[quote=partypup][quote=esmith][quote]I bet if you reviewed some of the wagers placed on Intrade you would find that this time last year the chance of a recession was almost nil because the sheep were going on the phony, published, flawed data issued by our government.[/quote]
Actually, this time last year the chance of a 2008 recession on Intrade was just below 50%. It was above 50% throughout most of September ’07.
I should have been more clear. I was thinking more about Spring 2007, when it really became clear to me that things were going to hell. Can you get the numbers for that period? Everyone was telling me I was nuts back then.
But look at this chart — there’s something else that’s pretty telling here. These fools actually thought the chances of a recession were DROPPING in May – August of this year! Correct me if I’m mis-reading this, but weren’t they putting the odds of a recession at 10% at the beginning of September ’08? After the Bear Stearns collapse and the IMF issuing warnings about a global depression? What does that tell you? Gamblers, like stock investors, can be complete and total idiots if they are working with bad data.
What are the odds of a Depression? Is there an index for that, esmith? I have to create an account ASAP and start making some bank. I may not be able to naked short financials, but I can still take advantage of some fools on Intrade :-)[/quote]
partypup:
Two issues with your logic; first the “bad data” is what Intrade futures contracts are based on (the underlying), so the “real data” is irrelevant.
Second, to win the bet you will need two consecutive quarters of negative gdp growth (as compiled by the govt, the same ones supplying the bad data). As of May, with a positive quarter in the books, plus stimulus checks to affect 2nd quarter growth, the chances of a technical recession were receding, so odds went down. As of September their were two known quarters of positive growth in the books, with another two + months of “relative calm” before the financial meltdown. If the meltdown had occurred later, consumers may have spent enough in the 3rd qtr. to have flat to slightly positive gdp (vs. the barely negative .3% decline for Q3), and the chances of technical recession in 2008 would be zero.
