Juggling Dynamite

Some much-appreciated levity this morning in this lovely cover.  Enjoy.

What a Wonderful World by Louis Armstrong, covered by Reina del Cid and Toni Lindgren.  Here is a direct video link.

The ‘Reddit mob’ has legitimate reasons to feel retaliatory against a financial sector that has increasingly been run by and for predators that are afforded advantage at the expense of their customers, economic strength, taxpayers and workers, worldwide.

But there should be zero delusion that broker/dealers, including the deceptively named ‘Robinhood’ (presently working with investment dealers to cash out its founders in an initial public offering), are platforms designed to “help the little guy.”

The truth is that the zero-commission services were adopted when it became clear that this would attract more users and financial intermediaries could make much larger profits selling their customer order flow to high-speed predators.

Decades of data and experience attest, meanwhile, that individuals expending their time and emotional energy trading financial instruments may ‘win’ periodically, but almost always end up losing money in the end.  See a few of the studies noted in Attention Robinhood power users: Most daytraders lose money:

Given this evidence, why does day trading persist, and why is it so popular? The authors concluded that very active traders seem to believe they know more than they really do. “Overconfidence can explain high trading levels and the resulting poor performance of individual investors,” the authors said.

Their conclusion echoes those of the other studies. “Our central message is that trading is hazardous to your wealth. … Those who trade the most are hurt the most.”

A world of financial platforms, news providers and services are designed to lure individuals with the ‘easy money’ siren song of security market participation.  The more fevered and long-lasting the buying frenzy, the wider the capital losses in the end.  This time won’t be different.

Recent high-profile fights between different groups of computer-enabled-levered traders are just more evidence of the wild-west that poor oversight, purchased advantage and revolving-door appointments have made of so-called ‘investment’ markets.  The loss-cycle this accentuates will hurt all participants, the overall economy and taxpayers.  Shit-show exemplified.  Senator Warren correctly connects the dots in this interview.

Sen. Elizabeth Warren lambasted the Securities and Exchange Commission on Thursday for the regulator’s failure to take action after a dayslong blitz of market speculation.

“We need an SEC that has clear rules about market manipulation and then has the backbone to get in and enforce those rules,” Warren said. “To have a healthy stock market, you’ve got to have a cop on the beat.  That should be the SEC,” she added. “They need to step up and do their job.” Here is a direct video link.