STU BURGUIERE: Put your money where your mouth is: Prediction markets won the midterms

Billions of dollars were spent this election season to lie to you.

More than $12.8 billion was spent on political advertising in the 2026 midterms making this the most expensive election cycle in American history. In my home state of Texas, the Senate race drew preliminary estimates of nearly $573 million placing it among the most expensive non-presidential contests on record.

Despite all the differences between races and candidates, a few things were dependable. Every campaign said it was going to win. Every analyst said their numbers were right. Every super PAC said its candidate had the best policies and character. And the mainstream media picked its favorites, cut to commercial, and served up a dozen ads of warring politicians accusing each other of high crimes and misdemeanors.

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A massive industry exists to bend your view of reality toward whatever our would-be leaders in Washington and the state capitals want you to believe. Americans need a way to cut through that noise. No wonder prediction markets are booming.

As with any new technology, prediction markets have drawn a lot of attention and a lot of criticism. Senators wrote letters warning about election contracts. States moved to sue or ban them outright. And somewhere, a podcaster is still on hour 133 of explaining how it's all rigged.

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Then Election Day settled the argument. Across all tracked federal contests, Kalshi's markets had the eventual winner out front in 98% of races. The markets not only correctly priced non-competitive incumbents they also accurately reflected the razor-thin odds in core battlegrounds.

This wasn't a one-time fluke. Kalshi studied 2,243,741 of its resolved markets, dating from its launch in 2021 through mid-2026. It found that prices became remarkably well calibrated as events approached. In plain English, the prices meant what they said. Events priced at 30 cents happened about 30% of the time; events priced at 90 cents, about 90%.

Outside researchers have reached the same conclusion. Brier.fyi, an independent site that measures prediction-market accuracy, saw a similar pattern across nearly 74,000 Kalshi markets. In a study published last month in the Proceedings of the National Academy of Sciences, researchers examined more than 1 million resolved forecasts across four platforms and found events happened about as often as their prices said they would. A Washington Post review of this year's primaries showed that candidates won about as often as their market prices suggested.

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Despite that long track record, critics will seize on upsets like Democrat Annie Andrews' defeat of Republican Sen. Darline Graham in South Carolina as proof that prediction markets are worthless. The markets had her as the underdog, about a 1-in-3 shot heading into Election Day. But if underdogs never won, the markets wouldn't be working. Upsets like hers are exactly what a 1-in-3 price promises.

Prediction markets don't have to be perfect to be useful. They're an incredible addition to the polling, forecasting and reporting we already have, and they make all of it better.

Serious data journalism is expensive. As newsrooms have cut budgets and staff, the deep dives and data desks have been some of the first casualties. Prediction markets give that work a new reason to exist. When information is worth money, someone will pay for it. That means more research, more deep-dive reporting and more jobs for data nerds. That's a win for all of us. Reliable information has never been more valuable, and markets reward people for finding it, weighing it and acting on it.

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Show me a profitable trader, and I'll show you someone who would rather read a precinct-by-precinct breakdown of Hinds County, Mississippi, than finish a Netflix series. Ask me how I know.

Understanding the world is no longer just something you can show off at cocktail parties. Now, your dedication to the truth can potentially improve your financial well-being and, at the same time, help make all of us better informed.

For anyone who has felt shut out by the mainstream media, prediction markets are especially good news. They're the next chapter in a long story.

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For decades, three networks and a handful of anchors decided what it was acceptable to believe. Rush Limbaugh broke that hold on talk radio, giving millions of listeners an alternative. Fox News Channel followed with "We Report, You Decide." Blogs and podcasts offered additional perspectives and drew attention to stories that might have never been covered.

But with billions of dollars still lined up to twist the truth, we can always use a new way to separate fact from spin.

Prediction markets do that by making you put your money where your mouth is. A campaign insider can insist a race is in the bag with no downside. A trader has to back the same claim with cash. In a market, you only get paid for being right.

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Even if you never trade, you benefit: Markets crystallize all available information into a single number, and that number has no reason to lie to you.

Depending on who you were rooting for, Tuesday was either exhilarating or devastating. On Election Day there are important issues at stake and emotions run high. That's exactly why it helps to have a way to set those feelings aside and see the race as clearly as possible.

In more than a decade of trading these markets, I've learned that the best traders share one habit: They don't invest with their hearts. I've been fortunate enough to come out ahead cycle after cycle, often in years when the results went against what I'd hoped. That's the discipline these markets teach (and require): It's forecasting, not wishcasting. We root for the world we want, but we invest in the world we have.

If investing in elections feels a little strange, consider this: Politicians have been making money off you for decades. Maybe it's time to return the favor.