Basically it's a futures trading market for political prospects. Rather than
Because it functions as a free market, InTrade and other sites like it reflect aggregates of individual decisions (just like the actual market), and as a result they tend to be pretty damn good predictors of what actually will happen. Not perfect, of course--market failure FTW!--but given that politics, too, is in large part an aggregate of individual opinions (or individuals responding to an aggregate), it's not a bad crystal ball.
It predicts, so far, that Sarah Palin will be taken off the Republican ticket.
Personally, I think JMac is way too stubborn for that--not to mention it almost ensures defeat and it would piss off the religious right base, further ensuring defeat. She would have to be a really, really, REALLY huge liability for that to be feasible even to someone who isn't as proud and sulky as John McCain.
In addition, the people who tend to hang out on these sites, I wager, are some very politically savvy people--junkies, poeple who follow the media and the news cycle, the blogs, etc. Most people may not be aware of everything that's been coming out about SP lately. Many may not even know it's POSSIBLE to replace your VP candidate; I didn't, until all the Eagleton comparisons started popping up.
Anyway, I doubt it'll actually happen. But The Market that those fiscal conservatives love so much is telling them to lose her.