Political Market Failure?
The Iowa Electronic Markets' claim to be more accurate than political polls. Take a look at what happened at the IEP's Democratic Presidential Nomination Market this past week. The Dean futures peaked at $0.75 per share on January 7 and were still selling at $0.50 per share the day before the Iowa caucuses. Yesterday Dean futures were selling at a low of $0.16. Meanwhile just one week before the caucuses, Kerry futures were selling between 3 and 4 cents per share. Yesterday they had bounced to a high of $0.38 per share. As for Edwards, he was not even listed on the IEP, but we can assume that the rest-of-field (ROF) futures now reflects his standing in the markets. ROF futures hit $0.24 per share yesterday.
Looks like the IEP suffered a "Crash of '87" moment this week.