This makes me think that, for some people, gambling may be addictive.
When people sincerely said something like: "I have crypto and tesla stocks, I am rich and don't need to work", there are more problems to solve than just gambling addiction.
Otherwise we have to close all the Louis Vuitton stores.
They didn't get scammed, they just blew all their cash. Adults are allowed to do stupid things with their money, it's almost never a crime (nor a tragedy) when it happens.
High fashion is also marketed toward specific classes of people, those with the means and ability to afford them. Meme stocks and cryptos are geared toward small retail traders who don't really have much in the first place. One of these will cause more damage than the other to its targets.
I don't know anyone blowing money on meme stocks or sketchy cryptos that isn't also blowing money on equally wasteful designer "fashion". I don't think they are "geared toward" anyone or anything.
* those who want to appear to have the means and ability to afford them.
Having read a bit about the neuropsychology of gambling addiction, I agree.
Slot machines are specifically designed to turn those who are susceptible to it into addicts.
Some people simply don't have the mental capabilities to distinguish a legit investment from a scam.
Maybe some kind of authorization should be required if you try to wire your life savings to a crypto exchange. But banks only ever ask questions if a lot of money comes in, not when it flows out :D
This is false. My bank made my rent payment late this month by freezing a wire (identical to dozens of others I have sent) because my client geoIP is in Japan.
If you walk into a bank and say "I want to borrow $76,000 to buy a massively overpriced piece of luxury fashion," they're going to send you on your way.
If you log into a web site and say, "I want to borrow $76,000 to buy a meme stock", they'll hand it to you and ask if you want to borrow more.
They will require collateral, but will accept other meme stocks that could collapse at an moment. The bank would give you a loan for a fancy bag if you backed it with your house, but far less likely if your collateral is a bunch of over-inflated stocks.
We can't, and probably shouldn't, protect people from blowing all their own cash. But it should be possible to prevent them from leveraging themselves into destitution. Not only is it bad for them, it's bad for the system as a whole, because it leads to crashes even of seemingly unrelated parts of the system.
The current generation is totally fucked over wrt the cost of education, health, property and pensions.
Reading about stocks, and hype is fun. Reading 10-Ks and building risk models is not.
Even nudging them in that direction is met with the skepticism and ridicule of responses like "Why would I do that?" as if suggesting the idea of doing actual financial analysis has made me grow a second head.
I can look around my coworkers, and... they're not economically desperate at all. Still got a meme-stonks problem though.
Its just untreated gambling addictions. These people are willing to lose tons of money on the off-chance of calling someone else "wrong".
2.5k € after taxes doesn't really count as economically desperate in Germany, I'd say.
Sure, housing is expensive - especially in Munich - but education and health isn't.
This is another hype-driven mania where some people gamble away their money. This guy could have just as well played roulette and bet 50k on a number.
I wonder if any kind of investor/debitor protection would help in these cases.
How did he get those loans? Why would a bank approve a 1.5k down payment with just 2.8k income after taxes, leaving just 1.3k for rent and food in Munich? Might be OK when buying a flat - but for gambling on the stock market?
Should more verification be required for risky or high volume trades? I just need to check some boxes with "yeah, I know that stuff" and I could trade derivatives + options with leverage.
People still fall for Nigerian prince scams, it just isn't novel anymore.
I.e., it isn't about them believing that modern times are different, it is about them believing that they are the ones above the cut, an exception from the average masses, the kind that can thrive in such landscape. Which is the same core premise that's been funding those types of gambles since forever ago.