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Flu-tures trading

While the world watches stock markets from Shanghai to Chicago cautiously rebound from Tuesday’s deep losses, public health officials have their eyes on a new futures market: the Avian Influenza Prediction Market, or “bird flu index,” run by the Iowa Electronic Markets project at the University of Iowa. It works like this: A select group ...

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While the world watches stock markets from Shanghai to Chicago cautiously rebound from Tuesday’s deep losses, public health officials have their eyes on a new futures market: the Avian Influenza Prediction Market, or “bird flu index,” run by the Iowa Electronic Markets project at the University of Iowa.

It works like this: A select group of public health officials and pandemic experts are given about $100 a year to place bets on the likelihood of bird flu’s projected path. (Fortunately for those of us who aren’t steeped in epidemiology, people who might otherwise profit from the sale of, say, flu vaccines or masks aren’t invited to participate.) The bets are simple and specific. One current market asks “traders” to bet on the likelihood that the dreaded H5N1 strain will infect a human in Hong Kong by July 1. Right now, a share in a “yes” vote is running at 43 cents, which indicates that the market sees a 43 percent likelihood of infection. By contrast, the chances of the flu infecting a human in North or South America are running at 5 cents.

Though the project is not without controversy, it’s garnered far less outcry than the terrorism futures market that the Pentagon briefly introduced a few years ago. Which might mean the American public has more faith in the collective predictions of the public heath sector than the DoD. More likely, though, it could mean that, after years of hearing dire warnings about the threat of bird flu, people just want the medical community to put its money where its mouth is.

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