Prediction Markets and the ‘Suckerifcation’ Crisis With Max Read

When I say a Sacrification crisis, I don't simply mean like, oh, you know, they're getting they're getting built out of their money Though that I think that's part of it. I think there's a whole kind of both commercial and political kind of apparatus that is working really hard to You know separate young guys from their money I'm Charlie Wurzel and this is Galaxy Brain a Few weeks ago on this podcast the journalist Pablo Tory told me this it feels like you know We're living at a time in which lots of young people were promised things They were not delivered perhaps because of the generations that continued to wield power in our government economy, etc. The boomers and the way to like shoots and ladders your way to the American dream is gambling on shit and In that casino premise I think you just see again a through line across all these sectors of American life now sports being one that has so naturally taken to it because My gosh, here's an unlimited menu. I mean literally today We're gonna explore another part of that unlimited menu of gambling in the casino application of the American economy Prediction markets chances are you've been hearing a lot about prediction markets lately at their core prediction markets are online spaces Where people can place wagers on the outcome of events? They share similarities with sports books except unlike a traditional better at a casino Your wager is a futures contract the value of which fluctuates based on the market value of the outcome of any given event Right now people use the markets to bet on sports events like the Oscars whether Elon Musk will tweet a specific number of times in a given month Or by the outcome of an election the top platforms now for prediction markets collectively report several billion dollars worth of weekly trading volume Cal-Shi one of the biggest prediction markets in the space announced this month that it raised a billion dollars from many of Silicon Valley's biggest venture capital firms Recently CNN announced it was partnering with Cal-Shi to integrate the company's prediction market data in the news coverage The company's CEO Tarek Mansour has big ambitions at a conference in October He said this about Cal-Shi's future the long-term vision is to financialize everything And create a tradable asset out of any difference in opinion Financialize everything That's essentially the quiet part out loud That is the blueprint for the actual casino Ification of the world brought to you by one of the more ascendant companies that's moving everything towards gambling So what's really going on here? How do prediction markets work? Is there some truth to what boosters allege that people putting their money where their mouths are is actually a good way to tap into the wisdom of crowds Or is this just a dystopian development an example of the company's praying on a society with a burgeoning gambling addiction Today I'm joined by Max Reed author of the great sub-stack read Max Reed covers culture and power on the internet and has this really intuitive understanding of platforms and people Recently he wrote a great piece titled prediction markets and the suckerification crisis Max and I talk about where all this is going and why everyone is gambling and no one is happy Now my conversation with Max Reed, but first a quick break At Betway casino state 20 pounds and get a hundred and fifty free spins for new customers 18 plus T's and C's apply bet the responsible way gamble aware dot all Max Reed welcome to Galaxy brain. Thanks for having me Charlie. Yeah, so we're gonna talk about prediction markets hopefully come up with some Grand theory as to why they are ascendant and why everything feels a little bit broken, but I wanted just first like What are they for for the the normies out there who aren't you know using them like how would you describe them? How are they different from you know straight-up gambling or like a sportsbook? Yeah, well, I described them the first time I wrote about them I described them as sports books that allowed you to place wagers on non sports events But I think the extra sort of bit that's important to understand about them because in the end of the day That is what they are And it's the way a lot of people use them and I should note by the way that when I say they're not there's sports Books that allow you to place bets on non sporting events many of them are actually also sports books Cal She in particular allows you to place wagers on games but what they do is really emphasize the wager as Security that you can purchase and sell the way you would a share on the stock market say if you believed say That there would be a democratic sweep across New Jersey, Virginia and New York City back in November You could have bought shares or you could have you could have bet on that outcome for you know What it like 30 like they'll do it as prices right you bet it Do you wager 30 cents for for the return of a dollar right? So you could buy the shares of 30 cents you buy 10 shares of 30 cents You get $10 back if if that comes off now I mentioned 30 cents say because you know a couple weeks I'm not sure if that's the exact price but a couple weeks before this election It was kind of unclear what Democrats chances were gonna be in any of these elections There's a lot of polls coming out saying that Mikey Sherrill in New Jersey was running dangerously Sort of close to in the race against I can't even remember the name of her opponent at this point But you know it was it was a fairly low probability according to the bettors on the app, right? But as the returns start to come in on Tuesday night And it becomes clear that actually the chances that this is going to be a sweep across all these elections get higher all of a sudden The price of a given wager rises or the price of a given share so to speak so you know a 30 cents suddenly It's 40 cents suddenly at 60 cents the way you would think about that if you were just talking gambling odds is all of a sudden you're getting less return on your wager basically your odds are getting significantly easier and You could have say if you had let me give a different a slightly different example of the election so recently in Tennessee this woman Afton Bean was running for a congressional seat and She was absolutely not the favorite. It's like I it's like a you know, it was a Trump plus 30 you know congressional district or whatever and You could buy shares for her victory at like you know 20 cents something like that the week before the election the night of the election As returns start coming in she is looking actually kind of good for it Like the early returns are quite good for her and I watched as those shares as as the price of her shares climbed up I'm not gonna say whether or not I had any any horse in this race any money on this but I was watching it closely Let's just say and there was a point where if you had bought shares at 30 and again Who knows who I'm talking about here, but if you had bought shares at 30 you could have sold them for a 100% profit sold them at 60 cents Only for those shares to come crashing down as the results continue coming over the night and it becomes clear It's not happening. So sorry This is a sort of complicated explanation, but I think it's useful to understand like how you use it, right? That when you go on these sites what you're doing is you're doing this kind thing. That's kind of a hybrid Like stock market day trading activity and a betting activity And I do think it's worth saying as much as they emphasize the sort of security Quality of these wagers you can do this at a sports book too, right? That odds will change at a sports book depending on who's taking which side of the bet and you can cash out most sports We'll allow you to cash out various times You know after you've placed your wager and if the odds of the wager have changed in between the period where you placed your wager And you're cashing out you can get it You could make a small profit just from cashing out right that if you if you if you wager that a team is gonna win and then You know you could cash out with five minutes to go and they're up by 20 points You're not gonna get as much as you would if you saw the whole thing out, but you can cash out at a fairly high profit So in that sense, it's just it's sort of another way of looking at or another way of thinking about gambling that emphasizes the sort of Up and down nature of odds and I think that's how most people kind of approach it when they're on the site You know placing these wagers is they're thinking about it like betting, but I think it's also important to understand why They have become so ubiquitous in media is that they and why they're they are exciting to a lot of economists and Libertarians especially libertarian economists especially is that they offer a kind of Semi-accurate accurate depending on the liquidity of the market accurate depending on the size of the market accurate picture of what you might think of as the Conventional wisdom right that it's sort of like because there's all these people Collectively saying how much how like placing their own odds so to speak on a given outcome Wagering their own actual money so they have skin in the game So nobody's doing this just as for propaganda purposes or whatever you can say Conventional wisdom has the chances of this event happening at you know 50% 30% whatever now these markets are still Fairly small and many of them are not very liquid at all So there is not like there's millions of people betting a couple bucks at a time to make them You know it's sort of accurate as possible You have a couple whales who are placing large wagers which makes them You know it's sort of interesting in what they tell you because it's not saying necessarily conventional wisdom It's like the conventional wisdom according to the kind of person who places a bet on this kind of thing That's the other side of it the non like user side the media side the the sort of philosophical side of this is Prediction markets allow us to start to look at the future In in this in this way that that allows us to set probabilities about things I'm curious what you make of the wisdom of crowds bit because the thing This is the part of me that like stops and feels a little insane sometimes with this because I Think about like this is essentially a meta game right where you have this system that produces outcomes and incentives for certain outcomes That are that arise in it and you wrap that system in an apparatus that is also a concern of influencing those outcomes It's this like second-order thing right like like you know You have food like poker where you know good poker players can technically predict the outcome of hands, but you know That is also influencing the outcomes of the games like it just feels to me like what you're doing is You prediction markets aren't what people think will happen. It's what people think other people think will happen right like the So so it feels to me like it's yeah, it's confusing I do think there's a use for that But you could you could come up with reasons and you know from a financial sort of market perspective one way of thinking about it is that these are effectively instruments for hedging right that you you you have a sense of you think something's gonna happen But you also want to place some wagers on the side in case it doesn't happen to limit your losses and for that you don't need it to be wholly accurate right you just need it to to sort of approximate a Given outcome that allows you to to make money off of that You know, I think there's there's sort of two ways to go with what you're saying one is that in Until recently prediction markets have largely been a sort of theoretical idea, right? I mean we could talk about the stock market or a sportsbook for that matter as a prediction market But this sort of all encompassing marketplace to make wagers on I mean recently They were there were wagers on the time magazine cover of the year like person of the year cover You know all the Oscars all the award season stuff that you can you can wager on who's gonna get nominated and who's gonna win We talked about elections already. There's even often marketplaces for Words getting mentioned by prominent figures in in what's the word? I'm looking for in speeches or in you know yeah, and This is a kind of you know, like if you believe really strongly in the idea of the wisdom of crowds It's very exciting But you know the the theoretical model of the prediction market is as I was sort of emphasizing before is one that Everybody is participating in the market is fully liquid everybody has taken it everybody is placing wagers there and These markets are fairly far from that right on election night there tends to be enough money and enough people to Sort of approximate what we've been talking about is the conventional wisdom about who's gonna win and who's gonna lose But it's not always the case and certainly not the case for stuff like these culture categories that I'm talking about I wanted to ask without you having to divulge whether you are or not Actively participating in these in these markets. What's the culture like on these like what you know? I think it mirrors some of the the culture on on X Twitter in the in the musk era but when you go either for you know to try to place some wagers or to You know for reporting purposes what? What's the culture like I can talk about the culture in the comment sections Which I wouldn't want to suggest is wholly reflective of the culture of these places in general and I think there is a wide range There is smart money. There are sharps out there who are Running programs and bots to identify You know like like especially on an election night You'll get guys who are pulling results all doing this automated like basically like HFT like high-frequency traders pulling results from the New York Times or decision desk or whoever and changing and like immediately placing orders on shares to take advantage of that with like a You know, you don't have to do it in the milliseconds the way you do on Wall Street But you can do it if you just do it in a cup like just a lack of a couple seconds will still You know make it advantageous and you have people who are quite good at like for example the time magazine cover leaked before it was Announced and a bunch of people made a tidy little profit because it it took a while for the market to catch up So I say that just to say that there are smart people just as a you know a to be sure thing before I get into the comments Which are really stupid. I mean there's a lot of stupid people there and there's like there's a funny mix of like Just a really obviously stupid people like free Republic commenter type like, you know X like bottom of the barrel Trumpist X types and then there's stupid. That's just guys who have sort of wandered in Like every every wager you will if you scroll far enough You will find a guy who took the stupid side of the wager because he didn't read the terms until after he put his $50 down He's like, oh, I didn't realize that I was actually betting, you know against this. I thought I was betting for it Oh, well, like now I'm out 50 bucks I think the the tone reminds me a lot of the closest thing I can think of online or the two closest things are The if you play fantasy football in Yahoo Every player has like their own little comment section and you can like pull it up as you're deciding who's to start and who to bench And you it's just filled with people just clinging to the like most desperate of threads, you know Like like citing articles they read somewhere. Nobody's linking to anything. Everyone's like, oh, I heard he's gonna play Oh, I heard he's injured. Oh, I heard he's you know, like he's not gonna be the first he's like he's he's not gonna get any Catch he's not gonna get any throws this this game whatever it is and and the bets remind me of that like the bet the comments on the betting on the on the bets kind of Reminding this on all the markets. It's somebody being like, oh, you know, there's one market that's Which which member of Trump's cabinet is gonna leave first and everyone's like, well, okay Well, here's this thing I read about Hegseth and everybody else will be like, well, I read this about Pampani and people like doing their theories It's it's like a message board. It's not the dumbest place I've ever read But it's like of a basic kind of politics message board stupidity. It's just that there's all this money, you know Going on in the background All the witches to say like when I say it's similar to the fantasy football Chats is it's very male. Obviously. It's very young obviously I mean young and the twi the most the guys are sort of in their 20s It's sort of confident but ill-informed in the way you would expect a lot of you know Guys who like to gamble in their 20s basically are there's also like and I don't mean I don't mean this like a like a Pearl clutching way, right? But like it's it's a little like reactionary, right? It's a little Because part of what I see in the elevator pitch from some of the founders of this right is a little like It's trying to court people who have Some skepticism about like the way that institutions behave right like like Cal she's co-founder Tarik Mansour, I think is how you say his name. He's really positioned this as like the wisdom of crowds because Regular institutions have failed us right because there's this plethora of information out there because reporters aren't actually very good at telling or getting the story the way it is come here This will actually like not only is this a helpful tool, but but that seems to recruit just generally people who are like a Little bit more Edgelordy or whatever. Yeah, is that accurate? Yeah, I think so. I mean, I think certainly Not to not to sort of underline this point, but I do think it's worth thinking about the prediction markets in two Phases there's especially the ones around politics. There's the long phase before The election whatever election is being bet on happens, which I think there is a I don't want to put a number on it, but I think that the markets tend to lean right like they just tend to overestimate Republicans they tend to Not by a significant amount not by a amount that you can make a ton of money off of unless you're like gambling a lot But generally they tend to give Republicans better odds and Democrats worse odds That's phase one and then phase two is like closer to the actual election And that's in my experience at least when the smart money starts to roll in and people come through just to pick up like basically they They they take the transition from the markets tilting Republican to reality setting in and they make a quick profit off of that And then by the end of the night, we know who won and them, you know, the markets are settled and mostly settled So I think that yes the culture, you know in that sense tilts, right? I think that there's also sort of two Aspects to why that is the first is exactly as you're saying that there is a deep and long-standing Philosophical affinity between predictions markets the the wisdom of crowds so to speak the idea that markets in general Can calculate things better than? institutions or humans can that dates back to Hayek and Mises and this is sort of foundational to Not just to you know, you might say neo liberalism in some broad sense But also to a lot of the way that Silicon Valley has thought about the world since the 90s, right? You know that there's this idea that we don't want top-down people in charge We want to the sort of collective anarchic mass of humanity working together, you know, you know You know market or a quasi market format will will pull these together. So I think that's like there is this kind of Highfalutin let's say philosophical Background here that that probably pushes the prediction markets the people who use them and certainly the people who build them to the right To the kind of libertarian hard libertarian market worshiping right, but there also is a particular sort of base Reactionary mess to a lot of what goes on there that I think is more tied in with Like to some extent takes its cues from the sort of intellectual Dross that I've just been talking about but is more tied into One like being young and male and like gambling friend like again, you know Young men like to gamble young men tend to be more right-wing. So I think that's that's just sort of a basic demographic and sociological fact of 2025 they're also pulling in a lot of people from X which is just significantly more right-wing than it was five years ago And as I was saying they also are you know without without wanting to be too smug about it they're trying to pull in through their marketing campaigns pull in a lot of dumb money to make it attractive for smart money to come in and they do that by Advertising to the biases of the reactionaries on X basically So, you know, I sort of first became I decided to write about this because around the time of the November elections when Zoran Mopdani was running high in New York City But as is often the case there's a lot of people in New York who hated him who were sort of well I don't think he's gonna win I you know, I think people there as you were saying the mainstream media is like ignoring all my neighbors that hate him all my neighbors are Gonna vote against him and Kalshi started running in Polymarket too started running all of these they own these They run these sort of newswire accounts, right that are Depending on the on the both the official accounts But also like they have their own news accounts that they don't link to the the betting sites really they just do these like Blanket like one line almost like a Bloomberg terminal news thing that tends to be very misleading very right-wing You know in one case Kalshi tweeted Sometimes they'll tweet about the prediction markets will be like, you know Zoran Mopdani's like position is tumbling and That kind of thing is obviously going to bring in, you know, you could do that with liberals I don't want to pretend that that liberals in America are so much better at picking out misinformation and scams and whatever else But it's very clear who they want to appeal to on Twitter and it's like low social trust Gamblers basically who are right-wing. Yeah, and and also just like even beyond the the political part of it like there's so much Some of these accounts that run by these these prediction markets like calcium poly market are just like trolling, right? Like there's there's this one image of 49ers running back Christian McCaffrey with the caption loves receiving balls Right like and it was just like this big sort of like like a look at trade or like, you know, like on the disabled list Style graphic, but it's just like and again as you said they don't link to it But it's almost just kind of like we're having fun on here, too. Yeah, why don't you come have fun on our place and And go, you know, you take advantage of this But you talk about this this dumb money and you described it in in this great sub-stack post that we'll link to as the part of the male Succurification crisis and can you can you elaborate a little more on that? I think you know, that's sort of your Corollary to the the male loneliness crisis there there in but yeah, what do you what are you saying here? I feel like one of the big stories on the internet over and in society at large over the last five years or so has been the extent to which Young men have fallen under the spell or the sway of a variety of different kinds of scammers hucksters fraudsters When I say a suckers vacation crisis, I don't simply mean like oh, you know, they're getting they're getting built out of their money Though that I think that's part of it I think there's a whole kind of both commercial and you know, political kind of apparatus that is working really hard to You know separate young guys from their money, you know, and I think that there's something about I don't have like a grand You know, I couldn't this is more of a corkboard and red yarn theory than it is like a like an equation Right, but I there's I see these connections I see these sort of basic dynamics play out in straight old-fashioned sports gambling which has sort of taken over sports media that You know was legalized a few years ago and now kind of dominates the way we talk about sports in the country At least, you know in in in the media that is written about sports and filmed about sports I see it in prediction markets as well like talking about this sort of Calci and polymarket Twitter feeds that we're talking about, you know The sense that this is this is gambling kind of creeping into even more layers of life layers of social life I see it in that kind of manosphere influencer guys these sort of perennial subjects objects of moral panic, but you know the main sort of dynamic I see there is not necessarily even kind of ideological Radicalization on the part of somebody like Andrew Tate But this the way that they are selling a particular story and a particular product to a bunch of young men that Cultivates them as suckers that turns them into suckers and I think that Trumpist politics by which I mean both, you know, the Republican Party under Donald Trump But also all kinds of the sort of right-wing reactionary politics emerge out of the same sort of soup You know this sort of the the this highly emotive This insistence that as as you sort of put it earlier that institutions are failing you But we've got the cure we've got the ticket you can participate in this movement You can show everybody that you're smarter than everybody else. Here's the secret to making money. Here's the secret to you know Winning in politics. Here's the secret to getting girls whatever it is It's funny to me how much you can sort of see that same dynamic across what should Theoretically be these quite different kinds of spheres But seem to in fact kind of be converging on this one sort of business model more or less You know, I think about this to just to provide some historical perspective Rick Perlstein the historian has a really wonderful essay in the baffler from maybe ten ten or more years ago That I think about all the time in terms of this called I think it's called the long con and it's about the origins of the conservative movement in the 1950s and the extent to Which the conservative movement has always been deeply tangled up with Basically snake oil mailing lists that a huge like part of what makes powers the conservative movement is access to mailing lists of Low social trust reactionary voters who are willing to buy what you're selling if you speak the right language more or less And I think this feels like I mean as I was saying before I think Twitter feels Sort of like a really sophisticated version of that and I think that this whole kind of complex of businesses are finding new ways to sort of exploit that particular dynamic and To some extent I think this is a sort of layered process, right that you go on Twitter. This is a social media site It's you know highly volatile. You're constantly feeling like everybody else is getting more views than you you're constantly sort of feeling You're in this this this strange space that you don't necessarily understand You know, you're surrounded by people who are expressing that same strange feeling It feels a lot like being in the economy to doesn't it and isn't politics also this strange volatile space Surely there's a way we can all make a little extra money off of it. We're all constantly in competition It's like a as I say, it's like not a not a not a hard and fast theory It's like this set of effective triggers, right these sort of this vibe that's out there that seems to be quite Inescapable in particular for you know recent college graduates kids in college even in high school Right and there's this way that it's this this reinforcing system, right? Like if you do fall into that mindset, you know, you enter into a place that that sort of Embraces the chaos embraces the the precarity therein, right is and and then feeling all that gives you The only possible way out right the only possible latch on to you know a kind of you know New version of the American dream, which is just like I buy this meme coin low. I sell high right? I get I get in this place here and it's it's you know, but that usually Doesn't work out well for for most people right a lot of the dumb money And then you get back in the cycle of precarity resentment. Okay. Now we have the the antidote to that and and the cycle just repeats over and over again Yeah, I mean one one thing I would add that I didn't really write about in this piece But that is been something on my mind for a long time because I feel it too Is a sort of increasing sense in American society that everybody else is getting one over on You and or the system and that in fact if you let everybody else get one over on you You are weak and you have made a mistake you have you know, you are a sucker When in fact I think it's kind in many ways is sort of the reverse that it's like if you're constantly trying Like if you're the one who's constantly trying to get one over you probably are a sucker yourself And I mean the root cause here I would say is is sort of society-wide breakdown of trust in in institutions You know in the sense that like institutions are in it for themselves And they are you know corrupt and giving handouts to the people to their people and not to you And again, this is also this is this sort of vibe that seeps out and and And powers a lot of the kind of activity around Around predictions markets, but also around a bunch of these other businesses and figures I I want to test out a theory on all this that's maybe another side of it Or maybe it's just this in a in a different skin But it is very broadly this idea that like a mature attention economy is It's succeedingly hard in a mature attention economy to sell something right And it is much because of all the the competition for attention and it's much easier to sell a derivative of that thing I read this this post a couple weeks ago that was talking about movie marketing and how it's kind of just gone Hey wire and this idea that you know stars are doing things that aren't they're they're not like traditional Junkity where they're like talking about the film with a hundred different people But they're going on a hundred different podcasts or you know video shows or whatever And and basically doing viral skits right you can kind of start at hot ones but then you can trace this to like Jennifer Lawrence and rock uh and and uh And and her co-star Robert Patterson. There is doing like lie detector tests Right like a lot of celebrities doing like like lie detector tests for vanity fair or whatever And it's good content people watch it people are interested in it It's good for like the you know the timeline, but it historically is like not selling these movies right Because they're not talking about the film. They're talking about themselves In the hope that they're going to garner enough attention to sell a film right and And I think of that that idea of like a derivative of something I think about it, you know Very obviously with sports gambling right like leagues Are interested sort of in in having this because it does draw attention to the games right like Adam silver the nba's commissioner wrote this op-ed 10 years ago or so You know kind of advocating to legalize sports gambling and there's this idea that that you know It will draw interest and attention to this event, but it's it's interest and attention Essentially to you know a game within a game right people are interested in hitting the over they're interested on you know how many free throws you know so-and-so gets or you know misses or whatever right and It it feels to me like I I'm curious If you you feel this too that that it's you know, we see it with elections right? It doesn't matter so much about About the outcome as much as it is you know getting the edge and this idea of Financialization of everything just creating derivatives of everything to the point where it's like it's almost impossible to sell a thing like Yeah, I mean I think that this is this is part of the attraction of the prediction market over The regular sports book too is it's you like it's not just to me. I guess it's not just derivatives It's securitization and that you have this you create this this object that you can sell and resell at whatever You know, I don't want to like drive the metaphor off a cliff or whatever But one of the interesting things about those viral videos of say Pattinson and Jennifer Lawrence doing the lie detector test As you say probably not very useful for marketing the movie But that video is now useful to vanity fair or whoever was that that filmed it and will be useful to them for 10 years Because those are going to be famous people that people want to see for 10 years Lord knows there's no time limit for anything on the internet. You now have this thing that just kind of exists in the world and I think that there's a real difficulty to sort of like uh to find ways to to to as to you know, if you put it to like Have those derivatives to to maintain their relationship to like the bigger project that's supposed to be pushing forward You know the the other thing I would say sports thing That you know what you were saying about sports makes me think is is that You know part of this is about media in general, right that there's It we're increase it's increasingly difficult to figure out how Uh to pay for the media that exists and that we think of presumably as sort of integral to democracy to our liberal democratic system and sports Arguably runs a little bit ahead of political media news media, you know In terms of business models and whatever else and one of the big reasons that adam silver has been an advocate for legalizing gambling One of the reasons why all of the media companies espn Chief among them have so enthusiastically embraced sports betting is that That we sort of have reached peak sports Like we're a little bit over the hill in peak sports basketball is a very good example because this is you know, mark cuban was talking about this Just last year Nobody thinks the next few tv deals are going to be anywhere Where anywhere near as lucrative as the last few tv deals are where Question is who is making money and how are they making money? And that's not just a question for the team owners who will always make money from the stadium, right? And from the actual games themselves But how is espn going to make money and the answer right now seems to be gambling like we're going to take gambling sponsorships We're going to talk about gambling all the time So when we talk about like what where does kal-shi and poly market like what's You know, why is why is cnn so enthusiastic about bringing them on? I mean they already are in fact partnering with kal-shi to I think or maybe with poly market to produce odds for you know Like odds for them on election night and presumably elsewhere during the During the political season And so I think there's like the the other part of it in addition to the kind of structural the way we think about You know marketing and attention is to break things off into these little pieces that can be bought and sold can last 10 years is that We are facing a crisis for like how we pay for these things and gambling Is a traditionally fairly lucrative uh industry to be in um, and you know, that's a way that cnn could take itself You don't you don't want cousin sal to moderate the press going forward. I feel like I feel like that's that's a great idea. Um, I Yeah, the partnership is between uh, kal-shi and cnn and and I think that I think that you're absolutely right about The the the paying for part of it, which is obviously the most important part I also think that it is to Like there is this attentional quality that like Injects a little bit of I'm trying to think about this, you know, it feels so dystopian having, you know Uh, I think uh cnn's harry enton the the polling guy is going to be the one the Who's going to be you know doing the big board and looking through the the kal-shi odds is is what they've said You know feels it feels a little dystopian to have that partnership, but also it injects. I think for them trying to rationalize it in some way like some excitement into something that You know, I I feel like when you said we've reached peak sports, you know a while back like we've reached peak politics, too All right, like we are well beyond peak politics where everyone is just sort of like ground down by You know how this works, but also kind of you know, strangely Like terminally addicted to it at the same time like you can't you can't quit it But you there's nothing in it and and this is sort of whatever derivative a securitization Like you know, it's it's some element that I think also injects like it is People joke about like horse race coverage and it's like no no no we're actually we're making a horse race now like Yeah, like we're actually giving you a horse race. No, no, no, we just didn't have the horse race The problem with horse race coverage was that we didn't have the horse race yet Right, I think feel like that is that is exactly it. I mean do you Our our mutual friend uh and fellow tech writer john herman wrote a wrote a thing for the neiman labs year-end predictions here for 2026 that the the media will be will become addicted to gambling follow the path of sports media. It's very smart Do you do you feel like this is just Going to get worse like where do you see this all moving? Is it just increasingly lawless? Like we're just gonna Fall victim to all this. Do you think this this is like a kind of like like a fad? Do you think this is maybe something that actually is like The injection of capital that like these places need like how do you sort of project it going forward? I I am not necessarily as pessimistic I could be I you know, I think that the forces are raid in favor of the prediction market becoming a sort of dominant You know means By which we interpret and understand the world around us Like there's a lot of money behind that and there's a lot of powerful sort of philosophical and political ideas that want to see something like this You know take a larger role in society and the truth is like in addition to I don't even mean to make it sound that sinister like From a banker's point of view a trade a stock trader's point of view like having all these extra hedging instruments is useful from The point of view of cnn an election night, you know setting aside as you know This sort of question of how much gambling is going to dominate cnn Like the prediction markets give us something to talk about that is not that different in terms of its relationship to reality from polls Say so all these all this stuff is like, you know the money the philosophy the use all like all that stuff is lined up in a way that Gives prediction markets. I think a big sort of runway to to Find themselves to become more and more prominent and to intermediate more sort of areas of life that being said, you know, we've seen since 2022 is when I think sports gambling was legalized in New York We've seen how much sports gambling has taken over sports media how much sports betting has sort of become this this ubiquitous thing in coverage But my impression but you know, and I think this bears out in most of the polling that's been done recently So people actually hate this even the young men who are supposed to be the customers don't really like it very much And I think that same quality is going to be true of Prediction markets. I think there's a very particular. This is just baseless theorization right here. This is like, you know, my own version of like Like astrology, but there's like I think there's a certain kind of person whose brain works in a particular way In this particular, let's say Bayesian way where they are constantly thinking about things in terms of odds where they are calculating in their own heads, you know arbitrage opportunities and And and and what kinds of bets they're willing to, you know, they're doing kelly criterion bets and and whatever like calculations in their heads And I think for those people these things are incredibly exciting I think those people are also like really heavily concentrated in silicon valley, you know, silicon valley and ball street Basically, like that's those are the places you go if that's the kind of brain you have I think a lot of the rest of us find it I mean, I could speak for myself alone, but I I know I'm not alone That kind of way of being in the world way of thinking about the world exhausting You're not really thinking about the game You're thinking about the over you're thinking about the props that you've put together you think about the parlay across the three different games I think that Prediction markets being inserted everywhere else has a very similar kind of quality to it. Um, you know, I I wonder If there's a happy medium, I think with sports betting What many people I think sort of just now these days believe is that it should not be you should there should not be apps for it It shouldn't really be legal There should be a guy that if you if you have the like social wherewithal to find you can press it that way Yes, but it it's not the kind I shouldn't be the kind of thing where there's they just like roll out the red carpet And there's like, you know a lubricated path to losing all of your money And I you know, I'm pretty sympathetic to that. I don't know if that makes me an old man. I think what you're saying Friction is is a good thing, right from friction friction is is is helpful here and These you know a lot of these these betting apps I I actually can't speak to Calci or poly market, but some of the you know, like the the draft kings fan duel You know, like they're literally sending push notifications of like this is about to happen, you know, like whatever it is, right? It's it's not even it's not even neutral in the sense that it's easily accessible It's like the bookie is sitting on your couch, you know, like asking if you'd like to get in on this, right? Yeah So you have you have that element You have the the idea that like gambling itself in in in all things whether it's on elections Whether it's on whatever like gambling is not a static Thing right every different type There's so many different types of gambling of ways to bet that that can give you, you know slightly better odds or that are, you know based off of skill instead of blind luck and sort of the The idea that the closer you get to like the the slot machine, right? Just pull and and you know a couple of things have to line up That's the worst, right? That's the the worst part of gambling and that what we are Moving towards with this tech enabled stuff tends to resemble that more than it resembles You know say betting on you know, who's gonna win in a golf match with you know, your friends or whatever and And and then I think you know, you have this I I think you're right about the Exhausting of it all and it reminds me just of the of the nature of Of all of of all of these companies, right? Like this this this Focus and need on scaling like a lot of these companies like Calci just raised a billion dollars In earlier in December You know from some of the major tech venture capitalists There's this they're obviously going to need to scale their CEO said now infamously you know the goal is to financialize every single difference of opinion in the world which as you put is like Patently the most exhausting thing you could imagine like no disagreement goes unmonitized is like like just end it all now um, I think unlike you I I do feel like it's a little sinister like listening to you talk about The relationship of the risk the volatility You know the gambling the You know the sort of reactionary poking and prodding and trolling on on x to get you in the funnel To put you into this precarious situation All of that to me actually feels like it like it It it it is bad and that feels dominant to me over the like this is a really great way to like You know get a bird's eye view of a complicated situation. Yeah, I should I probably am being too kind like I do It is sinister like and I think that it's bad in an absolute sense But I am also but like I I feel like it's good It's good to be conscious of the uses that it has and like the kinds of forces that are like arrayed in its favor And then it's not just a sort of phyllis. It's not a cash grab and it's not a kind of necessarily like a pure philosophical dispute that there are like serious institutions for whom this represents A windfall or a new method of doing what they do um You know, I I wonder a little bit A depressed let me let me preface this by saying this is a sort of depressing thought that I'm not necessarily endorsing But you know one reason I think that sports gambling Took off so has taken off so wildly and one reason I think even stuff like fantasy football has Which is which is in some ways quite similar to gambling, but obviously also very different in important ways Is the extent to which? Sports as a pastime or as an entertainment represent a kind of uh Like I'll take baseball for an example say that like baseball is kind of a solved game Like you have a pretty good sense, you know at the very beginning of the season like you can you know the the project People are very good at projecting who's going to win. How many wins they're going to be what you're waiting for is injuries And then you know the playoffs is basically it's not basic. It's not luck, but it's basically luck I say that you know, it's probably the greatest world series of my lifetime this past year Yeah, let's forget But one thing that I think that gambling allows us to do In a world where or in a world in like the NBA when like, you know, whatever a third of regular season games Most of the stars just flat out aren't playing which I know that the NBA hates but is but is also exactly what you need to do Because that's a solved that's a problem that has now been solved by resting people You know what you find yourself wanting to get the sense of uh, you know Volatility the sense of unexpected delight and whatever else gambling becomes the way you get out of sports that what you may be What feels harder and harder to get as more and more money gets applied to like figuring out the secrets to winning each one of these I'm not sure what the exact like the way to apply that as a metaphor to the rest of the world out there but I think that part of what the attraction here too is taking things that are Have been Like they've they've been optimized to hell like whatever it is You know that things that no longer give you the same kind of frissal of enjoyment because you know what to expect from them at all times and the gambling You know the prediction market the gambling the wagers they give you that little extra burst of You know dopamine energy enjoyment excitement because all of a sudden you're You're attaching some money to something that isn't the necessarily even the main point of the game And I think that's like to me. That's depressing because it's like I don't know I like partly because i'm sympathetic to it right though I'm like sympathetic to that desire to try and find the same kind of enjoyment But also because that's the thing that I think hooks people more than The sort of sense that oh I can find the edge by doing my calculations in my head and every dispute is going to be financialized And we're going to figure that out It's more like I just want to take a little risk somewhere like a like a fairly safe risk Just to give myself just to feel something just to feel something The thing that that makes me think about with sports, especially like you know, especially in in baseball Where like we're about to go into a year from now These you know major like like contract like like labor disputes, right? With the unions is this like this inequality, right? Like like there is this fundamental inequality in baseball between the haves and the have-nots and the big market teams and the you know the The the the Cincinnati Reds are like, you know, what have you and In that like you do have that situation as often in a fan base, right of of like, okay Well, you know if we make the playoffs we're going to get you to absolutely destroy the first round Like that's that and that's a good year and that's like that's you know, enjoy the ride, right? But it's like getting something else there and then when I try to think of like does that apply broadly out like to politics like of Maybe not exactly right. It's not like a total inequality thing But it is this sort of like this feeling like the system Isn't going to move right like there's like it's sclerotic in this way Like you're not going to get a candidate that's just going to come out of out of nowhere Unless you have you know these instances like like mom donnie And this might look at how much energy I mean look at how much energy I mean even Kamala Harris's emergence You know in 18 hours as the the democratic nominee after biden had that burst of energy because it was such an unexpected historical event even if she was You know like not the most exciting candidate to young people in the world or whatever And if she was the sort of what exactly who you would have expect the unexpectedness about it gave that extra bit of energy to your point I think I I think that that is such a is such a good way to to to frame all this is this like In a world that's feeling like a little bit locked right where whatever everything seems a little locked like this is Injecting a kind of chaos that allows people to feel yeah, I mean I think I really think that's real Well the the other thing I mean and I would say Two things on top of that one is like I think that's also part of just to just to reconnect some of the stuff We were talking about before I think that's part of It's a it's it's relatively similar to some of the appeal of social networks which have Of volatility to them and I think that one of the reasons that you know Twitter is less and and Facebook too are less and less and instagram even become less and less interesting to people Is probably because they become sort of solved games and there is like You know what does well in the algorithm? You know what does well and things? It's much harder to have that pop of like I you know The the the thing that you get really early on in a social network is always like I've never seen something like this before This is so weird this kind of person You could still sort of find it there, but those that that like volatility It's there in a in a in a certain limited way, but not in the same way The other thing I would say is that this feeling we're talking about like part of what's at stake part of I think what's at stake Is the sense that there's very little to surprise us anymore? And this is again a sort of a vibe more than it is a fact But there is this this vibe of like everything's optimized to hell everybody's for the most part actually cautious in There in the in the in the given settings the domains in which they're playing it's hard to find surprise gambling at least gives us some level of You know Allows us to feel something as we put it But what predictions market effectively do like over the long term is even eliminate that from gambling because what you're doing Like once the market is big enough once the mark once enough people are betting all of a sudden all the surprises are kind of gone Except for like weather events right you it's like the last thing you could bet on where there's Possibly there won't be rain despite the 90% chance forecast the next day and I think that's the sort of Like like it's it's it's self-defeating. I suppose I don't like that's a science fiction story more than it is something That we really have to worry about at this point But it is funny that there's like I think that the the predict like ultimately the point of the prediction market is to Like reassert the primacy of like locked-in predictions Even if even if the current sort of what makes it interesting right now is Is the enjoyment of of risk and novelty and surprise I I love the idea that the eventually that the prediction market eats its own young at the end of it I think that's a great place to leave it. Uh max re thank you so much for for coming on galaxy brand Yeah, it was absolutely my pleasure. Thanks for this great conversation charlie You That's it for us here Thank you again to my guest max reid If you liked what you saw here new episodes of galaxy brain drop every friday You can subscribe to the atlantic's youtube channel or on apple or spotify or wherever you get your podcast And if you enjoyed this remember you can support our work and the work of all the journalists at the atlantic by subscribing to the publication At the atlantic.com slash listener. That's the atlantic.com Slash listener. Thanks so much. I'll see you on the internet This episode of galaxy brain was produced by nathaniel from and edited by claudine abed It was engineered by dav grine Our theme music is by rob smurciak claudine abed is the executive producer of atlantic audio and andrea valdez is our managing editor