In early 2003, the Department of Defense proposed establishing a Futures Markets Applied to Prediction (FutureMAP) program. FutureMap was intended to provide some accurate predictions of events in the war on terror. This was to be done by allowing many people in the government to place "bets" on which way a future event would turn out..
FutureMAP is pretty much identical to our Prediction Market. In fact, we decided to create our Prediction Market after media and political opposition caused the cancellation of the FutureMAP program. It was cancelled mainly because some members of Congress, and the media, considered it trivial and doomed to failure. Well, that was certainly a self-fulfilling prophesy. Unfortunately, most people in the Information War and financial markets business agreed that FutureMap would probably work.
So late last year we put together our Prediction Market. Its been in beta test for nine months. And it works. So far, over 150 events have been submitted. 45 of them have reached a conclusion, and 42 of them were accurate. Thats 93 percent accuracy. Actually, its a little lower than that. If you take into account accuracy over every day successful item was in play, the accuracy rate is 89 percent for the ones that were correct in the end, and 84 percent overall (including the items that were not correct in the end). Sure beats flipping a coin. We still have over a hundred predictions waiting for either an event to occur, or a time limit to be reached. Some of them are quite interesting. Anyone can propose a prediction (after registering with a valid email address, which helps keep out the trolls and bombers). A StrategyPage staffer checks each proposal for spelling, grammar and logic, and then lets it go live.
The Prediction Market has accurately predicted the outcome of terrorism, military and political events all over the planet. StrategyPage's quarter million regular users are from all over the world, so that makes sense. Actually, any successful bookmaker or financial trader can tell you, from experience, that large numbers of knowledgeable people can be quite accurate in predicting events. Odds making, and taking bets is legal, and a very big business, in many countries. The arrival of the Internet led to sports betting sites taking wagers on all manner of events. To make money, the bookmaker has to come up with odds that will meet the expectations of the bettors, and still allow for a profit to be made.
Since StrategyPage does not allow our decisions to be vetoed by demagogues in Congress, we have a Prediction Market. Our motto is, "Many minds make quick work of uncertainty." And anyone can use the Prediction Market to get an accurate answer to the outcome of future events.