Category Archives: Prediction Markets

What will be the Final SWP Allocation for 2015?

How does 21% sound, which would be a 40% increase over the current 15% allocation declared by the Department of Water Resources?  While “more is better”, Californians cannot rejoice.  Due to the natural variability in precipitation, there is a 9% chance that the final SWP Allocation may be zero!

No, Hydrowonk is not using an Ouija board. Instead, these forecasts are based on a study of the historic record of SWP final allocations.  This year’s version is slightly different than the model used last year to forecast SWP Final Allocations for 2014. Continue reading

CA Water Bond on Election Eve: Did Political Leadership Push Prop 1 Over the Finish Line?

Sitting before my computer at sundown November 3rd, thinking about whether California voters will pass the 2014 water bond?  Hydrowonk believes the outcome depends on the balance among three factors: will the drought and political leadership exerted by Governor Brown overcome the drag of increasing debt burdens on voter support for water bonds? According to the wisdom of the Stratecon Water Policy Marketplace, the answer is yes. This market now predicts that the chance of the water bond passing is 57%.  Given the trend in voter support of water bonds and California debt loads, the passage of the water bond would be a remarkable achievement. Continue reading

Is the End of the Texas Drought Near?

Do you believe an Aggie or a Red Raider?

The Los Angeles Times recently ran a story on the September torrential rainfall in Texas: Rain pounds Texas: A sign the drought is ending?

“This could be the start of the end of the drought,” said state climatologist John Nielsen-Gammon, a professor of atmospheric sciences at Texas A&M University.

“We’ve been behind on rainfall for several years in West Texas. We have thirsty watersheds.” “We need multiple, wetter years,” said Ken Rainwater, former director of the Water Resources Center at Texas Tech University.

Well, this is one Aggie-Red Raider dispute that can’t be settled on the gridiron. Continue reading

Discovering the Crowd’s Wisdom About California’s Water Bond

The California Legislature passed the Safe, Clean and Reliable Drinking Water Supply Act in 2009 to ask voters to approve $11.14 billion in general obligation bonds for projects and programs to improve water supply reliability and ecosystem health in the Delta.  The water bond has been removed twice from ballots (2010 and 2012) due to concerns about the bond’s size and project earmarking.

The Legislature is currently considering seven bills that would remove the 2009 Act’s water bond from the November 2014 ballot and offer voters a new water bond.   For this to happen, the Legislature must pass and the Governor sign legislation by June 26, 2014.

The water industry is abuzz about the water bond and related legislative activity.  Hydrowonk asks the “water crowd” to share their wisdom on the issue.  Predictions markets have a track record of accurately prediction future events and thousands have been used in the private and public sector.

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Today, we have made public Stratecon Water Policy Marketplace that uses prediction markets to assess the likelihood of future events.  We have put up three questions about California’s water bond:

  • will California voters pass the water bond from the 2009 Act?
  • will the California Legislature and Governor act before the June 26, 2014 deadline and replace the existing water bond with a new one?
  • what will be the size of the new water bond?

So, have some waterwonk fun, let’s create a crowd and see where our collective wisdom leads.  Our marketplace is free.

For more information on prediction markets and the water industry, go to or read my two posts, Why Prediction Markets for the Water Industry and What Are Prediction Markets and Why Do They Work?