there is a bet that the Thing will go down in price so that the contract won't be executed. after all, why would someone want to buy something at 2 dollars per the contract when the market now has it at 1 dollar.
this 'naked call' truly allows me to make money out of thin air as i don't even have to own potatoes. it's risky though b/c if suddenly potatoes skyrocket in price, my loss is potentially unbounded vs if i owned the potatoes all they could do is take my potatoes
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like if a cabal of redditors conspire to monopolize all the potatoes and i HAVE to buy from them at 1 million per potatoes i'd go bankrupt!
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if i'm using cash as a buffer, my brokerage would force my hand into buying potatoes as soon as the obligation of the contract exceeded my cash buffer even though if in the long run i think the monopoly would break and i could buy potatoes at their regular price.
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it's like how casinos won't lend you money even though theoretically you can martingale strategy your way to eventual victory given enough money/credit.
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with a naked put on the other hand you are promising to buy without necessarily being able to engorge yourself on all those potatoes. ideally the market price goes up so that you never have to actually eat so many potatoes.
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note that a naked put can be risky but at least the risk is capped. the contract specifies a specific number of potatoes at a specific price so at least you can't be in the hole for infinity dollars unlike the reddit monopolized potato scenario. at most you just sell a kidney.
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when combined, options allow hoomans to have some degree of control over the future. this is their MAIN strength, the ability to think into the future and plan for and around it vs animals which always live in the now.
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it can become degenerate though because the more one projects into the future the more one takes over the Act of Creation and the more one encroaches on God's Domain.
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like if suddenly for some reason my planning creates a world that's drowning in corn i'm forced to rework my world to use all the corn. like turn it into sugar and put it in all the food even though it's not healthy for the hoomans and gives them the diabetus.
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when planning for the future becomes TOO accurate it tempts one to overly commit to a "sure thing" w so many resources that the plan is Too Big To Fail. everyone just agrees to rip up the contracts b/c everyone signed it directly or indirectly. *cough* 2008 *cough*
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the reasons are many. one is that the real world is messy and 3-body-problem-like with internally emergent black swan behaviors as well as externally imposed ones. another is that when projecting too far into the future it's hard to feel responsibility or connection w the thing
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government projects tend to lack quality and efficiency b/c they both tend to be larger scale and don't create a connection between the creator and the creation. Big Boy Projects where the Big Boy pretends to be God tend to be plagued by Plagues.
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those who can buck this trend are revered as heroes or miniature gods. it's like they can see into the future with a God's Eye. they are hailed as prophets who will lead us into the future.
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(though imo in order to avoid false idols it's good to apply some anthropic reasoning. at any given moment there will be ppl going stubbornly and willfully in every direction. there's always going to be someone who is aligned very well with where the world is going.)
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for every hero hailed as such, many more die in obscurity despite them acting from the same core principles. (reasoning from first principles, refusing to conform to arbitrary social conventions, unappreciated gifts, etc...)
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