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We haven't seen the worst of what gambling and prediction markets will do

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Re: We haven't seen the worst of what gambling and prediction markets will do

#581

Post by malfist »

Spacecosmonaut wrote: post #545
worldsayshi wrote: post #542

Earlier quoted context omitted.

I can't believe people are throwing so much money on zero/negative sum games that on average have no benefit to anyone including yourself. I mean I know gambling is a thing but at least we are counting that as an addiction. But we seem to take polymarket more seriously.

There is genuine value in a wisdom of the crowds assessment of future events that is only sharpened up by the requirement to put money on the line.

That's why the metaverse happened. Lots of money bet on it's success

Re: We haven't seen the worst of what gambling and prediction markets will do

#582

Post by argomo »

WalterBright wrote: post #349
adamandsteve wrote: post #152

Earlier quoted context omitted.

Between these I think Amazon is less bad. It's a monopoly & monopsony which causes a lack of innovation and (eventually) higher prices but it's also a much more efficient way to sell things and it doesn't destroy the fabric of society or anything. Meta though is just as bad if not worse than any gambling site out there. Its products are optimized to destroy your attention span, feed you polarizing content, destroy yo…

Amazon is not a monopoly. See Walmart, Ebay, etc. Lots of companies sell products online. > (eventally) higher prices I have not noticed Amazon charging higher prices than others. The difficulty in charging higher prices is competitors emerge.

Amazon extracts a lot of the value of a purchase from the seller's take. Sellers risk sanctions if they sell a product cheaper thru their brand website.

Re: We haven't seen the worst of what gambling and prediction markets will do

#583

Post by dash2 »

georgemcbay wrote: post #234
dash2 wrote: post #67

An argument not mentioned here and which I didn’t appreciate until I actually took part in these markets myself, is that you need a supply of stupid/uninformed people to take the other side of the informed people’s bets.(In economic terms, no-trade theorems apply.) That suggests to me that the dream of perfect information revelation isn’t going to come true. Instead, the liquid markets will be those with a large supp…

I agree with you overall but I'm not sure the Trump bet is the best example. He certainly isn't going to be thrown out of office (unfortunately) but those 16% of bettors also win if he dies this year, and he's 80, fat, still gobbling burgers and shows signs of someone that has had at least one stroke so far. On the other hand he has access to the best medical care, but even still a 16% chance he drops dead before the…

So for example "shows signs of someone that has had at least one stroke so far" sounds like the kind of "information" that has not yet made it into a mainstream news outlet, probably for good reason. And indeed when I searched, I found it on The Daily Beast, whose reliability I doubt.

But maybe I'm wrong. If so, you could always take the opposite side of the bet. For sure, the correct probability is not zero!

Re: We haven't seen the worst of what gambling and prediction markets will do

#584

Post by starbugs »

moconnor wrote: post #523
snaily wrote: post #162

Here's an alleged secondary effect of 2 in a quote by Polymarket founder Shayne Coplan[1]: “When I get hit up by people in the Middle East who are saying, ‘Hey, we’re looking at Polymarket to decide whether we sleep near the bomb shelter; we look at it every day’ and I’m like, ‘Oh, it’s really that popular over there?’” he added. “That’s very powerful. That’s an undeniable value proposition that did not exist before.…

This is naive. The people deciding about the bombing will profit most by taking a very large and unlikely position against the market’s predictions and then carrying it out immediately. Anonymous trading on prediction markets leads to unpredictable chaos in the end. And as destruction is easier than creation that’s what we will see more of. Example: a fake German market for train punctuality was announced to make a p…

> blocking a door for a few minutes. Or betting against many trains and throwing a hopefully fake body onto a busy line.

Not necessary. If you just bet against them being punctual always, you'll have a 80% plus success rate.

Re: We haven't seen the worst of what gambling and prediction markets will do

#585

Post by doginasuit »

Spacecosmonaut wrote: post #545
worldsayshi wrote: post #542

Earlier quoted context omitted.

I can't believe people are throwing so much money on zero/negative sum games that on average have no benefit to anyone including yourself. I mean I know gambling is a thing but at least we are counting that as an addiction. But we seem to take polymarket more seriously.

There is genuine value in a wisdom of the crowds assessment of future events that is only sharpened up by the requirement to put money on the line.

The often-repeated "wisdom of the crowds" justification is misapplied to online betting markets. Like people, crowds can either be wise or unwise depending on the situation. Famous experiments like guessing how many gumballs are in a jar work because each person who can see the jar has a source of valid information, and in aggregate that can be surprisingly accurate.

You can't assume that the majority of individuals participating in betting markets have a source of valid information. Given the destructiveness of these markets to both individuals and society, the aggregate wisdom of the individuals participating in these markets is highly doubtful. Any meager value above more traditional forecasting does not justify the cost, corruption and a loss of trust in institutions.

Re: We haven't seen the worst of what gambling and prediction markets will do

#586

Post by kqr »

doginasuit wrote: post #585
Spacecosmonaut wrote: post #545

Earlier quoted context omitted.

There is genuine value in a wisdom of the crowds assessment of future events that is only sharpened up by the requirement to put money on the line.

The often-repeated "wisdom of the crowds" justification is misapplied to online betting markets. Like people, crowds can either be wise or unwise depending on the situation. Famous experiments like guessing how many gumballs are in a jar work because each person who can see the jar has a source of valid information, and in aggregate that can be surprisingly accurate. You can't assume that the majority of individuals…

Nobody says this on assumption. It's well-evidenced.

https://polymarket.com/accuracy

https://www.metaculus.com/questions/track-record/

Re: We haven't seen the worst of what gambling and prediction markets will do

#587

Post by jkubicek »

TFYS wrote: post #573
Spacecosmonaut wrote: post #545

Earlier quoted context omitted.

There is genuine value in a wisdom of the crowds assessment of future events that is only sharpened up by the requirement to put money on the line.

There's value in that only if assessments made by people using the prediction for something aren't better than crowd wisdom. I would guess that a large part of prediction market participants are simple gamblers whose assessment is worse than the prediction of someone doing it because they need the information for something. So if people who need predictions for decision-making start relying on prediction markets with…

Or if decision makers start using the gambling markets to drive their decisions, the value of these things will go extremely negative.

The headline bet in Polymarket right now is on when US troops will invade Iran. If some unscrupulous official can pull some strings to get boots in the ground in the next few days, they stand to win a significant amount of money.

Re: We haven't seen the worst of what gambling and prediction markets will do

#588

Post by jon-wood »

Spacecosmonaut wrote: post #545
worldsayshi wrote: post #542

Earlier quoted context omitted.

I can't believe people are throwing so much money on zero/negative sum games that on average have no benefit to anyone including yourself. I mean I know gambling is a thing but at least we are counting that as an addiction. But we seem to take polymarket more seriously.

There is genuine value in a wisdom of the crowds assessment of future events that is only sharpened up by the requirement to put money on the line.

Wisdom such as the mass purchase of GameStop shares, temporarily inflating the value of an ultimately doomed company?

Re: We haven't seen the worst of what gambling and prediction markets will do

#589

Post by tguedes »

doctaj wrote: post #575
well_ackshually wrote: post #552

Earlier quoted context omitted.

There's three kinds of players on Polymarket & others * The insider trading ones that will never lose money * The wallstreetbets degenerates with enough money that it's a fun game even if you lose money * People that have seen every chance they have at becoming moderately wealthy disappear under the current economic state of their country, where overwhelming debt is likely. The era of making it wealthy from a job is…

Note that #1 will get kicked off the platform immediately. Even non-inside traders who win significantly more than expected will be kicked off. If you’re on the platform, you’re losing.

Do these platforms care since the insider traders aren’t taking money from the house?

Re: We haven't seen the worst of what gambling and prediction markets will do

#590

Post by kqr »

N_Lens wrote: post #509
joelthelion wrote: post #499

There is a class of prediction markets that are useful and seem immune to most of these problems : play money prediction markets. I've been enjoying them for years; I feel they provide a useful service to understand what is going on in the world, and they don't seem to provide the perverse incentives that we are seeing here. Oh, and they seem to work just as well.

Do you have a recommendation for a service? I'd like to try it out.

Is it specifically the financial maneuvering you like? Or do you want to test your prediction skills?

If you like financial maneuvering, Manifold is a popular play-money prediction market.

If you want to test your forecasting skill, treat the current Spring Cup on Metaculus as a warmup and then compete properly in the next seasonal cup.

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