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Web gamblers wager on Saddam's future
(AP) -- Think Saddam Hussein's days are numbered? Care to put a little money on it? If so, tune up your Web browser to one of the many Internet gambling sites taking bets on how long America's most wanted despot will hold onto the presidency of Iraq. Big money is riding on the question -- about $1.25 million in wagers just on one site, www.tradesports.com. Late Thursday, the site put Saddam's chances of lasting in office through Monday at about 90 percent. But he was given only a 1 in 3 chance of being in power at the end of April. Betonsports.com, which bills itself as the Internet's "largest, legal and licensed sportsbook," puts Saddam's chances of remaining in Baghdad until June 30 at 1 in 15. The site offers 5-to-1 odds he will be in U.S. hands by then. Some may consider wagering on the forceful ouster of a despot to be in poor taste. Not Eric Zitzewitz, a Stanford University economics professor who is using tradesports.com as a research tool. "Yeah, war is a terrible thing. But you'd like to have information about it," and the site has potential to provide it, he says. Tradesports.com doesn't set any odds. Its bets are set up as futures contracts that bettors buy and sell directly to one another. The most active "Saddam security" pays $100 if Iraq's leader is ousted by March 30. If he's still ruling on that date, it pays nothing. The future sold at around $60 when trading began back in September and it looked like Saddam had about a fair chance of lasting until spring. Then its price gradually declined to about $25 as the U.N. Security Council debated and Iraq agreed to admit weapons inspectors, a stalling tactic that increased Saddam's chances of hanging on until the end of March. The price rebounded when in December U.S. Secretary of State Colin Powell complained about the incompleteness of Iraq's weapons disclosure to the U.N. and then accused Iraq of being in "material breach" of the Security Council resolution. Then the price declined, with a brief spike in January when U.N. inspectors found warheads capable of carrying chemical weapons. But the real action began after the bombs started to fly on March 19. The price of the March 30 Saddam future jumped from $19 to an all-time high of $88, an indication that most people believed the Iraqi leader would be out within days. But over the weekend it became clear that the second Gulf War would be longer than the first. With the contract set to expire in less than 10 days, the price of the March 30 future quickly eroded. By Thursday afternoon it was trading at around $10. "What's great about a financial market is you've got to put your money where your mouth is," Zitzewitz said. "It's a reasonably good proxy for what the average person thinks based on publicly available information." Interestingly, the oil and stock markets generally move in concert with Saddam securities, according to a paper written by Zitzewitz and a Stanford colleague, Justin Wolfer, and Andrew Leigh, a student at Harvard University's Kennedy School of Government. Copyright 2003 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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