Pentagon To Drop 'Terror' Market

Voice of America ^ | 29 Jul 2003, 16:40 UTC | VOA News

[yonif]

The Pentagon is abandoning its plan for an internet futures market where investors could gamble on potential terror attacks and assassinations in the Middle East.

Deputy Defense Secretary Paul Wolfowitz told lawmakers Tuesday that the plan was, in his words, "maybe too imaginative."

The project was disclosed by two Democratic senators on Monday. The planned eight-million-dollar Policy Analysis Market was an internet site that would allow people to place money on predictions and would pay profits if they guessed correctly. One example listed on the web-site is the overthrow of Jordan's monarchy.

Registration was to begin Friday, with trading to begin October 1.

The senators called the idea "a federal betting parlor on atrocities and terrorism" and declared it "ridiculous" and "grotesque." The opinion was echoed Tuesday by ranking Democratic Senator Tom Daschle, who condemned the program for what he called "trading in death."

A website for the Pentagon division responsible for the plan had tried to explain the rationale behind the market. FutureMap argued "the rapid reaction of markets to knowledge held by only a few participants may provide an early warning system to avoid surprise."

But the Democratic senators said potential terrorists could just as easily manipulate the market to mislead intelligence agencies as they could profit from it.

This is the second time outrage has cut short one of the Pentagon division's plans. A proposed scheme for utility workers and others to keep an eye out for suspicious, possibly terrorist activity in the general public was quashed after lawmakers, civil rights advocates and others condemned the project.

[camle]

too imaginative?? Too bloody stupid is more like it!

[LibWhacker]

Rats will naturally crap all over any idea that might give America an edge because they're traitors.

[dmz]

the freeper community was split nearly 50/50 on this topic. are you suggesting that the approximately 50% of freepers who were against this also "will naturally crap all over any idea that might give America an edge because they're traitors"?

[LibWhacker]

No, because they're honest.

[Russian Sage]

The terrorist betting aspect of this is over hyped - if  not made up. Visiting the web site, I haven't found anything specifically mentioning terrorism:

Three types of futures contracts will be offered on PAM:

• Quarterly contracts based on data indices that track economic health, civil stability, military disposition, and U.S. economic & military involvement in Egypt, Iran, Iraq, Israel, Jordan, Saudi Arabia, Syria, and Turkey
• Quarterly contracts that track global economic and conflict indicators
• Specific possible events (e.g., U.S. recognition of Palestine in the first quarter of 2005)

When trading starts on October 1, 2003, there will be contracts of the first two types that mature at the end of the 4th quarter 2003, 1st 2004, 2nd 2004, and 3rd 2004. On January 1, 2004, contracts that mature at the end of the 4th quarter 2004 will be issued. In this way, the forward view of PAM will be maintained at one year.

Contracts of the third type will be issued into PAM as specific potential events of interest are identified.
Copyright © 2003 Net Exchange. All rights reserved.

[meenie]

I hope there is a little more sanity in other parts of the Pentagon. Sending troops overseas and then having a lottery to see how long they survived is a little much. We see quite a few strange statements coming out of the Pentagon. There are a real cadre of squirrels hanging out there.

[steve50]

They never bothered to check out the trade profits from 911, I'd say that would be a good place to start.

[Atlas Sneezed]

Is there any difference between this and the concept of "Assassination Politics"?

[No Left Turn]

It's actually a great idea. If done correctly, it could provide
a crude early warning system that something is out there in the market forcing terrorism futures higher. It also could give small businesses and individuals access to terrorism insurance by allowing people to go long terrorism futures to hedge against a loss in the event of an attack. It's not unlike weather derivatives which are used by industries like ski lodges to hedge against mild winters. Simply put, the ski lodge buys weather derivatives, which move higher with the temperature. If temperatures move higher, they make money on the derivatives, offsetting losses from lower skier revenue.

Heck, all futures markets are designed to hedge risk. Is an oil trader stupid for buying oil futures when a tropical storm is churning in the Gulf of Mexico, threatening to knock out some refining capacity down there? No. He's stupid if he doesn't? And is he immoral if his futures bet pays off, and offsets a loss in the physical world, even though someone may have died as a result of the hurricane? No.

[StockAyatollah]

Increidbly stupid idea. But OTOH I was looking forward to placing $50 on Yassir at 3:1.

[af_vet_rr]

Not only was this stupid, but once again wasteful. It's like somebody at the Pentagon or DARPA has too much time and our money on their hands and they don't know what to do with it. They are wasting our money on this and other bs projects that will not do any good.

They might as well have gone to Las Vegas bookies and asked them for odds on various events, would have been the same thing.