Trading terrorism futures - a good idea?

These guys seem to think so. Seems to me it's not doable since there are just too many variables. Aside from the fact it just seems too creepy. How can this possibly be a good idea?

http://www.washingtonpost.com/wp-dyn/articles/A5696-2003Jul30.html


>By Justin Wolfers and Eric Zitzewitz
>Thursday, July 31, 2003; Page A19
>
>Betting on human lives seems ethically questionable. Yet if it helps save
>lives, surely the moral questions are mitigated. Not so, according to those
>in Congress (and elsewhere) who created such a furor this week over a
>planned Pentagon program to project geopolitical risks that the program was
>quickly shut down. The plan was to use markets to "price" such risks, and
>it was quickly dubbed a "terrorism futures market." Unfortunately, in hastily
>ending this program, the government may be closing the door on an important
>source of information and a promising avenue for research.

more-

MzPip
:dem:

Using a market to predict adverse events just seems so incredibly wrong. Some of the ideas these market anarchists are coming up with are really out there.

If it works, I think it would be more because of a self-fulfilling prophecy instead of anything else.

But one thing I don't want is for terrorism to be front and center in the national consciousness for the rest of my life. I don't want to ever see a terror ticker crawl on CNN -- Orlando is showing strong gains with heavy trading in biotoxins.

I'm going to place $500K bet that Tony Blair is going to get fragged in the next six months. Because the bet is so big, a lot of other idiots think there is something to it, so they buy in. Soon that Frag-Tony price goes sky high with bigger fools wanting to "get in".

Now you have a big pool of people with a vested interest, no?

Chances are I'll get paid off -- someone desperate (a later investor) does something stupid to save his investment.

Apart from the vested interest, the chances of people with inside knowledge betting WITH THE GOVERNMENT that a terrorist attack is going to happen is extremely unlikely and WILL NOT save any lives.

Two scenarios...

1) Osama Bin Laden plans to blow up target A...so he puts a few thousand on "Osama plans to blow up target B" and lets it be known that he bet on target B...the money (and the security) looks at target B and he's free to go get target A.

2) Somebody thinks it's worth betting that a certain unelected corrupt drunk is going to be assassinated...somebody else also thinks that's likely....soon the prospect is attractive enough to investors that it guarantees someone will invest in a hit man to cash in.....

i sure many things that never would have happened WOULD have happened because of greedy, sick investors paying people off.

There was a popular thing going on in French South Louisiana, called the "temptine" (sp phonetically).

Three or four guys would get together and buy a life insurance policy of each of themselves and signed a contract that said that the last person alive would collect all the insurance policy proceeds from everyone who died before.

It was outlawed after it was discovered that the death rate among those who signed up for these little games was quite a bit higher than the norm.......

Same thinking should have gone on here. You could bet on an outcome and then, if you had enough money at stake, pay someone to make it happen.

Incredibly stupid and idiotic idea from some bonehead who is not connected to reality and has not a lick of common sense.

been making the bets would have also had some control in what happened... and to receive a payout on top of it...

its all disgusting

that was made in this article was that Futures Trading in Florida Orange juice more accurately predicted the Florida weather than weathermen. How could that possibly work? Lucky guesses?

Legitimate futures trading is based on known variables. There seems to be too many variables to make this a legitimate souce of terrorism prediction.

MzPip
:dem: