Comment by mikeyouse
12 years ago
That's all well-and-good for SpaceX but it proved to be pretty catastrophic for the dozens of pump-and-dumps that bankrupted many Americans when we tried that previously.
12 years ago
That's all well-and-good for SpaceX but it proved to be pretty catastrophic for the dozens of pump-and-dumps that bankrupted many Americans when we tried that previously.
We don't use legal mechanisms to protect citizens from an endless myriad of things, many which are much more dangerous than investing in private startups. This is really a way to keep the proles out of the good investments. It's infuriating and unjust that the wealthy have more rights.
> It's infuriating and unjust that the wealthy have more rights.
No they don't have more rights. There is nothing preventing you from creating your own private company and sell equities only to poor people.
It's like people having a party and not inviting you. You can be frustrated about it, but please don't start whining about them violating your rights or anything. Just as people have the right not to invite you to their daughter's birthday party, they have the right not to do business with you.
Doing things in private association is a right everybody has, regardless of wealth.
> There is nothing preventing you from creating your own private company and sell equities only to poor people.
That's not actually true, which is what the people upthread were referring too. It's not that companies simply don't elect to sell equity to poor people, they aren't actually allowed to in most circumstances.
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Certainly there's that risk. But saying that only millionaire's are 'smart enough' to invest in private companies seems worse.
It's not about whether they're smart or not - it's that a multimillionaire can lose a bunch of money on a private company and not be out their retirement savings. That's not nearly as true for the typical middle class person.
Agreed, but I could drop a couple K on SpaceX and it wouldn't hurt me if it disappears.... but I'm not allowed to.
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So has putting it all on black in Vegas, alcohol, and any other number of statistically proven vices. At least investment has some measure of upside. But yeah, I'd like the $n trillion in debt government tell me how to manage my money.
The government that is able to borrow money at an interest rate lower than inflation? Yeah, they probably could tell you (and me) a thing or two about how to manage money.
They should borrow all the money and invest in an index fund. (Only semi-serious.)
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Sounds good in theory, but nowadays what happens is companies go public when they are fully valued, making them ripe for collapse when insiders take advantage of the liquidity to exit positions. When companies go public early, opportunities are created for retail investors to make huge money (AOL, Dell, Amazon, Walmart to name a few examples). Now it's like, you get to buy at the very top and it's for your own good. horaaaaay
If you believe that then short some of these companies. I agree the game can be a little rigged but there is still massive opportunity to invest well on the open market.
I know what you are getting at, but by the time the average Retail Investor can even get the opportunity to short the stock it is truely gambling.
"In a hot IPO, when many investors are clamoring to get shares, many of those who do get the newly issued shares will flip it—immediately sell it in the open market for instant profits. The investment bank must, by law, sell the new shares at the offering price regardless of demand. Because of the demand for the new issues, they have to be allocated, and usually it's the biggest clients of the investment bankers who get the issue—small investors almost never get to participate"
http://thismatter.com/money/stocks/investment-banking.htm