Prediction markets covered in the NYT podcast “Hard Fork”

I work at Manifold. I think it's notable that these two experienced tech journalists have had lots of repeated exposure to the idea of prediction markets, but it sounds like they only sort of figured out the basic concept?

• In the discussion on insider trading, nobody mentions the extremely obvious point, which is that the prediction market is trying to incentivize the people with private information (maybe "insider" information, or maybe just something they haven't said out loud) to publicize what they know. If Casey actually cares about whether Linda Yaccarino will be the CEO of X next year, he should be excited by the idea that some guy at Twitter will come and insider trade in his market. But they never said anything like this -- they just said that maybe the market was supposed to very generally aggregate the wisdom of crowds.

• It also sounds like they don't really understand why it would aggregate the wisdom of crowds better than, for example, a poll. Casey was like "well, when people have a Twitter poll, then partisans stuff the ballot box", implying that a similar result would be likely to happen with a prediction market on who will be the next Speaker, ignoring the obvious point that it costs a bunch of money to "stuff the ballot box" on a prediction market that isn't a self-fulfilling prophecy.

• Perhaps relatedly, it sounded like Kevin and/or Casey had absolutely no clue how a prediction market actually works, numerically. At the end when they were making the market, Casey wasn't like "OK, bet it to 25%, since I think that's the chance." Instead Kevin was like "OK, I'll bet 100 mana," and then they were like "Huh, how about that, now it says 10%. Oops, I bet 100 more and now it says 8%." It seems like they are totally missing the core concept that the point of the prediction market is trying to specifically incentivize you to move the market to the probability you believe, which is like the first thing I ever learned about prediction markets in my life?

In the end, their feelings about prediction markets seemed totally vague and vibes-based. On the one hand, the wisdom of crowds has good vibes. On the other hand, insider trading and crypto/transactionalization of everyday things have bad vibes. On the gripping hand, gambling with play money is cute and harmless. Therefore, prediction markets are a land of contrasts.

My takeaway is that prediction markets are harder to understand than I think and I am not sure what to do about that.