Buy Insurance -- Bet Against Yourself

For one reason, it is at least possible that national drug prohibition could end during a second term of Obama where that is more or less impossible under a Republic executive.

I doubt there is much difference at all. Prop 19 was a lot more modest than ending national drug prohibition, yet the White House declared it would not respect state law, and would continue raiding pot dispensaries (if 19 passed). Admittedly, it is possible that Obama is secretly an anti-prohibitionist, and that he has just been acting like the exact opposite for political reasons. But that applies equally to the Republicans. And, of course, since we don't yet know who the republican candidate will be, there is some small chance that a libertarian-leaning republican will win, and actually be somewhat anti-prohibition.

Of course, this is all overwhelmed by the fact that the president's effect on kratom legality is trivial (compared to Congress, FDA, other bureaus, state legislatures, local governments, etc.) Basically, worrying about who holds the white house is kinda silly when you consider how widely distributed regulating power really is.

Eventually the debate will be over whether it should be Schedule 1, or whether there are acceptable medical uses for it.

This is actually one of the best long term ways for my business to wind down in 10-15 years.

Kratom has a very obvious medical use. It's an opioid and there is evidence that it has fewer side effects than morphine in mice (less constipation, and less "rewarding action" (euphoria) per unit of analgesia).

There is a patent pending for all possible derivatives of kratom: http://appft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PG01&p=1&u=/netahtml/PTO/srchnum.html&r=1&f=G&l=50&s1=%2220090221623%22.PGNR.&OS=DN/20090221623&RS=DN/20090221623

I think the debate will likely be about whether kratom derivatives should be schedule 2 or schedule 4.

It's a pity that their supplied information is wrong, is there other way?

They have a somewhat involved way of accepting credit/debit card (involves you mailing or faxing bills or something, IIRC), and I think they also take money orders & cashier's checks. But personal check seemed the easiest method for me, all in all.

Cheques aren't only in the U.S., but they do seem to be rare in most of Europe any more. However, as long as your bank is willing to make a cashier's cheque for you, then it looks like Intrade can use it.

According to the post: "the best-informed actors in the market will make their money from the least-informed actors". If you bet without paying any attention to the most likely outcome, you are more likely to be among the least-informed actors - and so will lose money on top of the transaction charges for playing.

Insurance doesn't appeal to everyone. Many of my countrymen regularly play the National Lottery - increasing their risk-taking, not minimising it. Basically, insurance people always take their cut - which makes insurers poorer, on average. Minimising your risks is an especially poor strategy for males.

This post is trying to sell readers on insurance. However, I don't want insurance, thank you!

In fact any way that you can conclude an Obama victory from your liking Obama is obviously irrational.

Unless of course you are the CEO of a company with a large contract to manufacture computerized voting machines. In that circumstance, you could also conclude a not-Obama victory if you don't like Obama.

Okay, my thinking is basically that the insurance mechanism's predicted effects feed back to the legislature-level, not necessarily the outlaw-level (though it can do that too -- see the end of this comment).

In other words, in anticipation of this insurance-like reallocation, a legislature will find most of its potential laws less appealing. For example, if they want to ban something, they are doing it to reward a politically-powerful group and punish one that is less so. They want, e.g. "lots of wodget-sellers jailed so that honorable wodget-avoiders don't have to deal with the wodget menace". With the insurance mechanism, however, they can't get that by itself; at best, they can get that plus a large transfer of wealth from the "good guys" to the "bad guys" -- which is much less politically appealing.

Even if it doesn't have that influence on the legislature, and they persist in such bans, the general effect of the insurance (transfer of financial resources from those supporting [in this case] the ban to those opposing it) may not mean that the sellers of the banned product "take the money and run". It could just as well mean they can raise better barriers against law enforcement (like what happened with alcohol dealers under prohibition, who could make enough to disrupt the laws against them without them being overturned), allowing them to continue in their work.

So perhaps "impotent" is an exaggeration, but it definitely weakens the power of the legislature through several effects (legislators playing the prediction markets, political unattractiveness of enriching the target of the laws, and the shift in financial power each law brings).

I think Clippy refers to everyone as "User:[username]", but since he refers to Kevin especially often, that's what's most remembered.

This.

That with a link on first mention would do the trick.

That's only true for cases where the insured has significant influence over whether the insured event happens. That's not the case for legislation, unless you're an influential legislator or lobbyist; and, to the extent that moral hazards cause a problem there, it still works to make the legislature impotent (since they can no longer trust each other not to use their votes to game the prediction market).

And I think you've significantly overstated the impact of moral hazard problems: there are numerous instances of insurance contracts where the insured has significant control over whether the insurer must pay out -- the solution is to make sure the payout doesn't fully return the insured to their indifference curve (e.g. through deductibles), not for the market to fail to exist. Otherwise, how could there even be liability insurance?

EDIT: Easter egg: see if you can find an internet article by me arguing the opposite of what I've said here. Don't embarrass me further by posting it when you find it.

This is reminding me of The Quants, and not in a good way.

It's a book about some very smart people who thought they could beat the stock market by making large bets on what they thought would go up and smaller bets on what they thought would happen if the first bet was wrong.

They didn't have enough experience to realize that both their bets could go wrong.

I think the second bets were apt to involve margins.

Find an outcome that would make you financially miserable, and bet on it such that if it comes to pass you won't be financially miserable.

Financially wasn't the missing nuance. In fact this works in principle even for causes of non-financial misery. But the feature that is needed is risk aversion. Or a non-linear utility to money relationship. Anything that makes you care more about a winning bet than a losing bet of the same amount. Caring (potential misery) is actually not directly relevant.

The Eye of Sauron might turn to face you, but I think it will be more a random thing than something predictable by a change in administration.

How pessimistic are you generally?

It wouldn't surprise me if there's a bias for people to worry about things going badly for themselves (high stakes), and for them to be reassuring about things going badly for other people (improve the emotional atmosphere). This doesn't say anything about who's right.

What do other kratom sellers seem to think?

Inside view vs outside view, probably. You are looking at the myriad ways in which the system could absentmindedly crush your business; other people are extrapolating from their knowledge of previous similar cases.

Possibly it is just social convention. You have to be pessimistic about your business because it's rude to gloat, and other people have to be optimistic about your business because it's a form of well-wishing.

His but is fine.

blushes

Thanks, that's always nice to hear. =)

Decisions should be made not on absolute badness or goodness of any given outcome, but on comparative goodness of alternative outcomes following from alternative possible decisions.