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Jason Goldberg Ⓜ️ 💜
@betashop.eth
Last week I posted about the massive amounts of $$ going into polymarket trump bets, and asked why? This article has a fascinating economic theory take on it: If you believe in u.s. equities (10% ARR) betting big on trump in prediction markets is a massive hedge against his potential victory. Say what? If Kamala wins the u.s. likely stays in the same course as the last 100 years. Stock market goes up as it always does over the long term. If trump wins, this could be the big one. Shock to the system. Massive tariffs and changes to tax code. Mass deportations. Isolationism. Disruption of the bond market. Stock market goes down and continues to go down for years. So betting big on trump winning is a hedge against that. https://www.nytimes.com/2024/10/27/business/market-history-elections-disasters.html?smid=nytcore-ios-share&referringSource=articleShare
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Nicklas
@mr-silverback
yeah like it was going down last time he was in office. just down down down
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Jason Goldberg Ⓜ️ 💜
@betashop.eth
Last time he didn’t have such policy proposals … markets could be taking him on his word, or hedging against his keeping his word Let’s say you have $1b in equities. You believe with Kamala that will likely go up by 10% next year. But if trump wins you forecast it could go down by 10%. Might not. But could if he pursues his stated policies. So you bet $50m and you are up $50m on your forecast if K wins and down $50m if T wins rather than down $100m based on your models
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Nicklas
@mr-silverback
do you really believe the market wouldnt be down 30% due to uncertainty if anyone with any money believed that article even an iota ?
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Jason Goldberg Ⓜ️ 💜
@betashop.eth
I’m not saying I believe anything. Just sharing an interesting analysis that folks may not have considered. I find it fascinating from an economic theory standpoint. Is it correct? No idea.
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Nicklas
@mr-silverback
there are quality instruments designed to hedge risks. Betting on polymarket isnt probably a real one is what I am saying. More likely is people bet there to make gambling bets like the celtics winning or dodgers winning the world series. Insider polls all point to trump so insiders with an edge would vote that way
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