One of the things that we talked about on our recent podcast is how PredictIt traders are total farm animals when it comes to managing their biases.
To summarize, I think that most of the people betting on politics are definitely:
- Under 40
- Living in a big city
- White AF
- Making decent money
And often times:
- Subaru owners who have beards;
And if that’s not true, they are probably:
- MAGA hardos who just want to put $100 on Trump to win anything.
This causes amazing price distortions that you can absolutely punish people with. Right now they are clustered around the two big presidential candidates. Here are some rules for the road.
Joe Biden is Always Underpriced
I honestly think that PredictIt should just change its name to “The Dollar Store.” This is due to the fact that you can buy $1 there for 80-85 cents if you are willing to take a huge leap of faith and believe that Joe Biden, who is currently the only Democrat running for President, will in fact win the nomination. Let’s look at all the places where you can turn this savage insight into a profit:
This situation is honestly the most hilarious thing I have ever seen in my life, except for Chuck Schumer’s hairline.
Which Marco Rubio is currently hard at work copying:
People are literally betting that there is a 20 percent chance that Joe Biden will die, quit, or be implicated in a Harvey Weinstein-like rape scandal between now and the Democratic National Convention in August. That is a bunch of hooey. If you believe Biden’s Instagram page, then it is pretty obvious that his wife is keeping him locked in their basement 24/7. This eliminates the possibility of Uncle Joe being offed in a bad fall or getting the Coronavirus (unless he has been cranking beers down there with Chris Cuomo/Tom Hanks), so I am not that worried about him dying.
As for the politics, there is this fact, once again — NO ONE IS RUNNING AGAINST JOE BIDEN. The State of New York just canceled its presidential primary because Biden is unopposed in it.
The lesson is this: PredictIt’s core demo of young men in big cities just does not understand Joe Biden. This is not surprising. Uncle Joe’s polling consistently shows him strongest with old people, minorities, and poors. Because of that, you can almost always get a good deal taking a long position on Biden on PredictIt, which is dominated by people outside his demo. iSavage and I had a good chat about this on the pod:
Donald Trump is always overpriced
When I was a young and idealistic gambler, some of the old farts on PredictIt warned me about the “MAGA Premium.” The MAGA Premium was slang for the fact that PredictIt traders almost always gave Republicans inflated odds of success. That time has now ended. It is hard to say whether or not PredictIt favors one party or the other generally, but there is still an enormous MAGA bubble wherever Trump’s name shows up. We talk about this here:
IMO, the Trump bubble is proof that PredictIt takes a lot of bets from MAGA hardos who just want to bet on Trump winning stuff. If there had been a market on whether or not Donald Trump would buy Greenland and flip it like an Atlantic City casino, PI traders would have given it an 85 percent chance of happening. There is definitely a silent majority out there shelling-out for Trump and my assumption is that they pretty much only bet on stuff with his name in it.
Because of this, betting against Donald Trump almost always gives you a price advantage. For example, right now Trump is the favorite to win re-election on PredictIt, even though he is getting smoked by Joe Biden in battle ground states and is arguably responsible for letting a pandemic in the door that has absolutely dynamited the economy. Hmmm. Check it out:
BTW, notice how traders tax Dems harder on PredictIt than I taxed my dong in middle school as soon as Joe Biden’s name appears? These two bets are basically identical.
Correlated to markets on Trump’s re-election is this one, which is a measure of his coattails:
Are you kidding?
There is no evidence to support the idea that Republicans are primed for a comeback in the House this year. I mean, they got absolutely nuked in 2018. I know that people in politics like to say, “throw the bums out!” but honestly even homeless people are given more genteel treatment when they are removed from the suburbs than Republicans were. In 2018, it was an absolute massacre for them in areas like Orange County, CA; Houston & Dallas; and New Jersey that used to be strongholds. And there is absolutely zero evidence that the GOP has changed its game to counter-attack this cycle. They’re not going to win the House.
Once again, prices are being propped-up with bias. There is just tons of MAGA money propping up Trump’s odds and anything they touch. Bet against it and thank me later.