It took long enough, didn’t it? As traders we are always looking beyond the tricks and games being played in markets, because with so many players and opportunities they cannot rig the game against every participant, right?
Yet, we have seen far less participation these days from the average investor, the retail trader and the middle class American who would like to invest in the growth of their home country. Now, that may seem a bit Pollyannaish to some, but America is where it is today because of the risks taken by prior generations who believed in companies such as Coke, Boeing, Dupont and Union Pacific.
Today, it seems a desolate wasteland of hyper-trading, algorithms, high-frequency traders and ETF’s that seem to come from another place. Trades fly around at warp speed, the average investor whip-sawed constantly and finally into submission, participation is not going to happen. It’s a situation seen far too often these days, investors are disgusted with the games and lack of ‘rules’, while constantly being told everything is above board.
There is real fear out there from Middle America, the 2008/09 financial crisis still fresh in everyone’s memory. Why bother, say most investors? Market risk has taken on a different dimension, one that has become difficult to diversify. Until the playing field is leveled for all (which I doubt will happen anytime soon), the investor who takes risk to build our greatest companies is just going to fade away, finding other alternatives — foregoing the needless risks that cannot be controlled.
