Re: Idea Futures -> Foresight Exchange

I Find Karma (
Thu, 29 Aug 96 22:23:52 PDT

> A natural complement to the Iowa Electronic Futures Market where Adamn is
> playing... RK

Yuck on those stupid Iowa Markets ( --
can you believe that despite the news of Morris' impropriety, Clinton
is still selling for a solid 75 cents a share, while all my stupid
Dole shares are selling at a mere 2 bits.

I put all of my $$ in Dole in the Winner-Take-All market at the hope
that he'd rise above my investment price of 38 cents a share. He's
now at 25 cents a share. I need more Clinton scandals, darn it!

> >
> >This doesn't track the polls, which typically ask who the potential voter
> >would vote for rather than who they think will win the election.

Right, that's exactly where I got burned. I expected Dole shares to go
UP after the Republican convention, because his poll scores went up
immediately thereafter. Instead, Dole shares plummeted after the
Republican convention because people were solidly convinced (despite any
bounce) that there was no way Dole was winning the November election.

Darn it, Clinton's like this horror movie creature who's unstoppable;
there's just no beating the guy in the general election. The way I see
it, the only way Clinton can lose is if Bosnia starts killing hordes of
American troops, economic indicators for the Christmas season 96 look
horrible, and Whitewater pans out into an actual scandal where the
public knows what a lying, conniving crook Clinton is.

I guess that scenario is about as likely as Clinton bombing Iran in
October, eh?

> Indeed. Also, a prominent candidate (this time) told devotees (last time)
> to give wrong answers to pollsters when called. While it's still possible,
> this behavior is much less likely with real money (though with his kinda
> dough, distortions would be possible for him -- & profitable for others).

That's the key: in markets like these, money drives expectations.
It's not what the people playing the market expect to happen; it's what
they expect others will make happen. There's a difference.

Actually, Rohit, this has implications in Kudos if we ever get around to
writing that concept up: the value of a Kudo is not what a person
believes its value is... it's what a person believes OTHER people
believe the value is.

> >Note that there may be an opportunity for arbitrage when numbers
> >don't add up to 100;

We tried to automate the process of looking for (and cashing in on)
arbitrage opportunities in the Iowa markets, but it turned out to be not
worth the cost of implementation. Either that, or we were lazy.

In any case, my $100 in the Iowa market is now worth a cold $38.
First I got reamed betting on Forbes. Then I got reamed betting on
Dole. I have to learn not to trust my instincts, because my instincts

:) Adam