Technology Blows

Technology Blows Episode 12 Kalshi
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Dan Slimmon: Ah, welcome to Technology Blows Everyone. This a Stock Tips podcast where I Dan Slimmon and my guest Jeff Bonhag. Just yell directions at our stockbrokers over the phone for a full hour. I'll go first. Jeff. Buy. Buy. No sell. No buy. Diversify my bonds. Refinance my mortgage.

Jeff: Corner on wheat. Uh uh. Corn. Corn, corn. Corn. Corn. Corn. Corn. Corn. Corn. Soy

Dan Slimmon: Oh, soy. [00:01:00] I never thought about soy before. Buy soy. Great,

Jeff: Soy. Sell soy. Hold. Hold.

Dan Slimmon: bought some of your soy.

Jeff: Dude. I'm rich now.

Dan Slimmon: I understand why people do this all day. That's gonna help a lot of people. We gave a lot of people a lot of great advice there. No, just kidding. This is a podcast about technology, that thing where we build incredible marvels of human ingenuity and then use them to creepily record each other on the subway. Jeff, how are you doing today?

Jeff: I am good. I'm good. I'm good. Uh, yeah, it's the last day of 2025. Um, kind of a low key week. yeah, the holidays were great and, uh, we're just kind of cruising until, until the new year.

Dan Slimmon: Great.

Jeff: are you?

Dan Slimmon: Good. I'm, uh, I'm looking forward to how much, how normal 2026 is gonna be.

Jeff: Yeah.

Dan Slimmon: yeah.

Jeff: I think it's gonna be, I think it's gonna be super normal. Probably nothing surprising will happen all year.

Dan Slimmon: I can't imagine why anything [00:02:00] would. I saw, I went to, um, I went to a John Oliver, uh, standup show last night in Wallingford. That was pretty, that was pretty, That was pretty good.

Jeff: So, yeah. Was he like, so he was telling jokes obviously, but, but, but it wasn't like, like that's, that's how the standup generally works. Um, but it wasn't like, was it like news oriented?

Dan Slimmon: not really. He had a long, um, it was some news, but, um, but he had a long segment about, do you know about the, uh. The, at least three hydrogen bombs that were accidentally dropped on the United States but didn't go off.

Jeff: No, I didn't know. Um, by whom? Like, was that, was, was that an own goal? Was that like an oopsie by ourselves?

Dan Slimmon: Yeah. We, in the sixties, at least in the sixties, we dropped, um, a few bombs just like fell out of airplane.

One was one of the, one of the airplanes was like on the tarmac. Another one was, was in flight. And um, and you know, three of the four [00:03:00] detonators were, were un, were like, had gone off. So there was only one, there was only one safety on it left to prevent an H-bomb from going off in North Carolina.

Jeff: Good grief.

Dan Slimmon: Um, and

Jeff: Um.

Dan Slimmon: only three, only the three we know about.

So there, there was a large comedy, there was a long comedy bit about that. It was very funny.

Jeff: Those guys should read. Those guys, uh, should read the checklist manifesto. I hear that's a great, uh, that's a great read for, uh, for avoiding situations like that.

Dan Slimmon: ought to send that to military general or something. It's not in the reading material for that. For the

Jeff: Um, they're just, they're just winging it. They're just like, they're just like all off the cuff. Like, like, like, who's got the hydrogen bomb? You, you got it. Like, like I'll, I'll hold onto it. I'll hold onto it. Don't, don't worry. I got it.

Dan Slimmon: just will you press, you press here. Okay.

yeah. Bad, bad. It was a bad, it's a very scary thing.

Jeff: You go to, you go to the bathroom on the airplane, you accidentally like kick you, you kick the hydrogen bomb that's sitting in the aisle and it just sort of like rolls, rolls out the back.

Dan Slimmon: no. [00:04:00] I thought it was pressing the flush button and I was pressing the drop of hydrogen bomb on New York City button.

Jeff: We have to stop putting those buttons next to each other.

Dan Slimmon: damnit. There's just no room in the, there's so many buttons in the cockpit. There's not enough room for more buttons, so they had to put it somewhere else.

Jeff: Yeah. Yeah.

Dan Slimmon: bathroom.

You can't have people in coach dropping hydrogen bombs on, on major American cities.

Jeff: Well, and it's like, and it's like, why is the, why is the flush button in the cockpit to begin with? It's like, it's like the, the p the, the pilot doesn't necessarily need control of that. Maybe that's some, something that could be moved.

Dan Slimmon: trip.

Jeff: Yeah.

Dan Slimmon: Um, so Jeff, I have good news about ai. You know how back in like 20 14, 20 15 when language models were just starting to come out and they were hilarious because they were so bad.

Jeff: Yes. I mean, I do remember, I do remember like having a laugh about like, like math stuff and how many Rs are in strawberry. This feels like a little more recent than that, but like, you know, chess, chess situations where it would like [00:05:00] make up rules about chess and things like that. And we were all just like, oh, these, these, these funny machines.

Like they're, you know, they're not going anywhere.

Dan Slimmon: Right.

Jeff: Not gonna replace us anytime soon.

Dan Slimmon: a recipe for, um, cake that, that I like. I wa I was like crying, laughing in the lobby of my, uh, o office where I worked 'cause it was so funny. and then we lost that because the outputs got too plausible. They sound like actual human, Uh, so, well the good news is I think AI may be getting funny again.

The other day I was playing this game with my daughter, Phoebe, where I say the first line of a movie and she tries to guess what movie it is. Um, and so I googled first line of Beetlejuice. Uh, are you familiar with Beetlejuice, Jeff?

Jeff: Um, it's funny that you should ask, I just watched it last night. Um, as, as as preparation. I mean, I don't know if this is too much in the weeds, but as preparation for this podcast, uh, I did watch Beetlejuice and, uh, I, I enjoyed it quite a [00:06:00] bit. Um, I think the first, the first line is not spoken. It's actually the, the logo of the Geffen company.

So is that, is that what you, is that what you presented to your daughter?

Dan Slimmon: It, it starts as, Dayo, but like the creepy reverb Deo. Yeah. well good. I'm glad you've seen it recently. So you'll be able to play this game with me. So alright, I'm gonna read you the Google AI summary. That was, that came in response to the query first line of Beetlejuice.

And I want you to stop me the first time I make a true statement.

Jeff: Okay,

Dan Slimmon: Okay. You can just say stop, or you can make an sound or whatever, however you wanna do it. Okay. Ready?

Jeff: Ready?

Dan Slimmon: The first spoken words in the 1988 movie Beetlejuice are not from the main characters, but from a passerby. Jane Barbara. Hello, Jane. Right. I'm not, not gonna, not bringing any bells. All right.

Jeff: I don't think so.

Dan Slimmon: remember when Jane said to Barbara, hello Jane.

Jeff: Oh, [00:07:00] oh.

Dan Slimmon: All right. Next sentence, next

Jeff: It would make more sense if Jane said Hello Jane to Jane

Dan Slimmon: I mean, if anything, a lot of things would make more sense than any of this. So, so this, here's the next line from the AI summary. This is followed by Jane asking, how are you, Barbara? How's the flag cake coming?

Jeff: Un Uh, no. No truth. No truth detected.

Dan Slimmon: No truth yet. Uh, the opening scene also features a voiceover narration for a news report and the very first words of the film's opening credits are a voiceover Beetlejuice.

Jeff: So, so, so not only are all of them wrong, but, but it's like there are three different answers contained in, like conflicting answers contained in the, in the, in the same re response.

Dan Slimmon: Simultaneously, there's a news report and a voiceover saying Beetlejuice and [00:08:00] also Jane saying to Barbara, hello Jane.

Jeff: Those are all, all three of the first lines of the movie spoken simultaneously.

Dan Slimmon: What a, what a classic. Jim Burton's such a genius.

Jeff: He's, he's so, uh, zany. Um, yeah. Yeah.

Dan Slimmon: else

Jeff: He's a real, a real au.

Dan Slimmon: The flag cake thing apparently comes from the initial draft of which I found online of, of the script where there was, where Jane was making a flag cake. That wasn't the opening line, but the Jane was just, does make a flag cake. And they talk about the flag cake in the first scene of that.

Jeff: Oh yeah, apparently that script went through like a bunch of rewrites, um, like, like, because it was super dark, much, much darker at the beginning. And there was, there's some something in Wikipedia about like an executive kind of getting dressed down and being like, you're throwing your career away on this, on this, on this, the spooky stuff.

Um, so I'm glad that AI will help us straighten it out or, or help us arrive at the truth indirectly.

Dan Slimmon: I would, I would watch this movie, [00:09:00] um, but it's not Beetlejuice. Uh, speaking of things that aren't Beetlejuice, Jeff, you heard of Cowie?

Jeff: Um, only very, very, uh, NN yes. I've, I've heard of it. I don't really know what it is. Um, I mentioned it to some people and they kind of got these, this terrified look in, in, in their eye. Um, yeah, I try to, I try to generally keep my head in the sand as much as possible.

Dan Slimmon: great. well, well, you know, I'm a podcaster, so I can't, I gotta keep my head out, take my head out of the sand sometime and learn about

Jeff: This is my only, this is my only source of news is like coming on technology blows and like, and like learning about what's, what's happened.

Dan Slimmon: Yeah.

Jeff: It's like, oh, we have, we have large language models now.

Dan Slimmon: You're at the water cooler, talking to your coworkers is like, ah, did you hear about the smart beds that have the AI in 'em? And you're like, what are you talking about, man?

Jeff: Yeah. Yeah. I'm like, apparently there are these like wireless headphones. I guess the wires are just super short or something. [00:10:00] And, uh, and also, and also washing machines are woke.

Dan Slimmon: so Cal Kalshis not woke, Kalshi is a new sports betting app where you can also bet on US elections. Now, that's not how they talk about themselves. On October 6th, the two wunderkind founders of this company went up on stage at Citadel Securities Future of Global Markets 2025 event in New York, in their white sneakers and their windbreakers and slacks and, uh, CEO Tarek Mansour explained the company's vision like this.

Could you financialize anything that people care about? And, and, you know, Kalshi is everything in Arabic. The the, the long term vision is to financialize everything and create a tradable asset out of any difference in opinion

Jeff: Well, we, there's no shortage of that. I mean, in, in, in, in, in this, in this day and age. Um, yeah. Capitalize on, on that.

Dan Slimmon: How so does that sound? How does that hit you, [00:11:00] Jeff? Does that sound like the kind of thing a normal person would say?

Jeff: no, it, it definitely sounds like something that's, you know, you, you just take, you take sort of a questionable idea to an extreme,

Dan Slimmon: Hmm

Jeff: um, perhaps, perhaps antisocial,

Dan Slimmon: hmm.

Jeff: um, to, to financialize any difference in opinion to, to make like human discourse like transactional.

Dan Slimmon: Yeah. Yeah, yeah. Yeah. Uh. That's a, that's a good, that's a good analysis. I think personally, that it's an extremely fucked up thing to say, and I think it speaks to a diseased soul.

Jeff: you're more eloquent than I am.

Dan Slimmon: I, I am, I've, uh, I've had more time to think of it and I, I thought, I thought around, I was like, is there some way in which this is not, fucked up?

And it, there isn't. Uh, but, but you say it in front of an [00:12:00] audience of stock market people and everybody's like, oh yeah. Yes, yes. what a, what a genius. twentysomething

Jeff: Like, does Financialize have a specific meaning? Because that's, that's the word that I kind of get stuck on. Like, like, I'm like, I'm like, what does, what does Financialize actually mean?

Dan Slimmon: So welcome to, welcome to Technology Blows, where you get to find out exactly what is meant by that. And it's not good. It's not good. Jeff, um, Cal Kalshi doesn't like to think of themselves as a betting app. They're, they're not something as mundane and vulgar as a sports betting app, but rather they're the first federally regulated prediction market in the United States. And, and we'll talk about how that, that grandiose self-image shakes out in the real world. But basically Kalshis an app where users place bets on questions like, who will be times 2025 person of the year, or will SpaceX launch humans to Mars before 2030? Or [00:13:00] who will be the Democratic nominee for President in 2028 Right now we have a Ga Gavin Newsom trading at 35%, a OC at 10%. And uh, then Pete, Pete Buttigieg is way down there at five, 5%. And then there's some people I'd never heard of. Do you know who Gretchen Whitmer is? know who that

Jeff: Um, wasn't she the, wasn't she the, uh, governor of Min of Michigan?

Dan Slimmon: Oh yeah, that sounds like something, uh, Gretchen Whitner Whitmer would be. Um, anyway, she's got a 4%, so, you know, don't count her out. so let's learn about Kalshi, uh, the plucky little sports betting app that might just destroy democracy.

Jeff: Do people still use it to bet on sports? Like, like as opposed like, like,

Dan Slimmon: Absolutely.

Jeff: there's such a, there's such a overabundance of like sports betting apps. It's like, were people going to Kalshi instead of like [00:14:00] draftings or something?

Dan Slimmon: So, well, so for, for most of, for most of the year, Kalshi, the vast bulk of Kalshis revenue comes from sports betting the way that they get that market share, which is still a drop in the bucket compared to fan tool or DraftKings. But, uh, but the way that they get it is they make, um, pos possibly false claims about their odds being better than the betting sites because they're not a betting site.

They're a, they're a, a, a a exchange where you, where you trade with others. Um, and Cal doesn't set the odds. They don't take a vig, they don't set the odds. So actually you get better, better odds this way.

Jeff: Like a predictions market, but you can't, but you can't have like an opinion about like, who won a football game.

Dan Slimmon: No, you can't. So they write a, they write, they write a contract. That's like, that's very specific about what the terms are of when the contract, uh, lapses. When the contract settles. And [00:15:00] then we'll, we'll, we'll, we'll, we'll get into all this.

Jeff: Okay. Okay.

Dan Slimmon: it's, it's a, it goes back really far. So,

Jeff: This sounds, this sounds great. I think I'm, I think I'm really gonna be inspired by, by this, uh.

Dan Slimmon: you're gonna love this, um, you're gonna love this. You're gonna be on Kalshi betting on, uh, you're gonna be taking bets on every, everything on Kalshi. You're gonna be

Jeff: I'm gonna be like, who's, who's the next technology? Blows Guest? It's gonna be,

Dan Slimmon: yeah.

Jeff: yeah.

Dan Slimmon: million in, in trading volume on that question. Uh, and I don't see a time of it.

Jeff: But you could, you could push a result one way or the other if you had control over an outcome.

Dan Slimmon: No way, man. How? Don't

Jeff: Oh, okay. Okay. Maybe, maybe, maybe I'm, maybe I'm spoiling a little bit. All right. All right. Sorry.

Dan Slimmon: no, no,

Jeff: Please, please, please go ahead. I'm, I'm, I'm all.

Dan Slimmon: so yeah, it opened. It's a big, it's a can of worms. Uh, so, so the, the practice of wagering on future outcomes is older than money itself. oldest six sided dice we [00:16:00] have, which we think were used for gambling, are from about 3000 bc. Um, but those, those dice emerged from even older artifacts going back thousands of years earlier, called. And these were usually the knuckle bones of small animals. They're scrawled with symbols, and then a priest or other ritual figure rolls 'em and interprets the results in order to, to divine something about the future. so clearly, even at the earliest glimmers of human civilization, we have this intuitive sense of a deep connection between randomness and predicting the future. we saw that, um, through some invisible ineffable power, we could discern the contours of the future by giving up some of our control of the present. We, we, you know, we control some aspects of the process very carefully. It's a ritual, right? Uh, but, but the crucial step, the step that actually allows the gods to talk is through throwing dice,

Jeff: Mm-hmm.

Dan Slimmon: randomness. And, and this isn't just a, [00:17:00] you know, a primitive. Superstition because randomness does turn out to be central to modern methods of producing knowledge about the world and the future. For example, this is essentially how science works. We, we set up precise constraints and then we let random events happen within those constraints and we interpret the random events to make predictions about future events. You know, it's not that far off Modern science from what we were doing in 7,000 BC with Fox Knuckles, we're just a whole, a lot better a about it now. And it's been stripped of most of its mysticism. Right.

Jeff: I am digging the, I'm digging the fox knuckles. That's, I think that's, I think that's very cool. Um,

Dan Slimmon: yeah, yeah. We should use more Fox knuckles in, I mean, if somebody should come up with an app where you, where where like you just watch people throw Fox knuckles.

Jeff: um, that, yeah, that could be a twitch, Twitch stream. I mean, is that, like, is that where like bones, like, like bones is like also a name for dice.

Dan Slimmon: [00:18:00] Yeah. and science isn't the only way that hu modern humans use randomness to build knowledge about the future. Another way is betting, because it's widely believed that when you get enough people together betting money on the outcome of a future event, even if those people all have conflicting knowledge and conflicting motivations in emotional states, the odds that emerge from all that betting will approach the real world odds of the outcome. They, they call this the wisdom of crowds. The idea that while any individual person may be totally wrong about the odds of a, of a given event, the aggregated knowledge of everyone in the market can estimate those odds accurately.

Jeff: Yeah. This is also kinda like psycho history, right? Like the ov like foundation, psycho history,

Dan Slimmon: Yes, it is Jeff.

Jeff: and then you have this, this mule come along and, uh, and, and disrupt, disrupt, uh, these practices.

Dan Slimmon: And the mule is Donald Trump Jr. But we'll get to that. right. It's not just libertarian crazy talk. You can use, [00:19:00] you know, markets have been used with quite a bit of success to predict outcomes in politics and sports and the climate, which, which is, which is neat. The, the, it can work surprisingly well when certain assumptions hold, like independence of decisions, availability of information, amounts of money available to trade. But when these assumptions don't hold, which is in like most situations, wisdom of the crowd can be really, really wrong. for example. a bubble is a period in which the market price of some asset is much higher than the asset's actual value. And these, and these happen fucking constantly. Uh, just in the last 30 years, we've had the.com bubble in which the NASDAQ composite index fell 78%. Uh, we have the housing bubble that led to the subprime mortgage crisis of 2008, uh, which you may recall as

Jeff: Hmm.

Dan Slimmon: a recession that lasted three years. And a lot of people are saying there's an AI bubble right [00:20:00] now.

Jeff: A lot of people are saying,

Dan Slimmon: a lot of people are saying that, who

Jeff: do you think that, do you think that we're in an AI bubble? Do

Dan Slimmon: I think maybe these companies were right to pump billions of gallons a year of precious life giving water into the desert so that board teens can generate shit posts of SpongeBob and Patrick cooking meth. I think that's maybe that was the right thing to do, and it's actually worth a lot of money.

Jeff: I think, I think, I mean, to me it feels more like a shim. Like, it's like, it's like these companies are introducing a shim between like human thought and action, and, and that's really priceless. So like, even if the value, even if the value, like, like. The bottom falls out of the value of the services that they're providing or they're not making revenue or something like that.

They're still like transforming, like the way that people think and work in a way that can be like further, like that wedge can be like further leveraged in the future. Even if it doesn't like exactly look like that. It's like maybe we're not all [00:21:00] using chatbots in, in five years, but we're all sort of like captivated by like a different app or a different experience that these same, uh, people control.

Dan Slimmon: Yeah. We're all used to the idea that we, that we, give the machine our intentions as input and it comes up with what we're gonna do and say,

Jeff: Yeah, yeah. Just treating, just treating technology as an oracle basically.

Dan Slimmon: right. Um, we gotta get back to Fox Knuckles. Yeah.

Jeff: Yeah, we gotta get back to the, the organic. Yeah. I'm just gonna, I'm just gonna start writing down my thoughts on paper, ripping, ripping them up and, and scattering them and seeing where they land. And that's, that's, that's how, that's where I'll take my cues from.

Dan Slimmon: That's free. Yeah, so, so, so bubbles show how trusting in the wisdom of the crowd can be fucking catastrophic. And speaking of things that are fucking catastrophic American politics, one of our favorite things to bet on throughout American history has been presidential elections [00:22:00] 1884 and 1928, betters collectively wagered an average of $66 million adjusted for inflation on presidential elections like per election, 1916 election, Woodrow Wilson versus Charles Evans Hughes.

As I'm sure you remember,

Jeff: Hmm.

Dan Slimmon: attracted the equivalent of $300 million in bets. And, to quote this research paper, I found, uh, by some economists from UNC, in only one case during this period did the candidate clearly favored in betting a month before election day lose.

Jeff: Now those, those betters did not have an app, I'm pretty sure. Were they, were the, were the bets like coordinated or was it just like, uh, like just people going out and being like, uh, I bet you 20 bucks, like Woodrow Wilson's gonna win.

Dan Slimmon: It, it, it got pretty sophisticated. these were mostly like New York Stock Exchange traders who were doing most of the betting. And um, they had set up [00:23:00] contracts where they, you could buy and sell and, uh, was, was reported in the newspaper. This was before they really had polls, um, you know, reliable polls.

So this was like kind of the most reliable source of information, um, about what people were feeling about the election. And, and it was, it was pretty, um, it was pretty formalized in, in the, on the stock exchange.

Jeff: Are polls on the whole less reliable than like betting.

Dan Slimmon: That is a, that is a very good and interesting question to which we do not yet have a scientific answer.

Jeff: Huh? It's like if you, if you actually have skin in the game. Yeah, maybe you're, maybe you're, you're like pushing the outcome a certain way, or, or like if somebody calls you at dinner and you're, you're, you're feeling, you're feeling saucy, you're gonna like mess with a, pull the pollster and, and, and, you know, I don't know.

Dan Slimmon: out either way. It's

Jeff: I.

Dan Slimmon: complicated even than one being better than the other. They, they, they interface with [00:24:00] each other. They anchor one another. but, but betting, you know, it, it's a pretty impressive prediction record that, that, you know, the, the candidate who was ahead in betting a month before the election never lost during this, during this period. So they, they can be, you can do pretty well. but around the 1930s betting on elections went out of style, which, which these economists attribute to a few different factors. First of all, polls got better. They, we got better at doing polls. And so people didn't need this information from the newspapers about the, uh, bets as much. of all, exchanges started to strongly discourage their members from betting on politics. you know, they didn't want their very serious, economically important stock markets being associated with all this low class gambling,

Jeff: How, gosh,

Dan Slimmon: right? I mean,

Jeff: these are, these are serious. These are serious financial instruments.

Dan Slimmon: We're, we're, we're providing value by speculating on the, you know, get over yourselves.[00:25:00]

Jeff: Corn,

Dan Slimmon: corn,

Jeff: I.

Dan Slimmon: corn, corn, and finally. Maybe most significantly in 1939, New York State legalizes horse racing. So now all these Wall Street guys have something to bet on that happens every day instead of every four years. And it's legal. by the way, like this is still true so that people would, would, would prefer to bet on, like if you're, if you're a gambling addict, like every New York Stock Exchange trader, you're want gonna wanna bet on horse races or sports or something that happens every day, rather than things that ha only happen every four years, like a political election, which is gonna make it really hard for Cal to generate enough depth in its political markets to resist things like market manipulation.

But we're getting ahead of ourselves.

Jeff: Yeah. Yeah. So these, so, so these guys, either there's something innate in, in humanity that makes people want to bet with each other, or, or just like this career attracts people who really love to bet. And just like if you've got, if you've got an outlet for [00:26:00] that, um, that's good. It sounds like people are getting what they need.

Which is a, the first step towards Utopia.

Dan Slimmon: yeah, that's a great way to think about it, Jeff. You're so optimistic.

Jeff: I'm gonna start a, a sister podcast called Technology's Great.

Dan Slimmon: Yeah.

Jeff: And I have you on and just, we'll, we'll just, we'll just spin it.

Dan Slimmon: I did an episode about every week. Um, you could be like the, the, um, what do they call it? Uh, knowledge fight where they, where they just cover, they do a podcast every week about Alex Jones' podcast the previous week.

Jeff: Oh my goodness. I didn't know that was a thing. That's really funny.

Dan Slimmon: political betting goes dormant for a few decades during the Reagan years. Interest in political betting, goes back on the rise. Now though, instead of betting, we're calling it prediction markets. So a prediction market is where people can buy and trade what are called event contracts. Uh, an event contract is an asset that turns into money if your prediction [00:27:00] turns out to be correct, otherwise turns into ash. effectively

Jeff: And it's getting paid by the people who are predicting the opposite.

Dan Slimmon: yes, it's a so, sort of gives, it sort of gives political betting a, a financial sheen, you know, it's, it's nothing so vulgar as betting. You, you see, we're, we're using the science of market dynamics to aggregate revealed preferences into accurate predictions of the future. Oh. Oh, that sounds, that sounds much more intellectual than betting.

So how does it work? Well, first everybody puts in some money, right? It's,

Jeff: Yeah. Yeah,

it's kinda like health insurance. Sounds like, it, sounds like health insurance, honestly.

Dan Slimmon: like health insurance.

Jeff: So we're all putting money into a bucket.

Dan Slimmon: we all

Jeff: Uh, some people get, some people get money, some people lose money.

Dan Slimmon: It's, it's like the Futurama episode where they're going fishing and Bender says, uh, Hey, how about we make this interesting? Uh, everybody, everybody put in five bucks. And everybody's like, all right, that sounds fun. Yeah, I'll put in five bucks. [00:28:00] And then Bender says, there wasn't that interesting. And goes back below Decks

so the first of these new prediction markets is the University of Iowa's, Iowa Electronic Markets, which is founded in 1988, where you can buy event contracts for a lot of things, including US political outcomes. So in order to get approval this market, they wanna font start this market for academic purposes, but they have to get approval from a federal regulator for this sort of thing. Um, and that regulator is the Commodity Futures Trading Commission, uh, or CFTC. And,

Jeff: Is this gonna be another data? Is this gonna be like another data washing story where it's like something kind of emerged from like academia? Academia and like, and like, and then got like corrupted by

Dan Slimmon: they do

Jeff: business?

Dan Slimmon: Kalshi still does, still does make the argument that like, allowing political bets on their platform is good because it, it, it creates data, useful data for political scientists, which. You know, [00:29:00] impossible to believe that the people who created Kalshi care about that, but that's what they say.

Jeff: pay me to produce data.

Dan Slimmon: Right, right. we don't need to do that much science. anyway, so the way that, the way the IEM, the way the IOO electronic markets made it around this regulation requirement is that they made it so that nobody can have more than $500 in outstanding bets on their market at any time. Um, which, which is great, that makes these markets way too small to interest real traders and therefore avoids a lot of the problems that the, that the CFTC exists to prevent, insider trading and stuff.

Why bother in insider trading on this stuff? You can only make a, a $500 or some small, multiple $500 max.

Jeff: Right, right, right.

Dan Slimmon: Um, but these prediction markets have just kept coming. So nowadays there's a bunch of 'em. You got Predict It, which is a prediction market based in New Zealand that could briefly take trades from Americans, but got run out of the US by the CFTA few years back, although they may be coming back. Um, you got Auger, which [00:30:00] is a cryptocurrency based prediction market, which has a, a well-earned reputation for people betting on public figures being assassinated,

Jeff: Yikes.

Dan Slimmon: which sounds totally reasonable. Can't see why that would be a problem.

Jeff: that's the most horrible thing that you've said so far because that is definitely a thing that someone with a financial interest in that outcome could move towards realizing.

Dan Slimmon: Hmm mm-hmm. Um, and, and, and libertarians have written whole long screeds about why that's good. And also it would be good if you made it more, if you made it more like that. Um, where like you could take bets every day on whether bets on the date on which, uh, a particular figure would be assassinated. And then if you are, if you wanna assassinate that person, then you can take out, put all your money on that date and then go assassinate them. Um,

Jeff: that's horrible.

Dan Slimmon: very [00:31:00] cool. Um, you got Polly Market, another crypto based prediction market that's very big, and which has Donald Trump Jr. As an advisor and a bunch of investment from Donald Trump jr's, capital firm 1789 Capital. So these things are just up left and right.

Jeff: What's, what's, what's the significance of 1789? Is that Bill of Rights?

Dan Slimmon: Uh. I think that's when the Declaration of Independence, don't quote me on this. I think that's when the Declaration of Independence was, was drafted.

Jeff: 1776 though? Yeah.

Dan Slimmon: 1789. Oh, you're right. was the first president. Oh, 1789 was the first, um, presidential inauguration.

Jeff: Oh, interesting. Oh, 'cause, 'cause Washington didn't get, didn't get one.

Dan Slimmon: No, he did, but that's, it was in 1789.

Jeff: Oh man, this is embarrassing for me. I'm sorry that I don't know American history better.

Dan Slimmon: the, the, [00:32:00] I didn't, I, I, uh, misestimated the Declaration of Independence by 13 years, so,

Jeff: Oof. We should, we should cut this part out. Otherwise we might get, we might get the old boot ourselves.

Dan Slimmon: This has been Technology Blows podcast over, we were too wrong about too many things. Um, you can't have a podcast. There's the law.

You can't have a podcast if you're wrong about things on it.

Jeff: Oh yeah, that's true.

Dan Slimmon: Yep. Um, so now joining this illustrious club of prediction markets, we have a newcomer called Kalshi. Kalshi was founded by a pair of MIT 30 under thirties named Tarik Mansour and Luana Lopez. Lara Mansour is the one who wants to be seen as the bold visionary, I think.

Um, and so he's the one getting out in front of the public all the time and staying and saying very stupid shit. And then Luana Lopez Lara, for my money is the smarter of the two. Um, she grew up in Brazil and studied ballet at the Bolshoi Theater School in Brazil.[00:33:00]

Jeff: Nice.

Dan Slimmon: she says that the teachers at her ballet school would sometimes hold a lit cigarette under her leg while she tried to keep it raised to, to practice keeping her leg raised, which is the kind of thing you say if you wanna appear like. Mythically competitive as all these finance people do. I, I, I don't know if it's true. it sound true to you?

Jeff: Uh, it, I think it does. I think it does. Um, I think ballet teachers are pretty exacting in, in their demands. Um, it's, it's an, it's an art form that I think. I mean, obviously that's like an extreme right, but it is, but it is an art form that, that, uh, that requires a lot of precision and, and discipline and, you know, why don't, I don't obviously advocate like hurt, like hurting another person.

I can see, you know, kind of like, what was that movie with the jazz drummer or whatever, like, [00:34:00] like yeah, like whiplash style that sort of like your crazy mentor is like, is is just like making your life hell.

Dan Slimmon: Yeah,

Jeff: in, in pursuit of this vision

Dan Slimmon: Based on what I know about Brazil and ballet, which is very little, I can believe it. Um,

Jeff: I've heard more about Brazilian juujitsu than Brazilian ballet.

Dan Slimmon: yeah, Brazilian jiujitsu involves a lot of burning people with cigarettes. that sa Sam Harris is always burning people. It's, and, and Joe, Joe Rogan are always burning, burning each other with cigarettes. It's great. It's great. It's

Jeff: Yeah, yeah, yeah. You can't, there's no time. There's no time to be depressed when you're burning somebody with a cigarette in the middle of a Brazilian juujitsu match.

Dan Slimmon: Yeah. I remember when Mark Zuckerberg went on Rogan and he was just talking about his AI glasses in the middle of his sentence. He was like,

Jeff: Wait, what? He

Dan Slimmon: just but

Jeff: sneezed.

Dan Slimmon: is that not the sound you make when you're get burned with a cigarette? I don't know.

Jeff: It's like,

Dan Slimmon: find

Jeff: like a dog bark.

Dan Slimmon: Craig Zuckerberg's natural, natural voice. He's stopped doing his, he stopped doing his cool [00:35:00] guy, um, Brazilian Juujitsu,

Jeff: He's just like, stop it. Hey, stop.

Dan Slimmon: Um, so these, these two, these two, these two kids, they both get, like, they study computer science.

They both, they both study a little bit of finance, um, which is the study of how to make money go around in a circle until some of it ends up in your pocket. and both of them get these prestigious internships. You know, Goldman Sachs, Bridgewater Associates, which is a big hedge fund. Um, Mansour interns at Palantir, the government surveillance firm owned by investor and apocalyptic cult founder Peter Thiel. And after a while, uh, Mansour and Lopez Lara meet back up at MIT and they decide to start a business together. And the pitch for their business is what if people could trade future outcome? Uh, which in case you think you missed something. That's just betting. Uh, but, but it probably sounds really deep if you're in college, it's like, you know, huge bong rip. [00:36:00] Oh, what if we use economics to like predict the future, right?

Jeff: So, uh, uh, but are they like, are they like interested in making money for themselves? Like, did, did these two have like gambling addictions? Are they like, are they, like, are they like going up to strangers and being like, I'll bet you I can, like, you know, like, like jump five feet in the air or something like that.

Dan Slimmon: First of all, Luana Lopez, Lara might be able to jump five feet in the air. Uh, but they, they interned at these, these hedge hedge funds and they, um, they like met a bunch of traders and they found out like, well, these traders are trading all day.

They're trading their clients' money all day. But they're also making a lot of personal bets among themselves about like, will Brexit happen by this date? Or will, you know, things that may affect the outcome of their trades? They're sort of hedging, they're using these bets to hedge against their, their large trades.

Jeff: Like personally, like amongst each other.

Dan Slimmon: yes.

Jeff: Interesting.

Dan Slimmon: [00:37:00] so, so anyway, they, they, they were like, what, what could you, what if we could use economics to predict the future? And it's like, yeah, we've all read, we've all read Foundation as you pointed out. Like, you're not, you're not Harry Seldon, you're not going to like, you, you haven't, you haven't changed the way the world works by coming up with this idea.

But they think they had, they're like, this is it. This is the big idea that's gonna make us both billionaires. And the sad thing is they're right about that. They're both

Jeff: Of course.

Dan Slimmon: which fucking sucks. the original working name of this business was, get Ready for this name Cow. N-A-K-O-W-N-I-G.

Jeff: what is cow nig?

Dan Slimmon: No idea. They never used it. They, they, they're smart enough to know that that was not a Mark marketable name.

Jeff: But they kept the K

Dan Slimmon: working

Jeff: Kalshi does mean everything.

Dan Slimmon: Kalshium means everything in Arabic because the vision was, you could just bet on [00:38:00] anything. you know, because they wanna financialize everything people care about. they, they said like, you know, Kalshi lets, you bet, take something as subjective as a celebrity rumor. Like, is Kendall Jenner pregnant? And turn it into a concrete number, a price. It's like capturing a fleeting thought and giving it a form you can analyze and discuss.

Um, I.

Jeff: I think that's, I think that is very, you know, very smart on their part because it's like, right, like the idea is to is to sort of like capture this behavior that's like a part of human nature and that in, in, in the environments that they're living, they're like observing this, like, happening all the time and just like driving it to that end and just being like, yeah, let's be, let's be the middleman in like every thought, every, every, every, every bet.

Dan Slimmon: it's not dumb. but it, it's not like good for society

Jeff: Yeah.

Dan Slimmon: Uh, I, and it also like, probably doesn't help you make friends. [00:39:00] I, I, I wonder if I could put like a no bet on whether Tarik Mansour will make a single friend by 2030. 'cause if you go around telling people, like, your friend's.

Like, I wonder if Kendall Jenner's pregnant and you say like, put your money where your mouth is.

Jeff: Yeah, yeah, yeah. You're just like salivating your like, oh yeah, you, yeah. You really think that, you really think that.

Dan Slimmon: Yeah. your, your, your 8-year-old son is like, I'm not gonna eat my potatoes. And you're like, oh, do you think you're not gonna eat your potatoes?

How much, how much money have you got in your pocket?

Jeff: Yeah, that's, that's probably a pretty safe bet, actually. I would, I would take that bet. I don't know who would bet against me on that.

Dan Slimmon: Um, yeah, so, so in, anyway, uh, in order to, in order to execute on this horrible vision, um, for Kalshi to be within reach of everyone, not just finance nerds with, with crypto wallets or people who won't know how VPNs work to make it look like they live in New Zealand, um, they were gonna need to get regulated, right?

'cause, 'cause nobody wants to make big trades on a market that might just get shut down by the government at any [00:40:00] time for, because it's not, they're, it's illegal. And, and we'll talk about how that regulation fight went. 'cause it's a wild story,

Jeff: Could they have kept it? Could they have kept themselves like really small? Just been like, just been like, we are only, we're only interested in these like every man bets like. Like, almost like a micro loan type thing where they're just like, make it make it easy to like, bet a hundred dollars on the number, or no, not a, not even a hundred dollars, like five bucks on like, almost like lotto style.

Like make it easy to bet two bucks, bet five bucks on the number of people that are gonna be in front of you in the grocery line or something like that. So you're just going through the world, like money's flowing in, it's flowing out and, and, and you're, you're like, you're on man. You've got this, like, you've got this edge.

'cause you're like, you're hyper engaged and everything.

Dan Slimmon: acting up, but perfectly rationally.

Jeff: Yes.

Dan Slimmon: yeah, it, it, um, I mean, you can already do that though, right? Like, you can just make bets with your, if you have a fi just find a [00:41:00] friend who likes gambling as much as you do and make bets against them, you don't need to. You don't need to, and that's not how you become a billionaire.

Jeff: Okay. But they wanted, they wanted the, they wanted the larger bets. They wanted, they wanted depth, not breadth or whatever.

Dan Slimmon: they wanted, they wanted, uh, volume, they wanted

Jeff: Volume.

Dan Slimmon: that's

Jeff: Cool.

Dan Slimmon: 'cause they make, 'cause Cal's business model is they make money on every trade. They get a fee for every trade. So the

Jeff: Oh,

Dan Slimmon: are trading, the more money they make.

Jeff: is it a flat fee or is it like a percentage?

Dan Slimmon: I don't know their fee structure.

I'm

Jeff: I bet it's a percentage. I bet you a hundred bucks. It's a percentage.

Dan Slimmon: we could trade that on the i electronics market, um, or electronic markets. So, so let's talk about how Kalshi actually works. Um, you know, how, how they, how do you, how do you, as they say, trade on the future? the, the assets that are traded on Kalshi are these event contracts that I mentioned before. Uh, an event contract is an asset whose value settles to either $1 or $0, depending on whether a specified event occurs. which is [00:42:00] like a speci specified, varies carefully in the contract. so for

Jeff: Cool.

Dan Slimmon: suppose you and I each bet. Each buy an event contract on whether Tarek Menor will be charged with a financial crime by, by January 1st, 2031. And I think he will be charged with a financial crime because, I don't know, he just seems like the type, so I bet Yes. And you, and say that's, say that Yes is trading at 30 cents. So I buy a, a yes contract for 30 cents, and you buy a no contract for 70 cents because you think they, they already own, they, they own the Justice Department essentially.

And they're not gonna get, they're nobody got, nobody's gonna charge 'em anything, which is totally reasonable, tells you totally reasonable point of view. Um, or maybe you just think Tarek Mansour is, is a brilliant visionary who wants to make the world a safer place for political scientists and ice cream truck drivers.

And, and so what do you know? Tarek man store does get charged with wire fraud on December 31st, 2030. Um, again, this is hypothetical, uh, and instantly. So now [00:43:00] instantly my contract is worth $1 and your contract is worth $0. So fuck you. Um, I, and so I, I make a pros profit of 70 cents. 'cause I paid 30 cents for the contract.

And you lose your 30 cents, you get nothing back. Right.

Jeff: Yes. That's, that, that, that makes sense. So it's like, it's like it adds up, it adds up to a dollar basically.

Dan Slimmon: adds up to a dollar. and

Jeff: Per event contract. And you can, you can buy, I guess you could buy multiple event contracts or something, or you could,

Dan Slimmon: you want.

Jeff: yeah, yeah, yeah. So like 30 times a a million or whatever,

Dan Slimmon: that's how, that's how they get around the, that that's how they, um, make it. You can't trade on margin, which means like you can't trade borrowed. that you borrowed from Kalshi, um, on, on things like you can, you can on a lot of other markets, uh, you can borrow money from exchange and bet that, um, you, you can, you, you can bet only cash on Kalshi, which means that the bets are paid out by other beers, right?

Jeff: like [00:44:00] credit card rewards.

Dan Slimmon: like credit card reports. so, so you can see, you could see how the price that these contracts are trading on from day to day reflects sort of the market's aggregate belief about the odds of the event happening, right? Because if you know that an event has a 25% chance of happening, you irrationally, you should be willing to pay 20 cents for that event contract, but not willing to pay 30 cents for it. Um, which, which is what makes this a plausible way to estimate. Odds in the real world. but, but it only works under certain assumptions. One of one of those assumptions is rationality. So this works if, if we assume that at least most of the people, most of the time are acting rationally. And, and of course, as we all know, the thing humans beings are best at is acting rationally. I, I don't know. Have you, have you, have you, Jeff, have you ever encountered somebody acting irrationally? I, what? What was that like? Have you ever, has that

Jeff: He was, he was, he was rolling Fox Knuckles, man. Like I, I, he, he was, he was, he [00:45:00] didn't believe in free will at all. It was, it was crazy.

Dan Slimmon: Um, that's, that's insane. Uh, he would not, he should not. That guy should not be allowed on Kalshi. I, I've, I've never met, it's never happened to me. I've never acted very rationally. I have a five-year-old, she's never acted irrationally,

Jeff: Mm-hmm.

Dan Slimmon: place bets on, on Kalshi. another, another important assumption beyond rationality is. Liquidity, meaning people need to be readily able at any time to buy or sell their assets for cash. Um, if I go to try to sell my bets on, you know, will the White House ballroom be completed in time for Shark week, but nobody wants to buy them from me because nobody's interested in that market, then there's not enough liquidity in that market, right?

And it doesn't, it doesn't work to estimate odds anymore. because lack of liquidity can, can result in all kinds of market inefficiencies, including insider trading and, uh, market manipulation, which, which make the market very bad at estimating probability. and I think Kalshi has a [00:46:00] very hard liquidity problem to solve. but we'll, we'll talk about that later.

Jeff: And can I, and can, can I ask a question? Can, can anybody just like create a contract? Like could I just specify whatever thing I wanted or is are they sort of like, are they sort of like descending from on high?

Dan Slimmon: Um, it's a, it's a mix. So the, the most interesting part of the Kalshi app, if you look at the app, is the section where, to me at least, is the section where people are discussing potential bets or market ideas that they have. Um, Kalshi calls them market ideas. Basically, you can come up with your own things that you'd like to bet on, and you can describe them to the community in a little post that you make, um, in like a little social media thing. And for

Jeff: Fun.

Dan Slimmon: I went on and I made a post about whether Tarek Mansor will be charged with a financial crime by January 1st, 2031. And I'm not gonna say whether I'd take the yes or no bet. I thought before it was hypothetical. I don't want to give [00:47:00] my bat away. I'm not saying whether I would take the yes or no bet, but, By his own logic, he should take the yes bet as a hedge against going to federal prison. Um, so I'm, anyway, I made this, made this little post, um, and it was open to community discussion. the, the idea being that if an idea gets enough engagement in the social media, then Cal, she might decide to start a market for it. now nobody engaged with my post or one person engaged with my post. Um, I don't think it's gonna be listed. Um, the person who commented on it was like, they're never, they, they own all the regulators and they're never gonna, nobody, they're never gonna get charged with financial crimes. And it's like, A, that wasn't the question. And B um, if you think that, then put your money where your mouth is, asshole.

Jeff: Yeah. And C, would you like to be a guest on my podcast?

Dan Slimmon: Yeah. Yeah. Uh, so anyway, all, all this shit, all this shit with the event contracts and the hedgers and the speculators and the market makers is, is of course just another way for [00:48:00] capitalists to, to seemingly whisk money out of the empty air, right? No, nobody's actually doing anything of value here.

Everybody's just gambling. So the, the profits, to the extent profits can be made off of Kalshi by, by betters, are coming from exploitation.

Jeff: Well, and I love this, like, I love this like meta, like, like meta market of like attention.

Dan Slimmon: I mean, what, you know, the app is like a flurry of constant people think saying things they would like to bet on. And, and there's no, nobody, you don't have any friends on it. Like why would you have, it's a market, it's a, it's a market app.

You don't go, you don't go on cal sheet to make friends, so nobody really sees your posts. And, I don't know.

Jeff: Yeah, you're just like, you're just like a pack of wild dogs, just like barking at each other and then like, and then eventually, and then eventually like

Dan Slimmon: Exchange?

Jeff: what? Yeah. Yeah. It's like, it's, it, it is like the, it is like pit, it's like, it's like New York Stock Exchange, the [00:49:00] home game, but like an app form.

Dan Slimmon: Finally can have the, the relaxing, uh, pro-social atmosphere of the trading floor at the New York Stock Exchange, right in your hand, the palm of your hand.

Jeff: Now are you allowed to, like, are you allowed to like Jabber jaw with other people on, like, in these active markets? Like can you, can you sort of like gamesman, what's, what's the word? Like gamesmanship, like,

Dan Slimmon: you can have conversations about the market on the, on the app. Yeah.

Jeff: oh, fun.

Dan Slimmon: active market. Um, and you can try to like psych people out or whatever you wanna

Jeff: Yeah, yeah, yeah, yeah, yeah. You're like, I'm on, I'm on my way to redacted house right now with my redacted.

Get your bets in now.

Dan Slimmon: Uh, so it's, it's a social harm. It's not a social good no matter how many elections you correctly predict. It's, it's bad, but, but obviously Kalshis founders don't see it that way. They're, they're, they're always using this high minded language to cast their betting app as a social good. Um, [00:50:00] here's another clip from that Citadel Securities event in October. Um, questions about the future, you know, whether Brexit is gonna happen or what's happening with climate, who's gonna win the next election? these are important questions that a market-based rational answer would do us, would do us quite a bit of good, you know, instead of sort of depolarized, you know, bias, you know, emotional, emo, emotionally fueled sort of debate that we're currently having about all these questions.

Jeff: People famously not emotional when it comes to money.

Dan Slimmon: Yeah. Yeah. Yeah. There's no bias and there's no bias in finance. Uh, yeah. What do you think? I don't know what that means. Like he says, uh, if we could have rational answers to that would do us quite a bit, a bit of good to have rational answers to simple questions about the future. Does that to you, Jeff?

Do you know what he means by that?

Jeff: I get, I mean, it sounds like he's saying that like, people own like, like money is like a, like a tool to ex [00:51:00] to, to like express rationality or something like that. So it's like, so it's like if you do something with your money, then, then you know, it, it, you, you wouldn't be like, you wouldn't be doing irrational things with money because money actually matters, unlike feelings or emotions or something.

Which, which like, like opinions. It's like opinions don't matter. But like, if you're like, oh yeah, if you're willing to throw down like five bucks like that, then that's how you really feel or something.

Dan Slimmon: it Luana Lopez or calls it a taxon bullshit.

Jeff: Oh yeah, yeah, yeah, yeah, yeah. That that, I mean, I can see, I can understand that framing from their perspective.

Dan Slimmon: I can, I guess so I was kind of puzzled by it because like. It's not obviously clear to me what good it would do to have the, even if the rational predictions of the odds are correct, what good does it do to have them, right? Like for society, for example, Kalshi had a market on the New York City mayoral [00:52:00] election back in November, which you may remember as a resident of New York.

And, suppose KCI had predicted a Zoran win when the polls were still saying Cuomo, it's not how it went down, but if it had gone that way, like what good exactly would this do us? And for what definition of us, like you live in New York, maybe, maybe, you know, it would've given you an extra couple hours to barricade your house against the droves of lawyers and confusingly sexy drag queens that flooded up I 87 the moment the polls closed.

I, I don't know. What do you, what do

Jeff: Yeah. Yeah. I, man, I heard that, I heard that parade for sure. Um,

Dan Slimmon: they're

Jeff: no, like, like, wait, so I just have to, I just have to point of clarification. Kaci did not predict Zoan was gonna win.

Dan Slimmon: they did predict so on was gonna win, but so were the polls. So did every,

Jeff: oh, okay. Okay, okay,

Dan Slimmon: It

Jeff: okay, okay. Yeah. Yeah. So, okay. Right. So the idea was that, like, if it had been trading in that direction, like, like I could, could have known earlier and I could have, [00:53:00] I don't know, I could have like been happier sooner, I dunno.

Dan Slimmon: or angrier sooner if

Jeff: Or angrier sooner, you know, who knows?

Who knows?

Dan Slimmon: yeah, that's the, I think that's the, that's how what he, but you're not supposed to think about it too much. Um, I,

Jeff: Well, but you're supposed to, you're supposed to bet on it. I mean, that's, that's the real thing, right? Like Yeah, yeah, yeah.

Dan Slimmon: money on it.

Jeff: Oh, okay. But, but yeah, but, but specifically, yeah. Specifically talking about how like these like pure rational, like, like reads of, of, of people, these like rational Like if, if, if the market is a rational output, what can we do with that information?

Dan Slimmon: Hmm.

Jeff: I don't know.

Dan Slimmon: I don't know either. somebody can probably do something with it, but not me. Uh, so I thought I'd try to figure out where this idea of market predictions being good for society comes from, and, and it's, it's basically a libertarian idea. Uh, so if you, if you ask a libertarian to justify what he believes and [00:54:00] he happens to be the kind of libertarian who has ever examined his beliefs, he'll, he'll usually talk either about. Individual freedom. And, and if he's read some books, he might talk about John Locke or, um, he'll talk about markets. and most, most of the market stuff was developed in the first half of the 20th century by, uh, Ludwig von Mes and his student Friedrich Hayek, who were part of what's called the Austrian School of Economics. the Austrian School believed everything in economics had to be explained in terms of individuals acting in their own self-interest. You know, individuals meet in markets, they buy goods and sell goods for whatever prices they mutually agree to. And if markets are efficient, then prices can adjust rapidly in response to any new information that arises. So, like, you know, if there's no rain predicted for a week in Florida, then orange juice futures get cheaper. Uh, and, and to Hayek. is a social good in his, in his framework. This is a social [00:55:00] good because it means production will continue in the face of all sorts of disruptions. Like, you know, if the Coca-Cola factory burns down, then Pepsi's prices will go up, and everybody who wants Coca-Cola enough will be able to get it from, from Pepsi.

Jeff: This is, this is deep. This is deep. Sorry. Yeah. I'm trying to process all this.

Dan Slimmon: feels almost reasonable, right? It's like efficiency is good for production, production is good for society. and, and you know, it seems almost reasonable to me because I tend to be pretty skeptical of central economic planning, um, because it concentrates too much power in too few hands. However, during the rest of the 20th century, America's financial Elite has developed this skewed reading of the Austrian School, where markets are not just the means, but the ends for more markets. Freer markets, markets everywhere, markets all the time. they develop this sort of market fetishism.

They, they believe that all problems in society can be solved through bigger, freer markets. And as a [00:56:00] corollary, if a societal problem can't be solved in any clear way by bigger freer markets, then you know, if it's something like climate change or racism or poverty, uh, it must not be a real problem, right?

Because it

Jeff: Right.

Dan Slimmon: an illusion or some kind of obscure second order symptom of not having free enough markets. And somehow it'll, you know, we don't know how yet, but it'll definitely be solved by, by freer markets,

Jeff: Right. Like the markets, the markets are like this, like extremely pure thing. And if, uh, if, if something's, if something's sort of like not aligned with the markets, it's like not the market's fault. It's like, it's like, or, or it's, it's the market's fault in that it's like, well, the market's just not good enough.

But if we had a better market, like we would account for that thing,

Dan Slimmon: or it's monopoly, or it's some something

Jeff: it's a no no. True Scotsman kind of thing. It's like, that's not, that's not, that's not the real, that's not a real free market.

Dan Slimmon: Right. that's,

Jeff: so funny. That's like [00:57:00] what people say. Yeah. I mean, I feel like that's like what people say about like, other, other forms of government that, you know, that have, that have not succeeded where they're just like, I don't know, anytime something doesn't work that people like, they're just like, well, that wasn't really the rip, that wasn't really it.

Dan Slimmon: there's a lot of like, that wasn't real communism arguments made about the Soviet Union, for example.

Jeff: Yeah, man.

Dan Slimmon: there's a lot of like, there's a lot of like, I mean, it, it's similar to that argument and it's similar to also to religion you know, why does God let bad things happen to good people?

Well, you know, God, God is perfectly moral. God is the, the source of morality. So you don't worry about that. Like, God, God has a plan and everything's gonna work out for you. right.

Jeff: Yeah, and it's like, it's like God moves in mysterious ways and, and you do not necessarily understand the inner workings. And, and [00:58:00] so, you know, you can't say that this was like a bad thing.

Dan Slimmon: yeah, so, so I think that's what he means. I think that's what, what Tarik Manor means when he says that that event contract prices on Kalshi, if they're accurate, can do us quite a bit of good. He means that investors will be able to use the odds that are generated to get more profit in the market.

That's, that's the good for society. Uh, it is someone who thinks this way good for society is a synonym for useful to investors.

Jeff: Mm-hmm. Mm-hmm. And specifically use useful to investors in Kalshi, or are they able to take these, these outputs from Kalshi and like apply them in other areas?

Dan Slimmon: why not? You can

Jeff: Oh, okay.

Dan Slimmon: that's market efficiency, baby. You can, you can take it any information you have. It's if all information should be public and if anybody has information they can use to trade and that makes better, that makes the markets better. nevermind that, that like having only free markets solve things leads to millions of people hungry and cold and dying in the streets, or [00:59:00] to the breakdown of democracy or to the scouring of life from the only habitable planet in the fucking galaxy. all must be good because it shook out of the markets, which are good. And, and, and even if we do accept that the scouring of life from Earth is maybe bad, something we shouldn't do, you know? Um, because it, it'll kill everyone. we still need to come up with a free market solution to it because the free market is the Alpha and the Omega and nothing is possible except through profit.

Jeff: Right, right, right. And then the free market, the free market says, like, we there, our, our response to that is like, invest in like space travel.

Dan Slimmon: Yeah. Right. We'll just get out of, get out there. Get

Jeff: Yeah.

Dan Slimmon: we'll scour this one. Yeah, right. yeah, so I, I think at the end of the day, this is, this free market philosophy is, is nothing really.

It's just the idea you arrive at when you're taric Mansour and you've been immersed in the social network of high finance where everybody's constantly telling you that becoming hyper rich is the moral purpose of your existence. anyway, [01:00:00] so Kalshi become regulated by the CFTC when, when so many prediction markets before them had failed? well, you can't deny that it took some grit. The founders say they called 65 lawyers in a single day trying to find someone, anyone who would tell them it wasn't hopeless. Everybody's like, they've been trying, people have been trying this since the 1980s. It doesn't fucking work. Um, you know, get, get a job. Uh, but eventually they did, they did find that person in Jeff Bandman, a formal, a former C-T-C-F-T-C official who told them that the regulatory environment was, was shifting. And they might have a chance, uh,

Jeff: What year was this?

Dan Slimmon: don't quote me on this, but probably like 2018.

Jeff: Oh, okay. Interesting,

Dan Slimmon: Yeah.

Jeff: interesting.

Dan Slimmon: first Trump presidency.

Jeff: yeah, yeah. Oh yeah. The, the regulatory environment is shifting.

Dan Slimmon: Hmm. That's a great way to put it, yeah, if only they had stopped after calling 64 lawyers. I mean, but unfortunately they called their 65th lawyer and he agreed to [01:01:00] help them through their approval process as their lawyer.

Jeff: Maybe, maybe he was actually lawyer number, like three and, and they just like left a message for him or something, and so like they spent the rest of their day calling these other lawyers and then he finally called them back and they were like, oh,

Dan Slimmon: I like to

Jeff: well.

Dan Slimmon: was lawyer 62 and he said, actually that could work. And they were like, okay, thanks. And they hung up and they called the next three lawyers and they're like, wait a second. that guy just say it would work? Which guy? Which guy said that?

Jeff: Yeah, like they were just on autopilot and they were just like, they were like, thank you. Goodbye. Thank you. Goodbye. Thank you, goodbye. And he was like, I love this idea. And they were like, thank you. Goodbye.

Dan Slimmon: you're right. Ah, fuck.

Jeff: Wait, what?

Dan Slimmon: yeah, so, so they had two, their strategy, their, their regulatory strategy was, was two phased, um, phase one. Convince, convince the C ft c that they were trustworthy by checking all the right boxes. Uh, they, they answered this like 23 item checklist, which was mostly about mundane things like, you know, do you have appropriate record keeping?

Can you guarantee [01:02:00] there'll always be enough money to pay out all the bets? Shit like that, that the CFTC worries about. And they were like, they filled out the, they were very diligent. They filled out the questionnaire. Um, they, they were, they were like, look, we're not poly market, we're not auger, we're we're serious financial professionals acting in good faith

Jeff: We're from MIT.

Dan Slimmon: we're, we went to MIT we're look at our windbreakers. so they, they passed the questionnaire and they moved on to phase two. Flood the agency with proposals for contract markets. in March of 2021, Kalshi sent the CFTC 30 proposed markets, everything from how many people will get vaccinated against COVID-19 to who will win best new artists at the Grammys, to will bees be placed on the endangered species list.

and, and the CFTC was just hilariously under prepared to review 30 proposals in a timely fashion. They were used to reviewing maybe like a handful of markets each year for, for each exchange. this was basically a [01:03:00] DOS attack against the federal regulators.

Jeff: Well, and did the regulators think that this was like very silly? Like were they, like, were they like actually like. Bees is like a very silly market.

Dan Slimmon: well, they have to, so they have to go through each one. these are not people with a sense of humor and they have to, they have to go through each one and say, okay, is this, be detrimental to Amer America if people were allowed to bet on this? And is it about terrorism, assassination, war, or gaming? Those are the

Jeff: interesting.

Dan Slimmon: things that they're legally allowed by their own rules to stop based on.

Jeff: Oh.

Dan Slimmon: but like, they have to, that means they have to decide. It takes a long time for each one to go through, like, okay, is it, would it, would this, could this be harmful? Let's write, let's figure out ways in which this could be manipulated and blah, blah, blah, blah, blah.

It takes a long time and they have to do lots of these.

Jeff: So they're having like very serious conversations about [01:04:00] like, like how bad the smell is in the Penn Station bathrooms or something like that.

Dan Slimmon: . Bees. They gotta learn, they gotta read the whole Wikipedia page on bees and

Jeff: They're like, I don't know, protect our pollinators. They're like, eh, it is no mo May. So

Dan Slimmon: exactly. so,

Jeff: back.

Dan Slimmon: Kalshi was kept submitting more and more requests, and the CFTC started like hemorrhaging staff and leadership because everybody was so demoralized and they were under the Trump administration who not give, did not want to help at all with this.

so Kalshi just kind of won by attrition. They just ran out the clock until they got a more, until like one of the, one of the five members of the panel, replaced by somebody more pro markets and, uh, and they, and they, they won, they were allowed to launch their business.

Jeff: That's crazy, man. Was that part of the strategy or was that just sort of like the nature of the platform that they were trying to [01:05:00] build, that they were just gonna have this like, you know this, I mean, yeah. I mean, the nature of the platform that they were trying to build was that they were gonna have like a billion different little markets anyways, so I don't know, maybe it just all worked out.

Dan Slimmon: think their strategy, I think. I think it was a very smart strategy. I think Jeff, Jeff Bandman came up with a very smart strategy here, um, because he had worked at the c ft C before, so he knew what their, he knew their weaknesses. He knew that if they got, oh, you guys want to do this many markets?

Okay, let, that's great. So we don't tell them that for the first part. And then when they ask for our submissions, we'll submit like a billion of 'em and they won't be able to handle it.

Jeff: Jeff man,

Dan Slimmon: But didn't we, didn't we have a bad Jeff on the last one? Oh, no. We had my room. We had, we had my

Jeff: Jeff was, Jeff was the roommate who like helped you move your TV and like, and like the TV fell over.

Dan Slimmon: a one for three, uh, on this podcast. But you're the, you're the one, you're the good, Jeff.

Jeff: I appreciate that, that, that means a lot to me. I'm trying, I'm, I'm, I'm out here. I'm out here trying.

Dan Slimmon: Um, they did not [01:06:00] submit any political bets for approval during phase, during either of these phases, um, because they were trying to get regulatory approval and they thought that might be a red line for the CFTC, to have like betting on the congressional election. So they did not, they didn't ask about any of those.

Jeff: Yeah. They're like, this is fun stuff. It's like birthdays and kittens and,

Dan Slimmon: Who could object to betting on whether Kanye Westell released a new album this

Jeff: yeah. Yeah. What a, what a harmless bet.

Dan Slimmon: Right. Then immediately they started, as soon as they got approval, they launched their app and they started taking, started trying to list election result contracts. which, which the C ft tried to CFTC tried to block them on because they were like, what the fuck?

You guys said you weren't gonna take bets on politics and now you're taking bets on politics. and so Kalshi sued the CFTC, on the basis that like, by their own rules, they could only, they only had certain things they could block markets on, and they, they hadn't proved that betting on elections [01:07:00] was contrary to the public interest, was the argument they made. Um, and they won.

Jeff: Um, how sad

Dan Slimmon: I know, I know.

Jeff: was that? Was that also Jeff? Was that another, another Jeff Bandman joint.

Dan Slimmon: them for that. It might have been Jeff. Um, I don't know if he represented them for that lawsuit. but they had, they had a shitload of money to hire lawyers after they got, after they got approval, they got investments from like fucking everybody.

Jeff: Mm.

Dan Slimmon: they could hire as many lawyers as they wanted.

Jeff: They're like, who's gonna be in the next Y Combinator? Like cohort or whatever.

Dan Slimmon: Exactly. They

Jeff: How

Dan Slimmon: actually, they, but they didn't do the whole Y Combinator thing, but they, they, they did a project for Y Combinator, which is when they called all those lawyers. anyway, so, starting in 2024, August, 2024, you could bet on political elections on Kalshi. And, uh, it was just in time for the, the presidential election.

So, [01:08:00] fantastic. Great. Thank you.

Jeff: That's, that's crazy. So they, I mean, they really were in the right place at the right time. Like, like that was, I mean, whatever. Yeah. You, I guess you can't, you can't say these, these guys aren't smart. Yeah.

Dan Slimmon: They're smart. Um, they're, yeah, absolutely. I think Luana Lopez la is smart. I think Jeff Bandman is smart. I think Tarek Mansour, appeals to a certain kind of finance guy. so yeah. So they're, they're taking bets on politics, but like, ultimately, what Right? Do I really care if a bunch of people on this dumb app can bet about who's gonna be president or whether Taylor Swift is gonna win her hundredth Grammy? Does anyone care? Well, some people care. 2024, right after Kalshi started taking political event trades. Tarek Mansour did this a MA on Reddit. it, it was like basically, you know, Hey, hey Reddit. Uh, my company just legalized trading on elections, asked me anything. and this is a fun read [01:09:00] because it was absolutely humiliating.

post has zero points on Reddit and two poop awards. Um, some choice replies include, do you think you would be capable of spending the same amount of time and energy as it takes to run Kalshi on doing something positive for the world you live

Jeff: Oh, man,

Dan Slimmon: yes, why not do that instead? And, and then also, um, did you run the idea of this a MA buy anyone before you did it? Because if you did, you should fire them. Um.

Jeff: that's funny. I mean, that, that's not, that's not honestly the reaction that I expected. 'cause like, like I feel like, I feel like there's, I feel like the kind of people who are using Kalshi and maybe who are using Reddit are people who think that their opinion is really important. And it's kinda like, and it's kinda like.

In a weird roundabout way, like if you're using Kalshi, you're getting like paid for your opinion sort of. Um, but, but yeah. What was the, I guess, I guess, I guess I'm a little surprised that, [01:10:00] that people on Reddit weren't more like psyched about it.

Dan Slimmon: mean, if you went on the crypto Reddit right, or

Jeff: Yeah.

Dan Slimmon: Reddit. Reddit or something, or the finance Reddit,

Jeff: Or like the stock trading ones.

Dan Slimmon: I, I, I think, um, this may be naive. I think the culture of Reddit has, has matured quite a

Jeff: Oh.

Dan Slimmon: in the last 10 years. I think people on the general Reddits, like the a MA sub Reddit, um, tend to be in the aggregate a lot more, um, reasonable than say, people posting market ideas on Kalshi. Um, but you know, obviously there's a lot of ra bad people being radicalized on Reddit too.

Jeff: But yeah. Okay. But, but this, but this, but this particular audience was a bit more mellow.

Dan Slimmon: they were very mad

Jeff: Yeah.

Dan Slimmon: about the potential harms to democracy, which is fair. Uh, you know, it's easy to imagine the risks if, if people can bet large sums of money on who will be the next president. Now you've got a group of people with a large financial incentive to make sure their candidate wins. [01:11:00] Kalshi has hired Donald Trump Jr. As a strategic advisor, whatever that means. So, so, so Donald Trump Jr. Can broadcast to the MAGA people, uh, hey, place your Trump bets on Kalshi, you know, Trump's go into the moon and, and then that artificially pumps up the price of the Trump will win contracts possibly by a major amount if there's not much trading volume, um,

Jeff: feeds into that narrative.

Dan Slimmon: which just feeds into the narrative, right?

But the, but the, but ultimately, like if the markets are fair, then, Maybe Kalshi has briefly inflated odds for a third Trump term. Um, but, but what's the harm in that? It'll, it'll, it'll recalibrate. well, I'll tell you what the harm is in that, because December, the major business news outlet, CNBC signed a deal where they're gonna start presenting Kalshis contract prices on TV like, alongside the news. So if there's a news story about the presidential election, they might have like a little Chiron that pops up [01:12:00] that's like is trading at 55% on Kalshi or whatever. this is so fucking

Jeff: I don't like that.

Dan Slimmon: shit, this is bad.

Jeff: Yeah, I, I do not, I do not want that.

Dan Slimmon: we're, we're just not ready. Like, we're never

Jeff: Okay.

Dan Slimmon: the, the, the law. Our laws in this country are never ready for the kind of shit that these people come up with. Um, like that

Jeff: Who could have predicted.

Dan Slimmon: right?

Jeff: yeah, yeah.

Dan Slimmon: Uh, but it's not, and it's

Jeff: There's some,

Dan Slimmon: Well, go ahead.

Jeff: well, there's something, there's something crazy that I'm just like, I'm just like, so are we getting to this point where you basically have to pay to like, participate? Like, like it's like, it's like, so you have to pay to participate in democracy because it's like also now there's like this like market force that's like driving the elections, actually.

Um, and it does make me, I mean, it does make me think about like Super pacs and stuff like that as well, but like, but [01:13:00] like, you know, if, if it's like, it's like if Kalshi is like a democratizing force for throwing money at politics. Which just feels so gross because it's like, then, then, you know, if you're not spending money on Kalshi, are you, is your candidate just like guaranteed to lose?

Like that's, that's weird.

Dan Slimmon: it's weird and it's terrifying.

Jeff: Yeah. I don't, I don't, I don't like the idea of like, of like lending legitimacy to the, to the, to the platform by, by presenting it. I mean, I, any, any, like, when people just started putting tweets on the news in general, I mean that WI think we were already pretty, pretty, pretty far gone. But yeah, that's, that feels, that feels bad.

Dan Slimmon: Yeah, we were al we were already cooked, but now we're, now we're getting fucking roasted to a crisp. the CNBC thing is a, is a, is not just an afterthought. It's part, it's central to kashi's [01:14:00] strategy. In an interview on the crypto podcast empire, uh, just, just last year in October, Tarik Mansour said this Maybe CNN and Fox don't need to be polar opposite of every single issue. Maybe. Maybe climate change is not percent real or. 40% next.

Jeff: It sounds like he really doesn't believe in climate change.

Dan Slimmon: He doesn't really, he doesn't, he believes in nothing. yeah.

Jeff: Oh, true. Right, right, right. Because, because you're, why I have beliefs. When you're perfectly rational,

Dan Slimmon: Yeah.

Jeff: taking, you're taking the outputs from the markets, and that's what's driving your decision making.

Dan Slimmon: They wanna change the nature of truth, right? They want to create an environment where nothing is. Real or fake anymore. Nothing is true or false anymore. It's all just priced differently. And we have odds based on the prices, is, which is why both Trump administrations have worked so [01:15:00] hard to make Kalshi into a legitimate regulated marketplace.

The, the apparent, hard-nosed mathematical rigor of the markets will, will grant Cal's odds, an aura of inevitable truth, which will make Kalshi into a very powerful tool for fascism. Um, but to offer something in, in closing, in the way of hope. Uh, let's talk about what's standing in Kalshis way in its quest to financialize everything people care about? so first of all, the biggest risk to Kalshi as I see it, is that Tarik Mansour does so much finance math, that his head explodes, you know, his doctors have been telling him, stop, you're too good at finance.

Please stop doing calculations. It's gonna explode your head and kill everyone within two city blocks. he just won't listen. So condolences in advance to dark man. So neighbors. so that's one. Uh, but on the off chance Tarik Minur head does not explode. Uh, Kalshi has a lot of competition to worry about, ma, mainly the big sports betting apps, uh, FanDuel and [01:16:00] DraftKings because a huge portion of Cal's revenue, like I said, still comes from sports betting. Uh, but those aren't, uh, so right. So they, he's, they're competing, competing with those guys. But those aren't Kalshis own com only competition because now Kalshi has proven you can start a prediction market and the CFTC won't do shit about it. So now FanDuel and DraftKings are also moving into prediction markets and so are tons of other companies.

In fact, one of those companies is Donald Trump's Social Network Truth Social, which is planning to launch Truth Predict through a partnership with crypto.com.

they're all cannibalizing each other's liquidity. Right? And,

Jeff: Uh,

Dan Slimmon: so for any of these to work, one of them needs to basically win,

Jeff: Yeah. Yeah. Yeah.

Dan Slimmon: Um, and, and so far, uh, that has not happened with the, with the betting apps, so, or, or the, or the exchanges. So, you know, maybe that's, maybe that's a little hopeful. the,

Jeff: Good grief.

Dan Slimmon: um, uh, one, another bright [01:17:00] spot is that Kalshi is currently drowning in lawsuits. Um, one of the biggest is a class action that's been proposed in New York Federal Court, which alleges that CCHI has been falsely advertising that it has better odds than the betting apps. because like, they don't, they don't charge a vig and, and it's, it's, there's no, you're not betting against the house, right?

There's no house,

Jeff: Yeah. Yeah. But how can they, how can they even claim that they have better odds if the bets are completely outta their control? Like, if it's just like, if it just, if it just, if it's this pure, rational

Dan Slimmon: Well, fun fact, the bets are not completely out of their control. They

Jeff: whoa.

Dan Slimmon: they have a subsid, they have a subsidiary called Kalshi X that is a, that they acts as a market maker in their markets. When they get a new market. You know, it's independent.

It's not, it's not profitable. there's a Chinese wall between Kalshi and Kalshi X, supposedly, but the, the exchange comes in and they say. Uh, alright then nobody, nobody has any of these contracts. [01:18:00] So we're gonna facilitate transactions. They're gonna set a buy price and a sell price for these contracts.

And then anybody who wants to buy or sell these can come through us for those prices and get, and, and that creates some sort of trading activity in the market. And they can make a profit by setting the, setting the buy and sell prices a spread, um, so that they can like, use their better knowledge to make a profit on that.

Jeff: Right, because you can't, you can't, you have to start it somewhere. You have to, you can't, you can't just come in and say like, ah, 50 50. Um, although maybe that would be the most rational way to approach to approach anything.

Dan Slimmon: so if you, if you wanna know, if you wanna know how, how they can guarantee that they have better odds than their competitors, you would have to ask Kashi's lawyers or just wait until this suit lawsuit resolves. And you can read the, read the papers on Pacer.

Jeff: Are you, are you a member of the [01:19:00] class action lawsuit?

Dan Slimmon: I, I don't live in New York.

Oh, maybe I, I think it's actually a national class action. So maybe I should, I I haven't lost any money on Kalshi yet. I haven't, I,

Jeff: Oh, brag.

Dan Slimmon: I.

Jeff: I'm humble. Brag. You're just like, nah, I'm doing pretty,

Dan Slimmon: on it.

Jeff: I'm doing pretty awesome actually.

Dan Slimmon: Yeah, I'm, I'm, I'm, I'm not in the red. I, um, I was gonna put a thousand bucks on, uh, on whether Tarek men will be charged with financial crimes by 2031, but nobody took me up on it.

Uh, so there's another lawsuit. Massachusetts is suing Kalshi on the grounds that Kalshi violates their state gambling laws, because you can trade on Kalshi if you're over 18, but Massachusetts doesn't let you gamble unless you're over 21.

Jeff: Oh.

Dan Slimmon: Um, and, and this is just the tip of the iceberg. There's, there are legal actions against Kalshi in at least nine states, including two from Native American tribes. Uh, you know, so that's, so that's good. Uh, but, you know, you can win lawsuits. Maybe they, maybe they win or settle all these lawsuits [01:20:00] without, without too much damage. They got a lot of lawyers. Um, so I think the biggest problem, the big underlying problem in the prediction market, business model is. about liquidity. Um, in, in order for Kalshi to work, it needs a wide variety of markets, right? Because people need to be able to bet on things. If they're gonna go to Kalshi, they need to be able to bet on lots of things that they, that they care about. And people care about different things, so they need variety. Um, but the more markets they create, the less money is available to be traded in each market.

'cause people's money is locked up in positions, in other markets. for example, if, if too much money of their, too much of their users' money is locked up in sports bets, um, then that drains the liquidity from their election markets, because election markets and elections happen much less often than football games, right?

So, and this gets worse for them as they create more markets, unless their user base grows faster than they can create markets. And even then it can only do that for so long. Um, so [01:21:00] I, I predict if I were to bet on something, I predict that this will be. This liquidity issue will be a huge problem for Kalshi and hopefully an insurmountable one.

Jeff: Yeah, like, like the sort of like market fragmentation. It's like, it's like, it's like my attention, my attention is, is, is spread too thin among all these different markets. And, but I think, I think, I mean, I think there's a way around it, which is just to, to drive to, to sort of almost like reconsolidate them, like, like based on like, okay, we've identified like almost like trending topics on Twitter or something like that.

It's like, these are the hot markets and, and the sort of like, sort of like. Having those markets attract most of the liquidity. Um,

Dan Slimmon: Yes. And they're doing that. Um, they're,

Jeff: I'm gonna,

Dan Slimmon: doing that, but both their competition and their other markets are, um, you know, if they're, if they're launching markets every day, um, [01:22:00] then they're gonna end up with like either ghost town of 90%, um, markets with no, where there's no trading going on, or, um, the inability to like, maintain the variety of markets that, that brings people to the platform.

Jeff: yes. Yeah, that's, that's, that's interesting.

Dan Slimmon: That's my hope. But, you know, maybe they'll, maybe, maybe, maybe they won't. Maybe, maybe it'll, everything will work out for these two and, um, they'll, they'll become the world's first hyper billionaires. Uh,

Jeff: But I wouldn't bet on it.

Dan Slimmon: ho ho. Um, well that's 'cause you're a coward. Jeff, I,

Jeff: Maybe. So.

Dan Slimmon: that's all I know about Kalshi. Um, so I hope you're, you're feeling good about the world of high finance,

Jeff: Yeah, I mean, I, I think, I think that's in, I think it's, it's sounds insane to me. It's, uh, very, you know, it sounds, it sounds like just ripe for [01:23:00] corruption. Um, I, I am, I am very curious about like, the granularity of, of these markets. I think that's, I think that's kind of, that, that's kind of fun. Um, but, uh, yeah, I don't, I don't know if I'm gonna sign up for a Kalshi account.

Dan Slimmon: Is a fun idea. It, it's just, um, it, you know, in, in, in the, in the system in which our society operates, it's a very dangerous idea also, uh,

Jeff: do they have horse racing in Connecticut?

Dan Slimmon: um, I. I am not sure. They're used to, there's a place called Sports Haven here in New Haven that has a picture of a horse on it.

Jeff: Ooh.

Dan Slimmon: I don't know, I think it's closed down.

Jeff: Um, 'cause I've been to, I've been to Saratoga, uh, a couple times. Um, I, I, I find it somewhat depressing, but, uh, but you know, it is, it is exciting. There's definitely a lot of people, uh, throwing a lot of money around.[01:24:00]

Dan Slimmon: Yep. And, and, uh, that's what makes the world go round. So, yeah. So thanks for, thanks for being on the podcast, Jeff. You're a wonderful guest as always. Um, you're willing to meet me in these, uh, in these complex and depressing topics and just fucking get, uh, get bummed out together. So thank you. Thank you so much.

Jeff: Oh, it was my pleasure.

Dan Slimmon: thanks everybody for listening. I, uh, appreciate you all or anyone you know has worked at, uh, stop and Shop Grocery Stores or Woodman's or Giant Stores, since 2018, I would love to talk to you for an upcoming episode that I'm writing. no, no spoilers, but uh, but please, please reach out dan@techblows.net. Alright. Um, that's it. Thanks everybody. Uh, thanks for listening to Technology Blows. We will see you next week uh, when we talk about cookies. Uh, so look forward to that. See you then.

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