News Aggregation + Prediction Markets

Posted on January 29, 2008 by admin

Dollar Head

On Wednesday, January 30, 2008, at 9:00 AM PST (12:00 PM EST- 5:00 PM GMT- 6:00 PM CET), dollar-thirsty Nigel Eccles (pictured above) will be introducing HubDub at DEMO 2008 (one of the best IT conferences, along with eTech, LeWeb, CES, etc.). The DEMO website will be live-streaming the presentation video.

My best wishes go to Nigel Eccles for his presentation. (Is there something to win, at that DEMO conference? Is it a startup contest? Is there a trophy to win, at the end?)

Trophy

In my view, the launch of HubDub (both a news aggregator and a MSR-powered, play-money prediction exchange) is a milestone.

Washington Delaware

It&#8217-s not the first time that a prediction exchange adds content to its offerings (they all do that, now, even in small ways), but it&#8217-s the first time that:

Quality content from the outside (that is, from professional media organizations, including news blogs) is systematically included into the exchange offerings-
Pertinent associations between the prediction markets and the news stories are proposed. (On top of the news aggregation mechanism, people vote for the most relevant stories on each prediction market page, so as to help the other traders to be better informed on the topic at hand. And, when creating an event derivative, the manager is asked to jot down keywords, which will be used by the search engine to harness links related to that prediction market.)

The Midas Oracle readers remember that I have been bullish on HubDub since day one. (See my previous post: HubDub wil redefine the play-money exchange landscape.) Others are now following.

Welcome Mat

I&#8217-m not alone, anymore, in thinking that prediction market pages should published the URLs of the related advanced indicators (i.e., primary sources of information).

Boy Scout

Enterprise prediction market consultant Jed Christiansen (pictured above).

Good Samaritan

Internet usability expert Alex Kirtland (pictured above).

2 People Conversing

And, after a good discussion, others came in agreement with the no-brainer idea that more external links and more information can be good for the prediction markets. (Next obvious discoveries: The sky is blue- The sun rises from the East- Water is wet- War is bad- The Internet is world wide- The French fries are not fried in France- The French bread is not baked in France- etc. )

If you think of it, David Pennock (pictured above) is the man to hire to tackle the problematic of integrating news links/stories with prediction markets &#8212-since he is a world-renowned expert in both microeconomics and search engine technology. We are on his turf, here. Hence, he should be the one leading us &#8212-as opposed to us pulling him.

Human Chart

What should the humans do with the prediction markets? As Michael Giberson knows better than I do, probabilistic predictions are the offspring of the trading activities on the event derivative markets. At inception, BetFair and TradeSports didn&#8217-t give the first fig about those probabilistic predictions, but today, the event derivative industry is being defined both by its betting side and its forecasting side.

And now we can see the main difference between the betting exchange approach and the prediction market approach: promoting (the trading of low-cost event derivatives) to bettors versus promoting (the generating of dynamic, objective probabilistic predictions) to people.

Statue Muscles

See, the prediction market approach consists in chasing people with news and probabilities. Hence, my personal version of HubDub would feature an aggregation news item (a la TechMeme, Memeorandum, or BallBug), mixed up with the appropriate InTrade/TradeSports/BetFair dynamic chart to give a hint on how the issue at hand will be settled in the near future. Content, first, and then the related prediction market chart &#8212-as an informative appendix to a good scoop or quality analysis. The prediction market page would anti-chronologically list all the relevant news links.

US Symbols

And since the US (not Scotland) is the most fertile place for web search technologies, I bet that we will see soon some US-based HubDub-inspired startups popping up like champagne bubbles in the coming months and years.

Better Prediction Markets = A Better World

People Globe Big

Read the previous blog posts by Chris. F. Masse:

WHY THE PREDICTION MARKETS WILL LIKELY F**K UP SUPER TUESDAY 2008.
Still unconvinced by prediction market journalist Justin Wolfers
Oprah Winfrey
RIGHT-CLICK THIS IMAGE, AND FILL IN THIS SURVEY, PLEASE.
Papers on Prediction Markets
The Journal of Prediction Markets
The 45-degree Line

Our good doctor EJSS laughs at the Web 2.0″ concept on TechCrunch, but touts it as an essential part of the NewsFutures offerings on his website.

Posted on January 29, 2008 by admin

Emile Servan-Schreiber of NewsFutures:

[&#8230-] Also, the mere idea of a Web 2.0 makeover of prediction markets is laughable. To paraphrase a good ol’ song from the 90’s, prediction markets were web 2.0 before web 2.0 was cool.

Yeah, but Emile advertises his mastering of &#8220-Web 2.0 tools&#8221- on the NewsFutures frontpage &#8212-while Inkling Markets and HubDug don&#8217-t even mention the &#8220-Web 2.0&#8243- concept on their frontpage (I checked).

&#8212-

Here&#8217-s a screen shot of the NewsFutures website:

&#8212-

NewsFutures Web 2.0

&#8212-

Care to revise your TechCrunch statement, doc?

MP3 file

Read the previous blog posts by Chris. F. Masse:

Pervez Musharraf prediction markets –Eric Zitzewitz Edition
The Over-Round Explained
WHY THE PREDICTION MARKETS WILL LIKELY F**K UP SUPER TUESDAY 2008.
Still unconvinced by prediction market journalist Justin Wolfers
Oprah Winfrey
RIGHT-CLICK THIS IMAGE, AND FILL IN THIS SURVEY, PLEASE.
Papers on Prediction Markets

NewsFutures do NOT favor event derivative management by traders.

Posted on January 29, 2008 by admin

Emile Servan-Schreiber of NewsFutures:

January 29th, 2008 at 7:25 am
Another important difference with NewsFutures (where people have been “trading news” in 2000) is that hubdub doesn’t give away any prizes to performers. That, perhaps, is a direct consequence of the false good idea of letting people create their own markets. This not only creates many opportunities for fraud (if, for instance, the creator of the market also controls the outcome), but it also encourages incoherent outcome definitions, unverifiable outcomes, and duplicate or junkyard markets. Same problems that Inkling’s public markets suffer from.
Also, the mere idea of a Web 2.0 makeover of prediction markets is laughable. To paraphrase a good ol’ song from the 90’s, prediction markets were web 2.0 before web 2.0 was cool.

Emile Servan-Schreiber&#8217-s criticism is pertinent. However, his conclusion (&#8217-no&#8217- to self-management of event derivatives) is too radical. Without Inkling Markets, we wouldn&#8217-t have had Michael Giberson, who loves experimenting with play-money prediction markets. Somebody will come up, one day, with the right technology (e.g., a reputation system) patching the flaws that EJSS addresses. One day, in the future, we will be able to enjoy both worlds, because they will have merged into one: the libertarian prediction exchanges and the disciplined prediction exchanges.

My good doctor Emile, remember JFK, who pushed his country to do things &#8220-not only because they are easy, but because they are hard&#8220-, &#8230-and succeeded. Just because event derivative management by traders is problematic does not mean that we should give up right now. Kudos to Inkling Markets and HubDub for trying, and acknowledging criticism from veterans.

&#8212-

UPDATE: Emile Servan-Schreiber comments&#8230-

No one has a monopoly on user-driven content. Every exchange out there lets people propose their own ideas for markets that might be of interest to themselves and others. For instance, on NewsFutures, a lot of the general forum discussion is back-and-forth between the users and the admins about which markets to create next. Where NF differs from FX, Inkling and Hubdub is that the NF admins (which, by the way, are recruited from the user-base itself) have the final control on wording as well as settlement. That&#8217-s what guarantees the coherence of the exchange, which in turn means we are able to offer prizes, whereas the likes of FX, Inkling and Hubdub likely cannot because they give too much control away to unknown entities to guarantee the fairness of the contest.

I like NewsFutures, and I get all that. But I&#8217-m saying that, nowadays, on the Web, people want DIY tools. That&#8217-s why HubDub and Inkling Markets are appealing to them. They don&#8217-t have to discuss &#8220-back-and-forth&#8221-. They create the event derivative they want. Straight from the producer to the trader.

Read the previous blog posts by Chris. F. Masse:

RIGHT-CLICK THIS IMAGE, AND FILL IN THIS SURVEY, PLEASE.
Papers on Prediction Markets
The Journal of Prediction Markets
The 45-degree Line
Implied Probability of an Outcome –BetFair Edition
Justin Wolfers on Rudy Giuliani = not convincing… yet
The Florida primaries thru the prism of the InTrade prediction markets

Xpree = Innovations + Prediction Markets

Posted on January 29, 2008 by admin

Xpree launches Open Innovation Markets, a simplified betting interface and also a new website.

Open Innovation Markets combines crowd based innovation, voting and prediction markets. The idea is to brainstorm as a community, vote on the ideas to rank them, then forecast key metrics using a market (cost to develop etc). Prediction markets work well for the estimations of unbiased key metrics, combining this with voting allows the crowd to bet on only the top ranked ideas.

In an effort to make truly Usable Markets, we changed from a &#8220-stock trading&#8221- metaphor to a &#8220-betting&#8221- metaphor. In research, we found that players found shorting stock to be a lot less intuitive than going long. With betting, &#8220-I bet $100 that X is lower than 3,000&#8243- is as easy as saying &#8220-I bet $100 that X is higher than 3,000&#8243-, and is a whole lot easier than &#8220-I sell short 10 stock units at an average price of $X, and cover this with $Y&#8221- etc. We have some demos on our site for you to try out. For the prediction market purists out there, we still allow the player to see the underlying prediction market dynamics – no black boxes at Xpree.

Feedback welcome.

prediction markets

Barack Obamas victory in South Carolina wont stop the Clintons.

Posted on January 28, 2008 by admin

Dixit InTrade.

The Clintons

&#8212-

South Carolina

The Barack Obama event derivative was expired to 100.

Dem SC Obama

Dem SC CLinton

Dem SC Edwards

Source: InTrade

Read the previous blog posts by Chris F. Masse:

Many people twitter on prediction markets.
Folks, when you have something important to say, write up a full post, not a comment.
Prediction Market Journalism
TechCrunch is 221 times bigger than Midas Oracle.
Earthquake measuring 9.0 or more on Richter scale to occur anywhere on or before December 31, 2008
Why Midas Oracle (and not TV news shows or print newspapers) will dominate the future.
The Six Degrees Of Separation

eTech 2008 – Googles enterprise prediction markets

Posted on January 28, 2008 by admin

O&#8217-Reilly Conference – eTech 2008: Prediction markets and the flow of information at Google – San Diego, California, USA – 2008-03-03~06

Read the previous blog posts by Chris F. Masse:

Many people twitter on prediction markets.
Folks, when you have something important to say, write up a full post, not a comment.
Prediction Market Journalism
TechCrunch is 221 times bigger than Midas Oracle.
Earthquake measuring 9.0 or more on Richter scale to occur anywhere on or before December 31, 2008
Why Midas Oracle (and not TV news shows or print newspapers) will dominate the future.
The Six Degrees Of Separation

Predictocracy = Market Mechanisms for Public and Private Decision Making

Posted on January 28, 2008 by admin

Robin Hanson:

[&#8230-] The main problem with using [Michael] Abramowicz&#8217-s book as a &#8220-technical manual&#8221-, however, is that he&#8217-s never actually seen, much less touched, most of the blocks he describes. His conclusions are not supported or tested by math models, computer simulations, lab experiments, field trials, nor a track record of successful past proposals – it is all based on his untested intuitions. And he doesn&#8217-t seem inclined to do any such testing himself – he hopes his book will inspire others to do that. There is of course a spectrum of rigor in how solidly one can support a claim. Most business decisions are based on far less rigor that elite academics often demand, and there is surely a place for &#8220-brainstorming&#8221- speculation. Compared with most academics, I admit I have often been more than toward the speculation end of the spectrum, though I have tried to test my speculations via math models, lab experiments, field trials, and have arguably collected a modest track record of success. [&#8230-]

Michael Abramowicz&#8217-s response:

[&#8230-] The incentives provided by two of my technical proposals (the decentralized subsidy approach and the nobody-loses prediction market) are sufficiently straightforward to me that math seems superfluous to me, though I agree that field tests comparing these with alternatives would be useful. Two of the proposals (the text-authoring market and the market web) could certainly benefit from experimentation, but the software needed to implement them would be considerably more complicated than what is needed for existing prediction markets. [&#8230-]

Robin Hanson&#8217-s second take.

Michael Abramowicz&#8217-s post.

Robin Hanson on futarchy vs. predictocracy.

Michael Abramowicz.

Robin Hanson.

I will blog about this book, once I have read it, in the near future.

Predictocracy = Market Mechanisms for Public and Private Decision Making

All the book is online, at the web address above. You can also buy it at bookshops, or at Amazon.

Predictocracy

Read the previous blog posts by Chris F. Masse:

Many people twitter on prediction markets.
Folks, when you have something important to say, write up a full post, not a comment.
Prediction Market Journalism
TechCrunch is 221 times bigger than Midas Oracle.
Earthquake measuring 9.0 or more on Richter scale to occur anywhere on or before December 31, 2008
Why Midas Oracle (and not TV news shows or print newspapers) will dominate the future.
The Six Degrees Of Separation

Why Indian Software Outsourcing Companies are Outsourcing to China

Posted on January 28, 2008 by admin

White Paper

Paul Denlinger:

This white paper examines some of the unique challenges Indian software companies are facing:
The decreasing talent pool-
Rising costs-
Insufficient infrastructure and-
Not enough time to train and build infrastructure
It then shows how China is the answer to their problems because:
It has only talent pool which is large enough to compare to India’s-
The local talent pool is still largely untapped in the second-tier cities-
Ten cities have targeted software development as part of their development initiatives-
Good universities provide strong training and basic skills-
English and communication skills are swiftly catching up.

This white paper is free &#8212-provided that you register on Paul Denlinger&#8217-s site.

Heres an example of the total crap that the BetFair blog is publishing.

Posted on January 27, 2008 by admin

Betting @ BetFair - Home

Betting @ BetFair - Sports

Betting @ BetFair - Specials

Betting @ BetFair - Poker

Betting @ BetFair - Casino

BetFair blog:

Pamela Anderson&#8217-s Poker Guru

PAMELA Anderson says she is &#8220-done with the marriage thing&#8221-.
Pammy is divorcing her third husband. The marriage lasted four months. Says Pammy: &#8220-My mom wishes I was born gay&#8221-. She adds: &#8220-I am in the market for a good divorce attorney.&#8221- And, who knows, maybe the attorney is the market for a wife. Of course, before her next marriage, Pammy has to complete her divorce from the man we call [?] Rick Salomon and Metro newspaper calls a &#8220-poker guru&#8221-. A guru is a recognized leader in a field, an acknowledged and influential advocate of a movement or idea. Rick Salomon is the man best known for appearing as &#8220-him&#8221- in the first Paris Hilton sex tape. He is not a poker guru. He is just someone who plays poker, sometimes&#8230-
Don&#8217-t be a Rick, play online&#8230- [link to the BetFair Poker site]

The posting is anonymous, as always, on that crappy blog.

No external link to the original news source &#8212-of course.

Pointless content, as usual. Why thinking before writing, when a vomit can do the trick?

As for rhetoric quality, my 6-year-old nephew could do better, if encouraged by a Hershey kiss.

Is there any adult in Hammersmith monitoring what the kids are doing on their computers?

Is professor Leighton Vaughan-Williams wise to write for that crappy blog? Justin Wolfers&#8217- association with the Wall Street Journal seems more adequate for a university professor.

Author Profile&nbsp-Editor and Publisher of Midas Oracle .ORG .NET .COM &#8212- Chris Masse&#8217-s mugshot &#8212- Contact Chris Masse &#8212- Chris Masse&#8217-s LinkedIn profile &#8212- Chris Masse&#8217-s FaceBook profile &#8212- Chris Masse&#8217-s Google profile &#8212- Sophia-Antipolis, France, E.U. Read more from this author&#8230-

Read the previous blog posts by Chris. F. Masse:

A case of advertisement mistaken for content
Michael Shermer’s The Mind of The Market
A prediction market panel… where only 2 out of 5 are truly prediction market experts. What a nuclear joke. This poor line-up is the reflection of the poor state of the prediction market industry in the US… and the inherent mediocrity of the conference business.
VentureBeat makes it like established veterans NewsFutures, Consensus Point and Inkling Markets are contemporary of just-out-of-the-egg Xpree.
13 lines for Justin Wolfers, but only 2 lines and one word for Eric Zitzewitz — Mat Fogarty, what were you thinking of?
Ducted Wind Turbines (DFWT)
The Betting King — The ATP Tour was his NASDAQ.

Midas Oracle is the only popular, independent, exhaustive, multi-author, multi-exchange, Web-based resource on prediction markets.

Posted on January 27, 2008 by admin

Dear Midas Oracle readers,

I&#8217-m happy to report progress in building the architecture and content of our group blog, Midas Oracle. Let me introduce you to our 2 master pages: &#8220-PREDICTIONS&#8221- and &#8220-BEST&#8221-.

&#8212-

#1. PREDICTIONS

Predictions

http://www.midasoracle.org/predictions/

= our explainer on prediction markets + the best charts of prediction markets

Following the New Hampshire brouhaha, I believe that the way to go is to systematically associate (when time and space permit) a short probability explainer to any published chart of prediction market. You can see such an association at the top of our blog frontpage. I will do that in some blog posts, too, in the future.

Political charts from InTrade and NewsFutures are published there. Charts from more exchanges will be added there over the coming weeks, months, and years. Suggestions are welcomed.

Thanks to Michael Giberson and Emile Servan-Schreiber for some tiny input in establishing that brand-new page.

&#8212-

#2. BEST

Best

http://www.midasoracle.org/best/

= the best external weblinks on prediction markets + the best Midas Oracle posts on prediction markets

This file has been quite popular &#8212-see the web stats report, in the appendix. I will, of course, augment this file with many more pointers, in the coming weeks, months, and years. Suggestions are welcomed.

&#8212-

#3. ARCHIVES

Midas Oracle.ORG – Predictions & Innovation

Prediction Markets, Collective Intelligence, Innovation and Growth

News Aggregation + Prediction Markets

Our good doctor EJSS laughs at the Web 2.0″ concept on TechCrunch, but touts it as an essential part of the NewsFutures offerings on his website.

NewsFutures do NOT favor event derivative management by traders.

Xpree = Innovations + Prediction Markets

Barack Obamas victory in South Carolina wont stop the Clintons.

eTech 2008 – Googles enterprise prediction markets

Predictocracy = Market Mechanisms for Public and Private Decision Making

Why Indian Software Outsourcing Companies are Outsourcing to China

Heres an example of the total crap that the BetFair blog is publishing.

Midas Oracle is the only popular, independent, exhaustive, multi-author, multi-exchange, Web-based resource on prediction markets.