Slashdot Mirror
Pentagon Lets You Bid on Terrorism?
Elysdir writes "DARPA is creating an idea futures market, the Policy Analysis Market, to try to predict events in the Middle East. See Bloomberg article for more info." Read this article. I mean it. This is amazing.
Update: 07/29 14:45 GMT by J : The
NYT story
claims "The White House also altered the Web site so that the potential events ... that were visible earlier in the day ... could no longer be seen," but those example images are still being served:
Jordanian overthrow,
bidding on assassinations,
cool graphics... Update: 07/29 16:44 GMT by M : Looks like the publicity was too much.
Look at how unpredictably the stock markets behave already. When was the last time a major drop or surge in the NYSE or NASDAQ was accurately predicted by the majority of investors?
At best this kind of analysis helps you see trends over a long time period, but I don't see how that can help the pentagon except when they ask for more funding (See! Carbombings will increase by 50% over the next 5 years! Please give us money).
This is moderated "funny", but it's less funny, and probably more true. Someone might be tempted to bet a lot if they had "insider information", and then the government would track them down to see what they know, and why they know it. Some might be false leads, but if the King of Jordan is assassinated 2 days after CmdrTaco bets $10,000 on it, I'd definitely question CmdrTaco if I were a fed.
Ceci n'est pas une sig.
The Iowa Electronic Markets operated by the University of Iowa Tippie College of Business has been n operaton since 1988. It has offered real-money futures contracts for U.S. and other political markets including"Control of Congress" as well as the Democratic & Republican Presidential nominee and the popular vote share, Senate seats, Russian and French Presidential contests, etc.
Speculation can be strictly distinguished from gambling.
The speculator makes a bet on the outcome of a risky event which would exist in the absence of speculators, such as bad weather and natural disasters.
The gambler, finding nothing satisfactory for betting, sets up a slotted wheel, makes six-sided dice, designs cards which are identical from the back but different from the front, and then bets on what happens when these devices are randomized.
Speculation shifts existing risk. Gambling adds to the universal total of risk.
The Pentagon site is speculative.
What a great way to fund future terrorism! All you have to do is load your bets on a target, then go blow it up! Talk about your self-fulfilling prophesies!
"Times have not become more violent. They have just become more televised."
-Marilyn Manson
Aren't you just so glad that Poindexter is in charge of the department that comes up with such useful ideas?
LE
It's amazing how the majority of /. readers miss the point of this system.
Futures-type markets are remarkably good at predicting future trends because they are essentially the consenses of thousands of people, who are confident enough in their outlook to put money on it. Because of this, the Pentagon launched this research project to see if they could harness that power in predicting terror. The point is not to make people rich off of terror attacks or assassinations, the point is to try to know where to focus your efforts in preventing such an attack.
Now as to whether it will work, who knows? If the investors know that the goal is the prevention of the events, therefore no payoff, will they put up the money? How will individual investors know the likeliness of various scenarios if they don't have access to top-secret intelligence, so therefore how accurate can they really be? It remains to be seen.
But again, this is only a RESEARCH project, to see if such a system is feasible, it isn't like we're betting the future of terror prevention on this.
By reading this sig, you agree to the terms of my sig license.
For any given attack, there are going to be a lot of people who know about it beforehand. Some of those people are going to be stupid enough to try to profit on it.
When the futures fluctuate dramatically due to the new 'interest,' everyone at the pentagon knows that something is going to happen. The SEC uses it to catch insider trading, the NCAA uses it to catch game fixing. Q: Why can't the government use futures to catch terrorists?
A: Great idea, bad diplomacy. Hello! This is the US government we're talking about! We don't care how the rest of the world feels anymore.
your missing the point, this system isn't about insider information or profiting off terorism, its about gather intelligence upon the risk of terrorism / risk happening. This entire future market model is a risk assessment model where a market of thousands predicts the odds at which events happen. Here's what most people miss about this idea; when people have money, they always consider risk vs gains. Not many people are going to put a million down on France declaring war on the UK unless they're fine with throwing a million away. Inverselly, many people would hedge bets on Iran becoming a nuclear power because there is less risk in that issue (but smaller returns).
DARPA is running this program, think how valuable it would be to DARPA if thousands of analysts all started hedging bets on Iran. The use of money makes the bet relevent because people act more objectivelly with their true beliefs with real money.
This entire project seems to me like it was dreamed up by an economist because it does make sound economic sense. Have people who know the most about certain topics put future investment in to issues that are most likelly to happen. The best way to gauge the amount of risk in any issue is through money.
The most troubleing thing about this article to me is that it suggests the US goverment isn't doing enough in gathering adequete foreing intel to prevent international disasters from happening. ie International terroism
As we New Yorkers like to say: fuckin' A.
... the trail went to a German bank, and I couldn't find any more info than that.
In the week before 2001-09-11, the volume of options traded on UAL (United Airlines) and AMR (American Airlines) was 500% of normal. 500% is not a blip. It's a huge freaking spike.
I didn't get these numbers from some.conspiracy.theory.org, I got them from cboe.com: the Chicago Board of Options Exchange, the official clearinghouse for options in the USA.
As for who did it
I agree with the parent. This was the smoking hot $40 million money trail and it dropped off the news radar within days.
"Follow the money" -- Deep Throat