Four Days and Counting: Exotic Markets, Forecast Swings and Random Election Notes

Being caught up in the sport of the election, I decided to attend a political comedy night last week. It was hosted by a friend and despite my loathing of cheap and nasty left-wing political humour and my well-honed instincts suggesting this would be painful, I went along. The fact the gig was at Trades Hall (seemingly the Operative Painters and Decorators Union is no longer affiliated with the Victorian Trades Hall Council as the building was in a dire need of a paint job and some spackle) should have been a loud enough warning but I persisted and it is a crossroads of time I wish I could have returned to and taken the path less travelled.

Host Matty Kaye was in fine form. Most of the young acts were surprisingly witty. The headliner was “Capt’n Snooze” Rod Quantock and he was a delight, as always. Quantock is professional, intelligent and he certainly lives up to his billing as a “living Melbourne treasure”.

Unfortunately, leading into Quantock was that heinous excuse for a human being, Catherine Deveny. She is not professional, she is as dumb as a fence post and the only time she has ever been associated with the word treasure is when punters who have had the misfortune to be stuck in the same room as her and a microphone wish for her to be buried under some and soon. Not only did Deveny deliver a thirty minute ramble bereft of humour, as vile as a needle chock full of heroin tp the eye and as patronising as you would expect from a delusional lefty who is in it for no other reason than image, she was completely hypocritical. Deveny, with all the class of a gutter snipe, is as close-minded, bitter and evil as any of those she derides. She rocked up drunk, she had nothing prepared, she used the word cunt in every third sentence and she rambled on from the high road like a goddamn squawking pigeon fluttering for attention. Catherine Deveny likes to tell the world what she thinks but she is so goddamn idiotic and pathetic that she got her ass canned from The Age for making a joke about Bindi Irwin getting laid. She was fired not for her low brow humour but for being completely without humour or intellect. Anybody who ever pays to see her, who deigns to read her or who flicks to watch her should remember they were warned here first.

That rant, like all the following, will be unconnected to anything before or after it other than through the loose bond of being “about the election.” This is a collection of notes, random thoughts and pieces of betting advice on various random betting markets as we draw ever closer to The Big Day.

Hung Parliament

There has been a concerted go for a hung parliament over the last week with the result of a minority government being formed into $3.85 (Sportsbet) after $6.00 was on offer when markets first went up. Betting against a hung parliament is $1.30 (Centrebet). The support for a hung parliament contrasts with the shortening of Labor over the last week.

At the beginning of the week I scored the next parliament 74 Labor, 72 Coalition, 3 rural independents and a single Green. Labor could claim two marginals I have them losing (Boothby or La Trobe) and they could hold onto a portion of the marginals I have forecast then to lose in Queensland (Dawson, Flynn, Leichardt, Longman) and New South Wales (Lindsay, Macarthur, Macquarie, Robertson) and even Victoria (Corangamite) and Western Australia (Hasluck) but at the moment this is heading to the crossbenches to my eye. There has been money for the Coalition to win Bennelong (I make this a Coalition win now) with would make it 73-73 though Labor have edged ahead in Corangamite. If an election was held today I think that Bob Katter, Tony Windsor and Rob Oakeshott (Adam Brandt will support Labor) will determine the next government with most pundits fancying they will go Liberal.

Having said that, I price a hung parliament at $4.25 so there is no bet at the current prices. A Crikey analysis makes the prospect of a hung election between 16-22% which makes the shortest price their analyst could bet it at $4.55.

Seats by State

Such a wipeout is now expected in New South Wales that Bennelong is thought gone by Labor insiders with the retreating fortification now at Page, Dobell and Eden-Monaro. All three are looking like staying Labor but momentum in the state is against the ALP and any further shift would place all three in danger. That means Labor looks like it has booked in losing Lindsay, Macarthur and Macquarie in Western Sydney, Bennelong and Robertson as well as the abolished seat of Reid. The only ALP pickup in NSW will be Greenway. That leaves Labor taking only 24 seats.

Every betting firm has taken down over/under total Labor seats in NSW. Sportingbet has a market on specific seats lost by Labor. The best bet is Labor losing four at $4.50 and that is the platform punters should work down from.

The situation in Queensland looks a little more stable with Labor set to suffer significant losses. Labor can kiss goodbye three with Leichardt, Flynn and Dawson gone. Three seats is available at $5.00 and would push Labor down to twelve total seats in the state. I also fancy that Longman could go with Forde another possibility of falling. Labor losing four at $2.35 along with the under 11.5 seats at $1.78 are also bets as there is plenty of downside for Labor in Queensland and not much upside.

The line in Victoria is 20.5 with the over favourite at $1.58. No bet. I have Labor winning 20 seats but the four marginals could go either way and polls are pushing for Gillard.

There is also no bet in Tasmania with the over 4.5 seats at $1.44. This is essentially a bet on Bass, the only true marginal in the state. The Northern Territory is the same with an over/under 1.5 bet being a bet on Solomon.

Bets on Labor under in South Australia and Western Australia exist. Labor have six sure seats in South Australia but are unlikely to wrestle Sturt from Christopher Pyne and Boothby is looking better for the Coalition on recent polling numbers. Labor under 6.5 seats at $1.46 is a bet. Labor under 3.5 seats in Western Australia at $1.85 is also a bet. Labor are polling poorly in Western Australia. They are not going to hold Hasluck and they will lose their notional margin in Swan. This is a fairly safe play and it has been heavily backed from $2.25 in recent days.

Total Labor Seats

Sportsbet have a market up with the total number of Labor seats. There is not a great deal of value in the market though it may be worth a bet on Labor winning between 71-72 seats at $9.00 and 73-74 seats at $5.00. Possum’s election simulation has them winning 77 seats but I’m not sure where Labor are going to pull them from. There certainly isn’t any value in playing around those numbers and the two seat ranges do not leave much wiggle room.

Forecast Swing

Both Sportsbet and Sportingbet have range markets available with a swing to the Coalition of between 0.01% and 0.99% and between 1% and 1.99% joint favourites at $3.50.

A history lesson to start with showing the swings against first-term governments:

1998: 4.6%

1984: 1.4%

1977: 1.1%

1974: 1.0%

The size of 1998 can certainly be, for the most part, explained by the GST. Aside from that, there is nearly always a backlash against the Government of at least 1% though, admittedly, the sample size is not significant.

Combined with the fact most polls have Labor as a narrow leader at 51% and the usual overstating of the Labor and favourite vote in polls over the actual vote, it can be expected that the starting point for the swing to the Coalition will be 1%. It is also important to note that a 2.3% uniform swing is required to get the Coalition to 75 seats.

1 to 1.99% would be my main play at $3.50 though I couldn’t recommend a bet with any confidence as I tend to think the swing could get to 3%.

First Preference Wins

Centrebet are offering betting on a number of seats as to whether they will be won on first preferences or not

Aston looks a good bet for the no against Alan Tudge winning on first preferences. There has been some talk that Aston is in trouble for the Coalition and while that is codswallop the Coalition may not claim it on first preferences. In three of the last seven elections the Coalition have relied on preferences and retiring MP Chris Pearce only hit 50.7% last time. The $1.87 looks a fair bet.

Robertson is a very close race and that will go to preferences. The only time the Liberal’s have won on first preferences is at the height of the Howard years. Betting against a Liberal win on first preferences at $1.35 is a play.

There is a yes play in Wentworth with Malcolm Turnbull great value at $2.35. The Coalition have won on first preferences in every election bar 1998 when they polled 49.75% of the number ones in the controversial GST election and in 2004 when Turnbull was taken on by incumbent but deposed Liberal Peter King. Turnbull won on first preferences in 2007 and was one of four seats not to swing to Labor. The Coalition are great value to win on first preferences at $2.35.

Family First v Sex Party

Sportsbet have put up a market on whether Family First or the Sex Party will poll higher in the upcoming Senate election Australia wide. Family First are favoured at $1.20 with the Sex Party at $4.00.

Family First will win this and easily with sitting Senator Steven Fielding up fro re-election. While Fielding most likely won’t get a second term, he does have his supporters in Victoria and there are many conservatives with a religious bent who will lead their Senate ticket off with Family First.

And it is not like Family First will need a big number to roll the Sex Party as joke/single issue parties rarely poll higher than 1%. In 2007 Family First polled 1.62% after polling 1.76% nationwide in 2004 when Fielding got elected. The total “others” votes at the last two elections only reached 4.5%.

This looks like money for old rope. Smash Family First at $1.20.

Next Foreign Minister

Sportingbet have put up a market on who Australia’s Foreign Minister will be after the election with Kevin Rudd favourite at $1.80 ahead of Stephen Smith at $2.50 and Julie Bishop at $3.60.

The best value in the market is actually Julie Bishop. Tony Abbott has committed to Bishop as his foreign minister if the Liberal party were to win power.

There is no value on Rudd at $1.80. All is calm now but there is no guarantee that if Labor are returned to Government that Gillard will boost Rudd’s standing in the party with the Foreign Affairs post. Stephen Smith is a better play at $2.50 with Smith having done a fine job in the role since 2007.

Betting Markets Disconnect

Simon Jackman of The Australian wrote this fantastic piece highlighting the difference in prices between Labor to win the election and the number of seats they are forecast to win in the individual seat betting. It is well worth a read for any election punter. Jackman is correct in asserting that the election is much closer than the winner markets suggest and while Labor are just ahead at the moment they are certainly not 75% hopefuls as the current prices imply.

Footy Season Election

It will be interesting to see what impact, if any, a winter election will have on the Government. This is the first winter (and thus first footy season) election since 1987 where Labor suffered a 0.94% swing against them but picked up four seats. There is some thought that footy fans could be resentful of an election during footy season and it is more marked in the AFL states who still play on Saturday afternoon. Saints, Tigers, Hawks and Dockers fans will have to vote early as will Manly and (Australian) Warriors fans while radio listeners will most likely have to deal with split election/footy coverage on Saturday evening. I doubt it will play much role but there could be more than a few pissed off punters annoyed at the election interrupting the footy.

Recommended Bets

Labor to lose 4 seats in NSW at $4.50 (Sportingbet)

Labor to lose 4 seats in QLD at $2.35 (Sportingbet)

Labor to win under 11.5 seats in QLD at $1.78 (Centrebet)

Labor to win under 3.5 seats in WA at $1.85 (Centrebet)

Labor to win under 6.5 seats in SA at $1.46 (Centrebet)

Liberals NOT to win Aston on first preferences at $1.87 (Centrebet)

Liberals NOT to win Robertson on first preferences at $1.35 (Centrebet)

Liberals TO win Wentworth on first preferences at $2.35 (Centrebet)

Family First to win more Senate votes than the Sex Party at $1.20 (Sportsbet)