Why is Chris Masse making a big deal about a little article on prediction markets in The Economist?

At the prediction markets blog, Midas Oracle, Chris Masse has posted several times (here, here, and don’t miss the remarks in the comments) about the recent piece on prediction markets in The Economist.  Among his recent grand pronouncements:

If you are a prediction market consultant, and have nothing to say about the negative piece from The Economist, then you don’t matter anymore.


What is it that The Economist said that prediction market consultants should have something to say about?

I read article when it showed up online, and then again when the print version arrived and after Chris mentioned it at Midas Oracle, and now a third time since I wonder why he is making a big deal of it.

Fortunately, it is a light read – reading it three times has not been particularly taxing. But there is not a lot of depth there to engage: An intro paragraph, some explanation, three brief examples-two of which illustrate implementation problems, and then the article concludes with a quip that “Perhaps the best way to find out when prediction markets will finally take off is to ask your employees–using a prediction market.”

That’s it.

No searing indictment of the prediction market software vendors and consulting business, no challenge to the theoretical foundations of prediction markets, no rejection of the “wisdom of the crowds.” All the article does is observe that the tool has “yet to take off.”

So my question to Chris remains, “What is it that The Economist said that prediction market consultants should have something to say about?”

(Cross-posted at Midas Oracle.)

The natural gas industry is adapting to changing conditions

Michael Giberson

From the Globe and Mail:

Last year, the continental U.S. saw its natural gas production grow by 10 per cent to 55 billion cubic feet a day, powered by huge production increases from shale gas plays like the Marcellus, Haynesville in Louisiana and Texas’s Barnett field. In Canada, gas production actually declined by about 4 per cent or 700 million cubic feet a day to 15.7 billion cubic feet a day.

The leading indicator for gas production is the drill rig count – how many rigs are in the field at any given moment exploring for and developing new fields. “Drilling activity on both sides of the border is collapsing faster than a bank loaded with toxic debt,” [BMO Nesbitt Burns analyst Randy] Ollenberger said.

Of course that is partly because there are fewer promises of bailouts being dangled in front of the oil and gas exploration business.

(As the article also notes, “After touching $15 for 1,000 cubic feet in the spring of 2008, gas prices have fallen to $4.20 on the New York Mercantile Exchange, and many analysts believe they have not yet bottomed out.”)