Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The microstructure of wealth transfer in prediction markets

jbecker.dev

Post reply on HN
Print view View original

161–170 of 193 posts

Re: The microstructure of wealth transfer in prediction markets

#161

Post by walletdrainer »

asdff wrote: post #144
LeifCarrotson wrote: post #47

Earlier quoted context omitted.

I have occasionally tried checking Polymarket and Kalshi to get an idea of the general political/cultural/technological consensus on various issues that are difficult to research otherwise, eg. "what are the chances that the Senate changes hands in the 2026 midterms?" People have thought about it enough to wager a million dollars and the consensus is at about 1/3. I have this abstract prediction market in my head, ea…

Polymarket is currently predicting a 3% chance of Christ returning by 2027 https://polymarket.com/event/will-jesus-christ-return-before...

That’s because 2027 is too far out, as the deadline gets closer it will trend towards 0%.

Buying “Christ doesn’t return” at 99 cents right now would be unprofitable, you will wait a year or so to “profit” 1 cent.

Re: The microstructure of wealth transfer in prediction markets

#162

Post by graemep »

eru wrote: post #159
graemep wrote: post #147

Earlier quoted context omitted.

It would deter those who are not insiders from investing as returns would shift from them to insiders. As the biggest social benefit securities markets provide is to enable raising capital this is a huge drawback and makes things worse for the general public.

> It would deter those who are not insiders from investing as returns would shift from them to insiders. Retail investors should be index funds anyway. Until fairly recently there was no 'insider trading' you could get in trouble for in commodities in the US. That hasn't stopped non-insiders from trading in commodities. Also, even if insider trading is legal, that doesn't mean your company needs to allow it: you can…

> Retail investors should be index funds anyway.

That does does not solve the problem as insider traders will still be shifting profit to themselves. You still need non-insiders (not necessarily retail investors) to make the market work - even for insider trading to work you need a non-insider to trade with.

> Until fairly recently there was no 'insider trading' you could get in trouble for in commodities in the US. That hasn't stopped non-insiders from trading in commodities.

Can you show that it had no impact on how non-insiders traded? How recently was recently?

> Also, even if insider trading is legal, that doesn't mean your company needs to allow it: you can still punish your own employees for it, and eg claw back bonuses and sue for breach of contract and breach of fiduciary duty.

A lot less of a deterrent, and a lot of people with access to inside information have a lot more to gain than to lose.

> In any case, American insider trading regulation is already laxer than French insider trading law. And it doesn't look like French companies have an easier time raising capital.

Both do have insider trading laws so both are probably good enough, and there are a lot of other variables.

Re: The microstructure of wealth transfer in prediction markets

#163

Post by 4ggr0 »

PlatoIsADisease wrote: post #154
eru wrote: post #136

Earlier quoted context omitted.

Huh? It's pretty obvious that you can influence the outcome of a sports event, if you can influence the ref or if you can get a player on one side to pretend to be less competent than she normally is.

10 years ago we'd be called conspiracy theorists.

Sports Betting Scandals have been a thing for probably almost as long as sports exist, i don't get why you think that this was a thoughtcrime 10 years ago?

https://en.wikipedia.org/wiki/Sports_betting#Famous_betting_...

wouldn't surprise me to find out that even cavemen were manipulating outcomes of stone-throwing contests to earn some more meat.

Re: The microstructure of wealth transfer in prediction markets

#164

Post by jrjeksjd8d »

asdff wrote: post #143
dist-epoch wrote: post #114

Earlier quoted context omitted.

It's not necessarily illegal use of secret information. There exists "alternate data", some companies monitor all kinds of stuff, satellite pictures, etc, some of these companies surely saw the inevitable asset positioning just before such a big attack (150 planes). Just like the Ukraine invasion was first visible on Google Maps as traffic jams !!! at the border at midnight https://www.washingtonpost.com/technology/2…

You could see USAF and navy air power operating in venezuela on ads-b. I was shocked seeing F15s. You'd think there'd be no way the military would have ads-b activated while performing military operations.

When you're doing extra-legal military operations in a country that isn't at war, what choice do you have? There are civilian aircraft up in the sky. Having a fighter jet run into one and kill a bunch of civilians is a bad PR situation.

Re: The microstructure of wealth transfer in prediction markets

#165

Post by _def »

> When the topic is dry and quantitative (Finance), the market is efficient. When the topic allows for tribalism and hope (Sports, Entertainment), the market transforms into a mechanism for transferring wealth from the optimistic to the calculated.

I get that the finance market is _more_ dry and quantitative than sports, but certainly not immune to hope and tribalism,

Re: The microstructure of wealth transfer in prediction markets

#166

Post by buellerbueller »

_def wrote: post #165

> When the topic is dry and quantitative (Finance), the market is efficient. When the topic allows for tribalism and hope (Sports, Entertainment), the market transforms into a mechanism for transferring wealth from the optimistic to the calculated. I get that the finance market is _more_ dry and quantitative than sports, but certainly not immune to hope and tribalism,

>I get that the finance market is _more_ dry and quantitative than sports, but certainly not immune to hope and tribalism

where is your paper?

Re: The microstructure of wealth transfer in prediction markets

#167

Post by rdtsc »

HNisCIS wrote: post #142
eru wrote: post #128

Earlier quoted context omitted.

That's neat. Though I'd say it was the first public sign. The US had been telling anyone willing to listen for weeks beforehand that an invasion was coming.

Disbelief and normalcy are a hell of a drug. Unless someone fully expects something terrible to happen and they are deliberately trying to find out when it'll happen, most people will happily ignore all of the signs until it's too late. Just look at the lead up to the Ukraine invasion, the US intelligence services were practically screaming from the rooftops that it was happening. Russians were obviously stacking up…

> Meanwhile, reporters were on the street asking people how they felt about the oncoming invasion and they all said some variation of "they've been threatening that forever, it's all talk, it won't happen".

The Ukrainian government took the approach of not starting a full on panic. They thought maybe there was still some chance of stopping it. And not knowing 100% the day and time meant stopping the economy, people fleeing and such. It could even play into the hands of the enemy as they could react and postpone as well.

Some have criticized the government for that tactic science. Some might say they should have listened to the US intelligence instead, but that presumes people should trust the US intelligence more than their own government.

Re: The microstructure of wealth transfer in prediction markets

#168

Post by hrimfaxi »

jrjeksjd8d wrote: post #164
asdff wrote: post #143

Earlier quoted context omitted.

You could see USAF and navy air power operating in venezuela on ads-b. I was shocked seeing F15s. You'd think there'd be no way the military would have ads-b activated while performing military operations.

When you're doing extra-legal military operations in a country that isn't at war, what choice do you have? There are civilian aircraft up in the sky. Having a fighter jet run into one and kill a bunch of civilians is a bad PR situation.

When you're doing extra-legal military operations in a country that isn't at war, do you really care about PR?

Re: The microstructure of wealth transfer in prediction markets

#169

Post by SleepySteve_sk »

tptacek wrote: post #46
bs7280 wrote: post #33

I mentioned this on a different post - the biggest problem with prediction markets is not the gambling or dumb people losing money. Its the fact that it gives very powerful people a vehicle to make lobsided bets on outcomes they control. A small example of this would be NFL / NBA Refs fixing playoff games with a bad call or two. This actually happened 20 years ago, an NBA ref went to prison over being bribed just $20…

This gets into a philosophical point about what a prediction market actually is. If it's a device for anonymously aggregating fragmented group information into a coherent accurate prediction, the lopsided bets are a feature; the only point of the market is the price signal, and the lopsided bets true up the price. But most of us understand that prediction markets aren't that, no matter what Robin Hansen said when he…

I think of them as "Accountability" markets. Someone who can influence the outcome is encouraged to make a public bet on their success, and define what the success criteria is. The bet is then a means to hold them publicly accountable for doing what they said they would do. The market then becomes a voting machine for the public to decide if they think the person will succeed or not.

Re: The microstructure of wealth transfer in prediction markets

#170

Post by dv_dt »

kibwen wrote: post #92
dv_dt wrote: post #76

Earlier quoted context omitted.

The irony that operational national security would be greatly improved if only they maintained a well staffed and resourced government kitchen for the Pentagon, but won't for many silly reasons. Oh no, lots of people would have to sit on idle standby many times, or gov't employees would get free meals.

The Pentagon has a ton of restaurants inside. There's literally an official mall-style map of all of them right here, I count almost 30: https://www.whs.mil/Services-and-Information/DoDCC/ The pizza index is specifically about late-night pizza orders, when presumably most of those restaurants are closed (though some do appear to be open 24/7).

If the pizza-indicator is still observable, then there is insufficient internal capacity (or perhaps it would be more correct to say insufficient at the right times) to mask the signal
Post reply on HN