> Given that inside information makes prediction markets more accurate, why do you believe it doesn't make stock markets more accurate?
He didn't say that it doesn't. It obviously does make stock markets more accurate.
But it tends to drive down the total amount of money available to be invested in stocks, which is compatible with the claim that it makes the market worse at funding productive enterprises.
> But it tends to drive down the total amount of money available to be invested in stocks
That seems like a big claim. For most market participants, there's always a counterparty that's so much more sophisticated that it doesn't make a difference if they're an insider or not.
He didn't say that it doesn't. It obviously does make stock markets more accurate.
But it tends to drive down the total amount of money available to be invested in stocks, which is compatible with the claim that it makes the market worse at funding productive enterprises.