curious builders

The New Information Stack

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Shower thought

The new information stack:

  • Podcasts
  • Prediction Markets
  • X

(All credit goes to nic carter for suggesting this stack in his podcast.)

I don’t watch much TV or read traditional newspapers. I haven’t done so for years. I think the stack Nic describes is interesting. Are these the sources I should seek if I want to stay updated on what is going on in the world?

Podcasts

Long form podcasting is a good way to really get to know somebody - to understand their view of the world, why they do what they do and say what they say. It is also a good way to absorb a topic at a high level.

That doesn’t mean people can’t say false things on a podcast. I happens all the time.

To me, podcasting is more about vibes than concrete facts and figures. I’d like to think I learn something listening to podcasts (as I listen to a lot!) - but I don’t think I absorb numbers and concrete details well in audio form. The media just isn’t for that.

One major reason I think podcasts are working is the ‘delivery mechanism’. Almost all the podcasts I listen to have been recommended to me though word of mouth. There is no algorithm to serve. And there isn’t the same incentive to sensationalize everything like in traditional media. Podcasts are generally built around a loyal following. Hype and clickbait just isn’t as effective there.

(If you want to see how the YouTube algorithm incentives hype just go to the YouTube version of some of your favorite podcasts - many of them will have thumbnails and titles that are almost unrecognizable - that’s how much an algorithm can distort incentives.)

Podcasting may have escaped the algorithm (for now) and the incentive to sensationalize. But it is not without flaws.

Because podcasts have loyal followers the incentive is to give these followers what they want. And that may not always be the truth. I think podcasting is still very much subject to our information silo issues and audience capture. If I only listen to my favorite podcasts there is a good chance I only hear one side of the story.

Podcasters aren’t necessarily rewarded for telling the truth. They are rewarded for building a following - and that is an entirely different skill set and incentive.

  • Incentive: create a loyal following.

Prediction Markets

A new entrant on the scene, prediction markets gained a lot of attention this US election cycle. And rightfully so I’d say - the prediction markets did quite well.

My experience was similar. Polymarket had Trump winning a while before the election and while I didn’t follow the election day closely, it was easy to check and see the market was convinced Trump won way before it was officially called.

The prediction markets were not 100% reliable. They are not oracles after all. They are just markets - and sometimes markets are wrong. E.g., Polymarket did not favor Trump to win the popular vote.

(And then we could have an entire debate about how well we humans interpret probabilities and how do we even conclude that a market is ‘wrong’? If it is showing a probability based on the available information, is that wrong if the result goes in the other direction or?)

One concern I have seen expresses is that if traditional media disappears, who will investigate and reveal the truth - who will dive deep and uncover secrets?

First objection is that this is not what most news is today. Second is that I think big prediction markets will incentivize investigative journalism. That’s exactly what happened this election! A french trader commissioned his own polling and traded based on that - so the information made its way to the public. Also, investigative journalism happens all the time in markets already - short-sellers (and longs) are investigating companies, publishing reports, and trading based on their findings.

Prediction markets aren’t without their flaws. But it is interesting (and good!) that we finally start to see some mainstream adoption of some of them. One of the big issues with prediction markets has generally been a lack of liquidity - with more awareness maybe we will see more money flowing into these markets.

I’m hopeful we will continue to run this experiment and see where it takes us.

  • Incentive: correctly predict the future

X

X is a lot of noise and a bit of signal.

The platform can be a cesspool that leaves you feeling awful after scrolling for a bit. But it can also be a funny, exciting, and informative place.

To succeed on X you have to give the algorithm what it wants. What it wants has changed over the years - but the unfortunate implication of a business model relying on ads is that the algorithm has mostly been optimized to keep you scrolling.

I have been away from X for a while and going back in I feel like the algorithmically generated ‘For You’ feed has become better. I’m also glad to see actual new features trying to move away from just ads - there is now a paid subscription feature, premium and premium+ with full length articles, etc. Maybe some of these new revenue streams can help move the algorithm in a healthier direction (although I’m not sure).

X, and the model it is build around, has a lot of flaws. It still favors sensationalism and tribalism. Outrage is a good way to keep people scrolling. But despite the flaws you can’t deny that there is some signal there. It is still amazing that people can go direct with their message - instead of relying on other people to transfer it.

  • Incentive: satisfy the algorithm

Legacy Media

I don’t have much to say about legacy media other than we have declared it dead for years now - and yet a lof of the discourse in ‘new media’ is about the old media.

We cheer when they quote Polymarket in their news coverage - “prediction markets are mainstream now!!”. And 5 seconds later we post about how the legacy media is no longer relevant.

For sure, old media is less dominant than it was in it’s heyday. But despite it’s flaws it is still here - and I sometimes think we forget a lot of people still watch the news on TV.