Several people have explained to me that the betting on how many votes Miers will get assumes that she gets a vote, while the betting on her confirmation takes account of the possibility that her nomination will be withdrawn. Thus the simultaneous betting against her confirmation and for her getting more than 50 votes if her nomination is brought to a vote. Here’s one of the emails I received:

“The contract on Miers’ confirmation settles at 0 if she is withdrawn for any reason whereas the contracts on ‘x-number of votes’ (in the example you gave, 50-or-more votes) are unwound if she is withdrawn (no gain, no loss to the trader). Thus the lower price for the pure confirmation contract relative to the 50-or-more votes contract represents the market’s view of the probability of her name being withdrawn before an up-or-down vote occurs in the full Senate. In other words, the 50-or-more vote contract is the market’s estimate of the probability she will be confirmed conditional upon her reaching the full Senate for a vote. The contract on her straight confirmation is an uncoditional probability estimate. Thus, you can calculate the market’s estimate of the probability of her reaching the Senate for an up-or-down vote by dividing the price of the ‘confirmation’ [unconditional] contract by the price of the ‘50-or-more vote’ [conditional] contract — at last look this was about 54%; hence the market’s estimate of the probability of her name being withdrawn is 46%. The possibility of fillibuster shouldn’t enter into the equation because neither contract would be settled or liquidated while her name was still before the Senate.

“One question I do have that you may be able to answer is: Can she be confirmed with less than 50 votes? In other words, is a majority of the full Senate needed or simply a majority of those Senators in attendence (assuming a quorum)? If the answer is that she could be confirmed with less than 50 votes, then this would be a downward-contributing factor to the price of the conditional (50-or-more votes) contract and hence the previous estimate of the probability of her making it to the floor for a vote would have been overstated. I don’t consider the possibility of exactly 50 votes because certainly Cheney would vote to confirm if necessary.”

My response: Thanks for the explanation (which also goes for the other emailers). A nominee can be confirmed with fewer than 50 votes. It takes a majority of senators present and voting, not a majority of the Senate.