Semi-Daily Journal

American Action Markets

Ah. A certain shoe drops...

AAM Concept Overview: Analysts often use prices from various markets as indicators of potential events. The use of orange futures contract prices by analysts of the Florida weather is a classic example. The Pentagon briefly attempted to apply this technique to terrorism, assassination, and war [articles] [archive of Pentagon site].

The American Action Market (AAM) refines this approach by trading futures contracts that deal with the two most important questions facing the world today: (1) What will the U.S. government do next? (2) What is informing the U.S. government's current behavior?

Some of the contracts traded on AAM will be based on objective data and observable events, as on a horse track, e.g.

• the next White House lie to break into the news
• the next country to which the White House will issue an ultimatum, and when
• the next foreign leader to move from the CIA payroll to White House "most wanted" list
• the lifespan of various DARPA projects, such as Total Information Awareness [site] and Babylon [site]
• the first White House staffer to resign in disgrace, and when
• the President's approval rating on the day before Saddam is captured or killed

Other AAM contracts will more closely resemble stocks on the market; they will be based on possibilities and scenarios that may or may not be verifiable, but that may be progressively revealed over time (e.g. via journalistic sleuth-work, public statements by concerned politicians, or Congressional hearings):

• how and at what stage the White House officially decided to use the attacks of September 11, 2001 as a reason for invading Iraq [article]
• whether Rumsfeld was the first, the morning of September 12, 2001, to decree that the attacks were the "Pearl Harbor" needed for attacking Iraq, or whether the idea came first from others [article]
• whether the invasion of Afghanistan had been planned from the start as a stepping-stone to an attack on Iraq, or whether the decision to attack Iraq was made only once the troops were massed nearby
• whether or not the President was conscious of overt lying in his various pre-war speeches, or whether the decisions to lie were taken by others, with the President thinking himself to be truthful
• whether or not the expulsion of U.S. and British oil companies from Iraq between 1972 and 1975 was an important long-term factor in the 2003 war on Iraq, and in what way [article]
• to what degree neo-conservatives Rumsfeld, Wolfowitz, Abrams and other students of Leo Strauss (who may have taught that it was necessary for elites to lie to the public) relie on Strauss's teachings in their daily decisions [article]
• whether or not Iraq's 2001 switch to the euro as its trading currency, and Iran's and Venezuela's contemplation of similar steps, was a factor in U.S. decisions leading to the 2003 war on Iraq [article]

Contracts of the second type will take much longer to mature, but are necessary in an environment where a great deal of information is kept under lock and key by a secretive U.S. administration. As evidence is accumulated to prove or disprove a particular future, its market value will change, possibly helping researchers evaluate likelihoods; also, those betting for or against it will win or lose money accordingly. Contracts of both types will be issued into AAM as specific potential events and scenarios of interest are identified.

Traders who are registered with AAM will use their money to acquire contracts. An AAM trader who believes that the price of a specific futures contract under-predicts the future status of the issue on which it is based can attempt to profit from his belief by buying the contract. The converse holds for a trader who believes the price is an over-prediction: she can be a seller of the contract. This price discovery process, with the prospect of profit and at pain of loss, may possibly help to shed light on some the most important questions facing the world today.