InTrade should be allowed to accept bets from Americans

If you were confident enough to put money on, say, an obscure congressman being elected president in 2016 or Argo winning Best Picture, you could buy shares on InTrade, the online predictions market. But InTrade, now the target of federal regulators for delving into oil and other regulated commodities, stopped taking trades this month, even the whimsical ones. That’s a shame.

There’s little harm in letting Americans back up their political and pop-culture predictions with actual money. Last fall, InTrade, an Irish company whose website updates constantly as if it were a stock exchange, helped provide a more accurate snapshot of where the presidential campaign stood than polling alone. A recent University of Michigan study might explain why; it found that people’s expectations of what will happen — which is what prediction markets measure — are more predictive of actual results than asking voters what they want to happen, which is what polls gauge. It’s a useful lesson: Don’t bet against bettors.