I'm going out on a limb and make a prediction...

[james.hendrickson]

Here is my prediction:

When the markets go down, which they will eventually, you're going to hear a lot of this:

Waaaahhhhhhh!!!!!!
Why did my stock go down!!!!!!
I lost $10,000 on Gamestop!!!!! Its so unfair!!!! Why!!!!!! Why Guys!!!!! Why!!!

There are a lot of younger investors out there who just haven't learned the hard way yet.

[kork13]

Here is my prediction:

When the markets go down, which they will eventually, you're going to hear a lot of this:

Waaaahhhhhhh!!!!!!
Why did my stock go down!!!!!!
I lost $10,000 on Gamestop!!!!! Its so unfair!!!! Why!!!!!! Why Guys!!!!! Why!!!

There are a lot of younger investors out there who just haven't learned the hard way yet.

Funny you mention the younger investors... My generation of young people (entering the workforce in 2005-2010) experienced the 2008 crash, and many of us saw it as a gift, and a great many of my peers took advantage of the low values to load up & garner huge gains over the last decade+, while getting a hard look at exactly what risk really means. The 2008 crash defined how many of us invest today now & into the future. It's also noteworthy that the FIRE movement, although originating in the early 90s, has really gained alot of traction in the 2010s as my cohort caught on.

Today's young investors seem to be more ephemeral, looking for quick wins & ignoring the reality of long term gains. The GME craze and huge interest in options trading by 100% novices (both executing then & apparently trying to squeeze them) highlights that dynamic perfectly.

BL: I guarantee that you will find yourself to be correct, James. These are just my personal observations from the many interactions I've had over the years with my peers about investment practices/philosophies..... But I think the current cohort is going to be in for a big hurt once all of this settles.

[james.hendrickson]

Heck yeah Kork, you can tell someone something, and in a lot of cases, they just have to go through it themselves to learn.

[LivingAlmostLarge]

Hahaha tell that to people who are buying homes now what 2007 was like

[srblanco7]

Here is my prediction:

When the markets go down, which they will eventually, you're going to hear a lot of this:

Waaaahhhhhhh!!!!!!
Why did my stock go down!!!!!!
I lost $10,000 on Gamestop!!!!! Its so unfair!!!! Why!!!!!! Why Guys!!!!! Why!!!

There are a lot of younger investors out there who just haven't learned the hard way yet.

Likely true. Though, speaking from personal experience, I made a few bonehead moves along the way when I was younger. Lessons learned the hard way (hopefully, not too costly) tend to stick with you and shape your perceptions for years to come.

[Captain Save]

I don't think the younger people necessarily don't understand that their GME stock can't go down... I think newer people who havent experienced a major loss will be shocked ..no matter whether or not they think they are mentally ready...

I think people who haven't gone through a major recession like 2001 & 2008 .. might panic.. so in that way a younger person might get a rude awakening from the overall prolonged major market dip ... but as far as the single stock buyers like The Wallstreetbets people .. they probably more used to losses than all of us combined

[bjl584]

Here is my prediction:

When the markets go down, which they will eventually, you're going to hear a lot of this:

Waaaahhhhhhh!!!!!!
Why did my stock go down!!!!!!
I lost $10,000 on Gamestop!!!!! Its so unfair!!!! Why!!!!!! Why Guys!!!!! Why!!!

There are a lot of younger investors out there who just haven't learned the hard way yet.

I disagree.

Spend some time on Reddit r/wallstreetbets.

It's a complete joke that everyone is broke, losses money, that their wives are cheating, and that they might die tomorrow.

YOLO (you only live once) is the battle cry over there.

I doubt that there will be much whining going on from that crowd.

[QuarterMillionMan]

I'll be the first to admit that I took the "sky is falling" approach around 2019 and transferred my 457 large cap fund (9% growth) into a stable income fund (2% growth) and have missed out on the moves up. I'm still bearish in that a correction may be coming due to "kicking the can down the road." But I'll suck it up and continue staying my course. I think the "sugar rush" high especially from the 3rd stimulus is helping equities soar even higher but like James, I predict something looming on the horizon and it won't be pretty.

[ua_guy]

Here is my prediction:

When the markets go down, which they will eventually, you're going to hear a lot of this:

Waaaahhhhhhh!!!!!!
Why did my stock go down!!!!!!
I lost $10,000 on Gamestop!!!!! Its so unfair!!!! Why!!!!!! Why Guys!!!!! Why!!!

There are a lot of younger investors out there who just haven't learned the hard way yet.

My gut reaction is to say, "Yes, ...and?" Every young/new investor learns. Some lose more than others. To make a blanket statement about so many different people and situations is not useful, IMO. But yes, there will be those who whine and want to speak to a manager in hopes of getting their money back, claiming unfairness or unforeseen personal hazard.

Markets crashed right about the time I was getting out on my own and investing heavily in retirement and also purchasing a house (2006). It was unlike anything I had anticipated, but eventually I followed the good advice of my father to realize that some things are a long game. As stunting as it felt at the time, I learned and moved on. It also has given me a unique perspective (and distrust) of financial entities, but I'm still in the game.

[myrdale]

I really think the roller coaster analogy is pretty good. The stock market is going to go up, and down. So long as you don't jump off, you won't get hurt.

The thought of investing in single stocks though, aka Gamestop, is more akin to gambling in my opinion. If you are going to do the research and put the effort into making a judgement on a stock being under valued, and it's potential to grow that's one thing. If you're just looking for the next big thing, well good luck with that.

[disneysteve]

The thought of investing in single stocks though, aka Gamestop, is more akin to gambling in my opinion. If you are going to do the research and put the effort into making a judgement on a stock being under valued, and it's potential to grow that's one thing. If you're just looking for the next big thing, well good luck with that.

I don't think investing in individual stocks is the same as gambling, but I don't think what the WSB crowd did with GME was investing either. They weren't buying the stock because they thought the company had great value and was destined to rise because of it. They did it purely and intentionally to manipulate the price. And they knew exactly what they were doing. The question now is if what they did is or should be legal.

[myrdale]

I don't think investing in individual stocks is the same as gambling, but I don't think what the WSB crowd did with GME was investing either. They weren't buying the stock because they thought the company had great value and was destined to rise because of it. They did it purely and intentionally to manipulate the price. And they knew exactly what they were doing. The question now is if what they did is or should be legal.

By equating purchasing single stocks to gambling, I am looking at it from the point of short term investments / day trading. If you really believe in some particular company, and over time you buy stock in the company, there is a calculated risk but your not looking to get rich quick.

Should what they did be illegal? No. A group of people identified a stock which was being shorted beyond the available units. That group of people then decided to begin purchasing the stock. The result of their purchasing the stock was the price increases exponentially. There is no collusion or conspiring involved. It's not much different that some guy on TV saying a stock is hot and you should buy it.

I would agree there is an argument to be made, if shorts should be allowed to surpass the existing inventory.

I would agree there is an argument to be made, that shorting in general should be banned.

I think Robinhood stepping in and preventing sales of a stock is extremely problematic, and they should be open to law suites for the potential damages they caused.

[disneysteve]

I think Robinhood stepping in and preventing sales of a stock is extremely problematic, and they should be open to law suites for the potential damages they caused.

A bunch of brokerages halted trading on GME. Apparently the clearinghouses (or whatever they're called) require them to have a certain amount of cash on hand to cover everything. When the price shot up, it exceeded those limits so they had to stop trading. I'm fuzzy on the details but that's the basic story from what I understand.

[james.hendrickson]

A bunch of brokerages halted trading on GME. Apparently the clearinghouses (or whatever they're called) require them to have a certain amount of cash on hand to cover everything. When the price shot up, it exceeded those limits so they had to stop trading. I'm fuzzy on the details but that's the basic story from what I understand.

Disneysteve - Its also notable that, while there may have been liquidity rules governing how the exchanges handle order flow...these rules also worked in favor of institutional money in the case of GME. That's a problem for the long term legitimacy of capital markets.