Odd Lots

Prediction markets that enable you to bet on pretty much everything are everywhere nowadays. But there's still a big question over whether they can expand to include larger institutional investors like hedge funds. Part of the problem is that a lot of prediction market contracts are illiquid and trading volumes can sometimes be shallow. That's where trading firm Susquehanna International Group comes in. In this episode, recorded live at New York's City Winery, we talk to Jeremy Maletz, Susquehanna's head of macro trading and prediction markets, about the firm's market-making business with Kalshi. We talk about how big investors could use prediction markets, what Susquehanna is seeing in terms of flows, how a market-maker hedges risk on these contracts, and how it makes money from them.
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Today’s episode, which was recorded at our recent live show at New York’s City Winery, follows up on a conversation we had with Iain Dunning, head of AI at Hudson River Trading. Last year, we talked about how his firm uses AI. Now, some seven months later, we follow up on how one of the biggest market makers around is deploying this technology. We talk about the price of memory, bottlenecks in compute, how much HRT employees are actually spending on tokens, why the firm might develop its own chips, as well as AI-induced delirium.
Read more:
Jane Street Plans New Data Center as Compute Power Runs Scarce
Nvidia-Backed Robotics Startup Generalist AI Valued at $2 Billion
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There's a lot of debate about the future of AI — not just whether it will produce the returns investors are expecting, but also if AI will lead to mass worker displacement. Big banks are the perfect prism through which to explore some of these questions. Not only are they deploying AI very quickly, but they have a wide range of workers who are using the technology, from back-office employees to junior analysts to the most senior investment bankers. In this episode, we speak with David Solomon, chairman and CEO of Goldman Sachs, about the impact of AI on the banking business, and why he does not predict a major white collar wipeout. We talk about the outlook for headcount, current conditions in capital markets, and the bank's role in the upcoming SpaceX IPO and Alphabet's historic equity capital raise. He also tells us about his early career in junk bonds and (because of his love of electronic dance music) how AI is transforming music production.
Read: Anthropic Picks Morgan Stanley, Goldman Sachs to Lead IPO
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We talk about the commodity supply chain all the time. We talk about the ports and the trucks and the ships and all of that. But there's another dimension to moving commodities all around the world, which is actually paying for it. Who funds the oil tanker and what happens when that tanker is, say, stuck in the Strait of Hormuz? Commodity finance underpins production, transportation and storage of a wide variety of the things that make the modern world, but you tend to only hear about it when things go wrong. Today we speak with Lewis Hart, head of corporate advisory and banking at Brown Brothers Harriman. We discuss how the business of commodity finance actually works, how risk is priced, what makes for a good or bad warehouse, and the difference between financing a commodity you can hedge (like oil) versus one where's there's no futures market (like cashews).
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Rope is easy to take for granted. It seems obvious and straightforward. But of course, it had to be invented. Early humans discovered that by twisting fibers around each other, the resulting structure would be something durable and strong. Without rope, all kinds of things aren't possible, from lifting objects into the air to whaling or modern bridges. So how was it developed and what were the big breakthroughs in its history? On this episode, we speak with Tim Queeney, the author of the recent book Rope: How a Bundle of Twisted Fibers Became the Backbone of Civilization. He walks us through the history of the technology, and its ongoing evolution, including how it might one day allow to build an elevator into outer space.
Read more:Japan Cablemaker Rout Exposes Cracks in AI Infrastructure RallyWhy Huawei’s New Chipmaking Plan Has Investors Buzzing
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