Speaker 1: Call Zone Media.
Speaker 2: Last week, two major news networks, CNN and CNBC partnered
Speaker 2: with the so called prediction market Calshi, an online political
Speaker 2: betting platform, to use Calshi's real time betting data in
Speaker 2: TV news segments, online news content, and as Calshi announced
Speaker 2: on X the Everything app quote to integrate prediction Markets
Speaker 2: into CNN's global newsroom, with Kalshi threatening quote, a new
Speaker 2: era of media is here. This is it could happen here.
Speaker 2: I'm Garrison Davis. Regular CNN viewers may have noticed this
Speaker 2: integration has already been happening for some time. This past
Speaker 2: election cycle, news anchors used betting odds in place of
Speaker 2: an addition to polling data to weigh the likelihood of
Speaker 2: candidates when elections. CNN's chief data analyst, Harry Enton Nate
Speaker 2: Silver Protege, who used to work for five thirty eight
Speaker 2: trailblazed the use of political gambling data in news stories
Speaker 2: earlier this year. How she praised Entin by name in
Speaker 2: their announcement of the CNN partnership.
Speaker 3: Quote.
Speaker 2: Entin is an expert at translating what data and polling
Speaker 2: are saying on any given issue, and through this integration,
Speaker 2: he can tap into real time prediction markets data to
Speaker 2: better inform and fact check his reporting unquote. Here's an
Speaker 2: example of this reporting in a CNN segment from October
Speaker 2: twenty twenty five.
Speaker 4: If you go back six months ago, you go back
Speaker 4: to April k bauldwhen what were we looking at, Well,
Speaker 4: we were looking at the Democrats with a very clear
Speaker 4: shot of taking control of the US House of Representatives.
Speaker 4: According to the Calshi prediction market odds, we saw him.
Speaker 3: In an eighty three percent chance.
Speaker 4: But those odds have gone plummeting down now we're talking
Speaker 4: about just a sixty three percent chance, while the gopiece
Speaker 4: chances up like rocket up like gold, up from seventeen
Speaker 4: percent to now a thirty seven percent chance. So will
Speaker 4: look like a pretty clear Demo likely Democratic win in
Speaker 4: the House come next year has become much closer to
Speaker 4: toss up at this point, although still slightly leaning Democratic.
Speaker 2: Harry Enton never clarifies how these quote unquote odds are
Speaker 2: formed or what they really are. To a viewer who
Speaker 2: just tuned in or maybe isn't paying that much attention,
Speaker 2: it would be very unclear that these numbers are actually
Speaker 2: from a gambling website. They're just big percentages displayed on
Speaker 2: screen the way you would see polling data or legitimate
Speaker 2: information used in a newsroom. This short section using the
Speaker 2: Caushi prediction market odds was then followed by three minutes
Speaker 2: of analysis using selective mid term voting data from twenty
Speaker 2: seventeen to twenty eighteen to support the movement in these
Speaker 2: gambling odds. The gambling odds themselves with a load bearing
Speaker 2: piece of information in this piece. Calshi's main competitor, another
Speaker 2: so called prediction market called poly Market, partnered with x
Speaker 2: the Everything app and Yahoo Finance earlier this year to
Speaker 2: integrate their prediction data into online news content. Time Magazine
Speaker 2: and Sports Illustrated have also both launched deals with the
Speaker 2: prediction market platform Galactic. So what exactly are these prediction
Speaker 2: markets and how do they function? On poly Market and Calshi,
Speaker 2: users can bet yes or no on the outcome of
Speaker 2: a question relating to world events, which is called a market.
Speaker 2: As more money is wagered on either side, the odds
Speaker 2: of the outcome change. Currently, top questions include various predictions
Speaker 2: for Time Person of the Year, will the US strike
Speaker 2: Venezuela before the end of the year, the release of
Speaker 2: the Epstein files, and who will be the next president.
Speaker 2: Calshi has tried chances at six percent. Here's Polymarket CEO
Speaker 2: Shane Copelan explaining on sixty minutes.
Speaker 1: You make money if you're right, you lose money if
Speaker 1: you're wrong, and as a result, it creates this information
Speaker 1: that's really isful for people.
Speaker 2: These companies would like you to believe that the ratio
Speaker 2: of people betting yes or no on a certain outcome
Speaker 2: of world events is somehow useful or reliable information for
Speaker 2: the general public to forecast the future, whether that's through
Speaker 2: betting on the likelihood of an upcoming recession, the winner
Speaker 2: of a sports game, which days of the week Israel
Speaker 2: will bomb Gaza, or what movie will win Best Picture.
Speaker 2: Almost fifty million dollars is currently being wagered over a
Speaker 2: potential Russia Ukraine ceasefire in twenty twenty five. Production markets
Speaker 2: currently have three billion dollars in weekly trading volume. I
Speaker 2: do need to note these companies argue that hedging out
Speaker 2: homes of world events legally is not gambling, because that
Speaker 2: would be illegal. Payments through unauthorized gambling sites are illegal
Speaker 2: under the Unlawful Internet Gambling Enforcement Act of two thousand
Speaker 2: and six, which suppressed the early prediction markets of the
Speaker 2: two thousands, but CALSHI is regulated as a platform for
Speaker 2: trading financial derivatives rather than securities trading or straight up
Speaker 2: legalized gambling, and this determines what entity they have to
Speaker 2: register with and what regulations they're subject to. CALSHI launched
Speaker 2: in twenty twenty one with a federal license from the
Speaker 2: Commodity Futures Trading Commission, and after a year's long battle,
Speaker 2: in October twenty twenty four, a federal appeals court ruled
Speaker 2: in favor of CALSHI, allowing online prediction market betting on
Speaker 2: US elections, rejecting claims by the Commodity Futures Trading Commission
Speaker 2: that the practice was illegal gambling and their concerns that
Speaker 2: prediction market betting could undermine a lie election integrity. Former
Speaker 2: CFDC chairman Rostam benham My statement in May of twenty
Speaker 2: twenty four, reading quote contracts involving political events ultimately commoditize
Speaker 2: and degrade the integrity of the uniquely American experience of
Speaker 2: participating in the democratic electoral process. Allowing these contracts would
Speaker 2: push the CFTC, a financial market regulator, into a position
Speaker 2: far beyond its Congressional mandate and expertise quote. A week
Speaker 2: before his dad took office in January twenty twenty five,
Speaker 2: Donald Trump Junior became a strategic advisor at Calshi. Polymarket
Speaker 2: launched in twenty twenty without registering with the Commodity Futures
Speaker 2: Trading Commission, and was fined one point four million dollars
Speaker 2: by the CFTC in twenty twenty two for operating as
Speaker 2: an unregulated exchange and was henceforth prohibited from allowing bets
Speaker 2: from US based users. Though the Polymarket CEA EO sees
Speaker 2: it a little different.
Speaker 5: It was at one point four million dollars fine, and
Speaker 5: also it was a settlement and you could not have
Speaker 5: customers in the United States.
Speaker 1: Yeah, we had to go in geoblock trading in the
Speaker 1: US and move certain operations offshore. And it wasn't hey
Speaker 1: you're banned from trading the US. It's like until you're licensed.
Speaker 3: I mean it was breaking the law.
Speaker 1: I mean people say, bring the law. It's like which law,
Speaker 1: you know? So if anything it's incompatible.
Speaker 3: It's incompatible with the law. Yeah.
Speaker 2: With the regulatory matrix that existed the past two years,
Speaker 2: Polymarket has found to be facilitating illegal gambling and subsequently
Speaker 2: banned in the countries of Switzerland, France, the UK, Poland, Singapore, Belgium,
Speaker 2: Romania and Australia. Most of these bands just required geoblocking users,
Speaker 2: which can be easily circumvented through the use of a VPN,
Speaker 2: and since the financial transactions on poly market are all
Speaker 2: done through cryptocurrency, it's not clear that poly market is
Speaker 2: taking any steps to enforce these banksands beyond geo blocking.
Speaker 2: In the midst of facing regulatory hurdles and bands from
Speaker 2: across the globe, Polymarket still exploded in popularity last year,
Speaker 2: attracting investment from Peter Thiel's venture capital firm and hundreds
Speaker 2: of thousands of new users, primarily driven by betting on
Speaker 2: the US presidential election, speculation on whether Biden would drop
Speaker 2: out of the race and who Trump would pick as
Speaker 2: vice president, all despite the platform technically being banned in
Speaker 2: the United States after the first presidential debate in July
Speaker 2: twenty twenty four, around the attempted assassination of Trump and
Speaker 2: the RNC, Polymarket gained sixty thousand new accounts. The year prior,
Speaker 2: polymarket averaged two thousand, three hundred new accounts, per month.
Speaker 2: August twenty twenty four saw seventy thousand new accounts, September
Speaker 2: ninety thousand, October three hundred thousand, the month after Trump's
Speaker 2: second inauguration four hundred thousand. Currently, polymarket has over sixty
Speaker 2: thousand daily active traders and hundreds of thousands of monthly
Speaker 2: traders since October twenty twenty four. To give another example
Speaker 2: of their recent growth, in April twenty twenty three, Polymarket's
Speaker 2: monthly volume was about three million dollars. A year later,
Speaker 2: it was thirty nine million. In November twenty twenty four,
Speaker 2: it was two point five billion. Last month, it was
Speaker 2: three point seven billion. In summer twenty twenty five, cash
Speaker 2: Pttel's FBI and the CFTC under Trump dropped investigations into
Speaker 2: whether polymarket was illegally allowing US users to place bets
Speaker 2: using VPNs. Shortly thereafter, Donald Trump Junior's venture capital firm
Speaker 2: invested in the platform, and Trump Junior himself joined Polymarket's
Speaker 2: advisory board. Curiously, a few days after Trump Junior joined
Speaker 2: poly Market, the Commodity Futures Trading Commission announced it was
Speaker 2: going to allow poly market to operate in the United
Speaker 2: States after acquiring another company that held a US license.
Speaker 2: This past October, Trump's own truth Social announced it was
Speaker 2: partnering with Crypto dot Com to launch truth predict quote,
Speaker 2: a revolutionary prediction market backed by President Trump for enhanced
Speaker 2: decision making unquote. When Barry Weiss's sixty Minutes did a
Speaker 2: puff piece on Polymarket with its CEO last week, Anderson
Speaker 2: Cooper inquired about the risk of insider trading, poly Market's CEO,
Speaker 2: Shane Kaplan, seemed to think that a little bit of
Speaker 2: insider trading my be good actually.
Speaker 5: But predictive markets do rely on someone having some inside information.
Speaker 1: Yeah, I think that people going and having an edge
Speaker 1: to the market is a good thing. Obviously, you need
Speaker 1: to curate them, and you need to be really clear
Speaker 1: and stringent on where the line is drawn and like
Speaker 1: sort of ethics, and we spend a lot of time
Speaker 1: on that. But it's sort of an inevitability that this
Speaker 1: will happen and there's a lot of benefits from it
Speaker 1: and people will adapt.
Speaker 2: The CEO did not elaborate on what polymarkets practice of
Speaker 2: curating insider trading looks like and where their quote unquote
Speaker 2: stringent line is drawn, because in reality it doesn't seem
Speaker 2: this line exists. They essentially encourage insider trading through these
Speaker 2: vague statements and lack of clear enforcement. From the point
Speaker 2: of view of these platforms, insider trading makes their prediction
Speaker 2: markets more accurate, so it's a net positive, and if
Speaker 2: it fucks over some users on the other side of
Speaker 2: a bet, that's just the cost of business. Last week,
Speaker 2: an alleged insider trader won over a million dollars for
Speaker 2: bets on Google's twenty twenty five year in search rankings,
Speaker 2: listing twenty two out of twenty three in the correct order.
Speaker 2: This user has made a series of early bets related
Speaker 2: to Google the past year, like the exact release date
Speaker 2: of Google's Gemini three point zero, which they won one
Speaker 2: hundred and fifty thousand dollars on. But because this poly
Speaker 2: market user isn't trading stock, there's no clear regulatory mechanism
Speaker 2: to stop this behavior, and polymarket can't reverse these trades
Speaker 2: because they run through the blockchain, not that they would
Speaker 2: even necessarily want to. Professional gambler, political data analyst and
Speaker 2: poly Market advisor Nate Silver was also asked about insider
Speaker 2: trading on the China Talk podcast two months ago.
Speaker 6: Are you worried about insider trading with this, with all
Speaker 6: this political betting. I mean there's an aspect of like, look,
Speaker 6: these are all crypto, you know, you get on these
Speaker 6: markets with crypto and like like there were markets like
Speaker 6: which way is Suzanne Collins going to vote? And you
Speaker 6: know the sort of the like you know, like the
Speaker 6: tail outcomes for like a legislative assistant in her office?
Speaker 6: Are you know you can make ten times your salary?
Speaker 6: And like a minute, right, what's your what's your think
Speaker 6: think on this?
Speaker 3: For sure?
Speaker 7: I mean, look, I think there are a couple of
Speaker 7: qualifications though, Like, first of all, I think people on
Speaker 7: the inside often earn't as well as some formed as
Speaker 7: they think, and or there are some downsides having an
Speaker 7: inside view and not an outside of you. You might
Speaker 7: drinp the kool aid, so to speak, right, you might
Speaker 7: be in a bubble.
Speaker 6: Yeah, look, I mean I mean there are ones where
Speaker 6: it's like you can literally I mean there's been a
Speaker 6: lots of group chats people talking about like very very
Speaker 6: sketchy trades and one way bets that are being made
Speaker 6: in the stock market of like what's going to happen.
Speaker 3: With a trade deal?
Speaker 6: I mean you can literally be the person who decides
Speaker 6: right and be vetting on the side if weird.
Speaker 7: If there are incentives to make money in a world
Speaker 7: of eight billion people, many of them are very competitive,
Speaker 7: and all of whom and not all of them, most
Speaker 7: of them access to the internet, right, people are going
Speaker 7: to find a way a way to do it.
Speaker 2: Right, Let's pause here for a sec. What do you
Speaker 2: think Nick goes on to list as a comparison to
Speaker 2: political insider trading as like an unfortunate but somewhat inevitable
Speaker 2: consequence of our evolving system of finance.
Speaker 7: Like in the crypto space, we've seen like an increasing
Speaker 7: the number of like crypto kidnappings. Right, Well, I mean
Speaker 7: that's one of the consequences if people are worth vast
Speaker 7: amounts of wealth that isn't very secure. It's just it's
Speaker 7: just gonna gonna happen until you up security or have
Speaker 7: better solutions or whatever else. And so like, you know,
Speaker 7: I don't think there's necessarily anymore or less insider creating
Speaker 7: on polymarket then there might be for in sports betting side,
Speaker 7: we've seen a lot of sports betting scandals or for
Speaker 7: regular equities, you know, I believe the literature says that
Speaker 7: like members of Congress achieve abnormal returns from their stock portfolios,
Speaker 7: I'd have to double I'm sure there's some debate about that.
Speaker 7: I after like to double check that.
Speaker 8: Right.
Speaker 2: It's fine, bros. It's just like cryptocurrency kidnapping. It's fine. Actually,
Speaker 2: So Naate goes on to say that prediction market insider
Speaker 2: trading isn't that different from congressmen doing insider trading on
Speaker 2: the stock market, or like rigged sports betting, but he
Speaker 2: really neglects to emphasize that those things are also bad
Speaker 2: and should be aggressively clamped down on. That shouldn't be allowed,
Speaker 2: and prediction markets intentionally skirt regulation. They currently have far
Speaker 2: less legal protections for users against unfair practices, and with
Speaker 2: crypto they can be pretty anonymized, enabling bad actors. And
Speaker 2: now news companies are legitimizing turning everyone's phone into a
Speaker 2: corrupt casino for world events, whether that's Israel starving Palestine
Speaker 2: or how many tweets Elon Musk is going to publish
Speaker 2: this week. The day before CAW she announced their partnership
Speaker 2: agreement with CNN and NCNBC. CBS aired a sixty minutes
Speaker 2: puff piece on Polymarket anchored by Anderson Cooper.
Speaker 5: When we met with Copeland last month, more than three
Speaker 5: point six million dollars had been wagered on whether or
Speaker 5: not Venezuela's president, Nicholas Muduro would be out of power
Speaker 5: by the end of the year. Polymarket users didn't think,
Speaker 5: so they gave it only a twenty three percent chance.
Speaker 5: And if you buy no on that, and you're buying
Speaker 5: it at seventy eight cents and at the end of
Speaker 5: the year he's still in power, yeah, you get a
Speaker 5: dollar per share, so you've made a profit of twenty
Speaker 5: to share. I can't see why this would be I mean,
Speaker 5: I don't want to is a term addictive, but it
Speaker 5: would be compelling.
Speaker 3: I mean maybe it is a TICNII well, certainly compelling.
Speaker 3: This is how I see it.
Speaker 1: If you are into geopolitics, this creates an incentive for
Speaker 1: you to dig in to what's going on in Venezuela
Speaker 1: and try and get an edge.
Speaker 2: Anderson Cooper, who both works for the newly Calshi partner
Speaker 2: at CNN as well as CBS's Sixty Minutes, is so
Speaker 2: hesitant to call this clearly addictive practice addictive quote unquote compelling.
Speaker 2: Here's how Polymarket CEO Shane Copelan explained the platform earlier
Speaker 2: in this piece.
Speaker 1: It's a site where you can basically bet on current events,
Speaker 1: some sort of question about the future, like an election,
Speaker 1: and as a result, when a ton of people are betting,
Speaker 1: you get the betting odds, which basically tell you how
Speaker 1: likely each outcome.
Speaker 3: Is and how accurate is it.
Speaker 1: It's the most accurate thing we have as mankind right now,
Speaker 1: until someone else creates some sort of super crystal ball.
Speaker 2: Anderson Cooper responds with narration that the CEO quote may
Speaker 2: be prone to hyperbole, but he's definitely onto something unquote.
Speaker 2: In explaining how poly Market users attempt to seek truth
Speaker 2: and gain an edge, copeland told the story of how
Speaker 2: in twenty twenty four, an anonymous French user made over
Speaker 2: eighty million dollars on poly Market by betting on Trump
Speaker 2: winning the presidential election, and to bolster his bets, he
Speaker 2: contracted YouGov to conduct private polls in swing states.
Speaker 1: People thought he'd just liked Trump, and he had actually
Speaker 1: commissioned a ton of private polls. He did something called
Speaker 1: neighbor polling, which is you ask people who they think
Speaker 1: their neighbors are likely to vote for four scenarios for
Speaker 1: an election where there's a stigma to saying you're going
Speaker 1: to vote for somebody, and people feel some sort of
Speaker 1: social awkwardness. And what he noticed was there was huge
Speaker 1: discrepancy in the neighbor polling versus the normal polling, and
Speaker 1: the neighbor polling favored Trump enormously.
Speaker 3: He thought Trump was undervalued.
Speaker 1: If this guy was not able to make eighty million,
Speaker 1: but rather able to make eighty thousand dollars, he would
Speaker 1: have never gone through the hassle. But when you get
Speaker 1: markets that are big enough, you create this incentive for
Speaker 1: people to go above and beyond to try and find truth.
Speaker 2: What the CEO is arguing here is that the sheer
Speaker 2: scale of money being wagered creates incentive to quote unquote
Speaker 2: find truth. In media discussions of prediction markets, there's this
Speaker 2: specter of objectivity around the gambled odds, which obviously the
Speaker 2: CEO of poly Market has a personal incentive to encourage.
Speaker 2: But Anderson Cooper here doesn't challenge this notion of capital
Speaker 2: t truth. Even though Donald Trump was way ahead in
Speaker 2: prediction market odds back during the twenty twenty election, which
Speaker 2: had his chances of winning that election far higher than
Speaker 2: what pure polling models showed. Kalshi claims that prediction markets
Speaker 2: can help journalists quote unquote fact check, but doesn't explain
Speaker 2: how fact can be determined from speculative gambling markets. Where
Speaker 2: is the fact in gambling? Well, we will find out
Speaker 2: after these ads. To quote from poly market advisor Nate
Speaker 2: Silver's blog The Silver Bulletin quote, It's basically good when
Speaker 2: people are more exposed to probabilities and they become more normalized.
Speaker 2: But of course I also analyze poles and build probabilistic
Speaker 2: models myself. In that capacity, I strongly disagree with the
Speaker 2: notion that prediction markets can serve as a good substitute
Speaker 2: for poles. These sorts of claims are sometimes advanced by
Speaker 2: the prediction market companies themselves, including poly Market. To be fair,
Speaker 2: one minor pet peeve is that both reporters and readers
Speaker 2: often confuse probabilities for poll results unquote. As Nate goes
Speaker 2: on to explain, if Trump is up fifty five to
Speaker 2: forty five over Kamala Harris on a prediction market, that's
Speaker 2: not saying that Trump is expected to win by ten points.
Speaker 2: It means that ten percent more users on the website
Speaker 2: favor Trump winning, which is pretty close to a toss up.
Speaker 2: This confusion is a huge problem, which is bolstered in
Speaker 2: both how prediction market companies market their platform, but also
Speaker 2: how journalists use gambling data in news stories. If you
Speaker 2: see a social media post, an advertisement, or a random
Speaker 2: news segment showing percentages tied to pictures of two politicians
Speaker 2: in a race without context, those betting numbers could be
Speaker 2: interpreted in a number of ways and influence someone's perception
Speaker 2: of an election and maybe even their choice on who
Speaker 2: to vote for, or even whether to vote at all.
Speaker 2: In an October speech, Zora Mumdani reference to Calshi billboards
Speaker 2: predicting a Cuomo victory in the Democratic primary.
Speaker 9: When I walked the length of Manhattan just a few
Speaker 9: days before the election, hundreds of New Yorkers marched alongside me.
Speaker 9: And when we strolled into Times Square under a billboard
Speaker 9: with betting odds that showed Cuomo's chances of winning at
Speaker 9: nearly eighty percent, we knew that the so called experts
Speaker 9: were set to get it wrong yet again. Andrew Cuomo
Speaker 9: was supposed to be inevitable. When you see the Calshi
Speaker 9: odds that have our chances of victory in the nineties.
Speaker 9: Know this. You are reading the same things that Andrew
Speaker 9: Cuomo read when he went to sleep each night in June,
Speaker 9: believing that his victory was promised. We cannot allow complace
Speaker 9: see to infiltrate this movement.
Speaker 2: Cal She excitedly shared the latter half of that clip,
Speaker 2: proclaiming breaking zoron Mamdani references his Calci odds on stage,
Speaker 2: Calshi is mainstream unquote despite this clip demonstrating how prediction
Speaker 2: markets often suffer from inaccurate bias. Last week, Discount Steve Kornaki,
Speaker 2: former five poin thirty eight analyst and now CNN's data
Speaker 2: expert Harry Enton shared this segment about the Tennessee District
Speaker 2: seven special election on x the Everything app with the
Speaker 2: caption odds are Dems will come within ten points of
Speaker 2: a win, if not outright win.
Speaker 10: I would say, if you had to look at the
Speaker 10: congressional map any district that Donald Trump won by twenty
Speaker 10: two points, you would say, you know, you've got like
Speaker 10: nearly a one hundred percent chance of winning if you're
Speaker 10: running for Congress there.
Speaker 3: But what are the prediction markets saying right.
Speaker 4: Now, Yeah, what are we talking about in terms of
Speaker 4: diction market huts. Look, the Democrat has a fifteen percent
Speaker 4: chance of winning in that race. Okay, a fifteen percent chance,
Speaker 4: which ain't nothing in a district that Donald Trump won
Speaker 4: by twenty two points. But here, I think is the
Speaker 4: key nugget on this side of the of the ledger,
Speaker 4: and that is a GOP win by under ten points.
Speaker 4: There's a sixty eight percent chance of that. So there
Speaker 4: is a more than two thirds chance that the Republican candidate, Yes,
Speaker 4: they win, but they win by a significantly lower margin
Speaker 4: than Donald Trump. We're talking about double digits, smaller. We're
Speaker 4: talking about a huge, huge shift to the left. We're
Speaker 4: talking about When you add these two together, we're talking
Speaker 4: about a more than eighty percent chance that there is
Speaker 4: a clear double digit shift to the left, and a
Speaker 4: fifteen percent chance the Democrat actually wins in a district
Speaker 4: that Donald Trump won by twenty two points. That just
Speaker 4: shows you how bad the environment is for Republicans right now,
Speaker 4: that the Democrat has any sort of a chance in
Speaker 4: this talk to me about with a special lak.
Speaker 2: He's just authoritatively rattling off complete speculation on a Democrat victor.
Speaker 2: As big screens display percentages in huge text with source
Speaker 2: Calci in tiny text the bottom of the screen. Ordinary
Speaker 2: polling showed that this was a close race that leaned
Speaker 2: Red by two to eight points, and the Republican did
Speaker 2: end up winning by nine points. To quote the broken
Speaker 2: clock Nate silver quote. Without having polls to look at,
Speaker 2: the prediction markets would probably kind of suck at making
Speaker 2: election forecasts. Translating poles into probabilities is considerably more complicated
Speaker 2: when there are many correlated races at once, such as
Speaker 2: in the battle for the electoral College or control of Congress.
Speaker 2: Prediction markets had a strong twenty twenty four in this regard.
Speaker 2: They leaned toward Trump when our model had it at
Speaker 2: fifty to fifty. I don't think this was because of
Speaker 2: any special modeling insight per se, but because they incorporated
Speaker 2: some sort of prior intuition that Trump would overperform his polls. Again,
Speaker 2: so give the markets credit for that. These sorts of
Speaker 2: soft quote unquote intangible intuitions can be valuable, though you'd
Speaker 2: need a lot of data to determine whether they add
Speaker 2: or subtract value in the long run unquote, As Nate
Speaker 2: himself acknowledges someone like Andrew Cuomo had much higher betting
Speaker 2: odds throughout the entire New York mayoral race than a
Speaker 2: purely statistical model would show. A contention I have with Nate.
Speaker 2: One of many is though I call prediction market numbers
Speaker 2: gambling odds, they are not actual probabilities. These odds aren't
Speaker 2: based on objective mathematical principles like flipping a coin, the
Speaker 2: three door problem, or even something like blackjack. These odds
Speaker 2: are created whole cloth through guessing, sometimes educated or day
Speaker 2: informed guessing, but still primarily through people's intuition, which is
Speaker 2: susceptible to group impulses. Many random world events lack a
Speaker 2: reliable basis of continuous controlled data that's needed to form
Speaker 2: a probability like that which is applied to legalized sports betting.
Speaker 2: This is quite evident in the betting odds around the
Speaker 2: last Papal conclave, which had very little relevant data to
Speaker 2: use for informed predictions. There was no existing probability to
Speaker 2: support the election of an American pope, a first time occurrence.
Speaker 2: With prediction markets, people can still do research to make
Speaker 2: an informed bet, but it's not really the case that
Speaker 2: ex candidate is mathematically expected to win an election. Eighty
Speaker 2: out of one hundred instances, a hive mind of users
Speaker 2: have formed that statistical division. Through the power of money,
Speaker 2: eighty percent of users are betting that a certain result
Speaker 2: is likely to occur. So the problem isn't just that,
Speaker 2: like Nate says, people are confusing probabilities for polls. It's
Speaker 2: that they're confusing prediction market betting odds for mathematical probabilities.
Speaker 2: It's this difference that allows betting on sports outcomes via
Speaker 2: Calshian polymarket, even in states that ban typical sports betting,
Speaker 2: because you're not actually betting on fixed odds, you're betting
Speaker 2: against other investors. And now news companies are not just
Speaker 2: manufacturing consent and normalizing political gambling, but are actively encouraging
Speaker 2: the use of these platforms and endorsing the predictive capacity
Speaker 2: of these gambling markets. Anderson Cooper calls it the quote
Speaker 2: unquote wisdom of crowds. But we already have methods for
Speaker 2: learning group consensus, like polling, which may have problems, but
Speaker 2: frankly far fewer problems than gambling on world events. Beyond
Speaker 2: the moral qualms of betting money on human suffering, prediction
Speaker 2: markets are susceptible to not just personal bias, but group
Speaker 2: bias based on the current ratio of odds. This in
Speaker 2: group consensus can be influenced by short lived trending topics,
Speaker 2: and these platforms cater to a hyper online point of view.
Speaker 2: Prediction market users provide a very non representational sample variety
Speaker 2: pulling from a very specific type of guy who regularly
Speaker 2: uses these platforms. To quote from Calsh's CNN Partnership announcement, quote,
Speaker 2: cal she has become the definitive source for staying informed
Speaker 2: about the future and is used by reporters, politicians, pundits,
Speaker 2: Wall Street and Main Street get recently called the New
Speaker 2: York City mayoral election eight minutes after polls closed, hours
Speaker 2: before the media. It's because of this accuracy that calci's
Speaker 2: data will serve as a powerful complement to CNN's reporting.
Speaker 2: Lists can more easily surface credible information to their audiences
Speaker 2: about the real time probabilities of future cultural and political
Speaker 2: events unquote. In practice, this reporting mixes gambling data and
Speaker 2: actually reputable or credible pulls in a confusing way, like
Speaker 2: this recent scene end segment, which cites Calshi odds on
Speaker 2: whether Trump will send tariff stimulus checks as well as
Speaker 2: CBS you gov polling data on if tariff's lower prices
Speaker 2: back to back In the same segment, do.
Speaker 4: They think that the tariffs, that these rebay checks are
Speaker 4: actually coming? And at this point now no, I mean
Speaker 4: chance Trump tariff the tariff stimulus checks are sent to
Speaker 4: Americans by August of twenty twenty six. It's a twenty
Speaker 4: five percent chance. That's one in four, So that's not nothing.
Speaker 4: But the American people right now are craving, craving some relief,
Speaker 4: and at this point it doesn't look like it is coming.
Speaker 4: Although I will note John Berman, this twenty five percent,
Speaker 4: it is greater than this six percent who say that
Speaker 4: terrors decrease prices, or that five percent back in March,
Speaker 4: which are just you never see one, two, three, four,
Speaker 4: five percent. So look, twenty five percent eight nothing.
Speaker 3: But at this point it's love.
Speaker 10: Yeah, it's interesting the prediction, Marcus think they only one
Speaker 10: in four chance that will actually happen.
Speaker 2: There is this really what the future of political forecasting
Speaker 2: is going to be? Maybe, maybe not, but there are
Speaker 2: four horsemen of this political gambling apocalypse. Nate Silver via
Speaker 2: his gamification of election predictions based on his time as
Speaker 2: a professional gambler sports betting, especially since the Supreme Court
Speaker 2: struck down a federal law banning sports betting outside of
Speaker 2: Nevada in twenty eighteen, resulting in almost forty states subsequently
Speaker 2: legalizing some form of sports betting, which has facilitated the
Speaker 2: cassibility of gambling to grow dramatically across the country in
Speaker 2: the past ten years through the spread of online sports
Speaker 2: betting apps. The third horseman is Trump, for the Trump
Speaker 2: administration through their removal of regulatory hurdles facing prediction markets.
Speaker 2: And finally that CNN guy Harry Enton, a Nate Silver
Speaker 2: protege who trailblazed the use of political gambling data in
Speaker 2: news stories the past year. These four horsemen, Nate Silver,
Speaker 2: sports betting, Trump, and Harry Enton have created the cultural
Speaker 2: and political conditions for political gambling to spread. Like wildfire, which,
Speaker 2: hey is also something you can bet on. During the
Speaker 2: LA Fires prediction market, users could bet on how many
Speaker 2: acres would burn. So what is the endgame of this,
Speaker 2: this gambling apocalypse that seems to be inching its way
Speaker 2: closer and closer To answer that? Here's a clip from
Speaker 2: Calshi co founder and CEO Derek Manser.
Speaker 8: The long term vision is to financialize everything and create
Speaker 8: a tradable asset out of any difference in opinion. We
Speaker 8: are living in a where like we have an abundance
Speaker 8: of information, but there's a lot of noise, and like
Speaker 8: we don't really understand what's really from what's not. And
Speaker 8: prediction markets are an antidote to that. They do very
Speaker 8: very good job at distilling information and surfacing truth to people.
Speaker 3: And you're seeing the sort.
Speaker 8: Of massive shift where like people are using them whenever
Speaker 8: they think about questions about the future, you know, whenever
Speaker 8: they're debating about anything. And I think that trajectory is
Speaker 8: going to keep going. That's a new consumer habit that
Speaker 8: I don't think is going to be undone.
Speaker 2: This is the demon child of crypto and sports betting,
Speaker 2: This financialization of everything to form a tradable asset out
Speaker 2: of any difference in opinion, creating new addictive consumer habits.
Speaker 2: These companies want to apply the logic of smartphone sports
Speaker 2: betting to everything, where everyone gets to be their own
Speaker 2: little Nate Silver while carrying around their own digital casino
Speaker 2: in their pocket, getting addicted to gambling on speculation of
Speaker 2: world suffering, and CNN is complicit in this. CNN and
Speaker 2: others have decided to partner with platforms that enable the
Speaker 2: people who decide when to drop bombs around the world
Speaker 2: to win millions of dollars by betting money on the
Speaker 2: choices they themselves are making at the expense of the
Speaker 2: rest of the world. And these companies think this is
Speaker 2: a good thing because the betting odds can serve as
Speaker 2: a potential heads up that something is likely to happen.
Speaker 2: Simple consumer protections for users, which currently are non existent,
Speaker 2: are just not enough. Congress needs to be far more
Speaker 2: involved in regulating online betting, and in the case of
Speaker 2: political events, it should just be completely banned. It is
Speaker 2: detrimental to a healthy society. It incentivizes corruption, cruelty, and
Speaker 2: erodes public trust. Gambling doesn't need to go away entirely,
Speaker 2: when it should return to being time and location locked,
Speaker 2: go to Las Vegas like a fucking adult. Currently, there
Speaker 2: is no existing mechanism for individual states to regulate prediction markets.
Speaker 2: Only the federal government can, and Trump's federal government certainly
Speaker 2: seems like it's not going to considering the president's sun
Speaker 2: works for both of the main platforms Kalshi and poly Market,
Speaker 2: and while news companies are legitimizing this, these platforms are
Speaker 2: now working as their own news aggregators, specifically Polymarket's social
Speaker 2: media account, which is acting as a news aggregation account
Speaker 2: because that drives traffic back to their website, where people
Speaker 2: can bet on the news stories that poly market is sharing,
Speaker 2: even if those news stories are speculative or completely made up.
Speaker 2: On December fifth, Polymarket posted quote just in suspected J
Speaker 2: six Pipe Bomber's legal council projected to argue he was
Speaker 2: included in Trump's pardon of those involved in January sixth quote.
Speaker 2: This claim subsequently spread all around the parroted by people
Speaker 2: of a variety of political orientations. But if you read closely,
Speaker 2: the original post says suspected J six Pipe Bomber's legal
Speaker 2: council projected to argue he was included in Trump's pardon,
Speaker 2: Polymarket is just spreading gambling information as if it is
Speaker 2: news content. Quote unquote projected just means that polymarket users
Speaker 2: are betting on this. But these projected posts are mixed
Speaker 2: in with other posts just aggregating the day's news. So
Speaker 2: unless you are paying super close attention, which rarely people
Speaker 2: on the Internet are. This becomes a trojan horse of disinformation.
Speaker 2: When news companies use the term projected on election night,
Speaker 2: usually that indicates, with pretty clear mathematical certainty, that an
Speaker 2: event is going to happen. When polymarket uses projected in
Speaker 2: news tweets, it only indicates that Internet gamblers are swinging
Speaker 2: around money in an effort to create truth, with once
Speaker 2: legitimate news companies not just complicit but active participants in
Speaker 2: this process that isn't for us today at it could
Speaker 2: happen here, see you on the other side. It could
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