Episode Transcript
[00:00:00] Foreign welcome to the John Lothian News Daily Update podcast for December 20, 2024. I am your host, John Lothian. In today's John Lothian Newsletter Update, where we are irreverent but never irrelevant, we'll explore gambling in the markets, an interview with James Putra of TradeStation, and our top three headlines. Don't forget to subscribe to the John Lothian Newsletter and Follow us on johnlothiannews.com, marketswiki.com, linkedIn, Facebook, Instagram X and threads. Let's dive in. Here are the hits and takes comments from today's JLN I've always been concerned about the perception that the markets and gambling were the same. I have always sought to differentiate the two and not use gambling terminology to described market activity. It was not that long ago that futures trading was banned in parts of Europe for being another form of gambling, or that long ago that there were efforts to ban it here in the United States for the same reasons. The introduction of binary options presented a difficult challenge for the markets, as the simple way to describe them was to use gambling metaphors. The gamification of the markets, which uses technology that looks similar to that of gambling, presents another challenge. The whole gaming concept of keeping score, playing against your peers, and even playing in a public setting creates a fear of missing out environment for young people. It's like sitting in a 1990s trading arcade with a scorecard above your head for everyone to see. You want to keep playing to improve your score and move up the scoreboard. Today, the Wall Street Journal has a story titled More Men are Addicted to the Crack Cocaine of the Stock Market with the sub headline Gamblers Anonymous. Meetings are filling up with people hooked on trading and betting apps make it as easy as ordering takeout. A growing number of men addicted to high risk stock trading and cryptocurrency are filling Gamblers Anonymous or GA meetings across the US Drawn in by the pandemic boom, boon and platforms like Robinhood. Dubbed the crack cocaine of the stock market, options trading has led some participants to lose hundreds of thousands of dollars, exacerbating compulsive behaviors. Many are struggling with mood swings, depression and secrecy about their losses. Apps like Robinhood and webull have been criticized for enabling impulsive behavior despite claims of safeguards to encour responsible investing. Financial market gambling has become a spiking problem, with treatment centers like Williamsville Wellness and Mary Haven Addiction center reporting surges in patients seeking help. These individuals often experience withdrawal symptoms, including anxiety and depression as they stop trading. High risk trades such as same day option contracts have been particularly addictive, with one patient reportedly losing $14,000 in five minutes. Tools like Gabin are now used to block trading apps, while GA emphasizes accountability through its 12 step program. The psychological toll of trading addiction mirrors that of traditional gambling, pushing some to the brink. One man described losing $1 million in cryptocurrency and feeling hopeless before seeking treatment. Experts warn the issue is likely to worsen as stock and crypto markets remain volatile and Wall street introduces increasingly speculative products. Addiction counselors and self help groups are urging greater awareness and intervention to curb the growing crisis. Greater attention needs to be given to financial literacy, especially to those most at risk. The jump from playing games to gambling on games to trading like you are playing a game is just much too easy without proper education about the risks involved.
[00:04:52] Here's one example of a good start. The UK's elite Royal Marines are now receiving financial literacy training as part of their comprehensive development program, the Financial Times reported. The Financial Times Financial Literacy and Inclusion Campaign, or flic, in collaboration with the Royal Marines charity, has launched an eight module course covering budgeting, borrowing, saving and investing. Aimed at both recruits and seasoned personnel, the program addresses knowledgeable gaps in managing personal finances, a critical skill often overlooked in the military. With young recruits earning over 25,000 pounds annually in a sheltered environment, there's a strong appetite for guidance on managing surplus income, investments and financial planning. This initiative also tackles broader challenges such as debt management and the risk of financial instability among ex service personnel. Funded by the association of British Insurers, the training will expand to the Royal Navy, army and nhs, equipping individuals with vital financial skills to secure their future and avoid pitfalls like payday loans and unmanageable debt. Here are the headlines from in front of fow's Paywall from some recent stories Happy holidays from the team at Fowler Analysis LCH Repo Clear Reaping Benefits of Collateral Restructuring CEO Analysis Winner in U S Treasury Clearing still uncertain Baton Systems Hong Kong Exchanges and Clearing Eyes Round the clock trading and analysis LCHSA plans push into U S Credit Derivatives Clearing CEO Our most read stories from our previous edition of JLN Options were Options Market charts show rush for protection as stocks tumble From Bloomberg Wall Street's next test after fed $6.5 trillion triple witching from Bloomberg and Vix's second largest spike in history indicates a local bottom for Bitcoin. Van Stratten from Market Insider. Subscribe to the free JLN Options newsletter with a link in today's jln. Here are more stories from the First Read section of today's jln. As mentioned earlier, Crossroads of Innovation Cathie Wood, Peter Zehan and Jamie Metzl share visionary insights at Miami Summit In a recent interview with John Lothian News, James Putra, vice president and Head of product at TradeStation, discussed key insights from several prominent speakers at the recent Crossroads Summit focused on innovation and economic trends, including investor Cathie woods, author Peter Zehan and Jamie Metz, founder and chair of One Shared World. You can watch this video on johnlothiannews.com and then here's a story from Bloomberg the headline Trump Threatens Tariffs if EU doesn't Buy more US Oil and gas President elect says the Bloc must make up for Trade Deficit the US Is the world's top LNG exporter, biggest oil producer. President Elect Donald Trump warned the European Union that its exports will get hit with US Tariffs if its member states don't buy more American oil and gas.
[00:08:52] I told the European Union that they must make up their tremendous deficit with the United States by the large scale purchase of our oil and gas. Otherwise it's tariffs all the way. Exclamation, exclamation, exclamation, unquote, he said. On Truth Social My comment Nothing like extortion as statecraft. Here's another story, this one from Bloomberg. The headline Trading gurus firm that trained 100,000 now faces complaints YouTube removed the firm's main channel earlier this year. Greg Secker denies any wrongdoing or misleading of customers in relation to his businesses.
[00:09:37] If you've got more than enough money coming in each month, feel free to skip this ad, Greg Secker says, sliding into a Rolls Royce fronted with the license plate that reads prosper with a 5 where the S would be as the car lists price from £250,000 purrs into action, the self described master trader turns to the camera. Quote, if I clinically outlined a proven blueprint, you could nick me for free and start printing your own cash. Would you listen very carefully? Unquote. By itself, Sechler's pitch for his learn to trade group is not unusual. Social media figures who offer personal finance advice have been everywhere since the pandemic. Making money from teaching others how to make money. My comment Come trade our fake money. That just does not work as well. Here's another story, this one from Bloomberg. The headline Crypto Insiders Jockey for Influence on Proposed Industry Advisory Council. The incoming US Administration is weighing two very different approaches to a council that the crypto industry hopes will dramatically increase its influence over digital asset policy. President Elect Donald Trump and his inner circle are considering options that would see as few as 10 people or as many as 100 on a council that would report to David Sachs, according to people with knowledge of the matter who asked not to be named as they were not authorized to speak on the record. Sachs, Trump's pick for the first ever AI and crypto czar, would oversee two separate councils, one for each part of his portfolio, the people said.
[00:11:37] My comment is the use of the word jockey in the headline A Swipe at the Crypto Insiders.
[00:11:46] Here's another story, this one from The Financial Times IMF1L Bitcoin Zip Rest in Peace Cho We Hardly Knew Ye June 5, 2021 El Salvador President Nayib Bukele to a Bitcoin conference Great ideas are beautiful and you have great power. But like most things, they can also be more fragile than everything. When I was a kid, we thought about the future and we were delighted by its possibilities. We couldn't wait for it to happen and be part of its creation. Our ingenuity is what separates us from other species. In El Salvador, we are hoping to rescue this idea and start the design of a country for the future using the best ingredients the that makes us who we are while using sensibility to find the best examples of ideas from history and around the world. I believe bitcoin could be one of those ideas. That is why next week I will send to Congress a bill that will make bitcoin a legal tender in El Salvador.
[00:13:03] So much for El Salvador taking monetary policy advice from From Jack Mallers. Here are the top three stories from Thursday's jln. Our most read story yesterday was Trump's pick for Commerce Secretary is buying Brett Bears DC Home from the Wall Street Journal. It looks like a very nice home. Second was North Korea stole $1.3 billion through crypto hacks in 2024 from the Financial Times. Third was also from the Financial Times was FT Person of the Year Donald Trump. Here are the top three stories from the lead section of today's jln.
[00:13:47] Here's that story referenced earlier. The headline More men are addicted to the Crack Cocaine of the stock Market. Gamblers Anonymous meetings are filling up with people hooked on trading and betting apps make it easy as ordering takeout. A new type of addict is showing up at Gamblers Anonymous meetings across the country. Investors hooked on the market's riskiest trades at Gamblers Anonymous in the Murray Hill neighborhood of Manhattan. One man called options the crack cocaine of the stock market. Another said he faced hundreds of thousands of dollars in trading losses after borrowing from a loan shark to double down on stocks. And one young man brought his mom and a girlfriend to celebrate one year since his last bet. They were among a group of about 60 people, almost all men, who sat in rows of metal folding chairs in a crowded church basement that evening. Some shared their struggle with addiction not on sports apps or at Las Vegas casinos, but using brokerage apps like Robinhood. Here's another story, this one from Bloomberg. The headline SPAC Kings who delivered 99% losses are raising Billions Again Howard Lutnick, Michael Klein are back with blank check IPOs. There have been 50 SPACs that raised 8.7 billion since April.
[00:15:25] There are many well established symbols of the froth building yet again in financial markets. There's bitcoin hovering around $100,000, or the NASDAQ hitting record high after record high. Or for that matter, the wild bidding war that broke out in Manhattan the other day for the banana and duck tape, quote unquote art. But there's also this the SPAC and its band of patrons and peddlers is back. Howard Lutnick, the CEO of brokerage Cantor Fitzgerald Ltd. And Donald Trump's nominee for commerce secretary, raised a $100 million blank check in August and then, days before the elections, filed for what would be a 10th SPAC. Michael Klein pulled $287.5 million in May, and Harry Sloan and Eli Baker's Eagle Equity Partners debuted its ninth SPAC in late October.
[00:16:35] Here's another story, this one from Bloomberg. The headline Tether Removal puts Europe at Risk of Missing Trump Crypto Boom crypto exchanges in EU must delist Tether's USDT by December 30 executives are concerned that removing USDT will SAP liquidity. European Union crypto asset regulations set to take full force at year end are already reshaping the market for a key type of digital token, potentially weakening the bloc's appeal to investors. Just as crypto convert Donald Trump gets ready to take office in the U.S.
[00:17:18] several crypto exchanges operating in the EU have already delisted the dominant stablecoin Tether Holding Limited's USDT to comply with the Markets in Crypto assets regime that's rippling through the market for such instruments, with new issuers seeking to fill the void and investors defaulting to using the euro for trading in and out of cryptocurrencies.
[00:17:49] This podcast is brought to you by John Lothian News, the home of Markets Wiki and Markets Wiki Education thank you for joining us. If you enjoyed this podcast, please leave us a review on your preferred listening platform. Have a great day and stay safe and treat people the same way you want to be treated with respect, equality and justice. This has been John Lothian Goodbye. This podcast has been produced by John Lothian.
