(*) Manipulando el futuro

Confirmed: someone — one large “institutional investor” — was manipulating the Intrade presidential odds, trying to drive up the price of a McCain win and thereby influence political perceptions:

An internal investigation by the popular online market Intrade has revealed that an investor’s purchases prompted “unusual” price swings that boosted the prediction that Sen. John McCain will become president.

Over the past several weeks, the investor has pushed hundreds of thousands of dollars into one of Intrade’s predictive markets for the presidential election, the company said.

“The trading that caused the unusual price movements and discrepancies was principally due to a single ‘institutional’ member on Intrade,” said the company’s chief executive, John Delaney, in a statement released Thursday. “We have been in contact with the firm on a number of occasions. I have spoken to those involved personally.”

Kudos to Nate Silver, who inferred this through circumstantial evidence.

This reminds me of the California electricity crisis, when a few of us inferred, from the logic of the situation and circumstantial evidence, that power companies were deliberately creating the shortage. Later on, this was confirmed by control room recordings of Enron traders calling in instructions to shut the power off.

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