Someone at the Pentagon read Shockwave Rider over the weekend

Tim May timcmay at
Tue Jul 29 16:17:06 PDT 2003

On Tuesday, July 29, 2003, at 03:24  PM, Steve Schear wrote:

> At 16:20 2003-07-29 -0700, John Young wrote:
>> Tim May wrote:
>> >Yes, a bunch of "ideas futures" markets have existed for nearly a
>> >decade. An acquaintance of mine, Robin Hanson, was actively promoting
>> >such things in the late 80s and may have been involved in some of the
>> >Extropians-type markets which arose a few years later (I recollect
>> >several efforts with varying degrees of success).
>> Yes, Robin Hanson worked on DARPA's PAM program. Here's
>> his e-mail about it in May 2003:
> Looks like Robin may have to concentrate on a commercial venture if he 
> wants to see his ideas put into practice.

And use an offshore nexus, and good anonymity and digital cash 
tools...just as predicted many years ago.

Doing this aboveboard, and doing it with the collusion of the actors 
who can alter the outcome, is asking for trouble:

* violation of gambling I said in other articles, betting on 
the death of the King of Jordan is not different from betting on the 
winner of the World Series.

* distortion of markets by players who see more benefit in adjusting 
the expectations than in spending some relatively small amount of money

(If "Chances that weapons of mass destruction being found in Iraq by 
Nov. 1"  is being de-rated, in a relatively thin market of a few dozen 
players, then someone with an interest in altering the odds can 
probably do so with relatively little money...especially if the money 
is from a Black Budget and comes from money taken at gunpoint from 

(I can't resist mentioning that I was able to massively 
distort/sabotage the market in reputations that the Extropian list 
experimented with in 1993. I did this by buying "play money" 
(extro-dollars or whatever they were called) from other players in an 
out-of-band transaction. A mere $20 in U.S. money gave me a huge amount 
of additional spending money in this reputation market. Naturally, my 
reputation rose. Likewise, if Paul Wolfowitz wants the market to assess 
a "grave danger" that Norway is financing terrorism, he can use 
out-of-band methods to get a bunch of "ringers" (cut-outs, 
co-conspirators) to start bidding up the market. As the penalty for not 
guessing correctly is not  clear until the outcome, and inasmuch as the 
money is provided by agencies, the opportunities for mischief are 

* Insider trading. Letting government employees benefit from their 
inside information is like letting IBM or Intel employees engage in a 
wagering system based on KNOWLEDGE THEY ACTUALLY HAVE. (Not that 
insider trading is unknown in commodity or stock markets, including 
futures markets. But these markets have traditionally been heavily 
regulated and insider trading is forbidden, at least nominally. In the 
case of this DARPA market, the players are by definition the insiders, 
with various amounts of very non-public information about plans and 
contingincies. "Duh.")

And so on. So many attacks on this system.

Anyway, there _already_ are very real, hard to manipulate markets in 
information. We call them markets. Markets for real estate, for corn, 
for copper, etc. If a lot of residents of Jordan think a collapse is 
coming, real estate prices in Amman will fall. If a lot of 
technologists think a return to copper wiring is coming, copper prices 
will rise. And so on.

Betting on contrived propositions with relatively small amounts of 
money ("toy systems") and/or with play money is not very interesting.

--Tim May

More information about the cypherpunks-legacy mailing list