While we are on the subject of pure bets, when will there be a prediction market on the outcome of this case?  When will you be able to place your bets?

I am not ready to take an official position - "Goldman is liable" or the "SEC will lose."  What law professor would given that we are only at the beginning of learning the facts?

But that doesn't stop you from making educated guesses and bets.  There is of course an active arbitrage market on Wall Street betting on the outcome of things like high profile litigation and whether a regulator will allow a merger to go through.

When there is a Goldman prediction market, prices will change as new facts come up.

Is there any social value to this type of bet? -- you can probably predict what I will say if you read a previous post -- depends if any party to a bet has a pre-existing risk.

And there is entertainment value.

Would there be any intellectual value to a prediction market beyond giving me something to blog about?  Remember Oliver Wendell Holmes' old adage that law is just a prediction of what a court will do.

Does that mean a prediction market is the law?   

Addendum:  I wouldn't be at all shocked if lawyers -- even law professors -- will be hired by arbitrageurs to evaluate bets on the case.  There may be a lot less professional risk if you are placing a bet without putting your name in writing or on a blog. 

Here is a more gossipy question: if you were hiring a lawyer or law professor to help you place a bet on the outcome of the case, who would you pick? 

Here is a half serious legal question: could there be market manipulation if a professor then writes statements to influence the price without disclosing her interest?

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