I gamble on politics and events. DMs open if you want to discuss markets.
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Also LeBron if you deny me I will feel psychic pain.
LeBron James and the Last Decision
-- LONG THREAD WARNING--
Since we're at the eve of the decision, I figured I would summarize my thinking on this market. It's a pretty difficult one! It's very easy for someone to zero in on one or two points and form that as the single basis for the reason LeBron would pick team A or team B. My goal is not to push people to one option or the other, but just to get my thoughts out there and plant my flag before the announcement drops. I can hopefully look smart, but more likely to end up looking dumb because it does feel very open-ended.
TL;DR I believe LeBron James is most likely to select the Miami Heat.
Below is my long thread explaining, in narrative form, how I arrived at this. I feel Miami satisfies enough clusters of what he needs. But it is not a recommendation to buy or bet Miami at a particular price point -- being most likely might only mean 35%? 40%? I do not know if anyone can get more than 50% confident on a particular option here without inside knowledge. It's interesting to me that Kalshi has surfaced Miami as the leader versus more conventional wisdom about Cleveland or Golden State. If we get it right, it's a cool moment for prediction markets. Hopefully it doesn't mean insider trading but I digress.
Also not me slamming the book buying tons of shares in the 40s and 50s. Unsure who that is or if they know more, I think the decision is probably kept tight enough that there's no inside info ... I don't think any winner would truly surprise me short of Mystery Team XYZ. You can form a case for any winner after-the-fact like "of course he chose Cleveland, its home!" "of course he chose Golden State, its steph! its close!" etc. Uncertainty is very high.
Thread below.
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"The more things change, the more they stay the same."
Way too many people are arguing what the Fed will do by explaining how they USED TO work.
They don’t work that way anymore and now a big “family fight” at the Fed is underway. The repost below is a good read and needs to be understood.
A 35% to 40% probably of a hike is justified. Sure they might raise rates this week, but there is going to be tension and lots of dissents. No hike this week and 50 might be on the table for September.
—-
Years of Trump bashing the Fed has changed them.
Before everything revolved around the Chair and what they wanted. That is why Wall Street parsed every word and framed every decision around the Chair, their personality and what they believed. The other 11 voters did not matter and were expected to go along with the Chair.
This is not the case anymore.
The Fed is now like the Supreme Court, all independent voters and can out vote the Chair. And there is no more Forward Guidance (signaling what they are going to do.) this is why the probability of a hike tomorrow is 35% to 40%, the Chair could get outvoted and we have no “guidance” either way.
——
All of these changes are positive, and should be applauded.
The root of many of the Fed’s problems were centered in too much power vested to one person (causing terrible “groupthink”). Additionally, forward guidance that amounted to promises of future moves encouraged too much speculation and leverage among financial institutions as they perceived lower risks creating moral hazards (Fed bailouts for bad decisions.).
These practices had to end.
In the meantime many of the hot takes about the Fed here should be filed under “historical viewpoints” and not “current monetary policy.”
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Lance Uppercut retweeted
MULTI-MILLION DOLLAR RINSE: Full single-post summary for people with normal sleep schedules of the most insane rinsing of bond bots I've seen firsthand, in which PM bonders appear to have lost 7 figures🤯
Scene: Last MLB game of the night (Giants vs Angels) bottom of the 10th inning tied 6-6. The time is ~1:15am EDT
- With the bases loaded, Devers hits what is normally a ground rule double. The initial final score shown is an 8-6 Giants win (due to an official MLB scorer error). Video below in thread
- Over 13.5 runs, Giants -1.5, and Giants team total o7.5 runs bond to 99c thanks to bots
- MLB rules state that a walk off ground rule double cannot score multiple runs and in this scenario counts as a single instead of a double
- People start to realize this and insane action comes in to unbond the above markets. Prices go absolutely haywire, touching 1c and 99c multiple times
- Kalshi closes and settles the totals & team totals markets while at least one (if not all) of the listed source agencies (MLB / Fox Sports / ESPN) still showed the final score as 8-6. PolyUS does the same for settlement of Giants -1.5
- However, the Kalshi spread (run line) markets remained open longer. Source agencies had then changed the final score to be 7-6. Market volume on the spread balloons from under 12,000 to 5 million (!) between the start of the bottom of the 10th inning and final market settlement
- Despite Kalshi settling the total as over 13.5 based on an 8-6 final score, per their CFTC rules, the spread must now settle Angels +1.5 as a win, and it does
- PolyInt settles Angels +1.5 as a win as well, rinsing botters there too and appearing to make the total losses for traders assuming a 8-6 final score "multi-millions" across all exchanges
- Sportsbooks all appear to have paid out incorrectly initially as well, but it seems all of them have resettled based on the 7-6 final score. CFTC certified exchanges on the other hand don't quite work the same way as sportsbooks.
- I fail to make riches since my 1am brain was staring at just the totals market and didn't notice the spread market had stayed open longer until it was too late
- I'm aware of some of the big winners, but am yet to hear who specifically were the big losers on this score adjustment
- Kalshi volume on the two "incorrectly" settled markets: 1.1mil on o/u 13.5 runs, ~60k on o/u 7.5 Giants team total. No idea or guess on how much was traded on the PolyUS "incorrectly" settled spread market. I would not expect a refund if you had the wrong side of these markets since the settlements appear to have complied with the sites' CFTC rules, but we'll see
TLDR: An official MLB score correction post-game made some grinders rich and rinsed others (mostly botters, I assume). Per the sites' CFTC rules, it appears all markets were settled correctly despite being inconsistent settlements
I'm now processing the scale of what happened. If you have a friend with a bonding bot, please check in on their wellbeing because bonders lost MILLIONS, many while enjoying their Friday / sleeping
Kalshi spread volume at 1:15am: 11,149
Kalshi spread volume at close: 5 million🤯
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So even Rich Paul thought it was likely to be Miami. We let LeBron think too long!
ESPN's Ramona Shelburne said Rich Paul told her that "for a lot of the time" Paul thought it would be Miami for LeBron "but when you won in a place before, it might not be the same. You want to leave those memories as they are. This appeal of something new is attractive."
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Lance Uppercut retweeted
ESPN's Ramona Shelburne said Rich Paul told her that "for a lot of the time" Paul thought it would be Miami for LeBron "but when you won in a place before, it might not be the same. You want to leave those memories as they are. This appeal of something new is attractive."
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Final on this ends up being a lot, but getting the main thrust wrong (Miami) is painful despite planting the flag.
I think a lot of the analysis in my thread holds up and explains LeBron's decision though. The core of all of this is his psychological profile and the longer variance pushes him towards options that are more basketball-centric rather than emotional-centric.
The way Philly wins is him selecting contention and the highest ceiling option for his skill as an organizer on the court. To take the frame of the younger athlete one last time, to "have fun" by stomping in deep playoff runs. They offer enough depth to allow him to take time off to go West and only really need him for playoffs.
Golden State I think got too wrapped up in the mystique of this theoretical AD trade. It's easy to write post-hoc, but much reporting indicated Warriors just weren't that into it.
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There is also one predictive pattern here that was hard to shake off: LeBron camp signals have been indicative of prior winners. But the form of the camp signal is hard to see in the moment; phone call with the big 3 in 2010, private meeting with Gilbert in 2014, meeting with Magic Johnson in 2018. We didn't have meetings this go around, but we did have these persistent quotes from Shams, Stein, related reporters that LeBron was "taking the Sixers seriously" that read differently from the usual "sources around the league think...". So I suppose the camp signal about "sources close to LeBron thinking" was right all along showing the Sixers.
I think this decision was made today, he landed on it and felt it would minimize his regret.
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Wow! Ended up more on this market because of this outcome with Philly always being so cheap. Really an all-timer, and a total surprise from the King.
BREAKING: LeBron James is signing with the Philadelphia 76ers on a two-year, $8 million deal with a player option, Klutch Sports Group and Klutch CEO and Game Over show host Rich Paul tells ESPN.
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LeBron James and the Last Decision
-- LONG THREAD WARNING--
Since we're at the eve of the decision, I figured I would summarize my thinking on this market. It's a pretty difficult one! It's very easy for someone to zero in on one or two points and form that as the single basis for the reason LeBron would pick team A or team B. My goal is not to push people to one option or the other, but just to get my thoughts out there and plant my flag before the announcement drops. I can hopefully look smart, but more likely to end up looking dumb because it does feel very open-ended.
TL;DR I believe LeBron James is most likely to select the Miami Heat.
Below is my long thread explaining, in narrative form, how I arrived at this. I feel Miami satisfies enough clusters of what he needs. But it is not a recommendation to buy or bet Miami at a particular price point -- being most likely might only mean 35%? 40%? I do not know if anyone can get more than 50% confident on a particular option here without inside knowledge. It's interesting to me that Kalshi has surfaced Miami as the leader versus more conventional wisdom about Cleveland or Golden State. If we get it right, it's a cool moment for prediction markets. Hopefully it doesn't mean insider trading but I digress.
Also not me slamming the book buying tons of shares in the 40s and 50s. Unsure who that is or if they know more, I think the decision is probably kept tight enough that there's no inside info ... I don't think any winner would truly surprise me short of Mystery Team XYZ. You can form a case for any winner after-the-fact like "of course he chose Cleveland, its home!" "of course he chose Golden State, its steph! its close!" etc. Uncertainty is very high.
Thread below.
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Denver, Minnesota, Philadelphia
Denver is one of the more interesting cases, because on paper I think it is nearly as clean a basketball fit as Golden State. He would slot neatly into a 2nd option role and thrive with true 5 man spacing. He would not be as celebrated or feted as Jokic, but his stature is still enough where he would receive some credit for their successes. He is very close with the owner, to boot. The main issue is how leveraged and weak the team's future is; apron locked, hardly any assets, executing salary dump trades. It's difficult to improve past what LeBron might ask of them. I like it as a dark horse, and would be happy if it won. I do not expect it to, it is likely one of the other 3/4.
Minnesota actually has the cleanest roster hole of anybody. With Randle and Reid gone there's an open starting forward slot that is squarely his position, in front of the best defensive infrastructure available to him for hiding a 41-year-old with Gobert behind him, McDaniels next to him. The willingness is real and demonstrated too: four firsts for Gobert once, an unprotected 2033 first plus swaps for LaMelo this month, tax paid. And they validated themselves honestly by beating Denver in the playoffs. The problem is that Edwards and Ball are an unresolved one-two already, both pull-up heavy, and dropping a third creator into an argument nobody has settled is more risky for him. Maps more cleanly to the Westbrook situation. The location is probably the weakest of them all so if he ranks by tiebreakers, Minnesota probably falls out. I still would like to see him here though.
Philadelphia has the widest range of outcomes here and the highest ceiling of anyone. The organizer vacuum is genuinely real -- three ball-dominant scorers, bad shot quality, and nobody who naturally sets the table -- and the precedent for what LeBron could be there happened in that building when Harden showed up in 2022 and ran everything at mid-twenties usage while Embiid scored his way to an MVP. They also cleared the commitment bar by giving up George plus two firsts and two seconds for Jaylen Brown within eight weeks of a new front office amid reports of LeBron "taking them seriously". But the entire ceiling depends on Embiid, Brown and Maxey being asked to defer to a 41-year-old newcomer. Three high usage scorers without established order grants as risky role compression as Lakers, if not even moreso. It would purely be a contention play, which isn't how the more aging star would strictly view things. Miami has comparable title odds with more needs satisfied for him. If he goes here, it would be his desire to win and the star power allure winning out. Perhaps a NYC angle too.
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The basketball fit is not as important as the other parts of this. LeBron's skill is good enough that he can rationalize his role on any team as long as it fits what he is personally seeking at age 41. The primary lens I am taking here is that of the aging, near-retirement elite athlete who still wants to matter and feel needed, and searches for the team that gives him this.
I think Miami offers the most here. His role would be established and protected. He can be central and trust the commitment of the team to truly contend and compete with his buy in. He has relationships and familiarity with the coaching and the FO and the players. He would enjoy the climate and weather the most of them (sans Golden State), with social circles that complement his current position in life; rich people, billionaires. Minimal disruption and cost to move into Miami or Cleveland versus the other locales.
The hardest part is just figuring out what will be the determining factor in the decision. Is it the things that drove him to leave Los Angeles in the first place? Will it be remaining close to his family? Or the allure of nostalgia and the homecoming? Or does he roll the dice on a contender and make a legacy gamble -- though I think the psychology of the elite athlete approaching the end is not that likely to prioritize something like that. It's why I downweight the other teams, because their argument is closer to being about contention than about satisfying some other part of LeBron. What is important is being needed, attention, and mattering -- he's gotten it for 3 weeks so far!
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