Intrade is Not An Opinion Poll, It's a Prediction Mkt.
Bobble comments: I don't put much stock (pun not intended) in Intrade. I find realclearpolitics.com is a far better source of how the candidates are doing. It computes averages of all the major polls and publishes the results in easy to comprehend format (see chart above).
MP: The average of the polls shows Obama ahead of McCain by 49.7% to 42.4%, while Intrade odds are 77.1% for Obama and 22.6% for McCain. Why the huge difference?
Because they are measuring something completely and totally different. The opinion polls are based on surveys of likely voters say who have stated which candidate THEY will likely vote for. The Intrade betting is not based on who traders will vote for themselves, and it is not based on who the traders WANT to win the election (or not win), the betting is on who is MOST LIKELY TO WIN THE ELECTION!
I could be a strong Obama supporter or a strong McCain supporter, or I could hate Obama or McCain, or be completely indifferent, and none of those positions about MY OWN voting preferences would influence what position I would take on Intrade. My position on Intrade is based on how I expect millions of other people to vote.
Bottom Line: Given that Obama has a 7.3% lead in the polls, the trading on Intrade suggests that Obama now has a 77.1% chance to win the election. That's not saying that Obama will get 77.1% of the vote, just that he has a 77.1% to win the election.
As some others have pointed out, if you think Intrade is flawed, inefficient or deficient in some way, that means you can make lots of money on Intrade by exploiting those inefficiencies by betting against the collective wisdom of the masses who have money at risk when they take a position on Intrade. Good luck.