War Of Words: Robinhood Responds To “Disappointing, Elitist” Charlie Munger Bemoaning “Speculative Orgies”
Investing legend Charlie Munger didn’t pull any punches when talking about Robinhood and the gamification that is driving new investments in the stock market over the last few years. In an exclusive interview with the Wall Street Journal, the 97 year old Vice Chairman of Berkshire Hathaway sounded off about the “wild speculation” created by the budding brokerage.
“I hate this luring of people into engaging in speculative orgies. [Robinhood] may call it investing, but that’s all bullshit,” Munger said on Thursday.
“It’s really just wild speculation, like casino gambling or racetrack betting. There’s a long history of destructive capitalism, these trading orgies whooped up by the people who profit from them.”
His comments on Thursday came after statements he made on Wednesday at the annual meeting of Daily Journal Corp., when he said “it’s really stupid to have a culture which encourages as much gambling in stocks.”
He said at the meeting: “You should try and make your money in this world by selling other people things that are good for them.”
“If you are selling them gambling services, where you rake profits off the top like many of these new brokers who specialize in luring the gamblers in, I think it’s a dirty way to make money, and I think that we’re crazy to allow it,” he continued on Wednesday.
He said excess in the financial system was located “in the momentum trading by novice investors lured in by new types of brokerage operations like Robinhood.”
Robinhood responded by calling his comments “disappointing and elitist.” A Robinhood spokeswoman responded:
“In one fell swoop an entire new generation of investors has been criticized and this commentary overlooks the cultural shift that is taking place in our nation today. Robinhood was created to allow people who don’t have access to generational wealth or the resources that come with it to begin investing in the U.S. stock market.”
Munger fired back on Thursday: “Everybody wants to protect their way of earning a living. That’s just human nature. That’s all I want to say about this.”
“I think all of this activity is regrettable. I think civilization would do better without it.”
Fri, 02/26/2021 – 14:15
via ZeroHedge News https://ift.tt/3koriyY Tyler Durden