It has been an open secret since last summer that Michael Bloomberg . . . almost halfway through his second term as Mayor of New York City . . . might be tempted to make a third-party run for the White House in 2008. In recent weeks, he has fed the speculation by criss-crossing the country and relaunching his political website, michaelbloomberg. com. But it reached fever pitch in June after he stunned the political establishment by announcing he was leaving the Republican Party, which he had joined before making his first run for New York Mayor in 2001.

Bloomberg, who until running for office had been a lifelong Democrat, has said repeatedly that he intends to serve out his term as Mayor, ending in December 2009, and he reiterated that yesterday. However, his decision to detach himself from the Republicans is still being widely seen as a first step towards a third-party bid in 2008.

How much chance do third-party candidates have?

History tells us that independent candidates face a steep incline to win the presidency. America has had a stable two-party system for more than a century but there are precedents. Ross Perot, another business billionaire, was considered a bit of a lunatic by many when he ran on an anti-free trade, anti-Washington ticket in 1992 but he did quite well, taking 19% of the national vote. Other recent independent candidates have included Ralph Nader for the Greens in 2000 (2.7%) and George Wallace in 1968 (13.5%).

However, because of the electoral college system, it is hard to win the White House, even with fairly deep support, if it is spread across the country. A candidate collects electoral college votes with each state he comes first in. Coming a decent second in several states doesn't help.

But will Bloomberg even stand?

That is the question no one can answer, himself probably included. Things in favour of a third-party candidacy include recent polling that shows a large number of Americans deeply dissatisfied with Washington and the direction of the country.

Bloomberg does not have to decide until May, when the arduous task of getting on to the ballot in the 50 states would have to start. By then, we should know who the nominees for the two big parties are, and Bloomberg will then be in a better position to calculate his chances of competing effectively. If he runs, he will be partly gambling on candidate-fatigue among voters, who will have endured months of saturation coverage of the establishment candidates and their positions. He could then jump in as a refreshing alternative.

How hard is it to run without the support of party machinery?

Tricky. Once nominated, the candidates for each of the traditional parties can count on a swing behind them. That includes being crowned at the early summer national conventions, bringing saturation coverage. As the election approaches, the big parties have sophisticated strategies for energising grassroots supporters and getting out the vote. Independents have none.

Like Perot before him, however, Bloomberg has the advantage of massive personal wealth. Derived from his majority ownership of the Bloomberg news wire service, his personal worth has been pegged at more than $5.5bn by Forbes magazine.

Recent reports suggest he is prepared to pour $1bn of his own assets into running.

What is wrong with the main party candidates already out there?

Not a lot really. The Democrats have a strong field of runners with Barack Obama, the senator from Illinois, and his colleague Hillary Rodham Clinton offering the most credible campaigns. John Edwards, the former North Carolina senator, is also compelling. The Republicans may be more vulnerable to a third-party candidate, however.

Rudy Giuliani is the front-runner in many polls but his liberal positions on social issues such as abortion and gay rights do not sit well with conservative Republicans, which explains recent gains for Fred Thompson, an actor and former senator from Tennessee who has yet to formally declare. Once presumed the front-runner, John McCain, a senator from Arizona, is struggling to catch fire. Another wild-card is Al Gore. His supporters are begging him to jump in but a Gore candidacy now seems unlikely. One problem for Bloomberg: with Giuliani and Clinton, we have too many New York folk already.

What effect would Bloomberg's presence have on the 2008 race?

Bloomberg's oratory is less than gripping but his entry would shake it up. If experts agree his chances of winning are slim, they are divided on which of the two other candidates he would hurt more. In 1992, Perot was thought to have badly damaged the incumbent, George Bush Sr, handing the election to Bill Clinton. But in 2000, it was Al Gore who suffered from Ralph Nader.

"I could draw a scenario where Bloomberg could be extraordinarily helpful to the Republican, or extraordinarily helpful to the Democrat, depending on how he positions himself, " said Republican pollster Tony Fabrizio. It may bother voters Bloomberg is single . . . divorced from English-born Susan Brown. Nor has there been a Jewish US president, but few people think this would be much of an issue.

So what does Bloomberg stand for?

We have no full picture of his platform but plenty of clues from his record as Mayor.

Moreover, in recent weeks he has increasingly begun to address national and global issues. His mantra is pursuing policies that promise practical impact without regard for ideological doctrines. For that reason, his disassociation from both parties makes sense. On social issues he was always an odd Republican. He is for abortion choice, and a supporter of gay rights. He is arguably the most outspoken US politician on stricter gun control. In the wake of 9/11, he dared to increase city taxes. He has successfully improved New York schools.

On health, he will be best known for making New York one of the first big cities in the US to ban smoking indoors. On Iraq, he has indicated opposition to deadlines for the withdrawal of troops. Recently, he vowed to plant a million trees in the city, and begin the process of making every one of its yellow cabs a hybrid vehicle by 2012.