Finance Roundtable

Finance Roundtable

The market forecasters and personal finance blogs complement the Economics Roundtable.

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Risk Markets and Politics

Jason Ruspini


April 30, 2018, 8:10 pm, 1849733
Now that the CFTC has effectively begun regulating event derivatives, what obstacles might lie in the way of a DCM-hosted election market? Is there now greater ambiguity between futures trading and legal gambling? After all, couldn't a game of roulette be described as an event option? (I see ...


April 30, 2018, 8:10 pm, 1849734
This month continues to see consensus build that "prediction markets" ought to be regulated by the Commodity Futures Trading Commission. It is quite possible that the CFTC will approve CME's Credit Event Futures on Wednesday, signaling the legal way ahead for other "event futures" in the US.


April 30, 2018, 8:10 pm, 1849735
As more prediction market enthusiasts in the U.S. reconcile themselves with eventual CFTC regulation, the Poker Players Alliance is making a bid to join the ranks of the privileged exemptions to UIGEA. Prediction markets have simply not been profitable enough to support a national lobby ...


April 30, 2018, 8:10 pm, 1849736
In the wake of the Neteller arrests this week, alternate currencies are unfortunately a bit less interesting. While the DOJ has not yet moved against gambling in virtual worlds such as Second Life, it is only a matter of time now. When the UIGEA ...


April 30, 2018, 8:10 pm, 1849732
The libertarian paradox whereby free markets spur wealth creation which in turn supports the growth of the state suggests a potential issue with tax futures. Tax futures are hedging markets that predict future tax rates and could trade alongside more specific policy event derivatives. ...


April 30, 2018, 8:10 pm, 1849731
The essential purpose here is to advance the ideas of public policy markets and tax futures. To this end, we can once again show that such markets help to address well-known problems that arise in government.

Consider the typical "special interest" problem as described in public choice economics. ...


April 30, 2018, 8:10 pm, 1849728
Last Month, Marc Groz of Topos Capital graciously invited me to deliver a guest lecture to his class at NYU. The talk, "Measured Enthusiasm for Prediction Markets", was given to about 20 students. It introduced prediction and decision markets, then went off into tax and policy markets. ...


April 30, 2018, 8:10 pm, 1849729
In February, I appeared on BNN, Canada's business channel, to discuss the tax futures that had recently launched on Intrade.

One clarification: after some more careful research, the predominant factor test technically does not hold in New York State, although small-ante gambling participants are rarely prosecuted.


April 30, 2018, 8:10 pm, 1849730
I am very pleased to announce the world's first explicit tax futures on Intrade. I thank John Delaney and everyone there for their help and enthusiasm in getting these off the ground.

The contracts will forecast the highest marginal single-filer federal tax rates for ...


April 30, 2018, 8:10 pm, 1849727
Insofar as event markets are within the CFTC's jurisdiction, they would likely be approved as "excluded commodities". Here is the relevant part of the definition within the Commodity Exchange Act:

(iv) an occurrence, extent of an occurrence, or contingency (other than a change in the price, rate, value, ...