Bulwark Takes - Easiest Money Ever: Bet Against Elon!

Episode Date: February 26, 2026

Sam Stein, Sonny Bunch, and Ben Parker give their takes on a Wall Street Journal story about a DC tax policy expert who made nearly $500,000 betting that Elon Musk wouldn’t actually cut federal spending, a wager that turned out to be almost free money. They break down how the bet worked, why it was such a lock, how political betting markets create openings for insider trading, and just how absurd some of these political wagers have become.Get 30% off your order with Soul at https://GetSoul.com with promo code BULWARKTAKES.

Hey, everybody. It's me, Sam Stein, managing editor at the Bullwork. I'm joined by Ben Parker and Sunny Bunch. We're here to talk about gambling, Kalshi, Elon Musk, how to make easy money, how to make dumb money. Guys, thanks for doing this. So what sparked our interest this morning was a Wall Street journal piece, which was kind of amazing in a way. Basically, I'm going to try to summarize it, but Sonny will do the full scope of it. Some guy, some tax nerd, here in Washington, D.C., really understood that Elon Musk was a fraud when he started Doge and that the money we spend will not go down because we have these things called entitlement programs that the federal government has to spend money on and they grow bigger and bigger.

Elon Musk wasn't going to touch it. And so he put his entire life savings into the prediction markets saying that we will not, in fact, spend less money at the end of the year. And lo and behold, he was a big winner. Sonny, did I get that right? More or less, yeah. I mean, Alan, Alan Cole's a guy who works at the tax foundation, right of center organization. It's not like he's, you know, radical lib like us at the bulwark, right?

He's doing, he's doing, he's doing, you know, kind of right of center tax stuff. And when Elon was like, yes, I'm going to come in and we're going to slash, we're going to get rid of all the fraud, we're going to slash the spending. He was like, no, you're not. That's ridiculous. Nobody's ever going to slash the spending. That's never going to happen. And so he pulled all of his money out of, you know, the rate. regular stocks and put it in this.

He did not, he made it very clear. He did not literally bet the house. The equity stayed in the house and he, you know, so it wasn't, we wasn't going to be homeless if he, if he lost this. But, you know, I'm sure, I'm sure he really had to have a good chat with his wife. Like, look, this is what you have to understand is money always go up in federal government. Like money, money always go up, never go down. And so I can't possibly lose.

And sure enough, he was right. He even hedged the bets in such a way that like even if there was a $50 billion reduction in spending, which again, possible, he still would have won. He still would have been in the black. Yeah. What were the actual contours of the bet? It was that the, I'm just trying to make sure I understand this. If federal spending, the ridds, if federal spending in each quarter of 2025 exceeded

federal spending in the fourth quarter of 2020, 2024, he wins. So that's the bet. It's like each quarter has to be a little bit higher than it was in the fourth quarter of 2024. And Ben, Ben, you made the point in Slack that whoever wrote this did a terrible job. Whoever wrote the contract for this did a terrible job. Because, okay, a few details here that are important. One, as you pointed out, Sonny, this is mandatory spending, right? Which includes Social Security and Medicare, Medicaid, things Donald Trump ran on not touching, things that were never going to be touched.

things that like even if Congress passed a law they're not they have to spend anyway things and and it's in nominal dollars so even if they spend exactly the same real amount they have to spend more money because there's a little bit of inflation all the time like this is a lock the fact that this guy just put a home equity loan and put that into the yeah he should have bet the house that else is big mistake like he should have bet more everything diamond hands to the moon on federal spending on mandatory spending. Also, the other thing is that even if they had gone after Social Security and Medicare, they weren't going to do it in a way that would cut it immediately. It was always going to be sort of like, down the road, we will do these types of reductions. It would have been a ramp-up. So if you just happen to know about monetary policy, tax policy, anything like that, this was a lot. I'm surprised that more people didn't do this. He was advised by colleagues to do this. Why didn't they also put their money where their mouth is, Sonny? Set aside the experts. the people who actually follow this and understand, again, money always go up.

Like, set those people aside. The fact of these markets is, and the fact of this market in particular, especially when somebody like Elon Musk is involved, who is very much a figure of adoration amongst the sort of person who is attracted to Kalshian polymarket, right? Like those people are like, yes, of course Elon will lower the spending. He's going to doge it. He's going to use the AI and they're going to come in. They're going to find all the extra spending.

they're going to find the fraud because the private sector is so good at these things. You know, the government is wasteful and terrible. Elon Musk is very smart and has these great systems. And so he's going to come in and change it. So he wasn't even really betting against, he wasn't betting against Kalshi, but he also just wasn't even betting against the actual funding, right? He was, what he did was he saw a market where all of these Elon Musk-addled dorks were like, yes, of course he's going to do it and took advantage of it.

There was a huge asymmetry in it. That's what's so interesting about this to me anyway. Well, that and Ben, the other thing is that there's like this whole, I mean, I'm sure there's insider trading happening on these platforms because they're completely unregulated. But Sunny's got a good point, which is that because these platforms are expanding into fields so rapidly, including politics, people who just sort of know the system and how it works are going to stand to have a much better advantage than casuals who have just come on board and decided, oh, yeah, we're obviously going to be going to work.

with around by Friday, right? Like, you can basically read the tea leaves much better if you've actually been around the block. Yeah, a little bit. Or if you just paid attention in school, in civics class. Can I read you this? Can I read you this one quote from the piece? Because this is, this is so great. So part of the, part of the article is in the Wall Street Journal is about how Cole had to convince his wife to go along with this bet of all their life savings. She read comments on the Calshy website from people on the other side of the bet and grew confidence that they didn't seem to understand what they were buying. That's it.

It's like, and there is a delicious part of this, which is like the guy who did pay attention in civics class and in his polysaciclass class got one over on like kind of the tech bros, the learned to code crowd, which I just savor in my soul. I mean,

that is, that is like, they're going to make a move, they're going to make a money ball about me one day. And it's going to be, there is some money ball. Also, we'll put the pictures up by,

well, that's hopefully, but the pictures of the journal uses of Alan Coe are absolutely fantastic. It's like this dude just sitting back. He's clearly a, you know, a think tanker. And he's got a, what is it, a glass of scotch or something on the front picture.

Sure. He's got a tumbler with like the Constitution, like we the people, like engraved on it. The other one is, I think the another one he's in a black tie tucks just on his couch checking his phone with the sunlight draped on him. It's amazing. It's the most DCR you could possibly. As we all do.

do, come on. You're telling you, it's after 5 p.m., we're in form aware, Sam. What are we? Let's talk about Cali in the predictive markets and how they're being adopted in politics writ large, because they're everywhere. And for full disclosure, Sarah discussed this on the live stream last night. I mean, you know, we have people from that world trying to advertise on the bulwark. We've said no. But they're everywhere. Like, I don't know if you guys saw it, but Nick Shirley, the right-wing provocateur video investigative journalist, he's not going around wearing a polymarket hoodie sweater because he's sponsored by

polymarket. There's this guy Walter Bloomberg, some infamous Twitter account, who is putting up posts that he said are sponsored by polymarket. So it's everywhere this stuff. How do you think it's changing our politics fed all sunny? Well, I don't know. I mean, it's interesting because I was flipping around the politics. contracts. And I was kind of curious, particularly the ones in Texas, right? I, you know, I live in Texas.

So I'm paying some attention to the Democratic Senate primary here. And right now, James Talarico's, I think, 80% to win, which I strikes me is very high. That's insane. That is, yeah, I like 80 cents on the dollar, which I, like, if I was a gambling person and I'm not, I'm terrible. Quick story about how terrible I am at this. I just, went to look and see how, how, how, uh, what the odds are on Virginia men's basketball team. Because I went to university. Virginia was like, oh, maybe, you know, they're probably pretty decent odds. And 50 to one. It was 50 to one odds. I was like, oh, that's not bad. That's like, wait a second. Went to fan duel. Fan duel had it for like, 72 to one. So I was like, I would have, I would have been leaving money on the table if I want to make that bet. Anyway, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the, the,

many polls, not all of them, but she is like, I think she has a higher profile. I think she has, at the very least, as good a chance to win as he does. And she is a massive underdog. So that's the sort of thing I would be betting in, but I'm terrible at betting, so I don't do it. I don't do it. I don't do this at all. It's a, it's, how is it, but how is it affecting politics? I think it, the thing that drives me craziest is when people treat these as a substitute for

actual polling. Right. That drives me insane because I don't think it, I don't think it, I, you know, people are like, well, on Polymarket, this person has a 50% chance winning the primary. I'm just like, no, that's not what this is saying at all. You're betting against what other people think is going to happen. Basically, it can flip and, you know, with one piece of information. So there's not really any wisdom at all.

Bullwork takes is sponsored by soul. I've been more mindful about eliminating anything that is affecting my health habits like my workouts, sleep, bedtime routines, and energy. so I've cut back on the evening glass of wine and instead I'm reaching for Sol's out-of-office gummies. They give me a light, happy buzz without the calories of the next day drag because I don't need my parenting skills drag down. Soul makes feeling good simple.

Make delicious hemp-derived CBD and THC products with precise dosing, clean ingredients, and formulations design for predictable, feel-good effects. Soul is the alcohol alternative that puts you in control. of your mood. Their best-selling out-of-office gummies deliver a customizable, calming buzz for a 1.5 milligram microdose. That's for a gentle lift, or the 15 milligram deeper, more elevated experience. Cautionary tale there. It's the easiest way to unwind without the groginess or next day regret of alcohol. Give yourself the gift of a healthier unwind. Right now, Seoul is offering our audience 30% off your entire order. 30% amazing.

Go to getsold.com and use the code bullwork takes. That's getsold.com promo code bullwork takes for 30% off. Fact check for you. Currently on call sheet, James Telerico has a 71% chance of winning to Jasmine Crockett's 31%. There was a poll this morning that had her up 56 to 44. So that's it. I will say there's also James Talaiko's mentioned in another bet. 2028 Democratic nominee for president.

He's at 3% probability. LeBron James is at 1%. I don't like any of those odds. I wouldn't have bet on either of them. I could have sworn there was a brief moment after the 2020 election when I think predicted had Donald Trump favored

to be the next president after the election just because there were a bunch of Trump super fans in there dumping all their money by Trump, buy Trump. It's bad. I think it's creating bad incentive structures too. And we did reference the insider trading

sort of in passing. But I do think, I mean, there's going to be huge opportunities There already are for people to just do insider trading on this stuff. We actually got a taste of that, non-politics related. As we were prepping for this show, a story broke on NPR, Mr. Beas, editor suspended and reported for insider trading. It goes like this. An editor who works for YouTube's biggest creator, Mr. Bees, has been suspended from the prediction market platform Kalshi

and reported to federal regulators for insider trading. Kalsh official said on Monday, it's the first time the company has publicly revealed the results of an investigation into market manipulation on the popular app. Mr. Beast's employee who Calchee identified as a micaw named person, traded around $4,000 on markets related to the streamer. The company said, Cal she then tweeted out, fuck around, find out, as if it's some sort of big regulatory body. But that's like, it did raise the question. Like, who's actually regulating this? Just the company self-regulating, I suppose. As I said to you guys before we started, who, they're levying fines on their own platform. Like, how does that even work? Yeah. Sunny, when you go to Vegas and you count cars,

in the casino. It's not like they call the cops on you. It's the casino that takes care of it. This did happen to me last time I was in Vegas with Sarah Longwell. I had a trip to the back room. It was not pleasant. I wouldn't like it. Let's close up here by I asked you sonny to find some of the surest bets or the dumbest bets on Carl Shee. Can you go through some of your findings, please? Again, I'm really, really, really bad at these things. I can't, I can't tell you what will, what will happen or won't happen on anything. I'm the sort of guy who goes to these. things and like, yes, one battle after another will win best picture. Okay, I'll bet one dollar to win 10 cents. Yes, I will do that. That's, uh, that's me. So I'm, I'm very, I'm very bad at this.

Um, but I do love, uh, our producer, Matt pulled this, uh, a wonderful one up about, um, Survivor. Survivor, the Survivor premiere. What will Jeff Prope say during Survivor episode one? Will he say the word alliance? Will he say Mr. Beast or trust? Why are people betting on these I don't understand it. I've seen videos of people watching Donald Trump speeches because they bet on him to say something. And they're just waiting and waiting. And then he utters it out and this like pure joy comes over them.

Because people are idiots and they live on the edge like that. There is one about what will Trump say this week? Sleepy Joe came in at 56%. Transgender, 59%. Some of the ones at 99% are 50,000. Why would you say 50,000? The Dow crossed 50,000 briefly. Oh, yeah, Dow 50,000.

Okay. Drill Baby Drill at 99% Hockey at 99% Melania 99% Nobel 99% all these are sure Somali 99% Where are the deals

I want some upside on these bets I gotta wonder Why is cookie at 47% 47% to say cookie What the fuck? Why would he say cookie? I don't know And so this is the genius

of Alan Cole If we can bring it back to the story here Because he saw this and was like Wait this doesn't make any sense sense. I know this better than these people do, obviously. The problem with me is that I look at things like, I'm like, okay, will, will, so there's, you can bet on rotten tomato scores. You can bet on rotten tomato scores. And obviously, I can't do this. As a rotten tomato certified critic, I wouldn't want to improperly, you know, impact the, the, the ratings here. But you can bet, for

instance, on whether or not Scream 7 will be above 55% or above 60% or, let's see, Let's see. What else? Or above 45%. Then what's to prevent you from like trying to just game the rotten tomato scores? Kelsey will come after you. Yeah, Kalshys Enforcement Mechanisms will find you. Set up bots to do the audience one.

No, I was saying before this started, I was saying that we should be doing this at the, at the, you know, the bulwark maybe. How many likes will the next JBL post get? And we've, if we know it's like a, you know, Trump in Minneapolis, that's going to be, that's going to be a big one. You take the over on that one. But if it's like electricity production in the northwest from 1950 to 1970, that's low likes on that one. That's not going to be a banger.

So like we know ahead of time what it's going to be. We got to bet on this. We got to start making, we got to start making a little bit of side revenue here, Sam. Come on. Are you basically saying you're going to be shorting triads? No, I'm, no, I'm betting on the triads. I would never, like Pete Rose, I would never bet against JVL. I would only bet on it.

There is one thing that Alan Cole probably is looking at, which, which peaked my hands. interest, which is because it's right in New Zealand. Will Americans receive a tariff stimulus check? And they have different odds before July, before August, before 2027. None of them have great odds. So probably wouldn't bet on them. But if they were to tick up, that's a surefire one. It's like, no, they're not going to get the checks. They will never come. Wait a minute. I looked into this one a little bit. Did you read the fine print? I looked into this one a little bit. It says at least one million Americans have to receive a check of at least $1,000 each that basically some part of the federal government says comes from tariff revenue, which is, I mean, money's fungible, right?

They can send out checks from some account and say like, oh, yeah, this revenue came from tariffs instead of taxes because like, who cares? What's the difference? So I don't know. So maybe you should take the bet then because it's only 24% before 2027. Would you take that? I don't know. That's not bad.

That's not bad. No, my favorite one here, I sent this to you guys, is the aliens one. Will the U.S. confirm that aliens exist before 2027? Here are the rules. If the president, any member of the cabinet, any member of the Joint Chiefs of Staff, or any U.S. federal agency definitively states that extraterrestrial life or technology exists before January 1, 27, the market resolves to yes, right? It's currently at 23 cents.

Now, here's the thing. What if somebody just comes out and says, yes, we found microbes on Mars? Does that count? Yeah, who would judicates this? Does it count as definitively if it's RFK in here? Who adjudicates whether the actual announcement is sufficient to, you know, collect the bet? Outcome verified from White House. I don't know what that means.

I don't know. I don't know who. There must be like a Kalshi person at the White House is like, yes, this one is yes. No, this one is no. I will say I'm on the page now. February 19th, the odds were 17.5%. February 20th, it went up to 27.7%. I believe that's right when Trump put out his post about declassifying all that shit.

So the market moved, but now it's back down to 23%. I don't know why they don't think Trump's going to follow through on that one. Guys, this was fun. I don't know what else to say. Maybe he's in those files, too. Yeah. Well play, Ben. All right.

I think we could leave it there. If folks want to hear more betting content, subscribe to the bulwark. We're going to do more of these. I'm probably not going to do any more of these. We do them occasionally. No one seems to really like this topic. We find it very funny. Ben, Sonny, thanks, guys.

Really appreciate it.