Over the past weekend, Buffett's remarks at Berkshire Hathaway's shareholder meeting sparked heated discussion, and his criticism of robin Hood, an online stock trading platform, was met with a strong response from the platform.
At this year's Berkshire Hathaway annual shareholder meeting, Buffett's speeches have received attention, one of which is criticism of Robin Hood, a major retail stock trading platform in the United States. Buffett believes that Robin Hood, who is loved by millennials, is helping to create a speculative, casino-like stock market.
WARREN BUFFETT, CEO of Berkshire Hathaway: I think I read this message somewhere, that is, there are 12% to 13% of "gamblers" investors in Robin Hood, trading options that are bullish or bearish, and I looked at it, there are a lot of 7-day and 14-day call options on Apple stock, and I believe that many of them are from Robin Hood, that is, there are a lot of people betting on Apple's performance in the next 7 days or 14 days, which is not illegal and unethical. But I don't think it should be done.
For this statement, Robin Hood also quickly gave a strong response. On the 3rd local time, the head of the company's public policy communication department published a blog post on the company's website, saying that in the past few decades, the American elite has accumulated a lot of wealth from the stock market, while ordinary families cannot participate. "What happened last year has taught us that people are tired of a world where only people like Buffett and Munger are investment pioneers," and now "retail investors in the U.S. are thriving because everyone is seizing the opportunity."
To some extent, platforms like Robin Hood have indeed lowered the threshold for retail investors to participate in the stock market, and retail investors in the US stock market have been enthusiastic about benefiting from stimulus measures and a large number of bailout checks issued directly by the government under the epidemic.
Statistics show that in April of this year, the share of shares held by U.S. households in all their financial assets has risen to 41%, and data from JPMorgan Chase and the Federal Reserve show that this is the highest level since 1952.
Others are more aggressive. According to a survey by the American Retail Investors Association, investor allocation to the stock market reached 70% in March, the highest level in nearly three years. And according to the Financial Industry Regulatory Authority, margin debt, the amount of money investors borrow to buy securities, reached $814 billion at the end of February, 49 percent more than a year ago, the fastest annual growth rate since 2007.
But many, including Fed Chairman Jerome Powell, warn that a bubble has emerged in the capital markets. Once the bubble bursts, whether retail investors or experienced professional investors can withstand the storm may be a key to the success or failure of this retail vs. Wall Street debate.
Source: CCTV Finance