JUST CALL IT “DEMOCRATIZATION” AND ALL THIS MARKET CRAZINESS BECOMES WONDERFUL, RIGHT?

 

2/1/21

Most of you have noticed that I haven’t been writing much of late for a variety of good reasons, largely centering around the decline of interest in the musings of people who deal in reason rather than emotion.   Rationalizations sell, rationality doesn’t.   Echo chambers are popular, alternative ways of looking at things aren’t.

All that having been said, many people have asked me for my opinions on what’s going on in the markets with the GME fun and games and related silliness.   While, as you might guess, yours truly has more than a few opinions on the matter, most are rather esoteric and of limited interest to most of my readers.   However, something I wrote to one of my closest friends, a guy I used to work with and have known for nearly 30 years, is sufficiently general that I thought my readers, whether financially oriented or not, would enjoy it.   As always, I’m not writing for agreement or affirmation; I’m writing to get people to think, an activity that seems to have fallen out of favor of late:

 

I'm getting a little tired of, and a little nervous about, commentators on CNBC and elsewhere talking about how wonderful it is that the market has been "democratized."   The underlying assumption behind that is that everyone participating has at least a minimum degree of knowledge or insight AND is willing to take his or her losses when things go south.  I suspect neither assumption is correct.   I wish somebody had the stones to say that attaching the word "democracy," or some derivation thereof, to some argument does not automatically endow that argument with sweetness and light.   Someone should be the adult in the room and say that having a bunch of kids play with their Robin Hood accounts when they tire of their video games is dangerous, and especially when they rationalize such behavior by attaching it to some kind of cause.   But nobody wants to offend the "young people" out there and somehow this society has been imbued with the idea that we are ALL equal in EVERY respect, including knowledge of or insights into particular fields.   We are somehow embarrassed to admit that, indeed, knowledge is valuable and experience and study genuinely do improve our abilities in matters that we have studied and/or in which we have experience.   But nobody of consequence says that.  People are cowards, and cowards cower.