The money is going on the independents being classified as Dems

As the argument goes on over how Betfair will settle the “Senate most seats market” we now have the extraordinary spectacle of much more money being gambled on this issue than the election itself.

Overnight a further £100,000 was traded in this market taking the total to nearly £240,000. Amazingly in all the months leading up to Tuesday election less than £50,000 had been bet.

With the Democrat victory in Virginia likely to go to a recount there are three possible outcomes:

Democrat victory in VA confirmed and the two indies classified as DEMS – overall result Democrats 51 – Republicans 49. Betting outcome Democrat backers win

Democrat victory in VA confirmed and the two indies NOT classified as DEMS – overall result Democrats 49 – Republicans 49 Independents 2. Betting outcome – Betfair “tie” rules come into operation

Republicans take VA after recount and the two indies NOT classified as DEMS – overall result Democrats 48 – Republicans 50 Independents 2. Betting outcome Republican backers win

This is how CNN is describing the situation “A victory by Webb (the Virginia Democrat candidate) would put the new Senate line up at 49 Democrats, 49 Republicans and two independents — Bernie Sanders of Vermont and Joe Lieberman of Connecticut — who have said they would caucus with the Democrats. That would give the Democrats the 51 votes they need to claim a majority for the first time since 2002.”

My guess, and it is only a guess, is that because this is being reported as a Democrat victory that Betfair would be influenced by the overall outcome and not the precise details of the affiliations of Sanders and Lieberman. Given the way the market has moved, as the chart above shows with the Democrats being BLUE, punters are taking this view too.

Having said that I got stung in 2003 when I tried to second guess how Betfair would settle a market in similar confusing circumstances.

Mike Smithson