With 50 days to go before the election, the race for President remains hotly contested–and close. Sure, you could bury yourself in MSNBC, CNN, and Fox for a non-stop slew of reporting on likely scenarios and probabilities of victory. But there are analysts out there much sharper than the political pundits. They’re the guys running the sports books. Yes, ironically, you can actually gamble on the Presidential Election.
For those of you faint-at-heart or honest or sheltered, a sportsbook is a place that establishes odds and takes bets on various sporting contests. It’s a big business, estimated at over $200 billion dollars annually across the planet, with the Super Bowl accounting for $7 billion in just one day. The analysis that goes into establishing odds is no less intense (while probably being done more scrupulously) than what takes place on Wall Street.
A survey of three major online sports books reveals that Obama is a clear favorite:
Sportsbook.com: Obama -150, McCain -110 (To win $100, one must bet $150 on Obama or $110 on McCain.)
BetUs.com: Obama -130, McCain -110. (To win $100, one must bet $130 on Obama or $110 on McCain.)
Bodog.com: Obama -145, McCain +105 (To win $100, one must bet $145 on Obama and a $100 bet on McCain will bring in $105).
Odds are established so that an equal number of dollars are wagered on each side. The sports book makes their money off of the vigorish–the gap between the two propositions. The higher wager cost on Obama tells us that more people (their dollars, anyway) are betting on him to win. By raising those odds, the bookmakers are hoping to slow down the action on that proposition, while encouraging people to go to McCain for a better payout.
What the bookmakers are analysing here are the betting habits of Americans, not how economic issues may play out in Ohio or Sarah Palin’s cleavage will effect the voters of Florida. They are revealing that “more people likely to gamble on a Presidential Election” think Obama will win. Whether these “degenerates” are betting with their hearts or have spent the past three months sifting through historical voting data and current opinion polls cannot be known. The Hangover just hopes that they are right. My money–and yours, if you’re in the bottom 95% of income earners in America–is riding on it.