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Comment by eric_cc | Hacker News Reader

> people are not (and we do not expect them to be) experts in investment.

So then they should stay out of the game. I totally disagree that we need a bunch of bullshit laws protecting people from poor decision making.

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It's amazing the gymnastics people will do to shift responsibility off the supply side and onto the demand side. No, lying should not be rewarded. Ponzi schemes should not be rewarded. Currently, they are. Yes, we need more responsibility -- on the supply side.

Demand side already has responsibility and correct incentives: the fools have been parted from their money. Done.

This goes for small things, like NFT ponzis, and big things, like turning housing into an asset class.

I don't think saying people need to take responsibility for their actions removes blame from the supply side. I think the underlying point trying to be made here is that both are at fault. I mean, with crypto, you are the supply side the moment you buy in, and are just as complicit in the Ponzi scheme as the guy you bought from. Being more ignorant than the other players buys very little sympathy from me when you're both playing the same game with the same information available to you.

I was with you until the last sentence.

When has housing ever not been an asset class?

Real estate is and was the original asset class.

I think "housing" here means "real estate" + "people living inside".

I’m not sure how that distinction makes a difference.

Within the western world, that has always been the primary basis of one’s wealth until fairly recently.

That's not what the post you replied to said at all and you are being intentionally obtuse. There is a reason the SEC exists. It's not to keep people from making bad decisions.

Well, it sort of is. The rules about not lying to investors, having accurate financial statements, and so on, are to help them avoid making bad investment decisions. The "accredited investor" limitations are supposed to make it harder for unsophisticated investors to lose their money.

Not really, it is to preemptively stop scamming.

I think the issue is assuming people who get scammed are at fault for something, just because a more paranoid person would have avoided the scam.

Regulation will not stop me from selling a potato for $100. it will stop me from selling a regular potato for $100 while claiming it cures cancer.

Buying a potato for $100 would be dumb, and nothing stops me from doing it

Buying a cancer-curing potato for $100 is not dumb. Believing a potato can cure cancer because someone else is publicly selling it to me that way in full view of the entire world is not dumb. I would think "oh wow, something about this potato must be cancer-curing because surely this guy knows that if he scams me in front of the public then the public will hold him accountable."

So it is now time to hold people accountable

https://www.sec.gov/about.shtml

Basically, it's exactly that.

So no, it's not. The SEC is there to protect investors from malicious actors to allow them to make informed decisions not based on lies & manipulation.

Now one can be informed but also choose to make stupid decisions. People do this all the time on penny stocks, options, etc... The SEC has no interest in trying to stop them, just making sure they know up from what they are getting into.

Non accredited investors aren't allowed to invest in many things where the seller of securities is telling the truth. Most startups in the US under most scenarios cannot go around pitching non accredited investors.

Other than that, lies and manipulation are part of the equation. It's a bad decision to blindly trust anyone or anything. You can't separate smelling bs from judgement.

The whole concept of an accredited investor is basically saving people from themselves.

That is more gatekeeping than anything. There are plenty of very risky plays available in the stock market.

Why are they gatekeeping? To protect people from themselves.

The SEC has a pretty ill defined set of risks they are trying to protect people from. People will find ways to lose their money if they don't have a general "wait, do I have a clue what I'm doing here?" filter.

this is about as logical as saying "just because we signed a contract doesnt mean I need to uphold my end of the contract. you should have known I wasnt going to be able to fulfill my end of our agreement"

I agree with personal responsibility but not at the expense of communication.

Imagine if every single person who moved a package was required to open the package and confirm the contents. It may be the only way to accept personal responsibility for its contents, but it's dumb. I am telling you what the contents are and if I am lying to you then I need to be held accountable. Especially if the contents are dangerous and I told you they are safe.

Yes but the thing is that you know that this "asset class" is unregulated - in fact it's one of its strongest selling points and one of the traits people tout as a benefit - it should be abundantly clear that "non-scams" are the exception not the norm.

If I write "i owe you a billion dollars for your 64 diamonds" on a minecraft sign you shouldn't be surprised if I don't hold up my end of that.

Regulation has almost nothing to do with it. Regulation is a means to make accountability scalable. you could write a never ending list of possible regulations, but the ones we settle on are the ones we need due to the ways people end up abusing a lack of regulation. It does not absolve the abusers of accountability.

The more a community holds itself accountable without regulation, the less regulation the community needs. If people always avoided unregulated assets because of your logic - we wouldnt have any regulated markets today.

Non-scams are the norm where I come from and with the people I interact with. Maybe it is cultural. Some cultures held people accountable for their bullshit and some didnt... and now the expectations for responsibility are different. "you should expect to get scammed" vs "if you find a scammer we will deal with them"

>If I write "i owe you a billion dollars for your 64 diamonds" on a minecraft sign you shouldn't be surprised if I don't hold up my end of that.

If you take my 64 diamonds, deny me a billion dollars, and then refuse to give the 64 diamonds back.. that is theft. In minecraft, I would then proceed to remove your health bar, take what I want from you, pour lava buckets on your house, etc. And you should not be surprised by that.

Abusing a lack of regulation causes chaos, and hinders the ability of communities to grow stronger. Weak communities enable unnecessary suffering. There is an ethical responsibility to make an example out of people who manipulate communication to scam others. It is one of the few things nature allowed us to have to enable building communities in the first place.

If scamming is currently the norm, then it is currently hunting season.

Regulation or lack of it doesn't fundamentally change contract law. So, it's not the same thing. People who say financial markets shouldn't be regulated are not saying you shouldn't be able to litigate.

We need laws protecting people for malicious actors with significant funding who target people that lack knowledge on deeply technical topics like investing.

I get reminded of the crypto.com commercial with Matt Damon that pretends as though buying Bitcoin is some grand adventure for those brave enough and looking to prove their masculinity.

both fiat and bitcoin currencies are purely memes when you really think about it.

We might not. People could learn from the long history of people being conned. I know zero about cars - if a guy knocks at my door tomorrow telling me I can sign a contract and get a brand new porsche delivered next month for an upfront cost of $10k, my lack of car knowledge isn't a problem. It's a no.

Yeah, let's eliminate all regulations. Some of you may die, but that's a risk I'm willing to take /s

I mentioned it to another, but have some humanity and empathy for those less "smart" than yourself.

The empathy goes both ways. Many people who oppose regulation like this don't oppose it because they are happy for "dumb people" to lose money. They truly believe that there is so much regulation these days that people aren't faced with conmen often enough to wise up to it. A person offering you "product insurance" at the checkout is conning you. The car dealer is trying to con you. Anyone suggesting you can double your money fast is conning you. If you are a woman, there is a decent chance the random guy buying you a drink is just trying to bed you. It's useful to come across enough folks trying to con you so you realize it's a thing. Then when the guy proposing some complex financial proposition knocks at the door, you don't need to know anything about finance to know there is a good chance it's a con.

That's not empathy though. The thing is, a lot of folks will get conned over and over, especially as the times change and the cons evolve.

You're still thinking of it as something people can learn, but psychology / history says otherwise.

This is why I say empathy is important. For you, it's obvious. For others, it's not.

In addition, there are other factors at play, like desperation (when you're living paycheck to paycheck, you _want_ to believe there's a way out).

Everyone has different experiences / situations to grapple with, and as a society we should try to help folks find the happy path and protect them. Especially so for those of us who recognize cons!

So I guess I wouldn't understand the "empathy goes both way" statement.

I'm saying you need to empathize with folks who want less regulation, ie they are largely well meaning, and it's a valid position.

Your points are certainly valid. I don't think either way results in something perfect or even that good.

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