IEM: Clinton ahead in N.Y. Senate race, Gore and Democrats post slight gains
In the IEM, the University of Iowa's real-money market where traders buy and sell political futures, current market prices show Clinton shares trading at 56 cents compared to Lazio at 43 cents. This spread has remained largely unchanged since mid-August, while recent polls have Clinton and Lazio in a dead heat. (See graph at http://iemweb.biz.uiowa.edu/graphs/nysenate.gif)
The candidates' Sept. 13 debate appeared to have little effect on IEM traders' decisions, said UI associate professor of finance and IEM co-director Tom Rietz.
"So far, IEM traders have maintained their preference for Clinton," he said. "But we'll be watching this market to see if they will be influenced by other events in the campaign."
Here are updates on other IEM political markets:
-- In the presidential market, Al Gore has gained some favor with traders in the past week, although his shares are only selling for five cents more than George W. Bush's shares. As of Sept. 14, Gore shares were at 52 cents and Bush shares were at 47 cents, predicting that Gore will lead Bush by 5 percent in the November election. Gore's prices began to increase this week, after a neck-and-neck market since mid-May. (See graph at http://iemweb.biz.uiowa.edu/graphs/pres00_VS.gif)
-- In the congressional control market, the leading futures contract is for a non-Republican (Democratic) House/Republican Senate, trading at 47 cents, compared to contracts for a Republican-controlled House and Senate at 41 cents. (See graph at http://iemweb.biz.uiowa.edu/graphs/Congress00.gif). Like the presidential market, this market has been fairly close over the summer, but the Democratic house gains have only been seen in the past week.
However, Rietz cautioned that the margin of the leads for Gore and the Democrats are slight, and that IEM directors will be monitoring the markets to see if these gains will continue, or if they are short-term reactions by traders.
The IEM has forecasted election results with great accuracy, tracking the Democratic and Republican vote shares in the last three presidential elections within an average of less than 2 percent. The IEM has 6,200 traders and more than $150,000 in equity.
Six faculty members at the University of Iowa Tippie College of Business operate the markets as a research and teaching tool. See the markets online at http:/tippie.uiowa.edu/iem/ for the latest prices.
For more information on the IEM, contact Jeanine Alcocer, IEM Operations Manager at (319) 335-0794.
Contact: George McCrory, UI News Service, 319-384-0012