On paper, of course, Perry could absorb a defeat in Iowa without it turning into a fatal blow. After all, Iowa distributes less than 1 percent of delegates to the Republican National Convention. And across the board, the RNC assesses delegates on something close to a proportional basis–meaning that Perry's home state Texas, for example, which has delivered him the governorship by impressive margins, weighs far heavier in the balance than a less-populated state such as Iowa or New Hampshire do. Nevertheless, because Iowa is first, it plays an outsize role in shaping the race's momentum–and in media horse-race accounts of who's up or who's down in the battle for the nomination.
Thus, it is not surpising that the markets suggest that losing Iowa would be fatal to his already low likelihood of wininng the Republican nomination.