My favorite Kalshi market was deeply flawed

On April 2nd, Donald Trump announced the largest tariff hikes in a century. Markets cratered. The S&P 500 dropped 10% in two days. Trillions of dollars in value evaporated. Pundits called it a shock. But it wasn’t… at least not to anyone watching the right screen. Weeks before Liberation Day, a prediction market on Kalshi was pricing in exactly this outcome. The contract asked a question: will Trump impose large tariffs if elected? By late March, it was trading at 70–80%. The signal was there, sitting in plain sight, on a market with just a few hundred thousand dollars in volume. I loved this market. In fact, I loved it so much that I wrote a whole post on how I priced and traded it, back before this newsletter was even created. This is the promise of prediction markets: real money, real forecasts, beating the conventional wisdom. And in this case, it worked. The market called the biggest macro event since COVID, and anyone paying attention could have positioned accordingly to make bil

On April 2nd, Donald Trump announced the largest tariff hikes in a century. Markets cratered. The S&P 500 dropped 10% in two days. Trillions of dollars in value evaporated. Pundits called it a shock. But it wasn’t… at least not to anyone watching the right screen. Weeks before Liberation Day, a prediction market on Kalshi was pricing in exactly this outcome. The contract asked a question: will Trump impose large tariffs if elected? By late March, it was trading at 70–80%. The signal was there, sitting in plain sight, on a market with just a few hundred thousand dollars in volume. I loved this