This will not end well.
So the only rational course of action is to jump in with both feet and take inspiration from the first Commissioner of the SEC:
“Tommy, it's so easy to make money in the market we'd better get in
before they pass a law against it,” he told one friend, Tom Campbell.
—Joseph P. Kennedy to one of his Harvard buddies*
From PYMNTS.com, January 15:
Goldman Sachs is looking into how it might get involved in prediction markets, Chairman and CEO David Solomon said Thursday (Jan. 15).
Asked about this and other innovations by an analyst during the company’s earnings call,
Solomon said that prediction markets are “super interesting,” that he
met with the leaders of two big companies in that space over the last
two weeks to learn more, and that people at Goldman Sachs are spending
time with those companies.
“When you think about some of these activities, particularly when you look at some of the ones that are CFTC [Commodity Futures Trading Commission]
regulated, they look like derivative contract activities, and so I can
certainly see opportunities where those cross into our business, and
we’re very focused on understanding that, understanding the regulatory
structure that’s going to develop around that, seeing where there are
opportunities for us to have capabilities or to partner to serve our
clients around these,” Solomon said during the call.
Solomon added that these discussions are in their early stages but that the company is spending a lot of time on this topic.
Seeking Alpha, which flagged Solomon’s comments, said in a Thursday report that if Goldman Sachs were to get involved with prediction markets, it would be in deeper competition with companies such as Robinhood Markets.
PYMNTS reported in October that “the prediction market moment is here” and that its momentum is underpinned by several forces.
One of those forces is a market
architecture that allows for a far broader range of products, including
finance, culture, politics, entertainment, weather and sports, all packaged as yes/no contracts or binary outcomes. Another is the entry of major platforms, which signals scale.
Robinhood Chairman and CEO Vlad Tenev said in November that since launching prediction markets on its platform in 2024, the company had doubled its volume of contracts each quarter. During the third quarter, Robinhood’s number of total event contracts traded reached 2.3 billion, Tenev said....
....MUCH MORE
*That was in 1922 when, trading on
inside material non-public information that Henry Ford
was going to buy Pond Creek Coal Company. Kennedy ran $24,000 to $699,000. Kennedy's tipster was his boss at Hayden Stone, Galen Stone, who was also Chairman of Pond Creek Coal.
Much later Mr. Kennedy helped organize what I believe is the largest pump-n-dump in history, the Radio pool of 1929. From our June '07 post "
Robert Kennedy Jr., Global Warming and Wall Street"
: In
1929 he and some other rascals got together to run the .com of the day,
Radio Corporation of America.
What a run it was! The pool picked up $5 million in ten days. My BLS inflation calculator says that's a bit over $60 million today (although the PBS special linked below says $100 million).
When the question arose as to who should manage the pool the answer was easy. Who better than the specialist in the stock, Michael J. Meehan! PBS did a good job on their show "The Crash of 1929", even interviewing Meehan's grandson. Here are some of my links, Senate Hearings (4 page PDF), 1948 SEC chief counsel memo on the Act of '33 (5 page PDF), Colliers story on the early SEC.
In 1934 Joseph Kennedy was appointed the first commissioner of the S.E.C.
