The NYT has an article, Odds Are, They’ll Know ‘08 Winner, on Intrade.com, a trading exchange for prediction markets based in Dublin.

Over the last few years, Intrade — with headquarters in Dublin, where the gambling laws are loose — has become the biggest success story among a new crop of prediction markets. Another company, Newsfutures, helps the world’s largest steel maker, Arcelor Mittal, run an internal market on which executives predict the price of steel. At Best Buy, a company called Consensus Point has helped start a market for employees to guess which DVDs and video game consoles, among other products, will be popular. Google and Eli Lilly have similar markets. The idea is to let a company’s decision-makers benefit from the collective, if often hidden, knowledge of their employees.

According to the article, Intrade’s odds correctly forecast the outcome in all 50 states in the 2004 US presidential election. What do they say about the 2008 election?

Intrade now makes John McCain the favorite for the Republican nomination, followed by Rudy Giuliani. For the Democrats, Hillary Rodham Clinton has about a 50 percent chance of being the nominee, more than twice as much as anyone else. The most counterintuitive forecast is that Mrs. Clinton is given a better-than-even chance of winning the general election if she is nominated, while Mr. McCain — perhaps because he wants to keep fighting the war in Iraq — is not.

Markets go up and they go down, so we’ll see how things progress. Shares in Vice President Cheney becoming the 2008 GOP nominee are a bargain at $1.50 compared to $37.40 for John McCain. Shares in Cheney resigning by December 7, 2007 are selling at $27.00. This looks like much more fun than actually voting.

Intrade has categories for current events (e.g., Bird flu breaking out in the US, Air strikes in Iran), entertainment (e.g., Jesus Camp wins an Oscar), financial, legal, politics, and weather.

The oldest Internet prediction market is the Iowa Electronic Markets, which are operated by faculty at the University of Iowa Tippie College of Business as part of their research and teaching mission.