If there is genius in crowds, then the internet prediction market Intrade might be the smartest website of all.
The online prediction service gives the individual mandate no more than a 30% shot to survive, although the late money coming in appears to be breaking for maintaining the mandate.
Nate Silver on why we might get a rude surprise from SCOTUS today:
After these oral arguments, Intrade's betting shifted dramatically. Quickly, the chance of the mandate's being overturned climbed to about 65 percent from 35 percent at the market.
The odds of the mandate's being overturned have fluctuated some since then, but have risen even further in the past few weeks, according to the market.
Is such a large shift in sentiment justified? In my view, probably not. This may be another case of traders being overconfident about the value of their information, a property which has also been observed in the stock market.
To be clear, the evidence is that oral arguments do have some predictive power in forecasting Supreme Court decisions, according to a variety of empirical analyses from academic and legal scholars. It's just a question of how much power they have, and how unambiguous the evidence about oral arguments is in any particular case.
These studies found that the side being asked more questions from the bench during oral arguments is more likely to lose the case, since this may indicate skepticism from the court about its position.
Which side was that in the health care case? Technically, it was the lawyers representing the State of Florida, who were arguing that the law was unconstitutional. But really, it was more of a tie. Some 54 percent of the words from the bench were directed at the lawyers arguing against the mandate, while 46 percent were directed at Mr. Verrilli, who was defending its constitutionality. That close balance in questioning might seem to argue against a substantial change in the odds either way.
We'll find out soon enough if Intrade is right.