I don't have any issues with Timex creating a market in this way.

I do think he could come up against some huge liabilities if some of these players hit a big score. Is he taking action on players in the Main Event?....that could get ugly if he shorts a horse who makes the FT.

Being out of pocket for a percentage of a few mid 6 figure scores would add up quickly

It seems this is eventually going to end up bad for the mom and pop shops of poker, and take away from the poker community as a whole. In Mike's interview he describes how the mid stakes grinders taking shots are scraping away profits from the over all poker community with high mark up, he specifically cites these players as the ones that are over valued. Mike decides he's going to settle for less profit then those ppl collectively (and the other player types he mentions) and keep it for himself. I don't see how that is good for the community as a whole.

Mike only needs to buy players and sell a little bit higher than their true EV to make this work. He doesn't need to worry about the expenses of each individual to play tournaments. Mike can say a player is overvalued, which could be true, but really he can just offer a better price closer to a player's true EV bc he doesn't have these expenses. I mean what's to stop him from doing this? That dead percentage between seller's MU and Mike's Mark up will ultimately come out of the pockets of the grinders. The ones affected the most will be the mid stakes grinders taking the shots where travel expenses will be a larger percentage of their overall cost compared to guys like Marchese. I guess that's poker though.

Not to mention main event will be paid out at final table according to chip equity.

Sure, and again, I'm not saying that he's overleveraging. I'm not even saying that escrow is necessary (though it would be better than nothing). I'm just saying that transparency as to his positions and agreements about his max leverage per horse would be a very good thing here, so that before people bet, they can make an informed decision about how much risk they have of not getting paid.

Does anyone know if something like would fall under US security regulations since he is becoming a market maker?

Probably too low of a dollar volume to get any scrutiny, but I would assume a risk to investors would be the risk of the entire operation getting shut down.

@Wyman: It's always your job to assess counterparty risk.

I have no opinion either way on this subject because I don't know enough about it, but this line of reasoning is just so ****ing bad.

which is extremely hard to assess without any transparency regarding the financials of the "bank of timex"...

You don't have much transparency about the financials of any major financial institution either, it's probably even murkier because GS doesn't say on its twitter account "Well we've got two CDS positions that we're unwinding at x cents on the dollar".

I've seen at least one player spamming players threads in the live MP with a tweet from him about this...pretty rude imo, basically calling out a player in their own thread instead of just having people PM/skype him the player that they are interested in.

Obviously. But IMO it's in the community's best interest to have a conversation about it. This is not a new concept, but it's being newly applied here. Those who are "staking" might not have thought about the finer details. Yes that's their problem, but it's bad for the rest of us, too, if they get taken for a ride. Conversely, if this works smoothly, the market should find the right price for a lot of horses, and stakers should be able to get action on solid players at a fair price.

Honestly there's pretty much no downside to BoT being transparent. It should get him more action.

Is he escrowing the funds? If not, sounds like a nice scam.

Sure, but (a) we have FDIC to protect some of our assets, and (b) we've already seen that when a major US bank blows up, the US govt pretty much has to bail it out (for a number of reasons that are beyond this thread).

If BoT blows up (i.e., goes beyond busto and cannot pay out), "investors" are SoL. That's bad for all of us.

I'm actually participating here because I _like_ this idea and want to see it succeed. Unfortunately, for that to work, I think we need some sort of transparency or oversight.

How long until we get derivitives and then there is a market crash?

are you even serious? you're comparing a bank with a person that has a twitter account, saying the transparency lvl is the same.. cool example with the CDS positions, doesn't even come close to an accurate picture of what we're actually talking about..

So he's ruining everything by ripping off all the sucker investors for 1% less than these "mom and pop grinders" are ripping them off for? While being honest about what he's doing?

I still fail to see how BoT is in any way riskier than a typical marketplace staking/share selling arrangement.

Only difference I see is that we know Timex & Co have deep pockets, and that they probably stand to lose a lot more than the typical midstakes grinder if they fail to pay back and their reputation takes a hit.

That moment when you show up in the BankofTimex twitter feed.

Because if I'm selling 60% of myself for WSOP, I can update the MP thread with

Wyman -- 40%
Broseidon -- 6%

and so on, and then everyone knows how much of myself I'm selling and to whom. And my risk is capped at the % of myself I'm selling * my max winnings in the event. Not to mention, since I'm actually playing the event, I'm somewhat collateralized -- even if I am shady and slightly overbook, at least if I have to pay out, it's because I cashed!

There is a huge difference between this and making sidebets on other people's action with somebody w deep pockets, not knowing how much of each horse he's taking action on, not knowing which horses he's taking action on, and so on.

Because in a regular staking agreement when the guy ships a tournament, he's err, just won a boatload of cash by shipping a tournament, whereas Timex hasn't?

I'll believe that your scam risk is way way lower with Timex than with Random McGrinder, but in general this sort of win a little often/lose a lot very occasionally style is a recipe for a blowup.

It's an interesting idea, and it'll be fascinating to see how it plays out, but it's far from clear to me that it's the best way, or even any way, of solving a problem of too much unfussy money.

I want to be on timex side. I want to short people with ridiculous MU too.

Not to get OT but I guess the U.S. government has endless amounts of money to protect from massively over leveraged CDS's and just has to print to cover huge losses. . Easy game

well you can't argue with the fact that it will make the staking market more efficient. as of now, it is a buyers market only, where sellers will put up what they think they can charge (in terms of MU) without risking not selling it all. There's no institution translating the seller's ability or past results into (expected) true ROI. When we have more market makers like timex, it will acutally allow to compare sellers and come closer to a true fair market price, because now we have demand and supply coming along with different prices, conditioned on different expectations. so, bankoftimex is good in terms of effiency of the staking marketplace. whether thats good for poker, or the majority of poker players in general is a different story.

This is interesting. I am going to follow this more.

Except that the default risk is massive - real world futures markets operate with sophisticated systems to make sure people can pay up their losses, without some system of escrow covering a Timex-clone's potential losses, multiple people operating banks is going lead to a default for sure.

The idea of a rich market of brokers is just replacing one problem with a bigger one.

I don't see why people can't just not buy overpriced packages, or make counter offers.

nh sir