Tomorrow will bring two things: the election of Barack Obama (no jinx plz) and the end of my year-long Intrade experiment. Although I'll leave some cash on the site to experiment with, it'll be the end of me obsessively refreshing 538.com every half hour, pouring over every poll internal and following returns by county while lining up the next state to roll over the profits according to the time their polls close.

I'll miss it :(

I promised myself I'd write a summary and postmortem of the Intrade experiment, and I'm already working on it in my head. It'll be a very long article that I will likely be putting up on the 5'th or 6'th, after my hangover wears off. It'll be interesting to see how much of what I write at the end of this long, strange trip applies in '10 and '12 - you can be sure I'll be back at it next time, probably using 100% of the cash I can spare.

In the meantime, here's who to vote for. If you're a McCain supporter, I apologize in advance. If you're voting for Obama, there's a party at my friend's house tomorrow - PM me for directions.

After that...time for poker. I'm already antsy to get some hands of cash in. It's been a while, but I haven't forgotten how to play and I'm anxious to prove it to a few MSNL regs :)

I'd like to say that something interesting happened for me in poker last week, but no, not really. I only played extensively on Sunday. Results: my dad, who'd been sweating me, calls me up telling me Full Tilt is rigged. I had a good laugh, but really, it'd be nice to run good or something. I'm not asking to crush the villains and hear the lamentations of their women like Vivek does whenever he sits down at a live table, but winning slightly more than a little under my share of coinflips would be nice.

At this point, though, I'd like to talk about something else. You might've noticed this site has gotten a little less busy of late. I'd like to think it's because I've been slacking and everyone waits for my next post with bated breath, but in reality, I'm guessing it's because we all managed to collectively take breaks from poker at the same time as the economy imploded and everyone stopped caring. Trying to update a site about what most of the world (although not all of it) sees as a hobby isn't as easy when your dozen most favorite relatives' collective life savings have decreased by a third or so over the last month. I'm doing my best to singlehandedly reverse that via running an Intrade investment pool (yes, really), but I can only make 20% in three weeks so many times, y'know?

(Warning: the following has nothing to do with poker whatsoever)

I do believe that a recovery of sorts is coming, though, and I would like to get this down in writing so that I can hail myself as a visionary and quote how awesome I am:

FWIW, I think we're on the cusp of something extremely different from everything that has gone before. I know very little about market fundamentals, but I do understand human psychology, especially as it pertains to gambling and, yes, trading. My intuition, derived solely from the media and an occasional friend in the sector, is telling me that a)Wall Street thinks/wants the worst to be over and b)we have hit something at least resembling a bottom on Thursday and Friday, but c)this is because (and Wall Street likes this) the way that markets operate is now going to be hugely altered. Even six months ago, the announcement that the United States, along with Europe, now owns large chunks of many major financial institutions would not be viewed as remotely positive for anybody; now, the analysts are praising the move and traders palpably want it to work. I don't claim to know whether the economic underpinnings of this idea are solid, but the bottom line is that the G8 finance ministers have collectively undertaken a largely socialist action potentially costing trillions of dollars and the markets are *cheering* this.

I am, therefore, forced to conclude that the idea/market goal of laissez faire capitalism is dead. (Yes, I do realize that the markets were never close to that, but that isn't really the point.) The Bush administration in particular and long-held US policy in general has trended towards constant deregulation of the markets and a hands off attitude; it's now safe to say that this will never happen again in my lifetime. The series of moves the people in charge of the situation have taken may or may not work - it's easy to criticize them on the Internet, but I doubt more than ten people on the planet fully understand the ramifications right now, anyway. But what I do know is that the market participants themselves seem in favor of this socialism-type action and are trading on the assumption that it is a positive, and what *that* means is nothing more than the beginning of a fundamental, permanent shift in the way we think of economics/capitalism. Even if the interventions fail miserably, there will be a distinct lack of traders arguing for hands off, deregulatory approaches for a very long time to come.

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I make no pretense that I know what I'm talking about. My only experience with doing anything properly in this area is accurately calling the oil bubble early this summer, again based on psychology ("if the talking heads saying oil will never drop remind me of the pets.com sock puppet, it's probably going to tank soon" seems like a good rule to go by.) But hey, it's cool to have a blog I can post random gigantic speculation on!

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Also, a cameraman is gonna film me for the Washington Post's online featurette on the AP/UB scandal this Friday. That's going to come out at the same time as 60M - again, I'm guessing at the end of the month.

While everyone should check out Bond's new post about MTT grinding, I've never been the kind of guy that does very well playing an 8 hour a day - or 4 hour a day, for that matter - schedule. I wish I were, but I'm not. Nevertheless, once in a while (usually following long breaks) the unwillingness to put in hands lifts and I do spend a few hours in front of a laptop making the Sklansky dollar counter go up. I've been playing SNG's, my new daily grind in between Sundays, since the first of the month, with very good results as usual in those games. I don't think I'm playing perfect SNG poker, especially because Cake can be weird; if you put my decisions for each long individual sit and go into SNGWiz, it usually comes out with 8-10 "incorrect" decisions that turn out to be right once you adjust their ranges from the "on Stars and everywhere normal, he should be calling 100% of his hands" to the "but on Cake, he folds 80% of them" part of the slider...still leaving 1-3 hands per session that are marginal or slightly -EV. But that's nothing a few hundred donkaments' worth of rust removal won't fix. At any rate, even with the game's negative effects on motivation, it feels good to watch the green numbers go up.

Intrade is also going well. The mystery Obama shorter referred to in my last post is back and striking again for 50K worth of action at a time. Adding everything up reveals he's taken at least $150,000 of bets on McCain at odds up to 10 points above where the market was trending, which is even worse than it sounds because we're talking about shares; buying a share worth 25 points at 35 isn't just a 10% mispricing, it's more like 30%. My best guess is he's lost upwards of $25,000 - which will be far more than that if McCain actually wins - on merely buying these shares, not counting Intrade's vig. Moreover, he's still enabling monster arbitrage opportunities for everybody else with accounts on other books - consider this one last attempt to get people to trade on the site. (Hey, the more liquidity on those shares, the more everyone including myself profits against him every time he hits.)

Finally, while I'm here, I've heard a rumor - at this point, only a rumor - that the 60 Minutes piece is airing on the 26'th. This does fit what a couple of people have told me, however, so I think it's plausible and actually a go this time. The novelty's worn off a little bit for me by now, but I still really want to see how it turns out...and kinda hope Hamilton/Tom/Green all get nailed afterwards. Nobody likes the necessity of the police being involved here, but it *is* a necessity; the industry cannot afford the kind of black eye that the twin scandals back to back have given it, and getting the bad apples into court is the first step to resolving that. With the recession/depression/whatever upon us, if poker is going to be a competitor for the reduced entertainment dollar, it's simply got to be seen as a clean, fair game.

While I'm still only playing a little bit, I couldn't really justify not doing much poker-related stuff to myself, so in the interim before I ramp up my schedule again, I've started writing and coaching. Pocketfives asked me to write a computer security article, which came out on Tuesday; in addition, I started to coach a few students that have contacted me earlier.

The most recent reason why my comeback's on hold again is actually legit :), however. In the last few days, Intrade has seen a suspicious trader who has probably made > $100K in McCain bets at well over market prices, artificially depressing Intrade compared to every other political betting site by making very large bets at odd hours. I caught this guy a few days before Nate's entry and have been buying low/selling high off him several times this week. It's now gotten to the point where I'm strongly considering having the site text me at all hours as soon as a certain price point is triggered, because at the amount we're talking about, if he keeps doing it, I can make $500 a day just from being awake at the right time. But this has also forced me to evaluate all of my positions (because I might be able to make more money by buying/selling the Obama contracts than I can with my state picks if I sell them now and buy them back later), and that is time consuming.

The little "prove a point" bet that I made with 2+2 politics about the site in December now looks to be the best idea I had all year, because it's going to provide me with a very large amount of income this year and has sparked my interest in trading in general. Poker is, fundamentally, a relatively simple game. Trading is not, but traders, especially in political betting (and, I assume, sports betting) are subject to the same kinds of psychological issues that poker players are, which makes most of them terrible at important parts of what they do and provides great opportunities.

Because I've been neglecting this blog lately and my positions are largely set anyhow, I'll break my silence and give out a few of my picks. If you want to make a free 20% over a month before the election, you should have all the cash you can spare on Intrade ASAP and bet on:

(People with large bankrolls, look here)
-Obama winning Iowa

Iowa has never seriously been in play. It's a state that McCain mostly skipped in the primaries while Obama spent a year practically living there. In addition, McCain came out against ethanol, a major Iowa issue instantly worth 3-5 points against him, while Obama has supported it. Even when McCain was up 3-4 points nationally, he was substantially down in Iowa; he would have to win the popular vote by something like 8 points to put the state in contention and probably by over 10 points to make it red. With Obama up in the polls 40 days before the election and leading in public perception on the handling of the economy issue, the true odds of a 10 point McCain victory are well under 5%, so Obama trading under 80 to win here is an absolute steal.

-Obama winning Wisconsin and Minnesota

Similarly to Iowa, these states are not actually the swing states they appear. The election will be close in both if McCain is up 3-5 points in the popular vote nationally, but with McCain never winning a single poll in either and with Obama's superior ground game, only a landslide would flip them. They aren't free money like Iowa, but trading in the mid-70's still has them 20 points off where they should be.

-Keep an eye on California

I've seen multiple offers on multiple books to sell massive amounts of Obama.CA shares for 90. Essentially, the guy (I can't believe it was two different people) wanted to bet 10:1 that California would go Republican. I took him up on it on another site, but left his Intrade offer on the table and he quickly pulled it. You never know, though - he might come back.

(Small stakes ballas look below)
-Ralph Nader to win < 1% of the popular vote

Ralph got 0.38% of the vote in 2004. Given how important this election feels to the left and how hated the guy still is for 2000, he'll find it difficult to break that this year and impossibly hard to triple that number. But the contract for him to break 1% is trading at up to 40 (although I'm not sure how high it'll stay, because once I finish typing this I'm going to take the tastiest offers off the board...)

-Various small stakes state deals

Do you think there's a 6% chance that Georgia goes Democratic? I don't. A 15% chance that Oregon goes Republican? No way; both are close to 0%. My bankroll's all tied up in better deals than those, but they're worth it for some of you guys.

There are a lot more I haven't talked about, but if you want to ask, feel free to do so on our forums.

The last couple of weeks have been a little hectic. As I said earlier, I had a bunch of real life stuff to do, especially the CLE classes ("I'd like to keep my law license, please." "Why?" "...it sounds cool?") and decided to just take a break and enjoy myself while those were going on. These classes happened to be in a building with no available wireless network, so for the last two days, I managed to come home to more market imploding than I thought was possible in one news cycle. Opeth was a fantastic show (brag: my wife got me tickets for my birthday, went with me and enjoyed it) but when we made it back at 1 AM, I'd gone without any Internet access for over a day.

"What do you mean Vivek FT'd the Borgata? Wait, he WON?!!?! wheeeeeee"

Vivek is, without a doubt, a live poker beast. He live timebanks every major decision, somehow never gets any of them wrong (or gets there if he does), 5 bets light successfully and just plays stunningly good poker. It's not that he's bad at the Internet thing, either; he just takes his game to another level when he's at the tables. It couldn't have happened to a nicer person (except Watts obv), and maybe this'll teach him to be less of a life fish too :) Congrats.


...and then I go to pocketfives to check out the pictures and find out Shaun won a random $144K for first WCOOP to go with the FTOPS. Nice day for tworags imo.

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Minor stuff about me since I can't really compete with the big stuff: I've got a pocketfives article on Internet security coming out sometime in the next 2 weeks and might be writing there more regularly in the future. Also, Intrade is going really well - I'll have some kind of really big writeup on political betting in general after the general election is over.