Category Archives: Analysis (Industry)

HubDub will get quoted in the future, just like the Hollywood Stock Exchange is, today… – PROBABILITY = 33%, AT BEST.

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HubDub CEO Nigel Eccles:

I fully appreciate the work that Emile and others have done but just because something hasn’t worked before doesn’t mean it can’t happen. […] Sometimes ideas take time and a fresh perspective before they achieve their full potential. […]

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My thoughts:

  1. The future is present today as a seed. If we examine today&#8217-s seed under a microscope, we can see part of the future. The fact is that the prices/probabilities from NewsFutures&#8217- play-money prediction markets are NEVER quoted by journalists and bloggers. They quote only InTrade, TradeSports, BetFair and the Hollywood Stock Exchange.
  2. &#8220-Time&#8221- can change that, indeed, provided that HubDub multiplies volumes by a factor of one million &#8212-which is what I wish for them.
  3. I don&#8217-t see the &#8220-fresh perspective&#8221- that HubDub would be bringing to the table. HubDub resembles a lot to NewsFutures. (The differences in terms of market design, automated market maker, and breath of topics, are a minor.) HubDub is a generalist, play-money prediction exchange, just like NewsFutures is.

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How does InTrade deal with insider trading?

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InTrade CEO John Delaney (in 2007):

Insider trading is one of the wicked problems, perhaps. Intrade is about providing the best predictive information. If insiders have information, then getting that information reflected in the market increases the quality of the information. I know this is not the conventional view concerning insider trading, and I am not arguing wholesale adoption or acceptance of insider trading. But we all know that, in the real world, insiders trade on inside information. We have even had markets on insider trading. Our view is to get the best information available into the market while we make sure there is some fair protection for outsiders.

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As I said, the problem is that this view is very unpopular among event derivative traders.

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APPENDIX: Economic arguments in favor of insider trading.

Pssttt… Did I tell you that I like InTrade CEO John Delaneys comment to the CFTC about event markets (prediction markets)? I cant remember whether I did tell you that already. (I do suffer memory lapses, sometimes. I know its a common affliction, because I see that Robin Hanson and Justin Wolf

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John Delaney (CEO of InTrade) – (InTrade PDF file – CFTC PDF file):

Nearly all leading academics, not known for their attraction to unanimity, have publicly supported event markets. A great majority of these academics have been supplied with Intrade market data in the past, a service that Intrade intends to continue, for all study leads to an increase in transparency and understanding of event markets. It seems that the leading event market academics make no distinction between the benefits derived from academic owned markets like Iowa Electronic Markets and commercial market platforms like Intrade.

Yet many academics, with some notable exceptions, do temper their policy prescription to suggest a “safe harbor” for academic sites where research might be more generally available. As noted above Intrade has gladly supplied its event market data, typically free of charge to most of the leading prediction market academics and their students, and we are committed to encouraging the future study of event markets by continuing to supply our event market data free of charge or at very deep discounts. The academics that study event markets do a great service in developing our understanding of the strengths and weaknesses of event markets. Some commentators suggest that market liquidity and breadth typically benefit all event market stakeholders. Thus far commercial platforms like Intrade seem to be providing the greatest depth and breadth in event markets.

As Intrade has been a staunch supporter of event market academic study, and supplies greater depth and liquidity in its event markets than any other platform, it seems strange not to be a preferred purveyor. Perhaps the predominant reason many academics have held back from advocating and treating all event markets alike is a sense that initiatives to clarify or unwind the legislation restraining the optimal development of event markets is unlikely to be achievable. It seems many academics and commentators suggest a slow bureaucratic and pragmatic caution rather than focus on the optimal result. While the optimal result may be more challenging to achieve, for consistency, for better price discovery for the benefit of all, as well as for the development of Intrade, we encourage CFTC to apply common goals, objectives and standards for all participants.

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Prediction Market Industry Association – (PMIA)

4) Lobby for a clear legal and regulatory environment conducive to the productive adoption of prediction markets by individuals, firms, and governments, and ensuring free access to these markets by traders.

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The PMIA’s first board is comprised of:

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Robin Hanson (George Mason University)
Justin Wolfers (Wharton School – University of Pennsylvania)

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Science comes to the rescue of the leading academics suffering lapses of memory -those who, on Monday, signed on to be on the board of the Prediction Market Industry Association, which is supposed to lobby for the legalization of InTrades real-money prediction markets in the United States of America

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CX717 = &#8220-memory pills&#8221-

US scientists have invented a pill that can boost memory.

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Invented by Dr Gary Lynch from the University of California.

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John Delaney (CEO of InTrade) – (InTrade PDF file – CFTC PDF file):

Nearly all leading academics, not known for their attraction to unanimity, have publicly supported event markets. A great majority of these academics have been supplied with Intrade market data in the past, a service that Intrade intends to continue, for all study leads to an increase in transparency and understanding of event markets. It seems that the leading event market academics make no distinction between the benefits derived from academic owned markets like Iowa Electronic Markets and commercial market platforms like Intrade.

Yet many academics, with some notable exceptions, do temper their policy prescription to suggest a “safe harbor” for academic sites where research might be more generally available. As noted above Intrade has gladly supplied its event market data, typically free of charge to most of the leading prediction market academics and their students, and we are committed to encouraging the future study of event markets by continuing to supply our event market data free of charge or at very deep discounts. The academics that study event markets do a great service in developing our understanding of the strengths and weaknesses of event markets. Some commentators suggest that market liquidity and breadth typically benefit all event market stakeholders. Thus far commercial platforms like Intrade seem to be providing the greatest depth and breadth in event markets.

As Intrade has been a staunch supporter of event market academic study, and supplies greater depth and liquidity in its event markets than any other platform, it seems strange not to be a preferred purveyor. Perhaps the predominant reason many academics have held back from advocating and treating all event markets alike is a sense that initiatives to clarify or unwind the legislation restraining the optimal development of event markets is unlikely to be achievable. It seems many academics and commentators suggest a slow bureaucratic and pragmatic caution rather than focus on the optimal result. While the optimal result may be more challenging to achieve, for consistency, for better price discovery for the benefit of all, as well as for the development of Intrade, we encourage CFTC to apply common goals, objectives and standards for all participants.

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Prediction Market Industry Association – (PMIA)

4) Lobby for a clear legal and regulatory environment conducive to the productive adoption of prediction markets by individuals, firms, and governments, and ensuring free access to these markets by traders.

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The PMIA’s first board is comprised of:

[…]
Robin Hanson (George Mason University)
Justin Wolfers (Wharton School – University of Pennsylvania)

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How InTrade CEO John Delaney tried to undo the great damage done to the prediction market industry by Bobs little minions (among them, Robin Hanson and Justin Wolfers)

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John Delaney (CEO of InTrade) – (InTrade PDF file – CFTC PDF file):

Nearly all leading academics, not known for their attraction to unanimity, have publicly supported event markets. A great majority of these academics have been supplied with Intrade market data in the past, a service that Intrade intends to continue, for all study leads to an increase in transparency and understanding of event markets. It seems that the leading event market academics make no distinction between the benefits derived from academic owned markets like Iowa Electronic Markets and commercial market platforms like Intrade.

Yet many academics, with some notable exceptions, do temper their policy prescription to suggest a “safe harbor” for academic sites where research might be more generally available. As noted above Intrade has gladly supplied its event market data, typically free of charge to most of the leading prediction market academics and their students, and we are committed to encouraging the future study of event markets by continuing to supply our event market data free of charge or at very deep discounts. The academics that study event markets do a great service in developing our understanding of the strengths and weaknesses of event markets. Some commentators suggest that market liquidity and breadth typically benefit all event market stakeholders. Thus far commercial platforms like Intrade seem to be providing the greatest depth and breadth in event markets.

As Intrade has been a staunch supporter of event market academic study, and supplies greater depth and liquidity in its event markets than any other platform, it seems strange not to be a preferred purveyor. Perhaps the predominant reason many academics have held back from advocating and treating all event markets alike is a sense that initiatives to clarify or unwind the legislation restraining the optimal development of event markets is unlikely to be achievable. It seems many academics and commentators suggest a slow bureaucratic and pragmatic caution rather than focus on the optimal result. While the optimal result may be more challenging to achieve, for consistency, for better price discovery for the benefit of all, as well as for the development of Intrade, we encourage CFTC to apply common goals, objectives and standards for all participants.

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This discourse should be given to read to children in public and private schools, all over the world.

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How InTrade CEO John Delaney rightfully spanked the posteriors of Bobs little minions (among them, Robin Hanson and Justin Wolfers)

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John Delaney (CEO of InTrade) – (InTrade PDF file – CFTC PDF file):

Nearly all leading academics, not known for their attraction to unanimity, have publicly supported event markets. A great majority of these academics have been supplied with Intrade market data in the past, a service that Intrade intends to continue, for all study leads to an increase in transparency and understanding of event markets. It seems that the leading event market academics make no distinction between the benefits derived from academic owned markets like Iowa Electronic Markets and commercial market platforms like Intrade.

Yet many academics, with some notable exceptions, do temper their policy prescription to suggest a “safe harbor” for academic sites where research might be more generally available. As noted above Intrade has gladly supplied its event market data, typically free of charge to most of the leading prediction market academics and their students, and we are committed to encouraging the future study of event markets by continuing to supply our event market data free of charge or at very deep discounts. The academics that study event markets do a great service in developing our understanding of the strengths and weaknesses of event markets. Some commentators suggest that market liquidity and breadth typically benefit all event market stakeholders. Thus far commercial platforms like Intrade seem to be providing the greatest depth and breadth in event markets.

As Intrade has been a staunch supporter of event market academic study, and supplies greater depth and liquidity in its event markets than any other platform, it seems strange not to be a preferred purveyor. Perhaps the predominant reason many academics have held back from advocating and treating all event markets alike is a sense that initiatives to clarify or unwind the legislation restraining the optimal development of event markets is unlikely to be achievable. It seems many academics and commentators suggest a slow bureaucratic and pragmatic caution rather than focus on the optimal result. While the optimal result may be more challenging to achieve, for consistency, for better price discovery for the benefit of all, as well as for the development of Intrade, we encourage CFTC to apply common goals, objectives and standards for all participants.

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Excellent.

However, simply to say that we want the &#8220-optimal&#8221- solution won&#8217-t do the trick, alas. I&#8217-ll blog about that, later.

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How InTrade CEO John Delaney rightfully slammed Bobs little minions (among them, Robin Hanson and Justin Wolfers) as hypocrite and short-sighted -and how he told the CFTC to put Bobs petition (signed by Robin Hanson and Justin Wolfers, among others) in the trash can (where it belongs).

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John Delaney (CEO of InTrade) – (InTrade PDF file – CFTC PDF file):

Nearly all leading academics, not known for their attraction to unanimity, have publicly supported event markets. A great majority of these academics have been supplied with Intrade market data in the past, a service that Intrade intends to continue, for all study leads to an increase in transparency and understanding of event markets. It seems that the leading event market academics make no distinction between the benefits derived from academic owned markets like Iowa Electronic Markets and commercial market platforms like Intrade.

Yet many academics, with some notable exceptions, do temper their policy prescription to suggest a “safe harbor” for academic sites where research might be more generally available. As noted above Intrade has gladly supplied its event market data, typically free of charge to most of the leading prediction market academics and their students, and we are committed to encouraging the future study of event markets by continuing to supply our event market data free of charge or at very deep discounts. The academics that study event markets do a great service in developing our understanding of the strengths and weaknesses of event markets. Some commentators suggest that market liquidity and breadth typically benefit all event market stakeholders. Thus far commercial platforms like Intrade seem to be providing the greatest depth and breadth in event markets.

As Intrade has been a staunch supporter of event market academic study, and supplies greater depth and liquidity in its event markets than any other platform, it seems strange not to be a preferred purveyor. Perhaps the predominant reason many academics have held back from advocating and treating all event markets alike is a sense that initiatives to clarify or unwind the legislation restraining the optimal development of event markets is unlikely to be achievable. It seems many academics and commentators suggest a slow bureaucratic and pragmatic caution rather than focus on the optimal result. While the optimal result may be more challenging to achieve, for consistency, for better price discovery for the benefit of all, as well as for the development of Intrade, we encourage CFTC to apply common goals, objectives and standards for all participants.

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InTrade CEO John Delaney&#8217-s comment to the CFTC is a major contribution, and I&#8217-ll blog about it many times under different angles during this Summer 2008.

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In its upcoming proceedings, therefore, the CFTC should exempt prediction markets from regulations that would prevent them from flourishing, like requiring that such shares be traded on designated commodity exchanges.

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&#8230- wrote that academic guy in the Wall Street Journal. But he doesn&#8217-t mention that HedgeStreet and the Chicago Mercantile Exchange (and the CBOT) are all for the &#8220-excluded commodities&#8221- and the &#8220-Designated Contract Makers&#8221- way.

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Honesty and fairness, when writing in a prestigious publication, would dictate that you mention your opponents&#8217- opinions.

Academia = Ivory Tower.

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Will the Wall Street Journal give the same airtime to HedgeStreet and the CME Group?

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Previous blog posts by Chris F. Masse:

  • The FaceBook profiles of the 2 most important men of the field of prediction markets
  • THE HUMAN GADFLY WHOSE OBJECTIONS ROBIN HANSON IS DUCKING…???…
  • Google now considers Midas Oracle as a major blog.
  • Horizon 2015: A long-term strategic perspective for the real-money prediction markets
  • Join our group at LinkedIn to have your “Prediction Markets” badge on your profile. It’s ‘chic’. (“Groups” info should be set as “visible”, in your profile options.) We are 63 this early Saturday morning —keeps growing.
  • If you have been using PayPal to fund your InTrade, TradeSports or BetFair account, please, check that horror story.
  • 48 hours after the launch of the “Prediction Markets” group at LinkedIn, we have already 52 members —both prediction market luminaries and simple people (trading the event derivatives or collecting the market-generated probabilities).

Why did Chris Masse opted for the excluded commodities and the DCMs way, since we know that stringent CFTC regulations can kill our lite, real-money prediction markets?

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My first argument is to value hedging, its role in the economy, and its function as a booster for the derivative exchanges (including event derivative exchanges). My second argument is to say that it&#8217-s up to the CFTC to lower the regulatory costs, again, as they did a first time for HedgeStreet (the first non-intermediated derivative exchange) in 2004. I understand that my argumentation is special, and some of you might think that I have a screw lose. That&#8217-s a fair criticism. That&#8217-s OK &#8212-I can take it. :-D

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My 2 comments to the CFTC:

– My first comment-

– My second comment.

I&#8217-ll probably end up in the group of losers, after the CFTC will have ruled. :-D

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Jason Ruspini has, of course, a much more elaborated view, and you might refer to his comment to the CFTC &#8212-for a more vertical argumentation.

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But I also support Tom W. Bell&#8217-s argumentation, because, obviously, his argumentation has value. (Other people have interesting takes, too.)

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Speaking of Tom W. Bell, take a look at his series of comments responding to Jason Ruspini&#8217-s critiques.

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Previous blog posts by Chris F. Masse:

  • The FaceBook profiles of the 2 most important men of the field of prediction markets
  • THE HUMAN GADFLY WHOSE OBJECTIONS ROBIN HANSON IS DUCKING…???…
  • Google now considers Midas Oracle as a major blog.
  • Horizon 2015: A long-term strategic perspective for the real-money prediction markets
  • Join our group at LinkedIn to have your “Prediction Markets” badge on your profile. It’s ‘chic’. (“Groups” info should be set as “visible”, in your profile options.) We are 63 this early Saturday morning —keeps growing.
  • If you have been using PayPal to fund your InTrade, TradeSports or BetFair account, please, check that horror story.
  • 48 hours after the launch of the “Prediction Markets” group at LinkedIn, we have already 52 members —both prediction market luminaries and simple people (trading the event derivatives or collecting the market-generated probabilities).