If John Kerry were to announce his pick of a running mate now, legions of Internet traders are betting he would choose John Edwards.
On the wagering site TradeSports, participants are giving Edwards, the youthful-looking North Carolina senator and runner-up in this year's Democratic primary, a 44 percent chance of being tapped for his party's vice presidential nomination.
Following a distant second and third are Rep. Dick Gephardt (D-Missouri) and Gen. Wesley Clark, with 10 percent and 7.5 percent likelihood, respectively, of joining the presidential ticket. Other potential VP picks with better than 2 percent odds include Sen. Hillary Rodham Clinton, New Mexico Gov. Bill Richardson and Sen. Bob Graham (D-Florida).
In all, traders have wagered more than $2 million on the vice presidential nominee since February. During that time, Edwards' odds of being chosen have ranged from a low of 20 percent to a high of 48 percent. It's a level of fluctuation that observers say isn't borne out by anything made public by the Kerry campaign, which still hasn't even disclosed when a running mate will be chosen.
"It's hard to say what the price movement means. Is it information slowly leaking out from the inside, or is it just mindless speculation?" said Justin Wolfers, an economics professor at Stanford University who studies political wagering.
Overall, Wolfers said, the current odds aren't what he'd expect to see. For one thing, he believes the chances of some long-shot candidates like Hillary Clinton or Al Gore joining the ticket are too slim to be worth wagering on.
Moreover, it's also hard to tell how speculation surrounding the possibility of Sen. John McCain (R-Arizona) joining a bipartisan ticket has affected the odds. McCain, who has repeatedly stated he won't join the ticket, isn't included in TradeSports' list of potential running mates. However, he would fall into the catchall category of "other." Traders believe that someone from this category, which includes running mates who aren't among the likely suspects, has a 22 percent chance of being selected as vice president.
While betting on election outcomes has existed since the dawn of democratic government, Wolfers said it's more unusual, and in many ways more difficult, to speculate on a non-elected position such as a running mate. Although gauges of public opinion will play a roll in the eventual VP pick, it ultimately boils down to a choice by the presumptive presidential nominee, John Kerry.
That said, Wolfers and other political analysts believe trading exchanges are often accurate forecasters of political events. The Iowa Electronic Markets, a political futures market run by the University of Iowa's Tippie College of Business, claims that its market, which allows traders to bet up to $500, frequently outperforms polls in predicting election results. In the Iowa market's last major election event – last year's California gubernatorial recall – traders were off by less than 1 percent in forecasting the margin of victory for Arnold Schwarzenegger.
As for the vice presidential selection process, traders are largely reflecting national opinion surveys in favor of Edwards. A recent Associated Press poll found that Edwards is the top pick among registered voters to be the Democratic vice presidential candidate.
Still, given that traders are in the game presumably to make money, not to boost their favorite candidate, odds on TradeSports, the Iowa Electronic Markets and other forums often don't reflect opinion polls.
In the case of George W. Bush's candidacy, for example, speculators on TradeSports believe the president currently has about a 59 percent chance of being re-elected. That's a sharp contrast to a Gallup poll conducted earlier this month that showed Kerry leading Bush in the presidential contest by 49 percent to 44 percent among registered voters.
John Delaney, chief executive of TradeSports, attributes the difference to basic capitalism.
"In an opinion poll, you will say who you would like to win," he said. "But where real money is concerned, you will say who you think will win."
