“Be kind, for everyone you meet is fighting a hard battle” - Often attributed to Plato but likely from Ian McLaren (pseudonym of Reverend John Watson)

Sunday, April 22, 2012

More of the same, but worse

On Intrade.com, as far as I know the best and most extensively used prediction market, it's estimated that President Obama's chance of being re-elected in November, 2012 are at about 60% and the chances of the Republican Party adding control of the Senate to its existing control of the House of Representatives are about 65%.

Say what you will about prediction markets' accuracy in comparison to other forms of prognostication, they've typically exhibited accuracy at least as good as poll results (though the markets are heavily influenced by poll results) and it's awfully easy to get moment by moment snapshots as trading takes place.

Of course, the voting results for President and for the Senate are far from independent but, if they were and if the chances above could actually be treated as probabilities rather than betting odds (see below*) then there's about a 40% likelihood that we'll have a Democratic President and that both houses of Congress will have Republican majorities.

This is not atypical of the second term of a President, but with the level of toxicity exhibited by present-day political discourse and a significant degree of public discontent (cf. the Occupy Movement and the Tea Party Movement) this seems to me to be a recipe for increasing levels of public disorder and chaos.

And, on a subject near and dear to my heart and that which is the foundational area of concentration of this blog, this is not a political environment in which the energy Sword of Damocles hanging over all of our heads will be able to be blunted.

*The salespeople in my Company must enter a "probability of win" when they log a proposal into our CRM database. We all know what we mean by this but, logically, it makes no sense. It's a one-time event and the probability is either 0 or 1, and we'll know what it was when the results are in. It's not as if we can say "in 100 similar opportunities that we've pursued in precisely this way in precisely similar environments we have won 60 of them." In order to reconcile this to the logical framework within which my thought processes operate, when a salesperson enters 60%, I interpret this to mean that he or she would take either side of a 3 to 2 bet where the bettor against us was offerred 3 units if we fail, and we win 2 units if we succeed.

Image credit: Felix Auvray via allposters.com

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