Betting markets have defeated experts, polls and the media in predicting the outcome of current events such as presidential elections.

During the past four U.S. presidential campaigns, economists at the University of Iowa have operated an Internet-based futures market system, where anybody could bet on one of the two major-party candidates.

In the 2004 election, for example, every source in the U.S. considered the race too closes to call before the election night. But the University of Iowa market gave George W. Bush a clear edge since the end of the Republican convention in September, two months ahead.

The outcome of the Michael Jackson’s trial, the probability of U.S. Military Action in Iran and South Korea, the winner of the American Idol contest; nothing is safe from the online betting services.

Researchers have been surprised at how well the guesses of bettors align with the real outcomes in all sorts of events. Bettors are, in a way, traders in a market, where prices get close to the actual values of whatever is being bought and sold.

The proportion of people betting money on the outcome of a given event seems to reflect that outcome's actual chances of happen at the time the bets are placed.

Therefore, the fast growing online betting industry, may be laying the way for the re-enactment of the ancient art of prophecy.

Author: Dario Pallavicino