Warning to all of my friends out there who may be interested in investing in the hot new investment category called SPACs. These are scams against the people who invest in them. Basically, here is how it ends up working:
Read this Bloomberg article about BLNK – a company with only $5m revenue and massive losses that somehow is trading with a market valuation of $2b. Absolute insanity.
Corruption in systems built by humans happens everywhere. Systems that hold corruption to a minimum or are able to self heal from corruption are truly amazing. The only two systems I have seen that generally can heal from corruption are the free market, which heals through removing corruption by natural selection and bankruptcy, and democracy, which heals through periodic elections and purges.… read more “Corruption Is Inevitable”
Robinhood had to take a billion dollar emergency loan to meet it’s requirements. We have seen Robinhood is a very shakily run brokerage with lots of downtime and was fined last month for illegal activity in how it handled client accounts. Interactive Brokers CEO pointed out that if one brokerage goes bankrupt, the other brokerages are obligated to pay off its debts.… read more “Risk of Broker Bankruptcy?”