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georgeecollins an hour ago | parent | next [-]

I think this is kind of a naive take. There's a reason why you can't take a license insurance policy out on a stranger. Being able to bet that there will be a wild fire or if a plane will be late creates terrible incentives. It's also a new way to do insider trading.

Most uncertain things that people need to hedge (currency, commodity prices) already had a hedge.

In practical terms can someone really give me an example of how they benefited from knowing the future (materially, not emotionally) from a prediction they got from Kalshi? I am honestly curious.

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dozerly an hour ago | parent | next [-]

It is a naive take, and the take that has been most propagandized by these companies.

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mahboi an hour ago | parent | prev [-]

The only one I can think of is, having a better idea of which way the presidential election goes might've been useful for some people, or some other large election. There's a lot of egg on the faces of all these mainstream media polls, which still continues to trigger some people.

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dozerly an hour ago | parent [-]

So what happens when someone like musk spends a few hundred million to skew what the probability looks like? Suddenly people see that a politician has a 90% chance of winning, and they feel silly voting for the operation?

These are not polling places, they are places for capital to influence odds.

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mahboi an hour ago | parent [-]

Eh, sounds like the excuse I kept hearing as to why Trump had favorable odds in the last election. Supposedly a foreigner trying to influence our elections, totally not the Democrats kinda not having a candidate. It would be a very expensive (on average) way to probably not make a difference. Cheaper to just buy up some media companies, which do the same thing, saying their preferred candidate is going to win.

Small elections are susceptible to corruption this way, though.

	▲	dozerly an hour ago \| parent \| next [-]
		There’s been plenty of blatant voter interference, and billions spent influencing American voters, not really seeing where your point is based. More handles to steer democracy with money is not better, period.
	▲	AngryData 34 minutes ago \| parent \| prev [-]
		Why not both?

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kube-system an hour ago | parent | prev | next [-]

> They are putting a financial incentive behind accurately predicting the future,

Unfortunately they also place a larger financial inventive on influencing the outcome of future events. Or incentivizing corruption within the inner circles of these events. Because the larger financial upside in these transactions is to bet against what the market thinks, and influence the outcome.

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austin-cheney an hour ago | parent | prev | next [-]

I don't think that is logically correct. Commonly perceived probability has been proven frequently wrong whether naturally or due to manipulation. The reasoning here is not exactly the same, but closely aligns to bandwagon fallacy.

It would be interesting to see how frequently Polymarket predictions bet against the most common prediction and by what margins.

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mahboi an hour ago | parent [-]

It's the least inaccurate way. There's money to be made if you're sure you have a better way. The real problem is we're already seeing these markets influence the outcome.

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austin-cheney an hour ago | parent [-]

You make two valid points, but they still do not qualify the validity of these markets as accurate predictors. There is a difference when people, like Berkshire Hathaway really dig into the financials and management of a company to predict its future versus somebody like me who just money on a stock. In one case an investor seeks to make money and actively influence an outcome, but in my case I am just dropping money and hoping it out paces the rise of inflation because banks are no longer reliable stores of financial security.

Polymarket projections do not provide investigative insight, as in the Berkshire Hathaway example. It's just gambling. Any influence drawn from these predictions is incidental and reactive, as opposed to active market forces like buying/selling.

	▲	mahboi 41 minutes ago \| parent [-]
		Nobody is saying it's better than stock market predictions of assets and company financials. Though there are some asset price predictions on there that exactly match the traditional markets, so it's no worse.

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__MatrixMan__ 32 minutes ago | parent | prev | next [-]

The range of activities in which this effect can be harnessed for societal good is extremely narrow, but I think it's there.

I'd be in favor of a prediction market for which which asteroids are likely to collide with something, and when. Though we'll have to shut it down once it becomes feasible that somebody might go up and nudge one.

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bayarearefugee an hour ago | parent | prev | next [-]

> They are putting a financial incentive behind accurately predicting the future, which makes these apps basically the most accurate predictor of the future.

There is plenty of data that shows they actually don't work very well outside of surfacing insider knowledge (which the commercial prediction markets superficially pretend to be against).

For events where you can't have full picture insider knowledge like elections, prediction markets are pretty awful at accurate predictions.

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jmyeet an hour ago | parent | prev | next [-]

Or they're creating a financial incentive for insider trading and manipulating certain events.

I mean look at all the oil market manipulation in the Iran war. The pattern was repeated so many times: short oil, announce a ceasefire deal with imminent on Sunday before the markets open, cash out on Monday, rinse and repeat.

The argument is that we get transparency on what's likely to happen. I don't think there's any evidence of this. I've seen any number of very poor predictions coming from Kalshi and Polymarket. I have also seen some clear manipulation.

We should call this what this is: gambling.

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miltonlost an hour ago | parent | prev | next [-]

> They are putting a financial incentive behind accurately predicting the future, which makes these apps basically the most accurate predictor of the future.

This is so fallacious. Putting money behind something doesn't make a prediction of a non-knowable more accurate.

Tarot card readings by a psychic must be more accurate predictor than a tarot card reading by an amateur because professional tarot card readers have a financial incentive to be right, so people continue coming back to them for advice. Getting a tarot card reading therefore makes this basically most accurate predictor!!

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parthdesai 30 minutes ago | parent | prev [-]

> They are putting a financial incentive behind accurately predicting the future, which makes these apps basically the most accurate predictor of the future. Available to anyone to view, for free.

Here, let me predict a future where someone will die. On the other side, let me pay for a hit on the same person. /s

^It's a bit extreme and exaggerated, but it's like that on purpose to make a point.