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Wall Street Bets And Gambles

Let’s talk about the recent uptick in interest in investing in general. Investing in gold (as the global pandemic kicked off), investing in stocks (after Wall Street Bets from Reddit’s short selling activity), and also investing in cryptocurrencies like Bitcoin. It’s always been a thing that gets certain people excited (myself of course, being one of them!), but recently investing (as a hobby or profession) has seen a lot more interest.

Wall Street Bets

Let me catch you up on the recent excitement caused by r/WallStreetBets. They’re a group of redditors who openly acknowledge that they are not sophisticated investors, who all “play” the stock market, unashamedly. They don’t use high-frequency trading like the big firms, they don’t (all) day-trade, and they don’t all make long-term bets based on the fundamentals, like seasoned investors. They’re a rag-tag bunch of internet meme aficionados who aim to get rich from the stock market.

To quote from Wikipedia:

The subreddit, describing itself through the tagline “Like 4chan found a Bloomberg terminal”, is known for its aggressive trading strategies, which primarily revolve around highly speculative, leveraged options trading. Members of the subreddit are often young retail traders and investors who ignore fundamental investment practices and risk management techniques, so their activity is considered gambling.

Their collective stated goal is to each be able to purchase a “lambo“. To be fair, a lot of them have made a lot of money, and they’ve donated a lot of stuff to people in need. So they’re not all “degenerates”, even though they claim to be. I am not a member / participant, just to declare any conflict of interest that my readers might suspect.

Gold

There’s something so alluring about buying gold. While most people never get it in their hand, it’s a mental effect anyway; people love to own and hoard gold. Most people who know anything about the economy know that when times are tough, people buy gold. Is this true? Yes. Let’s talk about why. People buy gold when they are afraid that currency is going to be devalued. For example, when the global financial crisis hit, everyone thought the dollar was going to crash, so everybody bought gold. The idea is that it holds value as currency, and can be used as currency. It is essentially a currency hedge. The reason gold is so appealing to people is because it was used as currency for thousands of years. It’s also not dependent on the health of a country’s economy. It doesn’t matter if the United States economy is in the toilet, gold will always hold value. This makes it a safe investment.

Another reason gold is so appealing is because it’s finite. This is a prediction that many people are making; that gold is going to rise in value over the next several years. This is a well-known fact; if you buy gold, you can sell it to someone else later, for more money. This is because the world produces very little gold.

Cryptocurrencies

Let’s talk about cryptocurrencies. While most people have heard of Bitcoin, I’ll go over what it is. Bitcoin is a “cryptocurrency”. Cryptocurrencies are decentralized digital currencies. They can be created by anyone, and they hold no physical value. They’re pretty much like regular money, just digital. They’re not backed by any government, and aren’t a medium of exchange. They are just an asset. Cryptocurrencies are a new form of money that are being used in the internet economy. They are a new form of money that has been adopted by new internet companies.

Why are they so popular? They appeal to a certain kind of investor. Many people who invest in crypto are “techies”. Many of them are also very interested in the underlying technology of crypto. Most people who invest in crypto are people who are interested in technology in general.

This is the first article in a series of articles I’m going to write about investing. I will touch upon different types of investing, and I will also talk about some of the people and groups who are investing. Stay tuned for more!

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