Ya gotta believe

Celebrities invited to a Knicks game are spared the indignity of mixing with regular sports fans. They enter Madison Square Garden through an unmarked entrance and ride a VIP elevator up to the luxury suites. It’s the sports equivalent of flying private, but far more exclusive.

How exclusive can a game of basketball possibly be? For Game Four of the NBA Finals, Sydney Sweeney found herself seated in the third row.

I’m sure her ticket was comped, at least, because invited celebrities don’t pay to watch games at the Garden — not even for the NBA Finals.

I’m guessing she also had access to the legendary Suite 200, where the select few enjoy New York’s finest food, drink, and networking before and after a game.

But not during. Never during.

Because there’s one unspoken but inviolable condition to accepting an invitation to sit courtside at the Garden: You stay until the end.

In 2023, supermodels Emily Ratajkowski and Irina Shayk vacated their courtside seats to a game against the Heat with just a couple of minutes left on the clock and the home team seemingly out of it.

Nothing was said at the time. But when Ratajkowski later asked for tickets to see the Rangers (who also play in the Garden), the request was declined.

“She was offered, and is welcome, to buy great seats at any time,” an MSG spokesperson told the New York Post with understated menace. 

Money gets you into the Garden. It does not get you into Suite 200.

A momentary lapse of judgment has relegated Ratajkowski to entering and exiting the Garden amid the hoi polloi, subsisting on overpriced hot dogs and novelty cups of beer, and wondering what kind of movie deals are being negotiated in Suite 200. 

She also missed a great game. The Knicks stormed back from 21 down and won.

Last week, with the Knicks down 29 against the Spurs, Larry David nearly repeated Ratajkowski's mistake. “Let’s get outta here,” he said to his courtside neighbor, John McEnroe. 

McEnroe claims he convinced his friend to stay by arguing the Knicks still had a chance, citing his personal experience of blowing big leads. “Let’s keep it positive,” he said he told David.

I don’t believe him. I suspect instead that McEnroe was simply more attuned to the unspoken rules of Celebrity Row, because no one thought the Knicks were coming back from 29 down.

Well, almost no one. We know that at least a few believed, because people made a killing on prediction markets betting on the Knicks mid-game.

“I won’t confirm the exact loss, but it was a tough day,” Susquehanna co-founder Jeff Yass told InGame. His firm, a market maker on Polymarket, found itself on the other side of high-risk bets: “the majority of Susquehanna’s losses came on in-game bets on the Knicks while the team was a long way behind,” InGame reported.

The bets were not small. “I grew up a Knicks fan,” the Queens native said, “but at this size, I was conflicted.”

I don’t know how much it takes to get a Knicks fan with a net worth of $67.4 billion to root against his team playing for its first title in 53 years, but it must be a lot.

As a market maker, Susquehanna is in the business of collecting tiny profits across many thousands of trades. Most of the time, the nickels add up for them. Occasionally, they get steamrolled by an improbable event like the Knicks overcoming a 29-point deficit.

It should not have happened. In the third quarter, the Knicks had just a 0.8% chance of winning, according to ESPN’s live tracker of win probabilities. 

With 3:30 left in the fourth, things looked only slightly less dire with the Knicks’ win-probability at just 1.8%. With 4.4 seconds left, the Knicks had a still-very-unlikely 14.6% chance of winning. 

But they played until the end. With 1.2 seconds to go, OG Anunoby flew through the lane and tipped in the game-winner.

The Knicks’ win-probability shot to 100%. Jerry Seinfeld was stunned. Prediction market bettors were in the money.

There’s a lesson in that for investors: Like sports, markets are probabilistic.

That’s not how we typically think about them — we’re always talking about what will happen in markets and the economy, not what might. 

But investing isn't about predicting the future. It's about assigning probabilities to many possible futures.

The series of improbable events that led the Knicks to their first NBA title in 53 years is a reminder that our job as investors is to price probabilities, not certainties.

There’s a life lesson here, too: Whatever you’re doing, do it until the end.

— Byron Gilliam