Futures Market

The orange juice futures market predicts Florida weather better than the Weather channel.

Markets, “information markets”, are very good predictors of the future, probably because they are able to incorporate the knowledge of a lot of people. And those people are betting real money, so they are making the best, most educated guess they can. If you want to see how it works, and try it out for yourself, The Iowa Electronic Markets run by the University of Iowa has a number of futures markets where you can buy options on different outcomes. For example you can buy a contract on who you think will win the Presidential Election in 2004. You can either try the trial version or you can open an account with real money.

I read about this in United’s inflight magazine, Hemispheres Magazine.