Greg Mankiw's Blog: Tax Hedging?
Now, he he, he is suggesting how to cheat system if Obama elected, instead he signs tax hike, leave the current one is until 2010 then filled his time half way so when his terms runs out he can’t be blamed as a signee of unpopular tax hike. So everything manipulates twists around for just for wining! So people are betting their money follow this “presume” that is sensible way of reduce their risk, feel comfort, all sense of lose something for voting Obama, so try to flocking off their possible loss doing hedge for compensation for their possible or immunize loss if Obama tax hike if he wins.
What he saying is, my bet gives me $100,000 profit, even if Obama tax hike cost of me $100,000 next four years, I make break even, not losing anything, in theory. But s/he also remember that all the cost relating multiple consequence of losing society- deadweight loss- as whole, which will eventfully bite people's ass if he elects. I think. Are bidders all voting for Obama? I am not quite sure how this work!
