Robinhood to launch 24 HOUR TRADING: A Deep dive
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Oh, that’s just a great idea. Let’s turn investors into crack addicts. Well, investing addicts, whatever you want to call it. Anyway, Robinhood, yeah, good old Robinhood. Looking to add a little fuel to the fire. Well, they got to make some money. I mean, you take a look at their stock and how poorly they have done. They’re going to 24 hour a day trading. 24 hours a day.
Yes, yes, fueling all of these novice investors’ bad habits when it comes to investing. Again, I’ve been doing this a long time, a long time, and it’s prior to the app-based trading platform, zero commission stuff. I’m going to take you back. We’ll go back in time. We’ll go back to the 1990s where you had Stuart from Ameritrade and you had…
E-Trade, E-Trade people, they actually had an office, it was an office, it was a casino in Midtown Manhattan and people would go there and trade during the day. Midtown Manhattan, how do you think these people did? Well, the casino’s not there any longer, but E-Trade, Ameritrade, or DLJ Direct, they had some funny commercials, remember the kid?
who got grounded and his parents took the helicopter away. And I think that they were also the one with the tow truck driver with their own island. Well, back then, back then I was interviewed, this is prior to having a radio shows, 1990s. I interviewed on a radio program and they’re asking me about the rise of all these discount houses and what’s gonna happen to Wall Street. Boy, this is gonna be terrible for Wall Street and the big firms. And I got a kick out of that because again, that’s what, you know, on the surface people would think.
But why in the world would Wall Street finance all of these companies? Why would they fund them if it’s going to lead to their own demise? No, no, all it did, all it did was bring, I’m sorry, dumb money to the table. So you think you’re going to you think you’re going to beat the traders over at Goldman Sachs and JP Morgan and Morgan Stanley? You think you’re going to beat them? You don’t think that they’re going to drink your milkshake because you’re competing against them?
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You’re competing against them. And that’s what I was saying back in the day. I said, these people are just gonna come and they’re gonna lose all of their money. First and foremost, humans, we’re not, they’re not, we’re not programmed to be very good traders. We’ve got fight or flight response. I always talk about greed and fear, setting the trap. And again, and it’s worse once people start making a little bit of money. And then at that time, the dot coms, tech stocks, everything was going up. You could throw a dart.
And I said, this is gonna end badly and people are gonna lose a lot of money and many of these places are gonna go away. And many of them did, some of them stuck around. But then we got to the point in time where we’re at, man, it was maybe about five years ago. Five years ago, I was approached. They said, you know, Chris, we think that you should start your own discount trading platform. You’ve got the radio show, you’ve got all this, you can get it out there.
And I’m saying to myself, you really think I want to be associated with something that I know people are going to end up hurting themselves with? Again, many people that they don’t, they don’t care. They don’t care. Drug dealer, drug dealer doesn’t care that he or she is selling fentanyl and what it might do to that person. They don’t care to them. Hey, you know what? Yeah, it’s, you know, not my business. They want to buy the drugs, buy the drugs. I couldn’t do that.
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And you talk about all the payment for order flow and how these companies go about making money and working with the citadels of the world and the other houses. None of this is good. And I saw maybe some people out there listening, like, well, some traders make money, it’s few and far between. Terrence O’Dean, professor, back in the 90s, I think he was at UC Davis back in the 1990s. I think he’s at Berkeley now from not mistaken.
actually got the information, went through discount houses and saw how people did. And it was miserable. The overwhelming majority of people, almost in totality, did really dumb things. They sold their winners to buy losers, they buy high, they sell low. And it’s the same thing that’s going to happen here. I talk about financial preparation.
financial planning, I rather call it financial preparation. You’re preparing for life. You’re preparing for the opportunities that are gonna present themselves to you throughout life. And we get across that everything in life that has meaning, value, and worth involves work, time, and effort. There’s no way around it. There’s no quick fixes. Who makes money in this? The casinos make money. It’s at the casinos nowadays. Casinos make money, right? These Robin Hood and all these discount houses, they’re basically casinos.
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They are, oh yeah, from time to time you’ll win, but the house is going to win. And again, people, do what you want. It’s your money, but don’t say I didn’t warn you. Watch Dog on wallstreet.com.
