[anactofgod]

I made the comment at HNDC last night that "Are crowds wise? That's arguable. But it definitely moves in herds."

The value of a well executed stock "betting" game is that, since what is being wagered is of little or no value compared to an actual market position, the herd may reveal it's intentions in the game before a similar movement is noticeable in the actual market.

For this to to be true, though, two necessary, but by no means sufficient, pre-conditions need to be satisfied: a sufficiently large and well-informed herd; playing a game that maintains the proper balance of care-free (not too much at risk) -vs- care-full (enough is at risk) gameplay.

[jaredmck]

Why would the crowd reveal its intentions earlier in a game than in the actual market? It seems historically, the herd does the opposite. The game is an "easier" market than the real market; much like how play money poker is far easier than real money poker games.