Predicting Leo

The new pope begins his tenure while Trump tours the Middle East

Habemus Papam

Neither of the two prediction market favorites, Pietro Parolin and Luis Antonio Tagle (shown in red and green on the graphs below), were elected pope in the conclave last week. Neither were Pierbattista Pizzaballa, Matteo Zuppi, Péter Erdő, or Peter Turkson, the other papabile that Manifold had given >5% odds to over the last couple weeks of the election. Instead, Robert Prevost was elected by his fellow cardinals, doing so in a dominant and rapid four ballots, just as Jorge Mario Bergoglio had done 12 years prior. Prevost (in yellow on the graphs below), was at least peripherally on the radar of Manifold users. He had hovered between 1 and 2% for the weeks prior to the conclave, the NYT had listed him as a serious contender, among just over a dozen others, and for the most part, prediction markets viewed the conclave with high uncertainty, with no candidate straying above 25% odds for very long.

I personally had scooped up a few thousand mana shares of Prevost in the waning minutes of the conclave as his odds sat at 0.1% (as I did with about a dozen other papal candidates), but his election came as much a shock to me as it did to the thousands of spectators in St. Peter's Square as Cardinal Mamberti announced:

Eminentissimum ac reverendissimum dominum, dominum Robertum Franciscum sanctæ Romanæ ecclesiæ cardinalem Prevost.

Indeed, what made it even more of a shock was that as soon as white smoke was announced after the fourth ballot, bettors assumed that due to the rapid end to the conclave, it was likely that a consensus-building favorite had quickly consolidated votes, leading to Parolin’s odds skyrocketing from 30% to over 60%. There might have been a bit of a feedback loop here as well, as traders assumed that there was some smart money driving up the odds, and followed suit. This ended up being noise.

Was there signal to go off of for traders, though? Manifold user Domer wrote a long breakdown of some of the interesting dynamics at play in conclave betting, with one of the more important observations being the divergence between the understanding that the share of Italian cardinals had fallen dramatically and the prediction market favorites all being Italian:

Of the 4 highest priced possible popes as of this morning, 3 of them = Italian. Zuppi, Pizzaballa, and Parolin. This was not coincidental! Nor did it even make sense: this was the most diverse set of Cardinals ever in the conclave, by far. The idea that they would gravitate back to Italians is possible, but seems like a bad assumption.

There had also been a fascinating interview with a real-life priest by Terry Oldreal at Kalshi, where the priest had cryptically ended the interview by mentioning the possibility of another South American pope. When I read it, this had confused me, as there had not been a single—even fringe—papabile who hailed from the South American continent. The Kalshi market at the time wasn’t even selling NO shares on that option, as they were >99%.

However, most American cardinals viewed Prevost as a Peruvian, as he had spent much of the last few decades living there, rather than in the United States. I wish I could ask the interviewed priest if this is indeed what they had been hinting at by their concluding statement, but… who’s to say.

Prevost’s international appointments, and recent role as prefect of the Dicastery for Bishops had given him great international exposure. One network analysis, conducted just before his election, suggested that Prevost was the frontrunner(!) by at least one metric to be named pope, due to his extensive network connections with other cardinals.

Leo XIV

Not only was Prevost well-connected, it appears that by all accounts, he was extremely well-respected and well-liked among the other cardinals. He has immediately signaled that he is paying close attention to an issue that Manifold traders are certainly interested in: the rise of artificial intelligence. Indeed, his statement on why he chose the name Leo signals that the new pope views the societal changes of artificial intelligence as on par with the industrial revolution, which Pope Leo XIII reckoned with a couple centuries ago. Manifold traders are fairly confident that he will issue an encyclical on this subject over the next couple years:

As an aside, Pope Francis’s message on AI from last year is probably worth a read.

Forecasters also assign high odds to direct criticism of President Trump from Pope Leo XIV, giving 80% odds to such a statement by the end of this year:

There is also speculation on whether the new pope will take up residence in the Apostolic Palace, which Pope Francis had eschewed. It seems likely, in a slight return to tradition:

Pope Leo XIV is already the frontrunner for TIME Person of the Year, due to his American background, potential for socially-relevant messaging, and perhaps, voter fatigue for Trump and Musk, who have both already won the award.

You can also wager on where the Pope will travel first, although it appears that he intends to go to Turkey at the end of the month, to celebrate the 1,700th (!) anniversary of the Council of Nicaea:

Trip to the Middle East

Speaking of world leaders traveling to the Middle East, Trump’s trip to the region has drawn some controversy around his acceptance of a private jet from Qatar, which might be transferred for his personal use. Please help make this market more efficient, so we can gain some insight into how likely that actually might be:

Trump’s courting of the Saudi monarchy has also drawn attention from the press, and likely also attention from the Iranian leadership, watching warily from across the Persian Gulf. Negotiations for a renewed nuclear deal between the United States and Iran appear to be trending positively, although odds on military action during the Trump administration against Iran still remain above 50%.

Despite the timing of the trip, it appears that Manifold traders are fairly convinced that Trump’s hyped up “very big announcement” had to do with a “most-favored nation” price plan for pharmaceutical price negotiation under Medicare.

Earlier in the week, traders had thought that perhaps some large tariff deal, or a rumored statement on the recognition of Palestine, to be released at the start of the trip to Saudi Arabia, perhaps, would be the “big announcement”:

Medicare, Tariffs, and “Gaza or Israel” highlighted in the graph.

Indeed, diplomatic relations between Israel and Saudi Arabia, long a goal of the Trump administration, appears to still be on the table:

Trump, while in Saudi Arabia, lifted sanctions on Syria’s new government, incurring an invitation from the new president of Syria, Ahmad al-Sharaa, to build a Trump tower in Damascus. Manifold traders view this as a long shot, however:

Roundup

The never-ending Romanian election (which had its first iteration annulled) is onto its “second” (but really fourth?) round, which will hopefully bring the saga to its conclusion:

Meanwhile, one Manifold user is trying to learn to better orient themselves:

Manifold traders have also been approaching an important question this week: are there more chairs or tables in the world?

It seems that the crux of this question has come down to weighing the two (by far) most plentiful sources of physical manifestations of tables and chairs, data tables on hard drives and chair conformations:

Tensors, lookup tables, and HashTables might count, but individual molecules of “Table Salt” are a bridge too far for the market creator.

Chemists often refer to chair conformations such as those within cyclohexane molecules as “chairs”.

As Andrew Bird would say,

I know we're going to meet some day
In the crumbled financial institutions of this land
There will be tables and chairs

Happy Forecasting!

-Above the Fold