But shouldn't the Market be as fair as Casino Gambling?
Neither are fair, and neither were ever meant to be. The comparison is absurd from a mathematical perspective alone, with respect to bounded and unbounded processes. The distributions that arise in casinos, however small ones' odds are, are Gaussian, and that's why they can tilt the odds even further in their favor by serving alcohol, keeping clocks off the walls, practically giving food away, limiting how much you can bet per hand/sitting, and through their reservation of the right to ultimately ban certain players. On the other hand, financial market returns are distributed leptokurtotically, which is why small participants tend to get blown out and, occasionally, large participants do too.
When was the last time you heard of a casino failing due to losses?
Equating investing/trading to gambling is a fundamental, epistemological mistake. Not that most people aren't actually gambling in the colloquial sense when they throw many at a stock, but the comparison from a process perspective is simply not apt.
Or if not, than should the small guy even be in the Markets at all? Especially those 99% who are at work and unable to follow the Markets during the day?
That's not for me to decide. It's their choice.
Aren't there just too many people or groups like Hedge Funds or others that get important information in advance, even with Reg. D?
You mean Regulation FD, right? LOL.
And to ask if there aren't "too many" people who get important information in advance, apparently you think that some people getting information in advance is justified.
What market participants are they, and why?
And even if one "buys into" the fact that the Market is too big to regulated effectively and some abuses will occur, is the small guy stupid to be a player?
I don't think size is a factor in regulation, I think regulation is the factor. It's a philosophical matter, really, but as I see it most attempts to regulate - except for where physical harm or fraud are concerned - are inherently biased and invite (quite lustily, I'd add) the Law of Unintended Consequences.
Is the "small guy" too stupid to be a player? I don't know that he's "stupid," but many such folks are definitely strange in thinking that while in most areas of life they have to (and do!) accept that society and commerce brings intrinsic tiers of access, service, and privilege...in the financial markets they carry some pretty humorous expectations of equal treatment and access. But, I guess it's kind of nifty - that uniquely American sense of entitlement, and all. Maybe that same sentiment is what leads Americans to excel at so many things?
Shouldn't this worry everyone...
I'm in no position to say what should or shouldn't worry "everyone," and you aren't either. This particular issue doesn't worry me, though.
...or is the BW article just a hype job and totally exaggerated?
It's hype, but having not read it I'm not in the place to decide how exaggerated it is. I say it's hype because when the markets were going up, the covers of every John Q. Public, middle America magazine and newspaper sang the praises of analysts and described in flourishing terms how wonderful things were, how great it was to be an investor, and all of that nonsense. Media is a business like any other, and to make money they have to perch themselves squarely within overriding public sentiment. Articles such as these, in times such as these, are not reporting issues. They're reacting to them. It's a yawn factory.
Do those 99+% even have a fair chance?
"Fair[ness]" is as meaningless a term as "greed." There's no absolute standard, whereby the issue automatically becomes moot. On the other hand, I find far more purchase in saying that not only do 99% not have a "fair" chance at anything - this being life, and all - but 100% don't have a "fair" chance, ultimately.
Too philosophical? Sorry. I'm outside and it's a wonderful day in NYC. :)
LP. |
