America's bewildering gambling rules mean
that no official betting on the outcome of the election is allowed in
the gambling mecca of Nevada or anywhere else in the US for that
So when marketing manager John W. wanted to have a little flutter on the biggest race of the last four years, he was forced to go to an online betting site to place his 100-dollar-bet on Barack Obama.
"I like to gamble on sports results and I usually do pretty well, because I follow the statistics and trends and keep my emotions out of it," he said, asking that his full name not be used because of the technical illegality of his election gamble.
"I took the same approach with the election. I am sure Obama will win because he has managed to hold onto his majority in the battleground states. It's easy money as far as I'm concerned."
Others resorted to personal bets, which are allowed under the law. The most famous exponent is US President Barack Obama's senior political advisor David Axelrod. He bet conservative news anchor Joe Scarborough that he would shave off his bushy mustache if Obama loses the states of Minnesota, Michigan or Pennsylvania on Election Day.
"I will come on 'Morning Joe' and I will shave off my mustache of 40 years if we lose any of those three states," Axelrod said. Scarborough also has a stake in the game. He promised to grow a mustache if Obama wins Florida or North Carolina.
New York Times pollster Nate Silver, whose nuanced analysis of individual state voting trends has led him to favour Obama's chances far more highly than all the national polls indicate, also wants to get in the game. He rated Obama's chances of victory at 79 per cent on Thursday, and was willing to wager Scarborough that he was right.
"If you think it's a toss-up let's bet," he tweeted the news anchor. "If Obama wins, you donate 1,000 dollars to the American Red Cross. If Romney wins, I do. Deal?"
Silver's scientific analysis is bolstered by online betting houses, all of which view Obama as a strong favourite to win reelection, with Romney cast in the role of the overwhelming underdog.
Most online betting shops were offering odds Thursday of 1:4 on an Obama victory, meaning that a four-dollar bet on an Obama victory would yield just one dollar in winnings. By contrast the odds for a Romney win were 11:4, giving winning punters an 11-dollar payout on a four-dollar bet. Intrade.com, in which punters buy shares in real world outcomes based on their probability, priced Obama's chances of victory at almost 70 per cent.
Leighton Vaughan Williams, the Director of the Political Forecasting Unit at Nottingham Business School in Nottingham, England, says his research has shown that gamblers are better predictors of elections than pollsters. This is because the average voter doesn't have any incentive to tell a pollster the truth about their voting habits, but when they are betting their own money they will tend to think hard about the choices they make using the best information available to them.
Williams expects about 100 million dollars to be bet on the outcome of the election, and in a blog posting this week argued that the betting markets were actually too conservative in assessing Obama's reelection chances.
Nevertheless he advised caution before wagering hard-won wages on Tuesday's election results.
"Polls don't decide elections, however, and neither do the betting markets," he advised. "People do, and that's why anything can happen, and sometimes does."
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