I have written in the past about the online betting site, Intrade (click here for their site), which will take wagers on anything under the sun, including a range of economic and political probabilities (click here for “Here’s the Winner of the November Election”).
The current betting is that there is a 76.5% chance that Muammar Khadafi will be gone by the end of the year. There is only a 6.2% chance that the US will launch an air strike against Iran this year. But there is a 32.4% chance that a weapon of mass destruction will be used somewhere in the world by the end of 2013.
Of greater foreboding for stock traders is that the likelihood of the US going into recession in 2012 has risen from 15.1% to 19.9% just in the last two weeks.
After watching this site with some amusement for years, I should caution potential traders that these prices are subject to huge swings, are often wrong, and come with hefty dealing spreads. Expectation often meets a tragic end at the hands of reality. They can also be very contradictory. While predicting a Democratic slaughter in the last election, they also anticipate that Obama has a 61.1% chance of winning the 2012 presidential election.