I grew up recognizing Warren Buffet as the richest investor — and thus best person — in the US and the world. His approach of buying “discarded cigar butt companies with a few good puffs left” (which I now understand he discarded following notes from Charlie Munger) made intuitive sense to me. The logic was implicitly to have conviction that outlasted the rapidly shifting opinions of markets. That makes intuitive sense to me.
Nowadays, I subscribe to many investment-related email lists where the list owners clearly want to appeal to “day traders.” From a purely economic standpoint (economic, here, meaning rational actors seeking to maximize individual self-interest), this makes sense: the purveyors of “trading advice” have an incentive to retain readership. Ergo, the incentive is only ever short-term, as durable guidance — ie teaching a man (or woman) to fish — would run counter to the business model used to retain readers, which is keeping audiences afraid to ideally sell them antidotes.
Amid this paradigm, there’s limited utility for a long view, which is often derided by newsletter purveyors, whose business models depend on anxious actors, not folks willing to consider ups and downs as part of life and graphs. Indeed, I have begun to see day-traders as essentially addicts seeking out just another bump of that sweet, sweet dopamine. When I was a kid, ~30-40 years ago, the notion conveyed to me related to investing was strongly tied to the mechanics of business. I am essentially positive you were taught roughly the same things as me. However, I think extreme market distortions began in the 1980s and continue today. Whereas I was taught that investors essentially bet on businesses, various derivatives (and cryptocurrencies) have proliferated such that it’s now possible to “invest” in things now that have essentially no connection to “the real economy,” making me wonder why those things even exist in the first place.
At any rate, the proliferation of exotic and dubious financial products sincerely leads me to wonder if these things only exist to obfuscate and create economic tools, which, of course, is a way of propping up, to borrow a term from Veblen, “the leisure class.” Essentially, it appears, one segment of society is tasked with having money, another is tasked with scaring them about losing it, another still is told that it needs to get more or that its members are stagnant, thus essentially less valuable. At that point, religious entities get involved, because their models entail leveraging humans in ways that markets do not. Now, the circle of life is complete. Wait — no, the state needs to get involved, too. In this metaphor, the state is tasked with implementing numerous tolls and extracting fees. Ok, I think that’s all. Society is now ideal and complete. /s