post/?q=ZGE5YTMzM2QzMjQxMTEwODI4ZmUyYmM3ZTcwMTE0MDI=

Hillary vs. Barack

From the Washington Post (hat tip to Drudge):

Colleagues say Clinton and Obama appear to genuinely admire each other. So far, they claim to see zero evidence of public rancor. "Everybody gets along just fine," Harkin said. Kennedy described the pair as "extra-dimensional individuals" and asserted in an interview: "There's no sort of pettiness or jealousy that I see. They understand the momentous nature of what the search for the presidency is all about."

Behind the scenes, of course, it's a slightly different story. "Don't tell Mama, I'm for Obama" has become the Obama campaign's unofficial motto. It's a reference to Clinton's nickname as first lady and an example of the conflicted loyalties of many Democratic political aides. Some are talking to both camps about possible jobs in the presidential campaigns. Meanwhile, Democratic senators who are not considering presidential bids of their own are remaining neutral.

Hillary's chart:



And Barack's:



Merry Christmas: households still getting wealthier in aggregate

I take the Fed's quarterly Flow of Funds report to be one of the best measures of household economic health. It indicates real estate vs. financial assets, as well as various forms of debt. Household net worth has increased from $40 trillion to $54 trillion in the last 5 years, which averages $5,000 per year per household. Of course, the richer households' net worth would intuitively be rising faster than the poorer ones. But today's WSJ talks about the rising tide lifting most all of the boats:

The competitive labor market is boosting wages, and the stock market has produced big gains for many investors so far this year. After declining slightly in the second quarter, the value of household financial assets rose nearly 2% in the third quarter to $40.5 trillion, the Fed said. That combination helped lift household net worth, which was flat in the second quarter, by 1.5% in the third quarter to $54.06 trillion.

It looks like households are still in pretty good shape," said Robert Mellman, senior economist at J.P. Morgan Chase & Co. "The fundamentals for consumer spending are really quite good."

That may be true, but they also appear to be turning cautious. In a separate report yesterday, the Fed said consumer borrowing decreased by 0.6% in October, the largest monthly drop in 14 years. "In the grand scheme of things, households are stepping back a bit and being more conservative," said Daniel Jester, an economist at Moody's Economy.com.

I hope that you can find solid reasons to celebrate this holiday season. If you need a little help, here is a nice piece from Greg Mankiw's blog, and that is just about temporal blessings. Add in some love and respect--of self and others, from self and others--and life is beautiful. I wish all our generation peace and goodwill towards one another.

UPDATE: Tyler Cowen notes the rise in buying power for non-management workers on his blog today.

UPDATE: Greg Mankiw, too. I don't know what to shudder harder at: 2 of my favorite economists linking to the NYTimes, or that I might get busted for reading Tyler before Greg.

Paying Taxes to the Government That Robs You

I have been very busy lately, but I really wanted to get this post out there. For starters, Friends to Tradesports Steven Levitt was on the Colbert Report the other night. If you have never seen him you may want to check it out.

In darker news a startling court ruling came down yesterday in New Jersey. This one involves eminent domain powers by the state. A few years ago many of you may remember the ruling that essentially made state sanctioned stealing private property legal so long as it was cloaked under the banner of “economic development”. This ruling is by a lower court, but if the ruling stands it would increase the powers the state has to take your property. In this case the court ruled it was OK to take land (that was already approved for other development!) simply for the reason of “preserving open space” (a more vague reason I cant imagine). Kudos to Justice Roberto A. Rivera-Soto for being the only dissenter (at least mentioned in this article). Shame on everyone else involved.

I always find life a little sadder when I am reminded that the Government controls us, not the other way around.

My Random Musings...

It's been a while since I have posted, been quite busy but there is quite a bit of info I wanted to touch on and articles/news I have read that are of interest to me.

Business
Consumer borrowing dropped big in Oct- http://www.breitbart.com/news/2006/12/07/D8LS78KG1.html
Attack of the Wal-Martyrs (can't they go do something better with their lives?)
http://money.cnn.com/magazines/fortune/fortune_archive/2006/12/11/8395445/index.htm?postversion=2006112813

side note to that: the anti-walmart crowd was going to try to attract faith based folk to spread their message. When are people going to stop treating the religious crowd as a niche and start treating them as people that believe something? I haven't seen or read anything about the movie yet, but I feel like the Nativity Story movie is running along the same lines.

Along a similar note:

Who gives more? Conservatives or Liberals? Regardless, Sioux Falls, SD puts me to shame
http://www.realclearpolitics.com/articles/2006/12/who_gives_to_charity.html

Politics
My boy Jeb Hensarling won the head post in the Republican Study Committee (a big caucus of conservatives in the GOP). Hopefully we will see more of the younger, idealogical conservatives lead more instead of those that have gotten too accustomed to the Beltway.
http://www.dfw.com/mld/dfw/news/16180821.htm?source=rss&channel=dfw_news

Bush/Blair Press Conference Transcript from today
http://www.whitehouse.gov/news/releases/2006/05/20060525-12.html

Sports
The last group stage of the UEFA Champions League pool play finished yesterday and the top 16 advance to tourney play. We need much more liquidity, bids/asks, etc on the champion over at TS but I have Liverpool (a whopping 2 contracts) to win. Real Madrid is a player and can turn it on instantly when they need to. I don't give Barcelona a chance of repeating. Read up on it yourself if you are unfamiliar:
http://en.wikipedia.org/wiki/UEFA_Champions_League
http://en.wikipedia.org/wiki/UEFA_Champions_League_2006-07

I don't have an article for this but I believe this year is truly the year of the mid-major. Last year was a break-through for them with the Missouri Valley Conference but they are taking down the big boys early (UNC, LSU, Tenn- just to name a few). But besides Gonzaga, you got Wichita State and Butler cracking the top 25 early.

Morons can appear to be geniuses

Yes, I am in a Scott Adams phase. Maybe if there was some more action in the NCAA.BK space, I could blog about that. But I think this post has univeral appeal:

A) For everyone who wants others to think they are smarter than they really are

B) For everyone who wants to know who the poseurs are

C) Both A and B (this would include me)

Adams says, in four managable steps:

...you need to wear corrective lenses even if your eyesight is perfect

...you must learn to stop talking so much

It’s also good to know a few brainy words that only appear in high-end publications...

...round out your artificial sense of smartness by becoming a fake wine expert

I do recall some ancient wise guy once saying "Even a fool is thought wise if he keeps silent, and discerning if he holds his tongue." He was an antediluvian fellow.

Mortgage delinquencies upticking

In today's WSJ (subscription required):

Based on current performance, 2006 is on track to be one of the worst ever for subprime loans, according to UBS AG. "We are a bit surprised by how fast this has unraveled," says Thomas Zimmerman, head of asset-backed securities research at UBS. Roughly 80,000 subprime borrowers who took out mortgages packaged into securities this year are behind on their payments, the bank says.

80,000 is not a big number, given that roughly 50 million households (about half the households in the U.S.) own 20% or more of their homes. Even if the deliquency incidence rises to 500,000 households, I don't think it will materially impact the economy. If it gets up to 2.5 million households, yes I think it's a real problem at that point, because that will exceed the unemployment rate, which suggests that even people earning regular income are in way, way over their heads.

The few bears that are left over in this post-2002 tax cut expansion will tell you that the sky is falling with this rise in delinquencies. I say, not yet.

Kobe Bryant Goes NUTS!

Once again the great Kobe Bryant scores a whopping 52 Points! With a great start with 10 points coming from the 1st quarter, 12 points in the second and dominating 30 points in the 3rd quarter (tying his own franchise record in the third) 9/9 from the floor in the third. Scoring 52 for his highest scoring this season. The most points he's had since the 81 points against Toronto. After the great thrilling performance at the Staples center on TNT, Kobe Bryant led his team to a easy 30 point win; 132-102 over Utah Thursday night. Which pushed his team to a 10-5 record and standing strong with a 2 game lead over Sacramento in their division.

After a great Central Michigan win, www.pregameconsensus.blogspot.com goes 8-1. Be sure to follow up on the consensus at my other blog they're smoking HOT! (there's a USA Championship play in the daily picks page)

Thursday Night NFL Nov 30

YES, i'm back. This is just a game that I can't let go. I must post this one, it just seems too good for me to not share it with you guys

The Pittsburgh Steelers felt like they were hit with a lead pipe last week when the Baltimore Ravens buried them 27-0. Now fellow AFC North club Cincinnati becomes the next team to try to derail the Ravens' express. To the Bengals advantage they get the Ravens at home but to their disadvantage they haven't played well there, going 2-3 straight-up and 1-4-1 ATS. Overall the Bengals are 6-5 and need this game to stay afloat in the AFC wildcard regatta. Cincinnati was almost as impressive as the Ravens last week, burying Cleveland on the road 30-0. It was the Bengals second consecutive win following a three-game slide with the middle loss coming at Baltimore by a 26-20 score. The Ravens have won five in row to get to 9-2 on the year (7-4 ATS) and can clinch the AFC North with a win.

Baltimore: 14-4 Under as an underdog
Cincinnati: 0-6 ATS at home off BB wins

JEDI THOUGHTS: Despite the fact that Cincy is 0-6, Doesn't count that this game means way more than those six loses they losed after after back to back home wins. If this game goes under, it'll be decided by who scores to 17 points first. And I clearly see Cincy scoring that in the first half. Take this game and thank me later =)

Jedi Pick: Cincinnatti -3
Be sure to check out my other blog, it's going after ANOTHER CONSENSUS TONIGHT on the CFB MAC Championship game. Check it out at www.pregameconsensus.blogspot.com the consensus is at 7-1, and 7 sweeping days of daily picks this month.

Geniuses appear to be morons

Early in the life of this blog, I posted about core drivers (even needs), an insider's view, about those of us who enjoy trading futures on TS. A snippet:

An even higher aspiration than wrestling with one's fellow man, there is something in each one of us that wants to be able to predict the future. To see farther, to understand more, to know Truth. If we can make the call to go left vs right, to take the shortcut, to go for it on fourth down, to see the incoming missile and get to cover in time, we can save ourselves and our loved ones. We'd be qualified to lead others to safety, and even to the Promised Land.

Now, two of my favorite bloggers, Scott Adams and Alex Tabbarok, have taken up the subject of being radically correct, even while being accused as being wrong. The cartoonist says:

And you probably know from your own experience that if you have an incredible idea of your own – the sort that is later proven to be genius because it works – that people around you will consider you a moron right up until the point your idea works. Then they’ll think you’re a lucky moron. Genius looks just like stupidity to the observer.

The professor says, about Milton Friedman (my favorite economist):

Friedman sets up a very simple model, Z(t)=X(t)+Y(t) where Z(t) is income at time t, X(t) is what income would be if there were no counter-cyclical government policy and Y(t) is the amount added to or subtracted from X(t) by the history of government policy.

You wouldn't think that much could come out of such a simple model but Friedman takes the model, notes that the formula for the variance of two random variables is V(Z)=V(X)+V(Y)+2 r(X,Y) Sd(X) Sd(Y) (where V is variance, r correlation and Sd is standard deviation) and proceeds to show that:

In order to cut the variance of income fluctuations in half (which would cut the standard deviation by less than a third), r(x,y) must exceed .7.

But was Friedman right? In the thirty or so years after he wrote, when counter-cyclical policy was in vogue, the variance of the US economy was much lower than in the pre-World War I years. Reality it appeared, refuted Milton Friedman.

Friedman, however, lived to see his simple model proved correct (Essays in Positive Economics!). In a series of papers beginning in 1986, Christina Romer showed that the pre-WWI volatility was an artifact of the way the data was collected. Once the pre-WWI and post-WWII data were collected consistently, using the same methods, the post-WWII economy showed no big drop in volatility.

Almost nothing in, a surprising and powerful result out, and an implicit prediction proven correct after thirty years. That's the Friedman magic.

A Teacher long ago also once said as much, in stating "a prophet has no honor in his hometown".

So for those of you who are being accused as morons: if your trading P/L is consistently positive, don't listen to the peanut gallery. But if you are not profitable, maybe the gallery is right.

Polls or Tradesports? Which is more accurate?

I came across this article on Kausfiles at Slate this morning and the author does a modest analyzation of the 4 major polling firms (Rasmussen, Mason-Dixon, Survey USA, Zogby) vs the results of the actual 2006 results. The order of finish according to the spread or difference of the final polls were as follows: Mason-Dixon, Rasmussen, Survey USA, Zogby. Read the article for more info. Now I know in 2004, Tradesports predicted every race except one according to a Dartmouth study if I am not mistaken; but does anyone know how TS did this year? I know for example on the GOP Senate control (trading in the 60-70s) lost big while if you looked at the state by state contracts for Senate the Democrats were actually winning. I also think off of the top of my head TS was wrong on the gubernatorial election in Minnesota where Pawlenty pulled it out over Hatch (the TS contracts were pretty heavily tilted in Hatch's favor, but lack of liquidity could be the culprit). I wish I had more time to fully analyze the results but let me know what you found to be the case. While I believe polls tend to give the general "temperature" per se of the race (whether the race is close or not), I still believe TS is the better indicator of not only the closeness of the race but who wins as long as there is great enough liquidity.


http://online.wsj.com/public/article/SB116360961928023945-o2r3vkEjvrPBUlECMJ5Vz2_mUWg_20061215.html?mod=tff_main_tff_top

Could a Mormon be elected President?

This seems to be a hot topic over at National Review Online right now with Mitt Romney as one of the "Big Three" for the GOP nomination. The main question is: Will conservatives vote for a Mormon? Now, depending on what you mean by conservative the question is up in the air. Generally there are two types of conservatives out there: 1) fiscal and/or 2) social. Now of the two types, I would say fiscal conservatives outnumber social conservatives. I believe all conservatives want a balanced budget, less spending, less taxes, and generally smaller gov't in size. Now most social conservatives I believe are fiscal as well but not as many fiscal conservatives are social conservatives. What is interesting about this is that Mitt Romney is aligned fairly strongly with social conservatives based on his values as a Mormon. The ironic thing about this is that despite being a social conservative, I believe more of Romney's support will come from fiscal conservatives (even though I am personally suspicious that Romney is a Big Govt Conservative). The reason for this is that many social conservatives are also Evangelical Christians. Mormons and Evangelical Christians have similar values but the latter distance themselves from Mormons based on the LDS' extra-Biblical teaching. This may not rub a soley fiscal conservative the wrong way but it could be hard for Romney to pick up the Evangelical vote precisely because of this. What could also very well hurt Romney is coverage by the media were he to win the GOP nomination. The media already picks on Christianity enough as it is, it will be interesting to see how the press reacts to the more quirky Mormonism (do your due diligence and you will know what I am talking about). Bottom line: I think Romney is a solid politician but like his other two front-runners, seems to face obvious challenges uniting the Conservative base. I would look for a dark horse candidate to make a run late (not necessarily Newt but Newt's ideas will set the campaign dialogue/debate).

Why do people both buy lottery tickets and insurance against losses?

Hat tip to Tyler Cowen. He says:

For a long time I didn't think much of Milton's seminal 1948 article on expected utility theory, but it turns out the joke is on me...

The Friedman-Savage piece starts with an obvious puzzle: why do people both buy lottery tickets and insurance against losses? That would seem to make them both risk-loving and risk-averse at the same time. The proffered answer is simple: part of the utility function is concave, and part is convex. Across the lower range we wish to play it safe, but above a certain margina we are willing to take gambles (by the way, here is some evidence, and why it might follow from market constraints).

I admit that I have bought about 100 lottery tickets in my lifetime, whenever the (overstated) pot is over $20 million, which usually yields the (false) expected value > 1.0. The reasons why the pot and expected value are false:

1) The pot figure is a total of future payments, usually over 20 years. The lump sum payout option is about half of the advertised pot, and that is before taxes.

2) There is a material risk of splitting the pot with identical tickets.

But even knowing this, I still have spent the $100 over the last 20 years. Silly me.

Since we are on the topic of utility, awhile back, I posted a reference to Pascal's Wager. Jason Ruspini recently linked to Alex Tabarrok's paper on the rationality of taking the wager, which I had read a long time ago. If you ever find yourself estimating your personal utilities beyond your estimated life expectancy, I suggest you read the whole paper.

Newt for Prez in 2008

Hello all, I returned from Jamaica this weekend and am back in the great state of Texas. At work I came across this article on cnnmoney.com regarding a Fortune interview with Newt Gingrich. Those of you who know me know Newt is my #1 candidate for the GOP nomination because right now, he is the only leader I know of that will lead from conservative principles and actually has ideas of transforming healthcare, the economy, and our energy dependency. Here is an excerpt:

But Armey adds: "He's never been a parochial member of Congress. He has big ideas, and has had them for a long time. He's not going to appear to have just discovered them for the purposes of an election. And that's a good place to be for an '08 candidate."

http://money.cnn.com/2006/11/20/magazines/fortune/newt.fortune/index.htm?postversion=2006112013

Brandon Lang's 75 Dimer

Since I haven't been doing much, and other have been saying I should give it up. I thought I might as well post another handicappers pick. This is from the great Brandon Lang and his insights of his picks. Bet wisely, I usually don't follow this guy, but maybe he's better luck than I am.

BRANDON LANG SUNDAY75 DIME
Denver Broncos
I dont get this line or why people really believe the Chargers are going to come in here and win this game. Not going to happen tonight.First of all, they are playing in a place they have lost 10 of their last 11 games including 6 in a row. I am talking about 6 in a row here folks.Secondly, they have a head coach who has lost 13 of his last 17 to the Denver Broncos. Not exactly confidence building numbers heading into this game tonight.Now, let me point out that with Merriman out of the lineup for the Chargers they have been torched for 25 points at home by Cleveland in a 32-25 failing to cover as a 13 point home favorite.Then last week, they travel all the way cross country and get in the highest scoring game of the year with the Bengals, coming from 28-7 down at the half to win 49-41 in a game that I got tired watching.Now they travel all the way back home only to go up to the altitude of Denver without their best defensive player against a team they just cant beat. I dont know about you but you couldnt ask for a better spot to hammer the Broncos.Now, I know Denver has struggled a bit offensively but if you really look a little closer you will see that not to be true. Let me take you to the numbers.They put up 31 at home against Indy and then go to Pittsburgh and get 31. Now just because they struggled last week in Oakland scoring 17 points, everyone thinks they are struggling. I give the Raiders 50 % credit for shutting down the Broncos and the other 50% to the Broncos being in a huge flat spot off the Colts and Steelers games.Let me also point out the Raiders have the 2nd rated pass defense in the NFL and 9th ranked defense overall. Just because they have no offense, people lose sight of just how good the Raiders are playing defensively all year.Denver will be refreshed tonight, playing at home, versus a defense that in their last 5 games has given up 19 to the Niners on the road, 30 on the road to the Chiefs, 24 at home to the Rams, 25 at home to the Browns and 41 on the road at Cincinnati. Do you have confidence in this Chargers defense, on the road again, without their best defensive player, to stop this Denver team and Mike Shanahan? I know I dont and I will force them to step up and do just that. My money says they cant and the Broncos are a huge play for me today.
75 Dime Winner Denver

PregameConsensus SWEEPS Daily Picks AGAIN!

Yesterday I posted 4 plays. And AGAIN the daily picks page SWEEPS the board for the 4th time this month. And a consensus record at 5-0 WOW! I'd like to thank the people that I have posted on the blog and to keep up the good work. Ronniedizel has a great pick today (is actually GOY#2), you can find it on my blog also, and other great picks for today. www.pregameconsensus.blogspot.com

Michigan @ Ohio St.

There's a berth in the BCS Title game at stake Saturday in Columbus, Ohio when the #2 Michigan Wolverines come calling on the #1 Ohio State Buckeyes. But this game might not settle the issue. If the game is close, a classic, an overtime thriller, then the call will go out for a rematch in the Championship Game. The call will be even louder if #2 Michigan earns a narrow victory: certainly the former #1 Buckeyes will demand and deserve a rematch. Of course, Ohio State isn't supposed to lose this one. Favored by seven points the 11-0 Buckeyes (8-2-1 ATS) are 4-1 vs. Michigan under coach Jim Tressel and are 4-2-1 straight-up (5-2 ATS) the last seven played at Columbus. But Michigan is also undefeated (11-0) and a fine spread team (6-4-1 ATS).

JEDI THOUGHTS: Troy Smith plays too good in big games. If Michigan can stop him with their great defense then it'll be tough. Considering Michigan's former coach just passing away, Michigan will play with HEART! Which can lead them to winning this game (would of been a major factor if they were playing at the big house rather than the horseshoe) But i'm still thinking 7 points is way to much for a great defensive game. DEFENSE WINS GAMES! But OHIO WILL STOMP ALL OVER E'M

Jedi Pick Of the Day: Ohio St. -7

PREGAME STEAM ALERT!
There's a PREGAME STEAM pick today, which made my Pregame Consensus blog. They're going for another dent in the winning column. Check it out, you know where to find it.

Pittsburgh GETS WHOOPED!

As you guys should have already known, that Pitt couldn't play up against WV. They hung in there with e'm for awhile but couldn't even keep up within 11 points. If you guys have check out my other blog www.pregameconsensus.blogspot.com you know they those guys went 5-0 on consensus last night on the ohio/akron game. I did post that game late on that site, but I did post before game time. I didn't have much of a bad day last night, got my money back and more from the Ohio, Warriors game. And didn't do so great on Pitt here, so I'm releasing my GAME OF THE YEAR later this afternoon, this is going to be my biggest wager in NFL this season. I'll try to post it by this afternoon so the spread doesn't jump any higher. I'm a 100, 200 dollar bettor, and i'm layind down 3000 on this game. I've been watching this game for two weeks now. So come back later afternoon for my release.

West Virginia @ Pittsburgh

West Virginia @ Pittsburgh

The Backyard Brawl will play out on National TV as #8 West Virginia visits Pittsburgh Thursday night on ESPN. West Virginia (8-1, 3-1) was knocked out of the national title hunt with a 44-34 loss at then-No. 5 Louisville on Nov. 2. But it rebounded with a 42-24 win over Cincinnati in its last and with wins over Pitt, South Florida and Rutgers can stay in the BCS Hunt with an 11-1 finish. Meanwhile Pitt is Bowl-eligible at 6-4 but has dropped three straight and has this contest and Louisville next so could be looking at five straight losses and a .500 finish. The Panthers lost Saturday 46-45 defeat in double overtime at Connecticut as an 8.5-pt. favorite. Pitt blew a 14-point, fourth-quarter lead in that contest. Check out daily plays at www.pregameconsensus.blogspot.com these guys hit ANOTHER PERFECT day yesterday! Still doing homework on this game. Be sure to check back later before game time, on tonights game. And they're now a perfect 4-0 on consensus

West Virginia: 8-1 ATS after forcing 3+ turnovers
Pittsburgh: 12-25 ATS off an Over

JEDI'S PICK: Pittsburgh +11

JEDI THOUGHTS: Theres a system I use that if you're a home underdog with more of a time possession handling the ball, and controlling the ball with yardage by passing or rushing, take the home dog!

ALERT THERE'S A CONSENSUS PLAY at www.pregameconsensus.blogspot.com they're 4-0 with another pick tonight, check it out!

Slim chance of overturning the ban

My good friends, BUCWILD and ****73NJ, were asking me about this article, which starts:

Casino executives and a poker lobby group said that they hope a change in power brought by the midterm elections will help them overturn an Internet gambling ban rushed through Congress while Republicans were still in control.

I don't think so. My reasons?

1. The GOP was obtuse enough to pass this ban, while excepting for state lotteries, horses, and casinos. The Dems are historically more obtuse.

2. This was not a major issue in the midterm elections.

3. As Dick Armey said today, the only place where avoiding any economic understanding furthers a career is in Congress. While the futures markets did not predict these recent election results perfectly, they still seem to outperform polls. So if information futures are bad, polls are worse. And if information futures are better than polls, then if used properly, we may improve lives and policy. Why would we expect Congress to improve lives and policy?

4. The article talks about how states can determine internet policy, just like with casinos. Duh!!! What is the point of the internet, if sites are excluded by state? Another terrible idea.

Here are some ideas from Jason Ruspini and Tom Bell, about some legislative possibilities. An excerpt:

Tom W. Bell's suggestion that lobbying campaigns take place at the state level could therefore be helpful. Efforts that would be ineffectively small at the federal level could be marshaled and directed at the most favorable states. The markets would only be legally open to those states' residents, and the operators of the markets should make the good-faith practice of blocking clients from states were gambling is clearly illegal. But there is reason to suspect that if such a law is passed in one state, others will follow, in part from precedent, in part as a tax-dollar rush. At some point, a network effect will help the process along. Within a couple of years, a "confederation" of states where prediction markets are legal could be bootstrapped.

Milton Friedman, my favorite economist, dead today

1912-2006. More to come.

UPDATE: According to his autobiography, Friedman considered his television series Free To Choose, among his outstanding achievements. The summary of this series, and Friedman's priceless body of work to us:

Free To Choose is about freedom, the interrelationship of personal, political and economic freedom. Free To Choose is about the ideas of Milton and Rose Friedman, ideas that still dominate public policy debates decades after they were first proposed. Free To Choose is about those who refined and continue to extend these ideas.

Why am I still slightly bearish on the Dow

The DJIA will trade over 12300 today. A few weeks ago, I called a retreat down to 11600 through early 2007. I am now revising that target to 11800.

Why am I still more bearish than the market? I think the market is obsessed with docile inflation (like the nice CPI that came out today), and also the prospects of a Fed funds cut--which are contrarian forces pushing against each other.

I am still looking more at economic growth and corporate earnings. Those are no longer growing faster than stock prices. One indicator of that: the price/earnings ratio of the S&P 500 has increased by 0.25% over the last couple of months.

The Pit is better if there are fewer smart people in there

How can I say such a thing? I didn't, Scott Adams did. And he's pretty smart. Read the whole thing, especially his finding that Mensa geniuses are losers. Here's an excerpt:

In prior posts I’ve mentioned how much I’d like to see political polls that are limited to the smart, well-informed people. I have to confess, I thought I was stating a universal truth along the lines of “it’s better to have good health than poor health.” It seemed to me that being smart and well-informed was almost the same thing as being wise. Who doesn’t want the benefit of wisdom to inform their choices?

I was surprised at how many of my readers rushed to support the high quality of decisions made by stupid, uninformed people who are guided by superstition.

Some people accused me of being an elitist trying to assign a higher value to my own smarty-pants decisions. That’s a perfectly reasonable assumption, and I would have made it myself if I were in your Birkenstocks. But the truth is that I want to know the opinions of people who are both smarter and more informed than me. Why would I limit the quality of my advice to people who don’t know any more than I do?

And yes, I agree that Carter was "smarter" than Reagan, in the academic sense. I do not think that Reagan would have flourished at the Naval Academy. But Adams and I seem to agree that Reagan was a whole lot more effective.

UPDATE: It looks like Adams and I have another thing in common: we both have bought some GOD.EXISTS, as Adams concludes with "Alternately, we can keep voting for the guy with the best hair while waiting for the Rapture. That might work too." Check out the latest rounds at Midas Oracle: Jason Ruspini chuckles, Chris Masse celebrates, and Alex Forshaw is maybe a little more testy than me.

PregameConsensus STRIKES AGAIN!

WOW! Need I say more? These guys are hitting like crazy. Jeff Bonds STRIKES AGAIN! Hits his Premium Pick Tryout at pregame. This pick was a daily pick at pregameconsensus.blogspot.com MAN THIS IS CRAZY! These guys won't stop winnning! As you guys already know. I had ANOTHER stop last night OUCH! I can't hit a two game winning streak. But my advice to you guys. Check out my other blog. These guys are winning like crazy. I'll update again tomorrow morning for their picks on college, so be sure to check it out before game time. GL everyone.

Louisville vs. Rutgers

Ok Ok, here it is, everyone is hammering Rutgers tonight, and Louisville is a big public favorite. So i'm going to leave the pick to the consensus (they are 3-0) at www.pregameconsensus.blogspot.com and tonight i'm taking the under at 51 only because Rutgers is going to play a good defensive game tonight.

Jedi Pick Of the Day: Louisville/Rutgers UNDER 51

Redemptive Cynicism

Or Cynical Redemption, perhaps? Chris Masse has spurred me to engage my brain on voting, and I think the best thing I've read in a long time is what Glen Whitman said about Bryan Caplan's Irrational Voter. Caplan says:

But why are there some areas – like politics and religion – where irrationality seems especially pronounced? My answer is that irrationality, like ignorance, is sensitive to price, and false beliefs about politics and religion are cheap. If you underestimate the costs of excessive drinking, you can ruin your life. In contrast, if you underestimate the benefits of immigration, or the evidence in favor of the theory of evolution, what happens to you? In all probability, the same thing that would have happened to you if you knew the whole truth.

In a sense, then, there is a method to the average voter's madness. Even when his views are completely wrong, he gets the psychological benefit of emotionally appealing political beliefs at a bargain price. No wonder he buys in bulk.

And Whitman reflects:

Bryan focuses on economics as an area in which voters are particularly likely to be wrong, and he shows this by contrasting the opinions of voters and professional economists. I find the argument compelling – but then again, I’m an economist. Besides, as I argued in the post linked earlier, economists may be less vulnerable to psychological rent-seeking because their training imbues them with an awareness of trade-offs and a tendency to balance competing goals (since nearly any goal is subject to diminishing returns at some point). Thus, Bryan may be biasing the case in his favor by choosing an area in which the experts are less susceptible to the sort of bias we should be concerned about.

Arguably, one aspect of voters’ irrationality is their credulity about the claims of supposedly public-minded experts. As Bryan’s colleague Don Boudreaux points out, a candidate’s being “pro-teacher” is quite different from the candidate’s being “pro-education.” Similarly, “pro-union” does not necessarily mean “pro-worker.” Yet voters will often conflate the two. Although I agree with Bryan’s overall perspective, I wonder if his deference to the opinions of experts might exacerbate a prominent source of voter error.

You might call it Heisenberg's Uncertainty Principle; I call it baggage. Voter baggage. We all have post-modern 3D Xray glasses on now.

That said, I think that Caplan's antireligious bias may cost him more than anything he is able to measure, at least, according to Pascal's Wager. In sum, Pascal reasons that a Bettor should Buy GOD.EXISTS and definitely not Sell Him. The downside of expiring the contract at 0 is very small (i.e. you aren't going to Heaven, no biggie), compared to the huge upside of ending up in the money--and the huge downside if you are caught short (i.e. you spend eternity surrounded by hot brimstone).

I have 3 words for trading futures contracts, and the same 3 words for the eternal soul:

Risk Adjusted Returns

By another Way: For what does it profit a man to gain the whole world, and forfeit his soul?

Louisville @ Rutgers

For the second week running the Louisville Cardinals face an unbeaten Big East Conference foe on Thursday night TV. Louisville (8-0, 3-0) vaulted to No. 3 in the Bowl Championship Series standings with last week's 44-34 victory over then-No. 3 West Virginia as a two-point home dog. This time around the Cardinals are on the road versus #15 Rutgers which is also 8-0 on the year and 3-0 in Conference play. The Cardinals, who have never opened 9-0, have outscored their opponents 315-122 while racking up 492.6 yards of offense per game. Rutgers has done it with defense, holding opponents to 227.3 yards/game and outscoring them 234-73. Louisville took last year's meeting at home 56-5 as a 21.-5-pt. chalk.

Louisville: 10-3 ATS off a combined score of 70+ points
Rutgers: 6-1 Under this season

Check out www.pregameconsensus.blogspot.com to see what these guys are taking. They're HOT 3-0 on consensus, and went 2-0 on their Daily Picks yesterday. Check out their DailyPicks on tonights game. I'll be posting my play here on this game later today. I just came off a great win on Tuesday's game taking Toledo, hopefully I can push the momentum to tonight.

Masse's response to my response

is here. To be clear, I share the goals stated in his note to me, specifically:

• that US-based (AND offshore) real-money prediction exchanges (a.k.a. betting exchanges) be legalized
• that prediction markets become more mainstream, especially in their forecasting dimension

and I also advocate against noncompetitive markets, including, as Chris puts it "an illegal and unregulated Irish prediction exchange having a de facto monopoly on prediction markets in America, with US citizens and US residents being forbidden to set up on US soil a competitor to this offshore operator. Crazy and unfair."

The material difference between us at this point in time is that I believe increasing the liquidity--more participants in the information markets and more accurate outcomes from that greater participation--will advance our cause more effectively than shutting a monopoly down. The NYSE and Major League Baseball are two market mechanisms that are effective monopolies (by congressional charter), and I advocate that the NYSE become more like Nasdaq and MLB like NFL. But I do not believe that shutting them down improves them, nor improves competition--it destroys it.

We have the same hopes, and the same antagonists. I believe that we are right, and that the current majority of legislators do not appreciate it. But realistically, elected legislators are not necessarily good at public policy or the law, they are good at getting votes. And a majority of voters are not good at public policy or the law, either.

Hopefully this blog is one voice that can change that over time, specifically when it comes to free trading of information futures. Thanks again for calling me out, Chris.

Some additional thoughts for Chris and my esteemed readers

I have had the benefit of sleeping on Chris' letter, and in terms of expressing my own view on what makes for good government, I would say the following 4 attributes:

1. pro-freedom, pro-family: individuals should be allowed to express their personal preferences and advocate for their children and parents

2. pro-market: individuals should be allowed to allocate their resources without barriers

3. pro-property: individuals should be able to transact with counterparties with effective enforcement of contracts

4. pro-stabilization: individuals should be protected from the threats of having their freedom, markets, and property unjustly taken away from them

Most partisan candidates tend to be pro-freedom at the expense of being pro-market, or vice versa. Libertarian sentiment emphasizes the first two, but is mostly silent on the role of government when it comes to property rights and defense. Here's hoping that we see more candidates who can advocate for all of the abovementioned points. Unfortuantely, I did not see any on my ballot in this past Tuesday's elections.

Chris Masse, writes me an open letter

I must respond, as Chris is a good friend, and so I am doing so here and now.

Dear Chris:

I apologize for this delayed response to your letter. I regret not providing specific instructions on how the hundred or so readers of this four-month-old blog should vote in their respective districts, and the apparent confusion this may have caused some.

As I trust an unfettered pricing mechanism as a superior source of information, so I also trust a federalist two-party democracy as a superior form of national leadership transition.

In each case, it is the individual actor who must buy, sell, and vote. Aggregating the actions of all the actors together yields a better outcome than trying to identify a machiavellian proxy to make those buy/sell/vote decisions away from all the actors.

Hopefully, this blog has provided some limited examples of pro-information markets leaders (e.g. Barney Frank) as well as antagonists (John Kyl, scroll down) in its limited lifespan.

My blogging intent, as stated in the header above, is to increase trading liquidity at TS. I believe that increased liquidity in information futures trading will benefit our society, as better information leads to better decision making. The benefits will flow to individuals as well as cooperative groups.

And while I pursue this goal, I do not want to distort the market or election mechanisms. I concede that some actors will make better decisions than others, and in the end, worst case, we get what we deserve. While I can strenously express my own opinion, I welcome that all others do the same, and realize that changing perspectives requires persistence and patience. In sum: I did not see the benefit of categorizing democrats, republicans, libertarians (or FIELD) as worthy of voting for, or against.

Perhaps you could enlighten me as to the type of instructions that I was remiss to provide the esteemed (and realtively few) readers of the blog. Then I can improve, applying what I can learn from you towards our shared goals.

Thanks for speaking to me directly and candidly. I believe we can be stronger partners in the future by wrestling through the issue you have raised.

Sincerely, CB.

The letter states:

My Dear “Caveat Bettor”,

I appreciate your linking to our modest group blog, Midas Oracle. How kind of you. I’m humbled by your gesture.

That said, I asked you a specific question in my previous blog post:

- You urged your fellow TradeSports traders to go to the polling stations en masse (no pun intended) so as to protest the recent damn law and save TradeSports. I made the remark to you that DEMOCRATS, TOO, VOTED FOR THE DAMN LAW IN THE U.S. HOUSE. (In the U.S. Senate too, but there the law was packaged with a Port law.)

- So my question to you (if you don’t mind), my dear “Caveat Bettor”, is this: WHAT ARE YOUR VOTE INSTRUCTIONS, EXACTLY?

I would appreciate a precise answer to my specific question.

I thank you very much for your time and your attention.

(Please don’t hesitate to explain things in plain English. I’m a little bit dumb, as everybody knows on this blog.)

Signed: Chris Masse

"The Dems are coming… the Dems are coming!"

Well a lot has taken place over the last 48 hours. The Democrats just took the Republicans behind the wood shed in the House, their about to take the Senate, and as I am writing this they apparently took out Rumsfeld. For what it is worth this is my analysis.

The Republicans had a lot of support from independent voters, and like all successful political parties had some help from multiple segments. Two main segments that have given the Republicans power have been the religious fundamentalists and the libertarians. The Republicans have failed both over the years, so the question is who will they court in the 08 run for the Presidency? Will they “stay the course” on the moral authority hypocritical high road, or will they steer the party in Reagan’s direction and relearn fiscal responsibility?

My guess is that based on McCain’s contract to win the primary that has just jumped nine points in half a day, the party will start to cater toward the libertarians. For that I am hopeful (the libertarian lean… not McCain which is a whole different subject). The though that five years from now the Democrats will have the means to instill their ideals on us scares me. Just think, five years from now Hillary could be signing a bill to provide national healthcare.

It also makes the Republican back dooring the gambling law that much more disturbing considering our government will get NOTHING done over the next two and a half years.

Post Election Wrap and a Few Words

First off, let me say my call for FL-16 was wrong and SellSellSell (aka WaveRider, WaveWarrior) was right, although he would have to admit it was closer than he thought. Last night was, well, a blood bath for the GOP. I do not have much to say that cannot be summed up by hopefully soon to be Minority Leader Mike Pence:


WASHINGTON, DC - U.S. Congressman Mike Pence released the following statement today on the GOP's midterm election loss:

"Election day 2006 will be remembered as a turning point in American political history. Twenty-five years after the Reagan Administration came to Washington with a conservative agenda of limited government, the American people chose a different course.

"It is the duty of the losing party in a free election to humbly accept defeat and to acknowledge that the people are sovereign in the People's House.

"As we examine the results of this election, it is imperative that we listen to the American people and learn the right lessons.

"Some will argue that we lost our majority because of scandals at home and challenges abroad. I say, we did not just lose our majority, we lost our way.

"While the scandals of the 109th Congress harmed our cause, the greatest scandal in Washington, D.C. is runaway federal spending.

"After 1994, we were a majority committed to balanced federal budgets, entitlement reform and advancing the principles of limited government. In recent years, our majority voted to expand the federal government's role in education, entitlements and pursued spending policies that created record deficits and national debt.

"This was not in the Contract with America and Republican voters said, 'enough is enough.'
"Our opponents will say that the American people rejected our Republican vision. I say the American people didn't quit on the Contract with America, we did. And in so doing, we severed the bonds of trust between our party and millions of our most ardent supporters.

"As the 110th Congress convenes next year, Republicans must cordially accept defeat and dedicate ourselves to advancing our cause as the loyal opposition knowing that the only way to retake our natural, governing majority, is to renew our commitment to limited government, national defense, traditional values and reform."


I will be getting married this weekend and in Jamaica the following week. Hope you all have a great weekend.


Update: A few words from Jeb Hensarling


Tuesday, November 7, 2006 (202) 225-1841
Hensarling Statement on Elections“Republicans have experimented with Big Government and it has failed.The era of Republican Big Government is over”
WASHINGTON, D.C. - Rep. Jeb Hensarling (TX-05) today issued the following this morning following Republican election losses:
“I am extremely disappointed with the outcome of today’s elections. Our party will see many good public servants leave our ranks, taking our Majority with them. I am deeply saddened by their departure, and I wish each of my departing colleagues and their families the very best.
“With loss comes a time for reflection. As Republicans, it is time for our party to look in the mirror and reflect on where we have gone wrong. Today, the American people have sent us a clear message, and that message is that we’ve deviated from our principles and values.
“The American people empowered us because of a shared commitment to reform government, to balance federal budgets, and to promote individual freedom while remaining true to our American values. Instead, over the last several years, Republicans have experimented with big government, and we have now seen the result. The Bridge to Nowhere has led us here. The era of Republican Big Government is over.
“There is no doubt that great anxiety over the War in Iraq played a role in our defeat. There is also no doubt that the American people and our fellow Republicans grew sick and tired of the scandals that too often plagued our Majority. Yet, all of the problems that have led to the defeat of our Majority are traceable back to one issue: an out-of-control government.
“To return to our Majority, we must renew our commitment to the principles of Ronald Regan and the Contract of America. Our core vision of limited government, individual empowerment, a strong national defense and traditional values enabled us to effectively establish a trust with the American people. We will now return to these principles and communicate our vision effectively, building a new Republican Majority in the process.”

Check out Midas Oracle, Prediction Markets Blog, if you haven't yet

I've been crazy busy, and should have blogrolled my good friend Chris Masse's new joint venture a month ago. Chris is the subject matter expert for prediction markets.

The latest link is relevant to today's election, and those handicapping with the help of exit poll data:

Biased And Inaccurate Predictions Have Led To Poor GOP Exit Poll Showings In Past Three National Election

UPDATE: Another nice link from Midas Oracle, to OpinionJournal's John Fund reporting on how exit poll reporting will have reduced bias. It starts:

This year the networks say they are guarding their exit poll results as if they were crown jewels. The results will be delivered to a "quarantine room," access to which will be granted to only two staffers from each network and wire service, who must surrender all cell phones, BlackBerrys and similar devices before entering the room. Such precautions are designed to prevent preliminary results, often wrong in 2000 and 2004, from being posted on Web sites like the Drudge Report.

Only at 5 p.m. will the occupants of the quarantine room be allowed to reveal the exit polls to their bosses. The networks claim to have completely revamped their exit-poll methodology, which in 2004 had surveys in which the results, collected mostly by female graduate students, consistently favored Democrats. The changes will mean the networks will be slower to call the winners. That and the difficulty of adjusting for the large number of absentee ballots could mean a longer night than usual.

Friends of Tradesports: Please vote today!

My good friend in the Pit, drugtest, reminds me that legalized information futures trading is not a major issue for our nation. However, may I suggest that you still consider it as a tertiary factor as you choose who will govern you in 2007 and beyond.

UPDATE NCAA Football Nov. 7

Hello again everyone, i'm back and ready to go. I've been out with a broken computer (darn viruses) and plus I was taking a break. While I was gone, I had a friend start another blog for me to post up my picks, because there have been alot of people emailing me about when i'm going to get my picks back up again. So I had a friend make another blog. I'll still be posting on here, and also on my blog. He's also done a good job with keeping track with Pregame and posting their consensus. They've gone 3-0 on consensus and I believe they've been hammering their daily picks. So if you want to check it out go to pregameconsensus.blogspot.com From here i'll leave you guys with tonights Toledo N. Illinois Game

Toledo @ N. Illinois

It's Tuesday Night Football from the Mid-American Conference as Northern Illinois hosts Toledo. The host Huskies dropped to 5-4 a week ago Saturday with a 24-14 loss at Iowa but got the cover as a two-touchdown dog. Covering is something NIU has not been doing this year: that got it to 2-6 ATS on the year. At home the Huskies are 3-1 straight-up but 0-3 ATS with their last a 43-21 win over Temple as a 31-point chalk. NIU is 3-2 in league play and won at Toledo last year 35-17 as an 11-pt. dog. Before that the Rockets had won nine straight in the series going back to 1992 and were 6-0 ATS. Toledo has won the last five at NIU, going 3-0 ATS, but has fallen on hard times this year with a 3-6 record and a 3-5 spread mark. .

Toledo: 7-0 Under away off a conference win

Northern Illinois: 11-2 ATS after gaining 125 or less passing yards

JEDIMINDTRICKS Pick Of the Day: Toledo +12

Is the Sleeper awakening?

Novak agrees, now the New York Times is catching up:


http://www.nytimes.com/2006/11/02/us/02foley.html?ei=5065&en=e89d75b8939debb7&ex=1163048400&partner=MYWAY&pagewanted=print


Could be the House Spoiler!

Hold onto your hats; we are heading under 12000

Nonfarm productivity was reported as 0.0%. Unit labor costs continue to rise quickly at a 3.8% pace (although this also means that households are enjoying significant income gains). Jobless data was fairly steady.

I am sticking with my DOW.TOUCH.11600.JAN2007 call from last month.

Dem Value/Sleeper Plays

Unfortunately, my original post was accidentally deleted as I was allowing pop-ups to run spell check so my analysis will not be as in-depth.

Dem Value Play:

NM-01.HOUSE.DEM This race has pitted Democratic challenger Patricia Madrid against incumbent Republican Heather Wilson. Early polling had Wilson up but has since reversed and is trending to Madrid who now has the lead. This district went for Kerry 51/48 in 2004 and with Madrid last trading at 44 and Wilson at 30; this is a toss-up race/lean dem that is also a strong value.

Dem Sleeper Play:

NV.GOVERN06.DEM The incumbent Republican Guinn is no longer running for office and this pits Republican Jim Gibbons vs. Democrat Dina Titus. Gibbons has had a lead in every poll except for a recent Zogby Interactive poll where he was trailing by 1% pt. What makes this race interesting is that Gibbons has not received Guinn's direct endorsement and his lead is now within the margin of error according to a recent Rasmussen poll with Gibbons lead of only 2% points. His lead has been shrinking steadily and this state went for Bush 50/48 in 2004. Right now Titus last traded at 25 vs. Gibbons at 75. This could be an upset that would return nicely.


UPDATE: Robert Novak has surprisingly included FL-16 as a GOP retention in his final outlook, which just so happens to be my sleeper pick for the GOP. http://www.humanevents.com/evansnovak.php?id=17809#2

Full Disclosure: I do not own the above stated positions, my money got taken from me in the infamous DOW -50 close glitch.


Clarification: I had originally posted this on the first attempt before I accidentally deleted it. There are two main theories about the election: 1) there will be a Democratic "wave" or 2) the GOP still has a shot at keeping both Houses. The above picks try to keep both theories in mind, that in a close race either has a shot at going to the Dems. I personally subscribe to theory #2; however, if there is a wave these races are definately in play, and NM-1 is a key race for both parties.

Thank you for the introduction...

Thanks Cav for letting me contribute. I have been on TS for over a year now and hope to contribute/create interesting discussion. My main posts will mainly be for sports/business/politics.

My Value Buy of The Day:

VA.SENATE06.GOP Last traded at 45; Allen dropped around 20+ pts today due to a few polls that came out today. Rasmussen showed Democratic challenger up 5 pts but the sample apparently came from only one day of polling and that occured on a Sunday. CNN and Zogby also came out with polls showing Webb up by 4 pts as well. Zogby has had a history of being inaccurate over the past few election cycles but this is a race to keep an eye on and for less than 50 screams buy.


My Sleeper Buy of the Day:

FL-16.HOUSE.DEM Shorting this seat in my humble opinion is my sleeper pick for the house election. Last trade was at 71 (albeit low volume) but if you can short it in the high 60's/70's it should return nice. This is Mark Foley's old seat and while GOP chances in this district looked slim at first, retaining this seat now looks like a possiblity. There are two distinct differences between this race and Tx-22 (Delay's old seat). 1) A vote for foley is a vote Negron and 2) Foley's name is already on the ballot. The public in this district is already very aware of the situation due to the extensive media coverage and roughly 60%+ already know Foley is no longer running. Another plus for the GOP is that this is a strong Republican district. (correction- republican leaning district- Bush54/46).

Update: Via RCP, an appeals court has ruled that signs can notify voters that "a vote for foley is a vote for negron" as long as the signs also say "a vote for mahoney is a vote for mahoney".

Full Disclosure: I currently own both positions

Please give a warm welcome to

bmili, who will be posting here. He is a good friend from the Pit.

WSJ Reports GOP Edge

From today's WSJ:

Republicans have had an advantage with early-voter turnout over Democrats because of better party funding and organization, according to Paul Gronke, director of the Early Voting Information Center at Reed College in Oregon, a state where traditional Election Day polling has been eliminated altogether in favor of voting by mail. "I suspect it will still be their advantage," he said.

In congressional districts from Ohio and Florida to New Mexico and Arizona, Republicans report that their get-out-the-vote organization is gaining traction a week ahead of Election Day. The aim of the effort generally is to maximize turnout among their most loyal and reliable voters. If successful, it could help them to hold down their losses in this election cycle and perhaps even retain their majorities in the House and Senate.

In the fiercely contested New Mexico district held by Republican Heather Wilson, the party says that the number of absentee ballots already requested by Republicans has almost reached the number requested in 2004 -- nearly 22,000 so far this year, compared with almost 24,000 in 2004. The party says it is on a pace to exceed 2004.

Meanwhile, in the bellwether Ohio district held by Republican Steve Chabot, about 60% of all early votes are coming from the roughly 40% of the electorate that the party has targeted for early voting. That's the highest rate in the country, according to an internal party memo, and good news -- "provided they vote the way we predict," the memo adds.

In two Florida districts that are in doubt -- the 13th and 16th, previously held by Reps. Katherine Harris and Mark Foley, respectively -- Republicans are ahead in both absentee balloting and early voting. In previous election cycles, Democrats have enjoyed an advantage in early voting, party operatives say.

And in the Georgia congressional district now held by Democrat Jim Marshall, "nearly twice as many of our supporters are voting as they should be, based on population," according to the internal memo. President Bush will visit the district today to stump for the Republican challenger, former congressman Mac Collins. Republicans hope to unseat Democrats in two districts in Georgia as a way of offsetting losses expected in districts across the Midwest and in the Northeast.

Solid economic forecaster thinks GOP retains control of both houses

Brian Wesbury says:

In another important area of analysis, we are convinced that national polls are overstating the potential for Republicans to lose both houses of Congress. Our local congressional contest (IL-6), between Peter Roskam (R) and Tammy Duckworth (D), for the seat being vacated by long serving house member Henry Hyde (R), is considered a toss-up by many national pollsters.

This seat is mostly in DuPage County, a staunch Republican stronghold. If the polls are correct, there has been a groundswell of Democratic support. But there is scant evidence to support this notion.

In the 2004 primary, an uncontested Hyde received 50,583 votes, while two Democrats split 36,158 votes. Hyde went on to win 139,627 to 110,470. In the 2006 primary, an uncontested Peter Roskam received 50,794 votes, while three Democratic challengers (who spent almost $1 million combined) split 32,575 votes. Republican votes went up by 211, while Democratic votes fell by 3,583. Where’s the groundswell?

While we have not analyzed every race in the country, based upon hard data from IL-6, we are discounting national polls, and we continue to believe that Republicans will maintain control of both houses of Congress this election.

I think Westbury forecasts as well as any economist out there. And I am long a little HOUSE.GOP.2006.