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Predicting the future?

My brother pointed out this article at The author makes the point that prediction markets could be the most efficient and accurate way to reliably predict the future. A prediction market is some kind of system where you can bet on future outcomes based on hypotheses.

It’s an interesting thought experiement to think that I could, instead of investing my money in markets or specific companies or stocks, that I could invest in very specific things that match my idealogical interests. I have some vision for how things should or could be in the world and I put money behind my hypothesis, that if say a certain legistlation or law or initiative is adopted, then a favorable measurable outcome can result. Or, alternatively, if not adopted, a measurable and less favorable outcome will result. I view it as a kind of altruistic gambling.

You can play with such prediction markets at There are currently many asinine questions on there like “Will Lincoln win best picture.” As such, it has apparently been classified as off market trading or gambling by the US govt and I think it’s not currently advisable or possible to trade inside the US.

Personally, I hardly see how buying shares in AAPL vs betting that Les Miserables wins best picture are much different. I suppose it has something to do with there being no oversight into the obvious type of corruption that could result from this type of trading.

What the article seems to be arguing, though, is that with enough liquidity, that these problems are self-correcting?

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