Midas Oracle .ORG » US CFTC

Legality of real-money prediction markets in America — [LINKS]

Chris F. Masse — Tue, 27 Dec 2011 22:27:09 +0000

#1. CFTC’s Bart Chilton says ‘no’.
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#2. DOJ says ‘yes’, other than for sports and horse racing.

U.S. futures regulators issued draft proposals to curb speculative trading in commodities, despite concerns that the regulators lack enough market data.

Chris F. Masse — Thu, 13 Jan 2011 16:27:37 +0000

“The CFTC voted 4-1 Thursday to propose the trading curbs in more than two dozen commodities including oil, corn, soybeans and coffee.”

Why does the CFTC allow the Cantor Exchange and not InTrade?

Chris F. Masse — Tue, 16 Mar 2010 09:00:16 +0000

Joe Weisenthal has a small opinion piece on why the CFTC allows real-money prediction markets on movie business, and bans those on politics or sports. The problem in the piece is that Joe is 100% wrong.

Joe says that there can’t be hedging in politics. Wrong. You can hedge your political ads on InTrade.
Joe says that there can’t be hedging in sports. Wrong. Businesses that operate inside a stadium could hedge the risk of the home team losing (which means less business for them).

So. why does the CFTC shy away from hedging on sports and politics? –> Politics. The CFTC is afraid of the US Congress, who would object to politics and sports “gambling”.

The CFTC is a weak institution, in the DC sphere of power. In the recent past, the CFTC lost one important battle against other parts of the US government —even though it was the CFTC that was on the right side of the issue at the time. With politics and sports betting, the CFTC does not want to lose another battle. It is a question of survival.

Ayn Rand’s influence on Alan Greenspan is responsible for the 2008 financial crisis.

Chris F. Masse — Tue, 08 Dec 2009 11:33:33 +0000

Or so is PBS’s thesis in “The Warming”.

Pretty convincing.

ADDENDUM

Wikipedia:

Brooksley E. Born is an American attorney and former public official who, from August 26, 1996 to June 1, 1999, was chairperson of the Commodity Futures Trading Commission (CFTC), the federal agency which oversees the futures and commodity options markets. During her tenure on the CFTC, Brooksley Born warned Congress and the President of the need to regulate financial instruments known as over the counter (OTC) derivatives, but her warnings were disregarded. Lack of regulation ultimately led to the crash of the derivatives market, and helped trigger the economic and financial crisis in the fall of 2008.