Liz argues today’s boom in prediction markets, crypto perps and leveraged niche funds serves speculation more than ordinary investors or genuine commercial hedging.
800 weather-related contracts on Kalshi and Polymarket illustrate the mismatch, she says: they invite retail betting and potential manipulation, yet still do not meet the needs of businesses such as Vail Resorts.
A fund charging seven times an S&P 500 index fund’s fee for 200% exposure to a zero-revenue nuclear company shows how far “democratized finance” has drifted from broad, low-cost investing.
She contrasts those products with older, regulated tools such as mutual funds, index funds and electricity futures, arguing utilities—not households gambling on apps—should handle hedging and pass savings on.
The broader warning is that America’s “people’s capitalism” is being confused with a “casino economy,” though speculative markets have historically been cleaned up into useful institutions.
Do prediction markets offer real economic value, or do they just turn global events into a high-stakes betting parlor?
With AI enabling elite traders, are speculative markets a path to wealth or a sophisticated trap for the public?
When government advisors are also top investors, who truly benefits from the new 'casino economy'?