I kid you not. Fantasy baseball invented what Warren Buffet calls “financial weapons of mass destruction” – synthetic derivatives.

As we all know fantasy sports provide an answer to the age-old puzzle:  I’m getting older. I can’t play any sport too well anymore, and never really could. But I think I’m smart enough to manage a professional team. The problem, of course, is not my prodigious talents. Rather it is the supply of major league baseball teams – there are only 30.  Due to reasons beyond my control (connections, not talent) I’m not likely to get my chance. So for six months of the year I have to watch some jerk manage my favorite team.

baseball

Along comes fantasy baseball and it solves the supply problem. It creates an unlimited number of teams to be managed. I now can let it rip. Also, it allows me to gamble, yet another activity that goes hand in glove with sports.

We didn’t know it at the time, but your favorite pastime – rotisserie baseball – provided the perfect model for Wall Street. It solved their supply problem. It solved it so well that it nearly took down the world economy. (more…)