It's no wonder stocks snapped their losing streak yesterday. The NFL’s replacement-ref experiment was clearly a reverse economic stimulus program.

You probably went through the five stages of grief regarding the Packers-Seahawks Monday Night Football extravaganza: *denial* that they would call a touchdown on a ball that sure looked like an interception; *anger* that you took the Packers and gave the points; *bargaining* with your fantasy league commissioner that Russell Wilson doesn’t deserve TD points; *depression* that you know there’s a 100% chance that this one game either bumps the Packers to missing a bye week or out of the playoffs completely; and *acceptance* that, hey, it could have just as easily gone the other way.

You also may have heard that by some estimates, **$150 million to $250 million changed hands** on the results of one play. The Packers were favored somewhere between 3 and 4 points, and would have won by 5 and covered. Instead, the Seahawks covered. Given that they also estimated the "public" had about 65% of their money on the Packers, that represented quite the dollar transfer from John Q. Square Bettor to bookies and offshores and Las Vegas casinos.

Let’s talk some numbers. Whether by malice or incompetence, the refs had an enormous effect on the game and the point spread and the exchange of funds on a mere two referee decisions *besides* the last one.

Thanks to the **Win Probability Counter at Advanced NFL Stats**, we can translate every game situation to an expected points (EP) total and win probability (WP), and then compare what-if scenarios. EP refers to the next points scored and do not necessarily occur on this particular possession.

Here are the two plays, and the before- and after-effects from the calls. EP and WP are from Seahawks' perspective:

**8:44 left in fourth quarter**, Packers intercept Russell Wilson, possession on Seahawks 26, EP -3.63, WP 0.1. Instead, Packers called for roughing the passer, now Seahawks 1st and 10 on Seahawks 35, EP 1.15, WP 0.28. The call effectively gave the Seahawks 4.78 EP and 0.18 wins.**6:14 left in fourth quarter**, Seahawks 1st and 25 on their own 43, incomplete pass. Seahawks 1.05 EP, 0.24 WP. Instead, Packers called for interference, Seahawks 1st and 10 on Packers 25, 3.71 EP, 0.43 WP. The call gave the Seahawks 2.66 pts and 0.19 wins.

Did I mention that these flags were way more questionable than the now-infamous *Touchereception* at the end of the game? They added up to an expected gain of almost 7.5 points for the Seahawks. Let’s round it down to 7, since they happened so close to one another (the effect is somewhat redundant). They added about 0.4 of a win to Seattle as well.

What does 7 points mean? Well, let’s assume the point spread was fair to begin with. A $100 bet on the Seahawks has an expected gain of -$5 (you normally have to risk $110 to win $100). Randomly gifting the Seahawks 7 points in some fashion gives them about a 70% chance to cover the fair point spread, which translates to an expected gain of about $37 per $100 bet on Seattle. Needless to say, that’s huge.

On the flipside, Packer bettors had only a 27.5% chance of covering a spread that was disadvantaged by 7 points (the difference from 100% is the odds of a push). That translates to an expected loss of $50 per $100 bet on the Packers.

So, let’s say $200 million was bet on this game. Sixty-five percent of that, or $130 million, went on the Packers (including **"five figures" from Charles Barkley**), and $70 million went on the Seahawks, for a net of $60 million public money on Green Bay. The 7 points gifted to the Seahawks cut the theoretical value of that bet in half, meaning two ref calls midway through the fourth quarter had the economic impact of transferring $30 million from public hands to the hands of casinos, offshores, and bookies.

And again, that’s two calls that don’t include the last one, which of course wasn’t a theoretical transfer, it was more concrete. But the last play never happens if the first two don’t set it up to begin with (and if you’re a conspiracy theorist, they’re not crossing their fingers and hoping it comes down to one malleable play).

*Disclaimer: The views represented on this blog are those of the individual author's only, and do not necessarily represent the views of Schaeffer's Investment Research.*

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