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Betting against the tide….

by David Yelland | 18.04.2016

 

The pollsters are still wiping egg off their faces over their collective failure to predict the 2015 general election result. So when the blogger who did call the election right says there’s only a 24% chance of a Brexit vote perhaps we should listen.

And when the bookies routinely lay odds that the UK will stay in the EU too, perhaps we should wonder why the UK Press is almost united in forecasting either a close vote or – increasingly – an out vote.

What explains what you might call the “Forecast Gap” — the difference between the odds offered by professional betting companies on the one hand, and the “general accepted view” as reported in many newspapers that the country is heading to the EU exits on the other?

First let’s look at political blogger Matt Singh’s view that there is only a 24 percent chance of Britain voting to leave the European Union. Remember, he is the chap who spotted polling flaws and correctly predicted the outcome of last year’s U.K. general election. He is the former Barclays trader who has a record of being right when others are wrong.

Perhaps it is his insistence that the Remainers will benefit from a last minute shift to their side that has influenced his data. He also takes into account the so-called “house effects” of the differing polling companies.

He described his approach in a recent Bloomberg interview: “This is a way of taking all the very noisy opinion-polling data that’s coming in and distilling it. By looking at who did the poll, what sort of poll it was, and the timing.”

Even a glance at our very own InFacts website each day shows the growing difference between the betting odds and the poll of polls, which on April 14 showed a 50/50 dead heat in the poll of polls, but a 67% chance of a remain vote with the bookies.

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On the same day the Times ran a front page story which opened: “Public trust in David Cameron over Europe has slumped as a new poll for The Times shows the referendum on a knife edge.”

“The prime minister’s hopes of keeping Britain in the EU appear now to rest in the hands of Jeremy Corbyn…..”

So on the one hand if you follow the money (as shown by odds offered by the bookies) it still looks as if the country will stay in the EU. However, if you look at most mainstream national newspapers you could be forgiven for thinking the PM has already lost most of his credibility and the country is stampeding to the exits.

So why is the press so far apart from the betting companies on this one?

Well, first of all there is the inevitable bias in all newsrooms towards drama. This has less to do with any political bias or anti-Brussels vitriol, more with the inevitable attraction of drama to all journalists. It is a natural affinity in a trade which only succeeds if it focuses where the action is.

There are of course other factors at play.

I have no doubt that the polling companies also thrive on drama, and I’m equally certain that a Brexit poll is a better and more exciting story than a remain one. I’m not suggesting, heaven forfend, that the polls are in any way fixed, just that drama plays its part in determining which polls get noticed.

And the Drama Factor comes into play even before you factor in the definite bias much of the British print media has demonstrated in favour of leaving.

Throw all those things in together and you have a real chance that much of the Brexit noise in the media is part bias, part wishful thinking. It certainly wouldn’t be the first time.

Which might suggest that Singh is right. And the betting companies are right.

But let’s not rely on that quite yet….. I could be entirely wrong.

But I bet you I’m not. I bet you a fiver… In Euros.

 

Edited by Geert Linnebank