4 ms·

You can say you don't want prediction markets and that's fine. It's not responding to my comment though which is saying that if we have prediction markets, the

You can say you don't want prediction markets and that's fine. It's not responding to my comment though which is saying that if we have prediction markets, the goal should be for them to reveal facts about the world. If you think prediction or stock markets should be "fair" then you have a very bizarre definition of fair (one that's compatible with a game that only rich people can win). Also desiring "fairness" implies that to imply the market's primary purpose is as a game. If it's just a game, it's nothing but toxic gambling. ANYWAY: pointing to one possible case of misuse and then leaping to "inherently problematic" is pretty weak IMO. Hopefully you can tell I'm not a prediction market booster, there's a lot about them that I think it's pretty suspect. But this is a pretty lame line of reasoning IMO. "Someone might shoot people with it" -> valid reason for gun control. Guns are for shooting people. "Someone might stab someone with it" -> not a valid reason to ban knives. We already ban stabbing people. We take precautions to try and mitigate the dangers of knives, because they have a very big upside.

jen20 9mo ago
They aren’t predicting anything if the result is known a priori. Words matter - “prediction markets” just smooths over grift by making it sound reasonable.
- sparky_z 9mo ago
  The result was not, and could never have been, known a priori. All sorts of random things could have gone wrong with the operation causing the raid to fail and Maduro to remain in power. Trump could have just randomly changed his mind, or postponed the raid to beyond the end of January (the cutoff for the betting market). The person placing the bet was still taking a chance, but it was an informed chance that shifted the market probability more in line with reality. If it helps, you can think of the money made as the payment to a confidential informant for information that contributed to a more complete picture of the world. It just happens via a distributed algorithm, using market forces, rather than at the discretion of some intelligence officer or whoever. The more important the information you have to share, the more it moves the market and the bigger your "fee". It's not being a "grifter" to provide true information that moves the market correctly. In fact, this mechanism filters out the actual grifters - you can't make money (in expectation) by providing false information, like traditional informants sometimes can. This "intelligence gathering" function is the primary goal of a prediction market. It's the only reason it makes sense to even have them. If you turn it into some parlor game where everybody who participates has access to all the same information, then what are we even doing here?
  - orwin 9mo ago
    Wasn't a guy at google seeing the top seach result before publication and bet on those? That's also intelligence gathering, so i guess that's okay?
    - sparky_z 9mo ago
      I mean, yes, unironically. If the goal of a prediction market is to find out the truth about the world, that's what will get you there faster. Google might feel differently about whether it's OK in that case, but that's their prerogative. Ask yourself: If the CIA really needed to know in advance what the top search result was going to be with as much accuracy as possible (for some weird reason, doesn't matter why), how would they go about doing it? Would they spend a bunch of time evaluating all of the public information, or would they just bribe (or otherwise convince) an insider at Google to tell them?
  - lxgr 9mo ago
    > you can't make money (in expectation) by providing false information You certainly can, but that's usually called market manipulation, not insider trading.
    - sparky_z 9mo ago
      Would love to know your proposed mechanism here.
  - scoofy 9mo ago
    > The result was not, and could never have been, known a priori. This is a level of solipsism not worth discussing. Yes, Superman could be a real person and we all had our minds altered to think he’s a superhero. Yes, when someone pulls the trigger of a gun pointed at someone’s head, it could misfire and explode in their hand. The point is that someone influencing prediction markets can push this probability to very, very near zero. So much so, as to make the outcome effectively certain for all intents and purposes.
    - 9mo ago
lxgr 9mo ago
Reveal facts about the world while influencing it as little as possible. Otherwise, you're arguing that a gun is functionally a blood pressure monitor.
scoofy 9mo ago
> It's not responding to my comment though which is saying that if we have prediction markets, the goal should be for them to reveal facts about the world. My point is you can’t have this without creating a massive incentive for people to create events, and it’s inherently easier to create disorder, which hurts everyone in a free society. > pointing to one possible case of misuse and then leaping to "inherently problematic" is pretty weak IMO. This is like saying nuclear weapons are “one possible case of misuse of nuclear technology.” Yes, obviously, but it’s serious enough to justify massive regulation of nuclear technology. I’m not saying prediction markets should be illegal. I’m saying that they should have a very small maximum wager, require public disclosure of who is taking which bets, and it should not pay out if the actor has any connection to agents that create the change in the world. Sports gamblers have known about how problematic this concern is forever. Organized crime used predictions markets they could influence (sports betting) as a major source of revenue throughout history.

jen20 9mo ago

They aren’t predicting anything if the result is known a priori. Words matter - “prediction markets” just smooths over grift by making it sound reasonable.

sparky_z 9mo ago
The result was not, and could never have been, known a priori. All sorts of random things could have gone wrong with the operation causing the raid to fail and Maduro to remain in power. Trump could have just randomly changed his mind, or postponed the raid to beyond the end of January (the cutoff for the betting market). The person placing the bet was still taking a chance, but it was an informed chance that shifted the market probability more in line with reality. If it helps, you can think of the money made as the payment to a confidential informant for information that contributed to a more complete picture of the world. It just happens via a distributed algorithm, using market forces, rather than at the discretion of some intelligence officer or whoever. The more important the information you have to share, the more it moves the market and the bigger your "fee". It's not being a "grifter" to provide true information that moves the market correctly. In fact, this mechanism filters out the actual grifters - you can't make money (in expectation) by providing false information, like traditional informants sometimes can. This "intelligence gathering" function is the primary goal of a prediction market. It's the only reason it makes sense to even have them. If you turn it into some parlor game where everybody who participates has access to all the same information, then what are we even doing here?
- orwin 9mo ago
  Wasn't a guy at google seeing the top seach result before publication and bet on those? That's also intelligence gathering, so i guess that's okay?
  - sparky_z 9mo ago
    I mean, yes, unironically. If the goal of a prediction market is to find out the truth about the world, that's what will get you there faster. Google might feel differently about whether it's OK in that case, but that's their prerogative. Ask yourself: If the CIA really needed to know in advance what the top search result was going to be with as much accuracy as possible (for some weird reason, doesn't matter why), how would they go about doing it? Would they spend a bunch of time evaluating all of the public information, or would they just bribe (or otherwise convince) an insider at Google to tell them?
- lxgr 9mo ago
  > you can't make money (in expectation) by providing false information You certainly can, but that's usually called market manipulation, not insider trading.
  - sparky_z 9mo ago
    Would love to know your proposed mechanism here.
- scoofy 9mo ago
  > The result was not, and could never have been, known a priori. This is a level of solipsism not worth discussing. Yes, Superman could be a real person and we all had our minds altered to think he’s a superhero. Yes, when someone pulls the trigger of a gun pointed at someone’s head, it could misfire and explode in their hand. The point is that someone influencing prediction markets can push this probability to very, very near zero. So much so, as to make the outcome effectively certain for all intents and purposes.
  - 9mo ago

lxgr 9mo ago

Reveal facts about the world while influencing it as little as possible. Otherwise, you're arguing that a gun is functionally a blood pressure monitor.

scoofy 9mo ago

> It's not responding to my comment though which is saying that if we have prediction markets, the goal should be for them to reveal facts about the world. My point is you can’t have this without creating a massive incentive for people to create events, and it’s inherently easier to create disorder, which hurts everyone in a free society. > pointing to one possible case of misuse and then leaping to "inherently problematic" is pretty weak IMO. This is like saying nuclear weapons are “one possible case of misuse of nuclear technology.” Yes, obviously, but it’s serious enough to justify massive regulation of nuclear technology. I’m not saying prediction markets should be illegal. I’m saying that they should have a very small maximum wager, require public disclosure of who is taking which bets, and it should not pay out if the actor has any connection to agents that create the change in the world. Sports gamblers have known about how problematic this concern is forever. Organized crime used predictions markets they could influence (sports betting) as a major source of revenue throughout history.