Susan Rice is new favorite for Joe Biden's VP pick: Betting Giant

Smarkets Head of Political Markets Sarbjit Bakhshi joins Yahoo Finance's Kristin Myers to discuss the latest overseas betting odds when it comes to presumptive Democratic nominee Joe Biden's pick for Vice President.

Video Transcript

KRISTIN MYERS: Well, Vice President Joe Biden, he still has yet to announce his candidate for vice president-- I should say former Vice President Joe Biden-- despite the election only being 84 days away, just 84 days. And at the betting giant's markets, many people have been putting money on who they think is going to be winning that horse race to be his VP.

So to break down all those bets, we're joined now by Sarbjit Bakhshi, head of political markets at Smarkets. So Sarbjit, break down for us the front runners. There's been a lot of flip flopping going on, even just today. I see that former National Security Advisor Susan Rice is now ahead.

SARBJIT BAKHSHI: Yes, this has been an incredibly interesting market, with over $400,000 traded on it so far. And this market is interesting because Kamala Harris has been leading it for so long. Since we started this market maybe eight to nine months ago, Kamala Harris has been trading above all other contracts.

And what's happening right now is lots of people are trading this market seemingly around the draft DNC timetable being published. So the big question on everyone's lips, really, is do losing nominees for democratic VP get their own slot? Because our traders seem to think that it's indicative that Kamala Harris does have her own slot at this stage, and Susan Rice doesn't. And so Susan Rice is now in the lead for our market, going up from 23% yesterday to 44% today and becoming the market leader, with Kamala Harris dropping from 45% yesterday down to 36%, going into second place.

Now there's about, what it that, 8% in it between the two candidates. So not a lot in it. It's becoming coin-toss territory. But it's interesting in as much as Kamala Harris hasn't ever had a competitor that's gotten this close to her before. And people are even-- sorry.

KRISTIN MYERS: No, no, go ahead.

SARBJIT BAKHSHI: People are even looking to Twitter and looking at her Twitter account and saying she's not following Joe Biden. Now we don't know whether she ever was or she wasn't. But people are looking for signs. People are reading the rooms, as it were.

KRISTIN MYERS: To that point, I'm really glad you mentioned that Twitter bit, because what folks might not know is something really interesting that you just mentioned, that draft schedule of the DNC, there's actually an open-- just for everyone at home to understand, there is an open slot there for the VP, essentially, to speak. We don't yet know who that is.

But if you are looking at the order of events over the convention-- we are seeing, of course, Gretchen Whitmer, is supposed to be chatting on Monday, which means she probably is not going to be the VP pick. And to that end, she actually once was over 15%. That now has completely dropped and faded away entirely.

I'm wondering, as you guys are seeing this, as you're looking at this, particularly as someone who is not here in the United States, what is with the interest between Susan Rice and Kamala Harris? The betters cannot seem to be-- cannot seem to make up their minds between the two.

SARBJIT BAKHSHI: Well, I think they're just looking for a sign. There is a very unusual race in terms of a race that you have the boundary set that Joe Biden wants to pick a woman. And with all that's been happening in the states, a woman of color seems to be the best kind of option for him. And people are looking for any signs of favoritism, any signs of patterns.

Everyone's looking for the Secret Service to turn up at someone's door to kind of give them the nod, as it worked for Joe Biden back in the day. And they're not seeing it yet. They're just looking at things like the timetables, at things like the Twitter handles.

There's even a case, I think, of Gretchen Whitmer moved up in our markets suddenly when she was-- I think she going to speak to Joe Biden. But it's just not clear. I think there is just a lack of information, which is why it's 44% Susan Rice, 36% Kamala Harris, and not something stronger at this stage.

KRISTIN MYERS: So looking at the general election, sort of put the VP picks aside for the second, what moves are you seeing there? I saw Joe Biden is still the frontrunner. That seems to be slipping. I believe he fell by 5%, correct?

SARBJIT BAKHSHI: That's right. What's interesting in this market is that we saw Joe Biden overturn-- overtake Trump's lead a few months ago, and then build on it and build on it. And Trump's place was getting weaker. It looked like he was turning into a one-horse race.

But this has been changing of late. In the last week, both sides have been dropping and increasing their lead by about 4%, 5%. Joe Biden now at 58%, down from 62% last week. And Donald Trump up to 39% from 35%.

Whatever Trump's been doing over the last week is working for him. And traders are increasingly convinced that he has more of a chance to win the election than was thought.

KRISTIN MYERS: Sarbjit, I want to quickly ask you the increased interest that you guys are seeing, at least in terms of political betting, just the absolute interest that people are having in who's the VP going to be, who's the president going to be. How much has that increased?

SARBJIT BAKHSHI: It's increased enormously. So this year, at Smarkets, we've never traded more money in politics ever. So this is by far the most interesting time for people to trade politics.

And what's interesting also is that that's more than they've traded in the last UK general election. So where our traders are based, mainly in the UK, they are normally getting all the kinds of information that come from the news on the UK election. And more money has gone on this election, the US election, than any other in Smarkets' history.

KRISTIN MYERS: All right, you're going to have to tell Boris Johnson to perhaps copy Trump. And perhaps UK betters will be a little bit more interested in the elections over there. Sarbjit Bakhshi, head of political markets at Smarkets, thanks for joining us.

SARBJIT BAKHSHI: Thank you.