There is some disconnect between what a prominent data analyst like Nate Silver says about the election and what the gambling markets are forecasting. In the former, Joe Biden is roughly 85% to win, while gamblers on PredictIt are pricing him at roughly 65%.
On the gambling platform, the state of Michigan is 76% (the equivalent of around -300) for Biden. Donald Trump scored a big upset in 2016 thanks in large part to taking Michigan, by only about 10,000 votes.
In poker terms, Biden is holding ace-king to Trump’s ace-queen. To be more accurate, it’s ace-king suited for Biden, versus the offsuit Broadway cards for Biden.
Biden is probably slightly undervalued in the swing state of Michigan, considering what Silver’s 538 is forecasting for the overall race. However, Michigan’s odds on PredictIt are probably closer to a fair price than the probabilities on the general election.
There’s more sharp money on the individual state markets than on the overall result.
As any poker player who has gone all-in preflop with ace-king only to be called by ace-queen and see defeat with a queen on the river will know, Michigan is still in play for the incumbent.
Little movement over last few months
Despite a tumultuous summer and early fall in terms of national politics, the odds for Michigan’s winner haven’t moved much. It’s become a pretty solid blue state, despite a Republican state legislature.
The Wolverine State dropped to a low of 67% implied probability in late August, only to again tick up for Biden. Here’s where the market stands as of Tuesday afternoon.
The latest polling suggests a relatively close contest in Michigan, but Biden has a clear edge.
POLL: US Presidential Election, Michigan.
— The Spectator Index (@spectatorindex) October 11, 2020
This week’s poll, however, was slightly worse for Biden than one from early October immediately after the debate. Trump’s debate performance was widely criticized, even by his own party.
Michigan poll: WDIV/Detroit News
Biden 48% (+1 since early Sept.)
Trump 39% (-3)https://t.co/oY9Y3c5E9W
— Sahil Kapur (@sahilkapur) October 6, 2020
What did the 2016 Michigan market look like?
PredictIt offered the same market during the last presidential election.
Around this time in 2016, Hilary Clinton was trading at around 90% for the Wolverine State, but that slowly fell over the next couple of weeks and ended right where we are now by the day of the election. Election day saw Hillary Clinton with a 77% advantage.
Barring a sudden and substantial change to the race, Trump will desperately need another draw out to take Michigan’s 16 electoral college votes.
Fortunately for Biden, Gov. Gretchen Whitmer’s recent political losses with regards to her COVID-19 emergency orders haven’t impacted the race, at least not yet.