Adam Smith's invisible hand decides all sorts of things for us: the price of oil, traffic patterns, your salary. Every time markets move through a price adjustment, market participants get a bit of information. If a good's price goes up and one assumes stable supply, it usually means that the market as a whole values the good more than it did before the price change. After all, someone is willing to pay a higher price for the commodity. If the price drops, one can assume the market values the commodity less because you can buy it for less. At firstdibz.com, the market gets to buy and sell national championship aspirations. The site sells options on BCS Bowl tickets. You buy an option on tickets by team. So, if you buy a Georgia option and UGA makes the title game, you get to buy a ticket to the BCS Bowl for face value. If Georgia doesn't make it, your option is worthless and they keep your money.
This market should tell us who ticket purchasers think will make the title game. Fans and ticket scalpers should pay the most for the team option most likely to pay off in the end. Only two options, those team options entitling the holder to a valuable ticket, will have any value in December. What does the market say? Right now, the options market predicts USC ($140) and Ohio State ($156) will meet again in January's national title game. The backups are Florida ($135) and LSU ($122). Georgia comes in at $82, well below the top of the market, tied with Texas, Tennessee, and West Virginia.
"Impossible!" you say. That system simply rewards the team with the largest and most dilusional, arrogant fanbase. Are you saying the market is wrong? How dare you question the numerous varible assumptions of the science of economics? How dare you question the mechanism that said Enron was a rock solid retirement investment? That your house really was worth the value of that mortgage? That Kirk Ferentz is a better coach than Mark Richt, Mack Brown, and Steve Spurrier? The market has spoken. Sit back and accept its conclusions.
Quinton
Quinton
