1 00:00:08,200 --> 00:00:12,400 Speaker 1: The legend of Robin Hood begins in the Sherwood forms, 2 00:00:12,920 --> 00:00:18,760 Speaker 1: with rob and his merry men reappropriating taxes unjustly collected 3 00:00:18,800 --> 00:00:28,000 Speaker 1: by the evil Sheriff of Nottingham. Yeah, ah, sorry, wrong, 4 00:00:28,120 --> 00:00:34,280 Speaker 1: Robin Hood. The story of this robin Hood begins in 5 00:00:34,400 --> 00:00:38,879 Speaker 1: New York City, where two recent Stanford graduates, Vladimir Tenev 6 00:00:39,000 --> 00:00:43,240 Speaker 1: and Baju, bought toil Away, building software for high frequency 7 00:00:43,280 --> 00:00:47,479 Speaker 1: traders on Wall Street. Inside their office, computer's home and 8 00:00:47,600 --> 00:00:56,480 Speaker 1: keyboards click while outside. I'm here myself as a free individual, 9 00:00:56,880 --> 00:01:01,400 Speaker 1: to humanize the markets and to make Wall Street here 10 00:01:01,480 --> 00:01:11,560 Speaker 1: the sound of what democracy means. Inspired by the Occupy movement, 11 00:01:11,640 --> 00:01:16,120 Speaker 1: to help bridge the economic divide and democratize finance, Tenefan 12 00:01:16,240 --> 00:01:19,960 Speaker 1: Bott designed an app that let anyone access the stock 13 00:01:20,000 --> 00:01:25,000 Speaker 1: market for free, and they named it after everyone's favorite 14 00:01:25,000 --> 00:01:37,640 Speaker 1: egalitarian outlaw, Robin Hood. Welcome to Calling Bullshit, the podcast 15 00:01:37,680 --> 00:01:41,760 Speaker 1: about purpose washing, the gap between what an organization says 16 00:01:41,800 --> 00:01:45,080 Speaker 1: they stand for and what they actually do, and what 17 00:01:45,120 --> 00:01:47,680 Speaker 1: they would need to change to practice what they preach. 18 00:01:48,280 --> 00:01:50,880 Speaker 1: I'm your host, Time Montague, and I've spent over a 19 00:01:50,960 --> 00:01:55,160 Speaker 1: decade helping organizations define what they stand for, their purpose 20 00:01:55,600 --> 00:01:57,960 Speaker 1: and then help them to use that purpose to drive 21 00:01:58,040 --> 00:02:03,840 Speaker 1: transformation throughout their business. Unfortunately, at a lot of institutions today, 22 00:02:04,080 --> 00:02:07,080 Speaker 1: there's still a pretty wide gap between word and deed. 23 00:02:07,600 --> 00:02:12,240 Speaker 1: That gap has a name bullshit. But, and this is important, 24 00:02:12,600 --> 00:02:15,880 Speaker 1: we believe that bullshit is a treatable condition. So when 25 00:02:15,880 --> 00:02:20,200 Speaker 1: our bullshit detector lights up, we're going to explore everything 26 00:02:20,280 --> 00:02:35,520 Speaker 1: the organization should do to fix it. Robin Hood's purpose 27 00:02:35,880 --> 00:02:40,120 Speaker 1: is to democratize finance for all. They say. Their aim 28 00:02:40,200 --> 00:02:45,240 Speaker 1: is to make investing friendly, approachable, and understandable for newcomers 29 00:02:45,320 --> 00:02:50,240 Speaker 1: and experts alike. Employing a business model called payment for 30 00:02:50,480 --> 00:02:54,320 Speaker 1: order flow, robin Hood makes investing free to users and 31 00:02:54,520 --> 00:02:57,560 Speaker 1: just as easy as downloading a game onto your phone. 32 00:02:58,760 --> 00:03:02,120 Speaker 1: And the app doesn't just provide access to the traditional markets. 33 00:03:02,600 --> 00:03:06,400 Speaker 1: In June, robin Hood leveled up to include commission free 34 00:03:06,440 --> 00:03:11,600 Speaker 1: crypto trading, making bitcoin, ethereum, and other tokens available to 35 00:03:11,720 --> 00:03:17,120 Speaker 1: just about anybody. However, as popularity and download numbers grew, 36 00:03:17,680 --> 00:03:22,600 Speaker 1: so did criticism. Massachusetts regulators are accusing robin Hood of 37 00:03:22,639 --> 00:03:27,560 Speaker 1: what they call aggressive tactics in marketing inexperienced investors, using 38 00:03:27,560 --> 00:03:31,960 Speaker 1: gamification to manipulate those customers and failure to prevent outages 39 00:03:32,320 --> 00:03:35,680 Speaker 1: on that trading platform this year. In one example, robin 40 00:03:35,760 --> 00:03:39,119 Speaker 1: had allowed a Massachusetts user with no experience to make 41 00:03:39,160 --> 00:03:43,040 Speaker 1: more than twelve thousand trades in just six months and 42 00:03:43,080 --> 00:03:46,760 Speaker 1: to complaint this morning. The state highlights robin Hood's revenue 43 00:03:46,760 --> 00:03:50,440 Speaker 1: model of payment for order flow. This is a key point. 44 00:03:51,160 --> 00:03:54,160 Speaker 1: Payment for order flow is how robin hood makes money. 45 00:03:54,360 --> 00:03:58,640 Speaker 1: Even though the app itself is free to users. Individual 46 00:03:58,680 --> 00:04:01,960 Speaker 1: investors don't have to pay to trade because big trading 47 00:04:02,000 --> 00:04:05,920 Speaker 1: houses called market makers give robin Hood a small amount 48 00:04:05,920 --> 00:04:08,800 Speaker 1: of money for every single trade that's made on the app. 49 00:04:09,360 --> 00:04:13,480 Speaker 1: The more you trade, the more money they make. That's 50 00:04:13,520 --> 00:04:18,240 Speaker 1: the misalignment that drives the entire conundrum here. Robin Hood 51 00:04:18,360 --> 00:04:21,560 Speaker 1: wants people to trade. It's absolutely in the worst interests 52 00:04:21,920 --> 00:04:25,200 Speaker 1: of clients. The more you trade, the more likely you 53 00:04:25,240 --> 00:04:29,160 Speaker 1: are to lose money. Study after study has shown that 54 00:04:29,360 --> 00:04:33,440 Speaker 1: buy and hold is a much better investment strategy, and 55 00:04:33,520 --> 00:04:37,320 Speaker 1: critics and lawmakers raised the red flag, saying robin Hood 56 00:04:37,440 --> 00:04:40,320 Speaker 1: was designed more like a game in order to hook 57 00:04:40,440 --> 00:04:46,720 Speaker 1: first time investors and then capitalize on their inexperience. Regulators 58 00:04:46,760 --> 00:04:49,960 Speaker 1: also point to incentives like confetti popping up on screens 59 00:04:50,000 --> 00:04:53,120 Speaker 1: after trades and offers for robin Hood customers who are 60 00:04:53,160 --> 00:04:55,800 Speaker 1: more active on that app to move up on waitlists 61 00:04:55,800 --> 00:05:00,000 Speaker 1: for new products. In an attempt to quell the backlash, 62 00:05:00,080 --> 00:05:03,760 Speaker 1: robin Hood actually changed some of their graphics, but critics 63 00:05:03,880 --> 00:05:09,040 Speaker 1: were unimpressed. It's absolutely gamification. They have leaderboards, you can 64 00:05:09,040 --> 00:05:12,760 Speaker 1: win points, they have competitions on on on the site. 65 00:05:13,160 --> 00:05:15,159 Speaker 1: The only thing that they've removed is that you don't 66 00:05:15,160 --> 00:05:18,320 Speaker 1: get confetti now on your screen when your stock goes up. 67 00:05:18,520 --> 00:05:20,320 Speaker 1: You know, the robin Hood's big claim to fame is 68 00:05:20,320 --> 00:05:23,960 Speaker 1: that they've democratized access to finance, But I think they've 69 00:05:24,000 --> 00:05:28,039 Speaker 1: democratized it the same way that Purdue democratized access to oxycontent. 70 00:05:28,400 --> 00:05:31,320 Speaker 1: Simply making something easier to buy does not mean that 71 00:05:31,360 --> 00:05:33,160 Speaker 1: it is there for a good idea to buy it. 72 00:05:35,360 --> 00:05:38,880 Speaker 1: But robin Hood continued to allow anyone the freedom to 73 00:05:38,920 --> 00:05:43,520 Speaker 1: buy whatever stock they pleased until the game stopped fiasco 74 00:05:43,760 --> 00:05:47,520 Speaker 1: in early because being sort of built by the people 75 00:05:47,520 --> 00:05:50,040 Speaker 1: who are doing it as a David versus Goliath thing, Right, 76 00:05:50,080 --> 00:05:52,240 Speaker 1: So you have this army of small traders who are 77 00:05:52,360 --> 00:05:55,680 Speaker 1: using a Reddit message board called Wall Street Bets, and 78 00:05:55,720 --> 00:05:58,719 Speaker 1: they're putting pressure on the short sellers of game step. 79 00:05:59,200 --> 00:06:02,080 Speaker 1: This looks like a move by an outfit called robin Hood, 80 00:06:02,120 --> 00:06:03,760 Speaker 1: which is supposed to be taken from the rich and 81 00:06:03,800 --> 00:06:07,560 Speaker 1: giving to the poor, and doing exactly the opposite. The 82 00:06:07,640 --> 00:06:10,160 Speaker 1: action is so wild that t d amritraded robin Hood 83 00:06:10,160 --> 00:06:13,479 Speaker 1: have restricted trading of these stocks. Traders on Rabbits sent 84 00:06:13,600 --> 00:06:16,919 Speaker 1: the stock soaring this week, causing billions in losses for 85 00:06:16,960 --> 00:06:20,599 Speaker 1: the hedge funds that been against the video game retailer stock, 86 00:06:20,960 --> 00:06:28,640 Speaker 1: and today Wall Street decided enough wasn't enough. Declaring certain 87 00:06:28,680 --> 00:06:35,719 Speaker 1: stocks off limits made the platform look ominously undemocratic, and 88 00:06:35,839 --> 00:06:42,240 Speaker 1: while the app makes complex transactions frictionless, understanding those transactions 89 00:06:42,240 --> 00:06:46,480 Speaker 1: can be really hard, especially for beginners. This lack of 90 00:06:46,560 --> 00:06:54,960 Speaker 1: clarity can have terrible consequences. The most tragic of these 91 00:06:54,960 --> 00:06:58,920 Speaker 1: occurred in twenty twenty when Alex Kerns, a college student 92 00:06:58,960 --> 00:07:03,000 Speaker 1: from Illinois interested in investing, was granted approval by robin 93 00:07:03,000 --> 00:07:07,039 Speaker 1: Hood to trade options, a very risky thing for even 94 00:07:07,120 --> 00:07:11,880 Speaker 1: professional investors because of the interface. He mistakenly thought he 95 00:07:11,920 --> 00:07:15,760 Speaker 1: owed seven hundred and thirty thousand dollars that he didn't have, 96 00:07:16,440 --> 00:07:19,960 Speaker 1: and he wound up taking his own life. The note 97 00:07:20,000 --> 00:07:23,600 Speaker 1: he left, said I had no clue what I was doing. 98 00:07:25,760 --> 00:07:29,600 Speaker 1: The Financial Industry Regulatory Authority said that robin Hood had 99 00:07:29,720 --> 00:07:34,080 Speaker 1: quote failed to exercise due diligence for years. When approving 100 00:07:34,080 --> 00:07:38,800 Speaker 1: options trades, they find robin Hood seventy million dollars, the 101 00:07:38,840 --> 00:07:43,240 Speaker 1: biggest fine in the authority's history. This and a lawsuit 102 00:07:43,320 --> 00:07:47,600 Speaker 1: by Alex Kern's family were finally settled just before robin 103 00:07:47,640 --> 00:07:54,520 Speaker 1: Hood went public in the summer of one. Robin Hood 104 00:07:54,680 --> 00:07:57,960 Speaker 1: says their purpose is to democratize finance for all, to 105 00:07:58,080 --> 00:08:03,960 Speaker 1: make investing friendly, approachable, and understandable for newcomers and experts alike. 106 00:08:04,680 --> 00:08:07,800 Speaker 1: But he's making investing free through an app the same 107 00:08:07,800 --> 00:08:12,440 Speaker 1: as democratization. It feels like gamifying the stock market is 108 00:08:12,520 --> 00:08:17,840 Speaker 1: almost making it too easy. Researching this further, I found 109 00:08:18,160 --> 00:08:22,320 Speaker 1: just the person to help me understand the intersection of gamification, investing, 110 00:08:22,480 --> 00:08:28,920 Speaker 1: and gambling. So I called him up. Folks, I am 111 00:08:28,960 --> 00:08:33,280 Speaker 1: excited to introduce Dr Devin Mills. Devin, thanks for being here, 112 00:08:33,480 --> 00:08:36,960 Speaker 1: and uh, welcome to calling bullshit. It's great to be 113 00:08:37,000 --> 00:08:39,880 Speaker 1: with you, Tie. So before we get into robin Hood, 114 00:08:39,960 --> 00:08:41,680 Speaker 1: I'd love it if you could just tell us a 115 00:08:41,679 --> 00:08:47,920 Speaker 1: little bit about your background. And the work that you do. Sure. Sure, so. 116 00:08:48,040 --> 00:08:51,920 Speaker 1: I'm an assistant professor at Texas Tech University in the Community, 117 00:08:51,920 --> 00:08:55,440 Speaker 1: Family and Addiction Sciences department. My research is on non 118 00:08:55,520 --> 00:09:00,080 Speaker 1: substance use disorders, primarily video gaming and gambling, and with 119 00:09:00,200 --> 00:09:03,600 Speaker 1: regards to gambling, I also look at cryptocurrency trading and 120 00:09:03,800 --> 00:09:06,920 Speaker 1: risk taking behaviors in the financial markets, looking at it 121 00:09:06,960 --> 00:09:09,840 Speaker 1: from the behavioral side of things, trying to understand exactly 122 00:09:10,360 --> 00:09:12,600 Speaker 1: how people can become obsessed with it, how people can 123 00:09:12,800 --> 00:09:18,040 Speaker 1: start to internalize more of a problematic trading pattern. M fascinating. Okay, 124 00:09:18,160 --> 00:09:23,280 Speaker 1: would you take a run at defining that word for us? Gamification? Sure? 125 00:09:23,480 --> 00:09:25,880 Speaker 1: I think the simplest way of defining it is to 126 00:09:26,160 --> 00:09:31,199 Speaker 1: employ game design to an area that doesn't necessarily have games. 127 00:09:31,600 --> 00:09:35,080 Speaker 1: You could not say that we're gamifying the NFL, for instance, 128 00:09:35,160 --> 00:09:38,440 Speaker 1: the NFL football is a game that wouldn't necessarily so 129 00:09:38,679 --> 00:09:41,880 Speaker 1: that wouldn't work. But gamifying learning in a way that 130 00:09:41,960 --> 00:09:44,240 Speaker 1: is something that education has done. And my understanding is 131 00:09:44,240 --> 00:09:46,880 Speaker 1: that's kind of the roots of gamification has been in 132 00:09:46,920 --> 00:09:50,320 Speaker 1: the education domain, right and and so the point of 133 00:09:50,360 --> 00:09:56,719 Speaker 1: it is to essentially make the subject matter stickier, more engaging, 134 00:09:57,200 --> 00:10:02,440 Speaker 1: more uh, fun all of those things, getting someone interested 135 00:10:02,440 --> 00:10:06,440 Speaker 1: in the topic area and making it more of a competition, um, 136 00:10:06,640 --> 00:10:09,880 Speaker 1: giving someone an objective a quest. But there's also the 137 00:10:09,880 --> 00:10:12,800 Speaker 1: gamification in terms of the rewards piece, and I think 138 00:10:12,800 --> 00:10:14,360 Speaker 1: that's where a lot of the literature, a lot of 139 00:10:14,360 --> 00:10:17,240 Speaker 1: the mainstream media has kind of focused more, especially as 140 00:10:17,280 --> 00:10:20,000 Speaker 1: it as applies to some of these mobile applications. Is 141 00:10:20,040 --> 00:10:24,560 Speaker 1: the idea of rewarding individuals for training behaviors, as applied 142 00:10:24,559 --> 00:10:27,320 Speaker 1: to robin Hood in terms of badges and whatnot, kind 143 00:10:27,320 --> 00:10:31,240 Speaker 1: of the Boy Scouts mentality of uh, keep on awarding 144 00:10:31,240 --> 00:10:34,720 Speaker 1: individuals for their acts of service and their acts of knowledge. Yeah, 145 00:10:34,800 --> 00:10:36,840 Speaker 1: let's turn to robin Hood. Would you say that the 146 00:10:36,920 --> 00:10:40,840 Speaker 1: design of the robin Hood app is gamified? They used 147 00:10:40,880 --> 00:10:44,160 Speaker 1: to have the confetti once you made a trade, um, 148 00:10:44,160 --> 00:10:46,680 Speaker 1: whether that was selling or buying. I haven't seen a 149 00:10:46,679 --> 00:10:49,680 Speaker 1: lot of rewards. It doesn't necessarily mean that individuals don't 150 00:10:49,720 --> 00:10:53,400 Speaker 1: feel rewarded in some way, So confetti would be an 151 00:10:53,400 --> 00:11:00,480 Speaker 1: example of a kind of gamified aspect of the app experience. Yeah, 152 00:11:00,640 --> 00:11:03,840 Speaker 1: but I would also I think the the idea that 153 00:11:03,840 --> 00:11:07,360 Speaker 1: that's the only way in which humans interpret a reward 154 00:11:07,840 --> 00:11:10,600 Speaker 1: is kind of a misnomer, right when their portfolio is 155 00:11:10,600 --> 00:11:12,719 Speaker 1: going up a hundred dollars two hundred dollars, or maybe 156 00:11:12,760 --> 00:11:16,120 Speaker 1: it's going down two dollars. I think the human brain 157 00:11:16,360 --> 00:11:20,520 Speaker 1: will interpret that as something to chase, something to continue. 158 00:11:21,440 --> 00:11:28,040 Speaker 1: I wonder, like our human beings all equally susceptible to gamification, 159 00:11:28,920 --> 00:11:33,600 Speaker 1: or are some people more likely to be seduced than others? 160 00:11:34,720 --> 00:11:37,680 Speaker 1: I would say it usually depends on the task. If 161 00:11:37,679 --> 00:11:40,680 Speaker 1: you are an individual who is completely averse to any 162 00:11:40,800 --> 00:11:46,400 Speaker 1: risk whatsoever, the idea that gamification by itself could get 163 00:11:46,480 --> 00:11:49,600 Speaker 1: you to do something that you wouldn't otherwise do I 164 00:11:49,640 --> 00:11:53,080 Speaker 1: haven't seen any research to suggest that gamification is that strong. 165 00:11:53,920 --> 00:11:59,240 Speaker 1: So you're an expert in gambling and gambling addiction, Robin 166 00:11:59,280 --> 00:12:03,439 Speaker 1: Hood says that investing is not gambling. Um, but I've 167 00:12:03,480 --> 00:12:06,720 Speaker 1: noticed that in some of your work you point out 168 00:12:06,760 --> 00:12:10,280 Speaker 1: that there seems to be a correlation between investing, particularly 169 00:12:10,320 --> 00:12:15,840 Speaker 1: investing through a smartphone, and risk taking behavior. So I 170 00:12:15,880 --> 00:12:20,640 Speaker 1: wonder if you could unpack the relationship between gambling and investing. 171 00:12:20,679 --> 00:12:23,480 Speaker 1: How are they different and how might they be the same. 172 00:12:24,720 --> 00:12:28,480 Speaker 1: When we think about gambling, we immediately assign a level 173 00:12:28,520 --> 00:12:31,960 Speaker 1: of risk. When we think about investing, we imply almost 174 00:12:32,040 --> 00:12:37,640 Speaker 1: a strong chance of return, almost eclipsing this idea of risk. Yeah, 175 00:12:37,679 --> 00:12:41,040 Speaker 1: it sounds responsible. I'm an investor or. Yeah. You have 176 00:12:41,080 --> 00:12:43,199 Speaker 1: your friends saying well, that's a gamble versus well, that's 177 00:12:43,200 --> 00:12:46,120 Speaker 1: an investment. You know, that has different ways in which 178 00:12:46,160 --> 00:12:49,520 Speaker 1: we interpret that, But I I go back to the 179 00:12:49,559 --> 00:12:54,640 Speaker 1: basic definition. Gambling is risking something of value, primarily money, 180 00:12:54,800 --> 00:12:59,200 Speaker 1: on the chance of an outcome. Uh that should result 181 00:12:59,240 --> 00:13:03,880 Speaker 1: in individuals earning more money in return. That's gambling. And 182 00:13:03,920 --> 00:13:07,280 Speaker 1: so based on that definition, I find it really hard 183 00:13:07,760 --> 00:13:11,400 Speaker 1: to see stock trading, crypto trading in particular, to not 184 00:13:11,480 --> 00:13:15,040 Speaker 1: be some element of gambling. Now that being said, I 185 00:13:15,080 --> 00:13:17,199 Speaker 1: do encourage people to take charge of their wealth. I 186 00:13:17,280 --> 00:13:19,760 Speaker 1: encourage people to learn more about the stock market, but 187 00:13:20,040 --> 00:13:22,800 Speaker 1: I also think there needs to be uh, some clarification 188 00:13:22,920 --> 00:13:26,360 Speaker 1: on the terminology. In my mind, if you're buying stocks, 189 00:13:26,400 --> 00:13:29,800 Speaker 1: you are gambling, but you're maybe gambling more responsibly or 190 00:13:29,880 --> 00:13:33,160 Speaker 1: less responsibly, and that's a variation of investing. One of 191 00:13:33,200 --> 00:13:36,480 Speaker 1: the other aspects of the app is that it makes 192 00:13:36,520 --> 00:13:41,360 Speaker 1: investing social. Does that make the app stickier? So I 193 00:13:41,360 --> 00:13:44,400 Speaker 1: would I would go back to our gamification question. Do 194 00:13:44,480 --> 00:13:48,000 Speaker 1: they have to have a gamification piece if so many 195 00:13:48,040 --> 00:13:52,040 Speaker 1: people are going to be bragging about it, sharing their gains, 196 00:13:52,040 --> 00:13:54,640 Speaker 1: sharing their losses on Wall street bets. If there's a 197 00:13:54,679 --> 00:13:58,199 Speaker 1: strong enough social community, does it have to have rewards 198 00:13:58,200 --> 00:14:01,280 Speaker 1: in order to increase participation? I think right now the 199 00:14:01,360 --> 00:14:04,480 Speaker 1: research isn't there yet, but generally speaking, when we look 200 00:14:04,480 --> 00:14:07,440 Speaker 1: at motivation in other areas, we see that the social 201 00:14:07,440 --> 00:14:11,160 Speaker 1: component is very very strong. Right. It seems to me 202 00:14:11,280 --> 00:14:16,240 Speaker 1: that people who who enjoy the feeling of risk, uh, 203 00:14:16,440 --> 00:14:19,200 Speaker 1: would be more likely to become addicted by gambling. Is 204 00:14:19,240 --> 00:14:25,480 Speaker 1: that doesn't right? Definitely? Yeah. You have to be interested 205 00:14:25,520 --> 00:14:28,240 Speaker 1: with uncertainty, you have to be okay with that, you 206 00:14:28,280 --> 00:14:30,960 Speaker 1: have to enjoy the rush. There's a little bit of 207 00:14:31,000 --> 00:14:34,080 Speaker 1: research on the fear of missing out. That idea as 208 00:14:34,080 --> 00:14:37,120 Speaker 1: well is quite prevalent. We've started to play with this 209 00:14:37,200 --> 00:14:39,760 Speaker 1: concept of individuals feeling like they're missing out on the 210 00:14:39,800 --> 00:14:42,960 Speaker 1: rewards that other people are experiencing, and that seems to 211 00:14:43,000 --> 00:14:47,000 Speaker 1: be contributing also to individuals taking greater and greater risks 212 00:14:47,080 --> 00:14:51,120 Speaker 1: and trading more problematically than they otherwise would. And so 213 00:14:51,200 --> 00:14:53,480 Speaker 1: that would be you know, again, the sort of social 214 00:14:53,520 --> 00:14:56,080 Speaker 1: aspect of it. You have you're doing it in public, 215 00:14:56,440 --> 00:14:59,600 Speaker 1: and you're watching other people presumably either make or not 216 00:14:59,720 --> 00:15:02,200 Speaker 1: make money, and and you kind of are judging your 217 00:15:02,240 --> 00:15:07,880 Speaker 1: own um success or failure against that of others. Like 218 00:15:07,920 --> 00:15:11,280 Speaker 1: that's got to have an effect on on the stickiness 219 00:15:11,440 --> 00:15:14,320 Speaker 1: of the platform for certain people. Definitely. Yeah, And this 220 00:15:14,360 --> 00:15:15,920 Speaker 1: is something I'm just thinking about in the midst of 221 00:15:15,920 --> 00:15:19,280 Speaker 1: our conversation. Is the idea that is this social piece 222 00:15:19,320 --> 00:15:23,280 Speaker 1: adding to individuals experience of FOMO. So it's amplifying their 223 00:15:23,320 --> 00:15:26,760 Speaker 1: FOMO and that's what's contributing to their greater risk taking 224 00:15:26,840 --> 00:15:29,800 Speaker 1: on the app um. So there there's definitely a role. 225 00:15:29,840 --> 00:15:32,440 Speaker 1: There's definitely a cycle that I can I can see 226 00:15:32,440 --> 00:15:35,960 Speaker 1: from a theoretical perspective. Um, and I'm not exactly sure 227 00:15:36,000 --> 00:15:39,920 Speaker 1: what breaks that cycle. Yeah, And robin Hood says, so 228 00:15:40,040 --> 00:15:42,800 Speaker 1: I'm just gonna quote there from their purpose. They say 229 00:15:42,840 --> 00:15:47,880 Speaker 1: their purposes to democratize finance for all. We believe that 230 00:15:47,960 --> 00:15:50,840 Speaker 1: everyone should have access to the financial markets. So we've 231 00:15:50,840 --> 00:15:55,320 Speaker 1: built robin Hood from the ground up to make investing friendly, approachable, 232 00:15:55,400 --> 00:16:00,640 Speaker 1: and understandable for newcomers and experts alike. And if you 233 00:16:00,680 --> 00:16:03,120 Speaker 1: have a great purpose, and we think robin Hood's purpose 234 00:16:03,240 --> 00:16:06,520 Speaker 1: sounds great, is you have to actually do it right. 235 00:16:06,560 --> 00:16:09,200 Speaker 1: And one of the actions that they could take is 236 00:16:09,240 --> 00:16:12,320 Speaker 1: do a better job of educating people. Are there other 237 00:16:12,520 --> 00:16:15,560 Speaker 1: things that you think robin Hood could or should do 238 00:16:15,760 --> 00:16:20,800 Speaker 1: to make the app align better with their purpose and 239 00:16:20,800 --> 00:16:25,480 Speaker 1: and not be as potentially dangerous. I do. I think 240 00:16:25,520 --> 00:16:28,680 Speaker 1: there's ways in which to have a cool off period 241 00:16:29,120 --> 00:16:32,640 Speaker 1: if someone is trading quite erratically. Uh. Robin Hood has 242 00:16:32,880 --> 00:16:35,160 Speaker 1: and just like any other brokerage out there, has access 243 00:16:35,200 --> 00:16:38,840 Speaker 1: to a ton of data on their interesting and how 244 00:16:38,880 --> 00:16:41,240 Speaker 1: they trade. And this has been something that actually I'm 245 00:16:41,240 --> 00:16:44,000 Speaker 1: borrowing from the gambling literature. Right now, we have quite 246 00:16:44,000 --> 00:16:48,840 Speaker 1: a few tech companies developing applications that can track how 247 00:16:48,840 --> 00:16:51,720 Speaker 1: individuals are gambling, how many bets they're making per minute, 248 00:16:51,920 --> 00:16:54,720 Speaker 1: are they escalating, are they acting in a very erratic way. 249 00:16:54,880 --> 00:16:57,440 Speaker 1: Robin Hood has to be acting in good faith with 250 00:16:57,480 --> 00:17:02,520 Speaker 1: regards to protecting its consumer versus protecting its business um 251 00:17:02,560 --> 00:17:04,720 Speaker 1: and so that needs to be uh, something that needs 252 00:17:04,720 --> 00:17:08,000 Speaker 1: to be drawn out. Binance actually supposedly I don't have 253 00:17:08,000 --> 00:17:10,520 Speaker 1: a Binance account, but they have on their website a 254 00:17:10,600 --> 00:17:13,520 Speaker 1: responsible trading platform, and they do have some of these 255 00:17:13,560 --> 00:17:16,600 Speaker 1: pop ups that say, you know, we're seeing that you're 256 00:17:16,640 --> 00:17:20,320 Speaker 1: elevating your risk, you're increasing your risk position. Uh, you're 257 00:17:20,359 --> 00:17:22,400 Speaker 1: trading quite a radically, you're buying quite a bit. Maybe 258 00:17:22,400 --> 00:17:24,959 Speaker 1: it's time to chill out, basically, to take a break. Uh. 259 00:17:25,080 --> 00:17:28,679 Speaker 1: They do actually put holds on people's accounts. Uh, definitely, 260 00:17:28,680 --> 00:17:32,680 Speaker 1: based upon whether or not they're over there, over extended exactly. 261 00:17:32,720 --> 00:17:35,640 Speaker 1: And finance is a crypto platform, So let's talk about 262 00:17:35,680 --> 00:17:39,359 Speaker 1: crypto because you can buy crypto now on the robin 263 00:17:39,400 --> 00:17:42,560 Speaker 1: Hood app as well. Do you see investing in crypto 264 00:17:42,600 --> 00:17:45,560 Speaker 1: as more similar to gambling than traditional investing since the 265 00:17:45,640 --> 00:17:49,159 Speaker 1: value of cryptocurrency is in most cases based more on 266 00:17:49,400 --> 00:17:55,359 Speaker 1: faith than on any kind of hard asset. Crypto does 267 00:17:55,440 --> 00:17:59,360 Speaker 1: not have a fundamental asset. There's a lot of belief. 268 00:18:00,000 --> 00:18:05,000 Speaker 1: The short answer is cryptocurrency trading is gambling. Is gambling? Right, Yeah, 269 00:18:05,040 --> 00:18:08,600 Speaker 1: Just again, in the spirit of fairness, UM, we should 270 00:18:08,640 --> 00:18:11,320 Speaker 1: point out that and I think you mentioned this earlier on, 271 00:18:11,359 --> 00:18:13,200 Speaker 1: but I just want to make sure we get this 272 00:18:13,320 --> 00:18:15,480 Speaker 1: on the record that to be fair to robin Hood, 273 00:18:15,480 --> 00:18:19,080 Speaker 1: they have responded in at least one tangible way to 274 00:18:19,160 --> 00:18:22,440 Speaker 1: the accusations that they are gamified. You know, before the 275 00:18:22,600 --> 00:18:26,199 Speaker 1: I P O one, they replaced the confetti with some 276 00:18:26,280 --> 00:18:29,400 Speaker 1: kind of new animation, and what they said about it 277 00:18:29,480 --> 00:18:32,240 Speaker 1: was the confetti distracted from the goal of the app, 278 00:18:32,359 --> 00:18:35,720 Speaker 1: which is to make regular people, everyday folks who have 279 00:18:35,840 --> 00:18:38,000 Speaker 1: been kept out of the market feel like they can 280 00:18:38,040 --> 00:18:41,439 Speaker 1: participate and feel like they're being positively reinforced for taking 281 00:18:41,560 --> 00:18:47,119 Speaker 1: steps in their financial life. So, you know, people people 282 00:18:47,480 --> 00:18:50,760 Speaker 1: noticed the confetti, people didn't like the confetti. They have 283 00:18:50,800 --> 00:18:55,200 Speaker 1: addressed the confetti. How meaningful a change would you say 284 00:18:55,240 --> 00:18:59,160 Speaker 1: that is you feel like that's enough? I would say 285 00:18:59,200 --> 00:19:04,600 Speaker 1: that it is start to better serving their consumer, recognizing 286 00:19:04,720 --> 00:19:08,080 Speaker 1: that it wasn't in the mission. It wasn't actually increasing 287 00:19:08,160 --> 00:19:11,840 Speaker 1: or the democrazation. It was adding more maybe fun to it. 288 00:19:11,880 --> 00:19:14,280 Speaker 1: I don't know how many people really cared about the confetti, 289 00:19:14,800 --> 00:19:18,040 Speaker 1: um right, and so it hasn't changed much. I think 290 00:19:18,040 --> 00:19:22,680 Speaker 1: when I'm looking at their statement to democratize finance for all, 291 00:19:23,040 --> 00:19:26,320 Speaker 1: I would love if they also not just democratize it, 292 00:19:26,560 --> 00:19:29,800 Speaker 1: but increase knowledge. Yes, And I think once you go 293 00:19:29,880 --> 00:19:32,760 Speaker 1: down that road, you're starting to really protect consumers and 294 00:19:32,760 --> 00:19:37,040 Speaker 1: you're starting to increase and democratize finance for everybody totally. 295 00:19:37,160 --> 00:19:39,840 Speaker 1: And you made the point about the gamification of education. 296 00:19:39,920 --> 00:19:42,680 Speaker 1: You could gamify that aspect of the app and make 297 00:19:42,720 --> 00:19:47,879 Speaker 1: it so essentially to unlock different layers of features, you 298 00:19:47,960 --> 00:19:52,159 Speaker 1: had to demonstrate certain levels of of knowledge. Right, essentially 299 00:19:52,200 --> 00:19:54,520 Speaker 1: you have to take a quiz in order to unlock 300 00:19:54,720 --> 00:19:59,880 Speaker 1: the options feature or the margin feature. Um, you would 301 00:20:00,000 --> 00:20:03,879 Speaker 1: you that people would work at internalizing that information, remembering it, 302 00:20:04,040 --> 00:20:08,119 Speaker 1: understanding it, and applying it. And uh, I completely agree. 303 00:20:08,160 --> 00:20:10,600 Speaker 1: It would actually do a much better job of helping 304 00:20:10,640 --> 00:20:14,280 Speaker 1: them achieve their their stated purpose, which is, you know, 305 00:20:14,359 --> 00:20:16,960 Speaker 1: to my mind, a really good one. I think that's great. 306 00:20:17,000 --> 00:20:19,159 Speaker 1: And I was also just thinking you why not you know, 307 00:20:19,200 --> 00:20:23,160 Speaker 1: create something like a diversification quotient that a simple trader 308 00:20:23,200 --> 00:20:25,440 Speaker 1: can look and say, well, how diversified am I? Oh look, 309 00:20:25,440 --> 00:20:27,800 Speaker 1: here's a number up here. What does this number mean? 310 00:20:28,240 --> 00:20:31,000 Speaker 1: Or what about a risk quotation? How risky have I 311 00:20:31,080 --> 00:20:34,200 Speaker 1: been trading? How risky is my is my overall portfolio? 312 00:20:34,600 --> 00:20:37,240 Speaker 1: How how open am I? That's one of the reasons 313 00:20:37,280 --> 00:20:41,600 Speaker 1: why people join these brokerages is ordered to gain access 314 00:20:41,640 --> 00:20:45,320 Speaker 1: to some of this information. And to your point, they've 315 00:20:45,320 --> 00:20:48,240 Speaker 1: got tons of data. They have tons of data about 316 00:20:48,440 --> 00:20:53,120 Speaker 1: people like you, and if it were an anonymised, right, 317 00:20:53,200 --> 00:20:56,400 Speaker 1: they would they would know when you're showing signs of 318 00:20:56,400 --> 00:21:01,560 Speaker 1: getting yourself in trouble and they should flag that to you. Um. Yeah, 319 00:21:01,560 --> 00:21:03,680 Speaker 1: So it seems like there's much more that they could 320 00:21:03,720 --> 00:21:08,119 Speaker 1: be doing as I as I really think about it, Um, Devin, 321 00:21:08,600 --> 00:21:10,199 Speaker 1: we have a tool on the show we call the 322 00:21:10,320 --> 00:21:13,160 Speaker 1: BS score, and what we're trying to do is measure 323 00:21:13,200 --> 00:21:17,159 Speaker 1: the gap between word. Indeed, our scale goes from zero 324 00:21:17,280 --> 00:21:21,159 Speaker 1: to one hundred, zero being the best, zero bs on 325 00:21:21,720 --> 00:21:25,840 Speaker 1: being the worst. Total BS. So robin Hood says their 326 00:21:25,880 --> 00:21:30,200 Speaker 1: purpose is to democratize finance for all and that they 327 00:21:30,280 --> 00:21:34,240 Speaker 1: believe that everyone should have access to the finale financial markets. 328 00:21:34,320 --> 00:21:37,080 Speaker 1: So they've built robin Hood from the ground up to 329 00:21:37,160 --> 00:21:42,240 Speaker 1: make investing friendly, approachable, and understandable for newcomers and experts alike. 330 00:21:42,960 --> 00:21:46,920 Speaker 1: What score would you give them? Um, I'm gonna give 331 00:21:46,920 --> 00:21:50,680 Speaker 1: it a fifty five out of possible one. I look 332 00:21:50,720 --> 00:21:54,040 Speaker 1: at their mission statement and I see that the democratization 333 00:21:54,400 --> 00:21:58,280 Speaker 1: it really has nothing in their about necessarily keeping people 334 00:21:58,320 --> 00:22:01,520 Speaker 1: safe from harm or educating people, trying to just make 335 00:22:01,560 --> 00:22:05,000 Speaker 1: sure it's accessible, uh, and democratizing making sure everyone has 336 00:22:05,040 --> 00:22:08,080 Speaker 1: access to these markets. It seems like that's something that 337 00:22:08,160 --> 00:22:13,200 Speaker 1: robin Hood has accomplished, but that's not necessarily without some consequences. 338 00:22:13,240 --> 00:22:15,920 Speaker 1: I want more from robin Hood. I think robin Hood 339 00:22:16,119 --> 00:22:20,200 Speaker 1: could be a great company that really doesn't just open 340 00:22:20,280 --> 00:22:23,560 Speaker 1: the doors, but also sits people down and says, here's 341 00:22:23,560 --> 00:22:25,879 Speaker 1: how you can do this more effectively, here's how we 342 00:22:25,960 --> 00:22:29,920 Speaker 1: can make you more effective in your trading. It's something 343 00:22:30,000 --> 00:22:32,960 Speaker 1: that I think robin Hood could actually achieve um and 344 00:22:33,000 --> 00:22:38,040 Speaker 1: be really fire its namesaked, really trying to build people up. 345 00:22:38,240 --> 00:22:41,240 Speaker 1: So that's where I see it as it stands right now. Yeah, 346 00:22:41,280 --> 00:22:43,640 Speaker 1: I love the thoughtfulness of that score. And I want 347 00:22:43,640 --> 00:22:45,879 Speaker 1: to thank you for being being on the show and 348 00:22:45,920 --> 00:22:48,760 Speaker 1: taking the time today. Thank you very much, Hi, It's 349 00:22:48,760 --> 00:22:56,440 Speaker 1: been great, So to be fair. Gamification doesn't take away 350 00:22:56,440 --> 00:22:59,840 Speaker 1: a person's free will or absolve them of responsibility for 351 00:23:00,080 --> 00:23:04,439 Speaker 1: or decisions. But robin Hood still turns the stock market 352 00:23:04,560 --> 00:23:08,400 Speaker 1: into a dangerous game, and given their business model, they 353 00:23:08,400 --> 00:23:11,600 Speaker 1: don't have any incentive to change. The more I learned, 354 00:23:11,880 --> 00:23:14,280 Speaker 1: the more concerned I am about the harm that robin 355 00:23:14,320 --> 00:23:17,840 Speaker 1: Hood can do. But we're not here to just curse 356 00:23:17,880 --> 00:23:20,879 Speaker 1: the darkness. It's important to light a few candles as well, 357 00:23:21,320 --> 00:23:24,160 Speaker 1: so we'll get into some ideas to fix robin Hood 358 00:23:24,600 --> 00:23:36,440 Speaker 1: right after the break, Folks, it is time to talk 359 00:23:36,480 --> 00:23:39,639 Speaker 1: about actions that robin Hood could take to better do 360 00:23:39,880 --> 00:23:44,320 Speaker 1: their purpose of democratizing finance for all joining me today, 361 00:23:44,359 --> 00:23:49,560 Speaker 1: we have two extremely qualified experts. First up, I'm really 362 00:23:49,560 --> 00:23:53,160 Speaker 1: excited to introduce Hailey Sacks. Hailey, thanks for joining us 363 00:23:53,200 --> 00:23:57,040 Speaker 1: and welcome to calling bullshit. Thank you so much for 364 00:23:57,080 --> 00:24:01,560 Speaker 1: having me. I'm excited to call bullshit and Haley for 365 00:24:01,600 --> 00:24:03,399 Speaker 1: the listeners. Could you tell us a little bit about 366 00:24:03,400 --> 00:24:08,720 Speaker 1: your background. Yes, So, I'm Haley, otherwise known as Mrs 367 00:24:08,760 --> 00:24:13,840 Speaker 1: dow Jones, and I was the first financial influencer fantastic, 368 00:24:14,040 --> 00:24:18,400 Speaker 1: and I want to introduce Charles road Blood. Charles, thank 369 00:24:18,440 --> 00:24:20,440 Speaker 1: you for joining us today and tell us a little 370 00:24:20,440 --> 00:24:23,879 Speaker 1: bit about your background as well. Sure, I'm a chartered 371 00:24:23,960 --> 00:24:27,480 Speaker 1: financial analyst. I work with the American Association of Individual 372 00:24:27,480 --> 00:24:32,080 Speaker 1: Investors AI and among the things I've created there as 373 00:24:32,119 --> 00:24:35,400 Speaker 1: our prison wealth blooding processes is really about taking your 374 00:24:35,440 --> 00:24:39,159 Speaker 1: goals and having those drive all of your savings and 375 00:24:39,240 --> 00:24:45,000 Speaker 1: investing decisions. Okay, so let's jump right into some ideas. Charles, 376 00:24:45,040 --> 00:24:47,200 Speaker 1: I'm gonna ask you to go first. In two months, 377 00:24:47,320 --> 00:24:50,159 Speaker 1: or less. What's the one thing that you would change 378 00:24:50,160 --> 00:24:54,359 Speaker 1: about robin Hood to better do their story? Well, I 379 00:24:54,359 --> 00:24:57,280 Speaker 1: think they need to focus on long term investing, and 380 00:24:57,320 --> 00:25:00,320 Speaker 1: given that they're an app based broker um, I think 381 00:25:00,359 --> 00:25:03,280 Speaker 1: it'd be great if they could actually gamify the process 382 00:25:03,359 --> 00:25:06,600 Speaker 1: of long term investing, give points or give rewards to 383 00:25:06,680 --> 00:25:09,960 Speaker 1: people who set up automatic deposits, to people who pick 384 00:25:09,960 --> 00:25:12,359 Speaker 1: an allocation and stick with it. And there's things they 385 00:25:12,359 --> 00:25:15,760 Speaker 1: can do like great leaderboards. Uh, this person's increased their 386 00:25:15,760 --> 00:25:19,720 Speaker 1: automatic contribution, this person has gone x days without looking 387 00:25:19,720 --> 00:25:22,960 Speaker 1: at their portfolio balance, a little things like that which 388 00:25:23,000 --> 00:25:26,400 Speaker 1: would really encourage people to think about investing for long 389 00:25:26,520 --> 00:25:29,320 Speaker 1: term and most importantly gets them in the habit of 390 00:25:29,520 --> 00:25:33,600 Speaker 1: not being reactive and not constantly wanting to trade and 391 00:25:33,680 --> 00:25:37,760 Speaker 1: turn over their portfolios. Hmm. I think that's a really 392 00:25:37,800 --> 00:25:40,159 Speaker 1: interesting idea. Haley, what do you think about that idea? 393 00:25:41,040 --> 00:25:45,960 Speaker 1: I'm like enthusiastically nodding. You guys can't see because the podcast, 394 00:25:46,040 --> 00:25:50,680 Speaker 1: but that's pretty much my dream app. Yeah. I guess 395 00:25:50,680 --> 00:25:54,840 Speaker 1: the only question I have about that is is sort 396 00:25:54,880 --> 00:25:58,800 Speaker 1: of um business model? Right? Because right now they make 397 00:25:58,880 --> 00:26:01,639 Speaker 1: money using some and called payment for order flow, So 398 00:26:01,720 --> 00:26:04,639 Speaker 1: the more you trade, the more money they make. Essentially, 399 00:26:05,200 --> 00:26:08,720 Speaker 1: it would definitely be a seismic shift about the revenues 400 00:26:08,840 --> 00:26:11,000 Speaker 1: come from payment for order flow and most of that 401 00:26:11,119 --> 00:26:16,000 Speaker 1: from options and from crypto. So it would require a 402 00:26:16,040 --> 00:26:19,800 Speaker 1: big shift and their business model. But I think it's 403 00:26:19,920 --> 00:26:23,879 Speaker 1: questionable how sustainable their business model is right now, given 404 00:26:23,880 --> 00:26:27,880 Speaker 1: that we're already saying trading volumes dropped because the market's 405 00:26:27,920 --> 00:26:31,879 Speaker 1: been down. Yeah, I agree, it doesn't feel sustainable all right, 406 00:26:32,000 --> 00:26:36,320 Speaker 1: So great idea. Thank you, Charles Haley, your turn. What's 407 00:26:36,359 --> 00:26:39,360 Speaker 1: the one thing you would tell uh CEO of lad 408 00:26:39,440 --> 00:26:41,640 Speaker 1: ten of to do differently to get robin Hood back 409 00:26:41,640 --> 00:26:45,320 Speaker 1: on track. You mentioned at the beginning of this that 410 00:26:45,560 --> 00:26:51,240 Speaker 1: robin Hood is here to make investing easy and democratize it, 411 00:26:51,880 --> 00:26:55,760 Speaker 1: and it almost feels like right now they've given everyone 412 00:26:56,040 --> 00:26:59,800 Speaker 1: the ingredients to cook with, but with no cookbook. And 413 00:27:00,160 --> 00:27:03,200 Speaker 1: so I would really like to see them and force 414 00:27:03,680 --> 00:27:09,480 Speaker 1: uh financial literacy course or some sort of quazz that 415 00:27:09,520 --> 00:27:13,879 Speaker 1: you have to go through before you tread um, just 416 00:27:14,160 --> 00:27:20,639 Speaker 1: to ensure that their users actually understand what they're doing. 417 00:27:21,040 --> 00:27:23,240 Speaker 1: We all want to be intuitive cooks, we all want 418 00:27:23,280 --> 00:27:26,720 Speaker 1: to be intuitive investors, but you know, rarely does it 419 00:27:26,840 --> 00:27:30,880 Speaker 1: actually work out. Yeah, I hear that and and agree. 420 00:27:30,960 --> 00:27:36,320 Speaker 1: So all right, it's it's my turn, and maybe not surprisingly, 421 00:27:36,600 --> 00:27:40,240 Speaker 1: I am hunting in in similar ground with with my idea. 422 00:27:40,320 --> 00:27:43,040 Speaker 1: You two are the experts, obviously, but you know, Robin 423 00:27:43,080 --> 00:27:46,040 Speaker 1: Hood says their goal is to make investing friendly, approachable, 424 00:27:46,040 --> 00:27:49,520 Speaker 1: and understandable, and my biggest beef with them is that 425 00:27:49,640 --> 00:27:53,640 Speaker 1: they've made investing friendly and approachable, but they've done a 426 00:27:53,720 --> 00:27:57,719 Speaker 1: pretty terrible job of making it understandable. So my idea 427 00:27:57,760 --> 00:28:02,160 Speaker 1: is to de gamify the investing aspect and instead gamify 428 00:28:02,240 --> 00:28:05,000 Speaker 1: the education part of the app and make it so 429 00:28:05,080 --> 00:28:07,800 Speaker 1: I earned points for reading and passing quizzes to unlock 430 00:28:07,920 --> 00:28:11,200 Speaker 1: functionality in the app, and don't just drop me in 431 00:28:11,240 --> 00:28:14,120 Speaker 1: the deep end, right, make a point system that creates 432 00:28:14,240 --> 00:28:18,359 Speaker 1: friendly competition among users and kind of encourages me to 433 00:28:18,359 --> 00:28:22,400 Speaker 1: be the smartest and wisest investor, so, you know, hopefully 434 00:28:22,440 --> 00:28:26,400 Speaker 1: making learning to invest well both social and interesting. Part 435 00:28:26,400 --> 00:28:30,800 Speaker 1: of the education could also explain the business model to people, 436 00:28:31,640 --> 00:28:34,959 Speaker 1: which right now is you know, currently buried in the 437 00:28:35,040 --> 00:28:38,080 Speaker 1: terms of service, so people actually understand that there's no 438 00:28:38,160 --> 00:28:40,520 Speaker 1: such thing as free, that that that that actually the 439 00:28:40,560 --> 00:28:43,640 Speaker 1: app because of its business model is encouraging them to 440 00:28:43,680 --> 00:28:47,480 Speaker 1: do things that are not necessarily good for them as investors. 441 00:28:48,680 --> 00:28:53,520 Speaker 1: I actually don't mind if they keep the ability for 442 00:28:53,600 --> 00:28:58,000 Speaker 1: people to invest like willie nilly, as long as it's 443 00:28:58,120 --> 00:29:02,680 Speaker 1: just really clear. But I don't need them to h 444 00:29:04,360 --> 00:29:08,560 Speaker 1: to change their business model, like I want them to 445 00:29:08,760 --> 00:29:11,440 Speaker 1: add to it. And then if you choose not to 446 00:29:11,520 --> 00:29:14,160 Speaker 1: do that, like you said that, it's like very clear 447 00:29:14,280 --> 00:29:18,600 Speaker 1: in Layman's terms. Okay, here are the risk that you're taking. Yeah, 448 00:29:18,600 --> 00:29:24,000 Speaker 1: it just seems like transparency. Yeah, right, So I just 449 00:29:24,000 --> 00:29:25,880 Speaker 1: want to add I get curious. I sent up for 450 00:29:26,000 --> 00:29:29,080 Speaker 1: Robin Hood, I guess earlier this year last year, and 451 00:29:29,120 --> 00:29:32,200 Speaker 1: I got approved the trade options probably within five minutes. 452 00:29:32,800 --> 00:29:36,040 Speaker 1: And I understand options, but they had no idea who 453 00:29:36,080 --> 00:29:38,160 Speaker 1: I was. And you know, if I was a novice 454 00:29:38,600 --> 00:29:41,920 Speaker 1: and more talking about education, I would have no idea 455 00:29:42,080 --> 00:29:45,760 Speaker 1: how deep will pull I'm walking into blindfolded. And I 456 00:29:45,800 --> 00:29:49,200 Speaker 1: think people are signing up and during social media or something, 457 00:29:49,240 --> 00:29:51,920 Speaker 1: they think, oh, let me go buy options on game Stop, 458 00:29:52,520 --> 00:29:56,200 Speaker 1: not having any understanding of what exactly it is they're buying, 459 00:29:56,720 --> 00:30:01,080 Speaker 1: much less the risk involved. Yeah, I was I was 460 00:30:01,160 --> 00:30:04,880 Speaker 1: reading uh just this morning, just to to you know, 461 00:30:04,960 --> 00:30:07,560 Speaker 1: kind of refresh my memory about the young man who 462 00:30:07,720 --> 00:30:11,400 Speaker 1: he was trading options and um, the app told him 463 00:30:11,440 --> 00:30:14,120 Speaker 1: that he owed seven thirty thou dollars at the end 464 00:30:14,160 --> 00:30:17,800 Speaker 1: of some trade, and and in in a note that 465 00:30:17,880 --> 00:30:20,000 Speaker 1: he sent to his parents, he pointed out that he 466 00:30:20,000 --> 00:30:23,240 Speaker 1: didn't have a clue how to you know, trade options 467 00:30:23,320 --> 00:30:25,760 Speaker 1: or what that actually even meant. And so in some 468 00:30:25,800 --> 00:30:30,280 Speaker 1: cases the results are are literally deadly. Yeah, it's extremely 469 00:30:30,320 --> 00:30:32,880 Speaker 1: a risk, especially when you start talking about margin debt. 470 00:30:32,960 --> 00:30:36,320 Speaker 1: That's where people can really lose a lot of money 471 00:30:36,440 --> 00:30:39,560 Speaker 1: versus that they just you just use a cash account, 472 00:30:39,920 --> 00:30:42,120 Speaker 1: then whatever is in any account, if that's gone, that's got, 473 00:30:42,280 --> 00:30:45,240 Speaker 1: that's gone, it's gone, right. But this case, you're basically 474 00:30:45,280 --> 00:30:48,040 Speaker 1: gambling on a credit card. And I think it's difficult 475 00:30:48,120 --> 00:30:50,080 Speaker 1: because people think, oh, well, this is going to be 476 00:30:50,160 --> 00:30:52,680 Speaker 1: the trade that gets me out, and so then they 477 00:30:52,800 --> 00:30:55,080 Speaker 1: keep trying and trying. And I mean it's a tale 478 00:30:55,080 --> 00:30:58,080 Speaker 1: as old as time. Um that that makes me wonder. 479 00:30:58,640 --> 00:31:00,400 Speaker 1: I'd love to hear what both of you to about 480 00:31:00,640 --> 00:31:05,800 Speaker 1: about crypto. Like crypto in particular feels like it's in, 481 00:31:06,080 --> 00:31:09,960 Speaker 1: like it's out at the edge of speculative um for 482 00:31:10,400 --> 00:31:13,400 Speaker 1: for investors how do you view that space. I think 483 00:31:13,440 --> 00:31:15,600 Speaker 1: that it's okay to be excited about cryptot to think 484 00:31:15,640 --> 00:31:17,480 Speaker 1: it's cool, But that doesn't mean that you have to 485 00:31:17,600 --> 00:31:22,719 Speaker 1: like make bitcoin your whole personality. Don't go all in Charles, 486 00:31:22,840 --> 00:31:26,120 Speaker 1: what's you're taking. I think the blockchain technology has a 487 00:31:26,240 --> 00:31:29,360 Speaker 1: lot of interesting a lot of upside, But I think 488 00:31:29,400 --> 00:31:33,680 Speaker 1: it's important to separate crypto from blockchain, and crypto itself 489 00:31:33,760 --> 00:31:36,600 Speaker 1: is a currency. I still can't go in my local 490 00:31:36,640 --> 00:31:39,960 Speaker 1: grocery store with bitcoin or ethere um and buy a 491 00:31:40,040 --> 00:31:43,520 Speaker 1: loaf of bread, and so there's a huge network effect 492 00:31:43,600 --> 00:31:47,320 Speaker 1: that crypto has to overcome. But whereas you look at blockchain, 493 00:31:47,600 --> 00:31:52,200 Speaker 1: we see JP Morgan's actually working with it too, spirit transactions. 494 00:31:53,000 --> 00:31:54,760 Speaker 1: There are a few other areas that I'd love to 495 00:31:54,840 --> 00:31:57,880 Speaker 1: explore with you, but I wanted to start out with 496 00:31:58,400 --> 00:32:02,320 Speaker 1: something that's Scott gallow Way said he said some funny 497 00:32:02,360 --> 00:32:07,520 Speaker 1: and mean things about about Robin Hood. Yeah. One thing 498 00:32:07,640 --> 00:32:11,000 Speaker 1: he said is I believe these guys are mendacious. Fox. 499 00:32:11,160 --> 00:32:14,880 Speaker 1: The company's mission to democratize finance for all is similar 500 00:32:14,960 --> 00:32:19,800 Speaker 1: to Pablo Escobar saying his mission was to democratize cocaine 501 00:32:20,800 --> 00:32:25,520 Speaker 1: um and and you know, humor aside. This idea that 502 00:32:25,600 --> 00:32:31,640 Speaker 1: he's poking at, that that democratizing something is automatically good 503 00:32:32,160 --> 00:32:36,840 Speaker 1: is deeply questionable. I would say, yeah it is. And 504 00:32:36,880 --> 00:32:40,240 Speaker 1: I'll make an analogy here. I'm running at the Chicago Marathon, 505 00:32:40,560 --> 00:32:42,960 Speaker 1: and my time will be against some of the best 506 00:32:43,080 --> 00:32:45,960 Speaker 1: marathon runners in the world, and obviously my time will 507 00:32:46,000 --> 00:32:50,120 Speaker 1: be much slower, but that doesn't harm me. Why walk 508 00:32:50,160 --> 00:32:53,000 Speaker 1: in the wall street. I'm taking my knowledge against everybody 509 00:32:53,040 --> 00:32:56,520 Speaker 1: else involved, and there's a bunch of very skilled people 510 00:32:56,640 --> 00:32:58,960 Speaker 1: with a lot more data and a lot more speed, 511 00:32:59,600 --> 00:33:04,040 Speaker 1: uh the average individual investor, And so individual investors really 512 00:33:04,120 --> 00:33:07,280 Speaker 1: have to play that long term discipline game to have 513 00:33:07,360 --> 00:33:11,960 Speaker 1: an advantage. But Robin Hood encourages this fast trading, this 514 00:33:12,120 --> 00:33:16,880 Speaker 1: concert turnover, which is exactly the wrong thing an individual 515 00:33:16,960 --> 00:33:20,160 Speaker 1: investor should do. Yeah, I mean, that's it's a very 516 00:33:20,240 --> 00:33:24,880 Speaker 1: interesting point. There are not a lot of situations where 517 00:33:25,560 --> 00:33:29,960 Speaker 1: to use another sort of sports analogy, like where you 518 00:33:30,080 --> 00:33:33,400 Speaker 1: play against professionals right out of the gate. You know, 519 00:33:33,560 --> 00:33:37,080 Speaker 1: in football, there's peewee football, and then there's grade school 520 00:33:37,120 --> 00:33:40,280 Speaker 1: football and high school football and college football, and then 521 00:33:40,440 --> 00:33:44,840 Speaker 1: there's the NFL. But in investing, like they tell you 522 00:33:44,960 --> 00:33:47,840 Speaker 1: to strap on a helmet and you're playing against NFL 523 00:33:48,000 --> 00:33:52,160 Speaker 1: players right out of the gate, playing against professionals. But 524 00:33:52,280 --> 00:33:55,520 Speaker 1: like in golf you would have the handicap. In investing, 525 00:33:55,720 --> 00:33:58,680 Speaker 1: you can also have a handicap. It's called not picking 526 00:33:58,720 --> 00:34:03,040 Speaker 1: individual stocks, right, Yeah, And I think a lot of 527 00:34:03,120 --> 00:34:07,400 Speaker 1: people don't really know that. So just another another area 528 00:34:07,440 --> 00:34:11,799 Speaker 1: of inquiry, you know, robin hood is is racking up, 529 00:34:12,520 --> 00:34:16,120 Speaker 1: you know, a bunch of data about each individual user. 530 00:34:16,960 --> 00:34:18,920 Speaker 1: One other idea that occurred to me was just what 531 00:34:19,120 --> 00:34:22,480 Speaker 1: if the app told me what my risk profile was 532 00:34:22,960 --> 00:34:27,960 Speaker 1: as an investor, right and and told me literally you're 533 00:34:28,080 --> 00:34:30,759 Speaker 1: in the red, or you're in the yellow, or you're 534 00:34:30,840 --> 00:34:33,000 Speaker 1: in the green in terms of the risk that you're 535 00:34:33,040 --> 00:34:37,359 Speaker 1: taking based on your investing behavior. Robin Hood could reach out. 536 00:34:37,400 --> 00:34:41,200 Speaker 1: There's these behavioral sciences, whether it's Richard Taylor who won 537 00:34:41,280 --> 00:34:46,000 Speaker 1: the Nobel Prize, marriage statman, Robert Schiller. Um, I'm sure 538 00:34:46,120 --> 00:34:48,319 Speaker 1: they would have some great ideas about how to use 539 00:34:48,400 --> 00:34:51,480 Speaker 1: the data to actually create a more sustainable, better app. 540 00:34:51,760 --> 00:34:54,320 Speaker 1: But again it's a shift in business models to shift 541 00:34:54,400 --> 00:34:58,279 Speaker 1: in thinking. Uh where you know, robin Hood, despite what 542 00:34:58,400 --> 00:35:02,480 Speaker 1: they say, uh, they're all really is to maximize profits 543 00:35:02,560 --> 00:35:05,719 Speaker 1: and not worry about what they're breaking. Um. And it 544 00:35:05,880 --> 00:35:09,080 Speaker 1: is that culture of let's not worry what we break. Uh, 545 00:35:09,239 --> 00:35:12,080 Speaker 1: that can cause a lot of damage. Do other of 546 00:35:12,160 --> 00:35:16,239 Speaker 1: you have any thoughts on the name Robin Hood? You know, 547 00:35:16,600 --> 00:35:19,360 Speaker 1: Robin Hood's namesake was a thief with a twist. He 548 00:35:19,480 --> 00:35:22,560 Speaker 1: stole from the rich and gave to the poor. Does 549 00:35:23,160 --> 00:35:26,200 Speaker 1: the Robin Hood app live up to that story? I'd 550 00:35:26,200 --> 00:35:28,399 Speaker 1: say it's the opposite. And you just look at their 551 00:35:28,719 --> 00:35:32,880 Speaker 1: SEC documents. Um. I mean they're primary source of revenue 552 00:35:33,040 --> 00:35:35,800 Speaker 1: is running orders through market makers, so they're taking the 553 00:35:36,000 --> 00:35:39,040 Speaker 1: orders placed by small investors and out of every trade, 554 00:35:39,560 --> 00:35:43,480 Speaker 1: they're directing it to specific market makers versus trying to 555 00:35:43,560 --> 00:35:48,800 Speaker 1: seek the absolute best execution price. And the investors training 556 00:35:48,920 --> 00:35:52,560 Speaker 1: Robin Hood's platform are paying for that, so they're not 557 00:35:52,680 --> 00:35:57,600 Speaker 1: they're doing exact opposite. Yeah. Yeah, that's a little dark. 558 00:35:57,800 --> 00:36:05,520 Speaker 1: Actually it's GDS. Obviously it's so misleading from a marketing perspective. 559 00:36:05,520 --> 00:36:13,000 Speaker 1: I'm like, well done, Sadly, somebody somebody smart. Yeah, I 560 00:36:13,040 --> 00:36:19,680 Speaker 1: could say Mr Burns in the background. Excellent, Yes, it's excellent. Um, 561 00:36:20,360 --> 00:36:24,360 Speaker 1: you both are extremely knowledgeable investors and you've both touched 562 00:36:24,400 --> 00:36:26,160 Speaker 1: on this a little bit, but I'd love for you 563 00:36:26,239 --> 00:36:29,680 Speaker 1: to both just off the tops of your heads, what 564 00:36:29,920 --> 00:36:34,640 Speaker 1: is a responsible smart way for a for an inexperienced 565 00:36:34,719 --> 00:36:39,719 Speaker 1: investor to enter the investing game, um, in a way 566 00:36:39,840 --> 00:36:44,440 Speaker 1: that gives them the best chance of of Actually, you know, 567 00:36:45,600 --> 00:36:47,520 Speaker 1: I don't even know whether it's winning the game, but 568 00:36:47,680 --> 00:36:51,839 Speaker 1: but doing well not getting hurt. Okay, go, I'll go first. UM. 569 00:36:51,960 --> 00:36:55,200 Speaker 1: I would say, someone who's working at a company offers 570 00:36:55,239 --> 00:36:58,719 Speaker 1: a four oh one k, set it up, UM. If 571 00:36:58,800 --> 00:37:01,799 Speaker 1: you don't really have strong knowledge of allocation chances are 572 00:37:01,840 --> 00:37:05,359 Speaker 1: the default allocations a target date fun. They're very good 573 00:37:05,440 --> 00:37:08,480 Speaker 1: default option if you don't know what you're doing, And 574 00:37:08,680 --> 00:37:11,920 Speaker 1: every year increase how much you're contributing, even it's just 575 00:37:12,040 --> 00:37:16,160 Speaker 1: ten more, keep increasing it, keep saving as much as 576 00:37:16,239 --> 00:37:18,960 Speaker 1: you can, UM. And then I'll pass along the advice 577 00:37:19,080 --> 00:37:21,880 Speaker 1: Jack Bobe gave to me once, don't look at your 578 00:37:21,880 --> 00:37:24,759 Speaker 1: account for thirty or forty years. And then when you do, 579 00:37:25,400 --> 00:37:27,839 Speaker 1: have a doctor on call, because you might faint when 580 00:37:27,880 --> 00:37:33,160 Speaker 1: you see how big the balance is. That's great, love it, Okay, Hayley. 581 00:37:34,160 --> 00:37:38,520 Speaker 1: I agree. I think like starting with your four O 582 00:37:38,600 --> 00:37:42,520 Speaker 1: onek matches obviously the best way to have a guaranteed 583 00:37:43,040 --> 00:37:47,680 Speaker 1: two hundred as to return UM on your investment. I 584 00:37:47,800 --> 00:37:50,600 Speaker 1: also think that what's really important for beginner investors is 585 00:37:50,680 --> 00:37:53,799 Speaker 1: to know why they're investing, because it's obviously a sacrifice. 586 00:37:53,880 --> 00:37:58,439 Speaker 1: We would love to all, like, you know, just spend, spend, spend, spend, spend. 587 00:37:58,480 --> 00:38:02,800 Speaker 1: I love spending money. It's very fun. You should try it. 588 00:38:03,000 --> 00:38:08,120 Speaker 1: But but knowing knowing why I'm not having a story 589 00:38:08,200 --> 00:38:10,640 Speaker 1: in my mind, a clear idea of why I can't 590 00:38:10,680 --> 00:38:14,200 Speaker 1: do something makes it a lot easier UM and sort 591 00:38:14,239 --> 00:38:16,360 Speaker 1: of gets you aligned with yourself. I think in a 592 00:38:16,480 --> 00:38:19,879 Speaker 1: really powerful way. M hm. And I think for someone 593 00:38:20,000 --> 00:38:23,040 Speaker 1: starting out, just that's what your goals are. List what 594 00:38:23,160 --> 00:38:25,399 Speaker 1: you're going to allocate to and list how much you're 595 00:38:25,400 --> 00:38:28,920 Speaker 1: gonna save. You can use your notes app on your phone, 596 00:38:29,040 --> 00:38:32,040 Speaker 1: and that simple process holds you more accountable, but it 597 00:38:32,120 --> 00:38:34,440 Speaker 1: also gives you that clarity, so you're not trying to 598 00:38:34,600 --> 00:38:37,440 Speaker 1: keep it all on your head, and whenever you're nervous, 599 00:38:37,520 --> 00:38:39,400 Speaker 1: you can always go back to those RT notes. Oh 600 00:38:39,440 --> 00:38:42,719 Speaker 1: I'm saving for vacation, I'm saving for retirement. Just being 601 00:38:42,760 --> 00:38:45,040 Speaker 1: able to look at that and have that reminder when 602 00:38:45,080 --> 00:38:48,120 Speaker 1: the market is really volatile, here's a big picture. It 603 00:38:48,239 --> 00:38:53,240 Speaker 1: keeps you focused and it keeps you more disciplined. Right, alright, 604 00:38:53,480 --> 00:38:56,720 Speaker 1: So are there any questions or topics that we haven't 605 00:38:56,800 --> 00:39:00,280 Speaker 1: touched on that you think users of robin hood should 606 00:39:00,400 --> 00:39:02,680 Speaker 1: know about? You know, I think the idea that robin 607 00:39:02,719 --> 00:39:04,200 Speaker 1: Hood is going to make it easy for people to 608 00:39:04,320 --> 00:39:08,920 Speaker 1: invest really doesn't make it easy because yes, commissions are waived, 609 00:39:09,080 --> 00:39:12,320 Speaker 1: but then you still have to decide what to invest in, 610 00:39:12,920 --> 00:39:15,680 Speaker 1: and just you know, not having that guidance and thinking 611 00:39:15,760 --> 00:39:18,319 Speaker 1: people are gonna walk in and know exactly what they're 612 00:39:18,360 --> 00:39:22,320 Speaker 1: gonna do, it just doesn't work. I would say that 613 00:39:22,520 --> 00:39:27,040 Speaker 1: like investing should be really boring, um, and that like 614 00:39:27,120 --> 00:39:30,440 Speaker 1: if you're getting your thrills from your portfolio and from 615 00:39:30,480 --> 00:39:39,960 Speaker 1: your trades, and like you need new thrills and getting 616 00:39:40,160 --> 00:39:42,760 Speaker 1: rich quick, Like if it seems too good to be true, 617 00:39:43,080 --> 00:39:46,160 Speaker 1: it's probably too good to be true. And like, trust me, 618 00:39:46,320 --> 00:39:50,040 Speaker 1: if you're hearing about it on like Twitter and the news, 619 00:39:50,360 --> 00:39:53,160 Speaker 1: you're too late. Yes, Like the people who are actually 620 00:39:53,239 --> 00:39:56,360 Speaker 1: having the crazy returns are so freaking early on this stuff, 621 00:39:56,440 --> 00:39:58,560 Speaker 1: Like honey, you would know and if that was your 622 00:39:58,680 --> 00:40:01,520 Speaker 1: like d n A and that's not me, that's not 623 00:40:01,760 --> 00:40:05,879 Speaker 1: most people. So get real with your bad self, right. 624 00:40:07,400 --> 00:40:09,040 Speaker 1: I just want to put hi saying. I think if 625 00:40:09,080 --> 00:40:12,560 Speaker 1: you really had deserves to speculate, then segment your portfolio. 626 00:40:12,640 --> 00:40:15,319 Speaker 1: Maybe not a person of portfolio is long term conservative, 627 00:40:15,680 --> 00:40:17,480 Speaker 1: and then you have the small portion and whatever that 628 00:40:17,520 --> 00:40:20,760 Speaker 1: small portion is realized. This is money that you're prepared 629 00:40:20,800 --> 00:40:24,440 Speaker 1: to lose uma and if you lucky with it, great, 630 00:40:24,760 --> 00:40:27,200 Speaker 1: Um you know, but if you don't, at least you're 631 00:40:27,239 --> 00:40:32,319 Speaker 1: not harming yourselves. Yeah, that's that's great advice. It acknowledges 632 00:40:32,400 --> 00:40:36,440 Speaker 1: human nature. We all like to you know, throw caution 633 00:40:36,520 --> 00:40:38,560 Speaker 1: the windicationally, but if as so long as you're not 634 00:40:38,640 --> 00:40:43,239 Speaker 1: betting the farm. So to wrap up, uh, we have 635 00:40:43,400 --> 00:40:46,520 Speaker 1: a tool on this show that we call the BS scale. 636 00:40:47,480 --> 00:40:52,840 Speaker 1: Zero is the best meaning zero BS and on is 637 00:40:52,880 --> 00:40:57,600 Speaker 1: the worst total BS. So on that scale, what score 638 00:40:57,880 --> 00:41:02,560 Speaker 1: would you both? Uh you to Robin Hood Hayley. Um, 639 00:41:02,840 --> 00:41:10,279 Speaker 1: why don't you go first? Oh? Um? Well it's hard 640 00:41:10,400 --> 00:41:14,120 Speaker 1: because like they are letting you it's not like they're 641 00:41:14,160 --> 00:41:16,080 Speaker 1: like not letting you trade. So it's like they're not 642 00:41:16,320 --> 00:41:18,640 Speaker 1: fully bullshit because they are doing what they say that 643 00:41:18,719 --> 00:41:22,440 Speaker 1: they do. They're just like withholding information and uh, you know, 644 00:41:22,680 --> 00:41:31,200 Speaker 1: profiting from compulsion, so I would say like sixty three. Yeah, Charles, 645 00:41:31,760 --> 00:41:33,120 Speaker 1: you know I was gonna go a little bit higher. 646 00:41:33,120 --> 00:41:37,319 Speaker 1: I'm gonna go probably, And I will say the reason 647 00:41:37,400 --> 00:41:40,000 Speaker 1: I'm not even higher is I do think one thing 648 00:41:40,320 --> 00:41:43,440 Speaker 1: they did do was they got the major brokerages to 649 00:41:43,480 --> 00:41:45,960 Speaker 1: get the commissions down to zero. And while we can 650 00:41:46,000 --> 00:41:49,160 Speaker 1: talk about paying for order flow, if you're an investor 651 00:41:49,200 --> 00:41:52,440 Speaker 1: and you're making paycheck related contributions to your IRA or 652 00:41:52,480 --> 00:41:55,840 Speaker 1: your roth IRA, UM, that's huge. Where maybe you're putting 653 00:41:55,840 --> 00:41:58,800 Speaker 1: in fifty. I think if you average it out of 654 00:41:59,640 --> 00:42:02,239 Speaker 1: page text, I think the limit for i RAS is 655 00:42:02,280 --> 00:42:05,360 Speaker 1: like two a paycheck to be able to invest at 656 00:42:05,400 --> 00:42:10,120 Speaker 1: two at no cost every pay period. Um, that's actually 657 00:42:10,120 --> 00:42:12,759 Speaker 1: a big benefit, and I'll give Robin Hood credit for 658 00:42:12,960 --> 00:42:16,759 Speaker 1: bringing that about. Unfortunately, they also unleashed a weapon of 659 00:42:16,880 --> 00:42:22,120 Speaker 1: mass financial destruction with our gamifications. So that's why the 660 00:42:22,440 --> 00:42:26,799 Speaker 1: Bullshop meter is rather high. Yeah, that resonates, and um, 661 00:42:27,040 --> 00:42:29,880 Speaker 1: I think that's the that's the highest score that anyone 662 00:42:29,960 --> 00:42:33,600 Speaker 1: has given them. But I follow your reasoning. So this 663 00:42:33,800 --> 00:42:36,320 Speaker 1: was a great conversation. Charles and Haley. I want to 664 00:42:36,360 --> 00:42:38,680 Speaker 1: thank you both for being on the show. Thank you 665 00:42:39,160 --> 00:42:44,279 Speaker 1: thank you. Happy to invite it, folks, it is time 666 00:42:44,320 --> 00:42:48,480 Speaker 1: to give robin Hood their official BS score. The key 667 00:42:48,560 --> 00:42:53,000 Speaker 1: takeaway from me here is free is never really free. 668 00:42:53,640 --> 00:42:56,319 Speaker 1: Free always comes at a price, and in this case, 669 00:42:56,760 --> 00:42:59,520 Speaker 1: the price is being tossed into the deep end before 670 00:42:59,560 --> 00:43:03,160 Speaker 1: you even know how to swim. Robin Hood is good 671 00:43:03,239 --> 00:43:07,760 Speaker 1: at fooling unsuspecting newcomers into thinking investing is free and easy. 672 00:43:08,560 --> 00:43:13,120 Speaker 1: It's free, but it ain't easy. You have almost immediate 673 00:43:13,200 --> 00:43:16,680 Speaker 1: access to some very dangerous tools, and you're asked to 674 00:43:16,760 --> 00:43:20,799 Speaker 1: compete against career professionals. You wouldn't let a teenager who 675 00:43:20,840 --> 00:43:23,920 Speaker 1: had never touched a football play in the NFL, but 676 00:43:24,200 --> 00:43:28,080 Speaker 1: that's what Robin Hood does with inexperienced investors every day. 677 00:43:28,800 --> 00:43:31,760 Speaker 1: So I'm giving robin Hood a BS score of seventy. 678 00:43:35,239 --> 00:43:38,960 Speaker 1: They've accomplished the democratization piece of their mission, and the 679 00:43:39,040 --> 00:43:42,240 Speaker 1: app is certainly user friendly, but they have a long 680 00:43:42,480 --> 00:43:46,040 Speaker 1: way to go to make investing more understandable. If they 681 00:43:46,200 --> 00:43:50,759 Speaker 1: leaned into education by gamifying learning instead of trading, they 682 00:43:50,880 --> 00:43:54,080 Speaker 1: might really be onto something. And Robin Hood, CEO of 683 00:43:54,200 --> 00:43:56,960 Speaker 1: lad Tene, if you'd ever like to come on the 684 00:43:56,960 --> 00:44:00,480 Speaker 1: show to discuss anything that we've talked about today. Please 685 00:44:00,560 --> 00:44:05,880 Speaker 1: know that you have an open invitation if you're thinking 686 00:44:05,920 --> 00:44:08,960 Speaker 1: about starting a purpose led business or beginning the journey 687 00:44:09,000 --> 00:44:12,520 Speaker 1: of transformation to become one. Here are three things you 688 00:44:12,640 --> 00:44:18,480 Speaker 1: should take away from this episode. One, language matters. Every 689 00:44:18,560 --> 00:44:21,440 Speaker 1: word that robin Hood chose in their purpose should be 690 00:44:21,520 --> 00:44:25,720 Speaker 1: there for a reason, and it should drive action. Democratize 691 00:44:25,760 --> 00:44:29,480 Speaker 1: finance for all check. They do this by making it free. 692 00:44:30,560 --> 00:44:36,000 Speaker 1: Make investing friendly, approachable, and understandable for newcomers and experts alike. 693 00:44:36,880 --> 00:44:43,040 Speaker 1: Friendly and approachable, check and check understandable Nope, And when 694 00:44:43,080 --> 00:44:47,080 Speaker 1: you're dealing with money, failing to make it understandable is dangerous. 695 00:44:47,719 --> 00:44:50,080 Speaker 1: Choose every word in your purpose with care and make 696 00:44:50,160 --> 00:44:54,359 Speaker 1: sure that you're prepared to back them up with action. Two, 697 00:44:55,120 --> 00:44:58,480 Speaker 1: your purpose and your business model have to be aligned. 698 00:44:59,000 --> 00:45:02,480 Speaker 1: Robin Hoods are aren't Trading on robin Hood is free, 699 00:45:03,040 --> 00:45:07,560 Speaker 1: but free is not free. Their actual business model is 700 00:45:07,600 --> 00:45:10,120 Speaker 1: to make money off of every trade you make through 701 00:45:10,239 --> 00:45:14,920 Speaker 1: market makers. Trading too often is a bad habit, especially 702 00:45:15,040 --> 00:45:18,000 Speaker 1: for beginners, but if you don't trade a lot, robin 703 00:45:18,040 --> 00:45:21,480 Speaker 1: Hood doesn't make any money. That's why they gamify the 704 00:45:21,600 --> 00:45:26,160 Speaker 1: experience to encourage you to trade. Worse, they don't explain 705 00:45:26,280 --> 00:45:29,160 Speaker 1: that to you anywhere except in the terms of service. 706 00:45:30,000 --> 00:45:33,560 Speaker 1: Make sure in your business your purpose aligns with the 707 00:45:33,600 --> 00:45:39,160 Speaker 1: way that you make money. And three, be transparent. Like 708 00:45:39,280 --> 00:45:42,400 Speaker 1: a lot of technology businesses today, robin Hood hides the 709 00:45:42,600 --> 00:45:46,360 Speaker 1: questionable aspects of their business in their terms of service. 710 00:45:47,200 --> 00:45:50,799 Speaker 1: That's just shitty and it makes people hate you. If 711 00:45:50,840 --> 00:45:53,880 Speaker 1: you're feeling sheepish about some aspect of your business, first 712 00:45:54,160 --> 00:45:57,520 Speaker 1: consider changing it, or at the very least, be really 713 00:45:57,680 --> 00:46:01,160 Speaker 1: upfront about the way your product works, how you make money, 714 00:46:01,440 --> 00:46:11,480 Speaker 1: and what users can and cannot expect from you. I 715 00:46:11,560 --> 00:46:15,280 Speaker 1: want to thank our guests today, Devin Mills, Hailey Sacks, 716 00:46:15,560 --> 00:46:18,520 Speaker 1: and Charles rope Blott. To learn more about how to 717 00:46:18,640 --> 00:46:23,160 Speaker 1: invest wisely, check out the American Association of Individual Investors 718 00:46:23,280 --> 00:46:27,800 Speaker 1: website at a A I I dot com or have 719 00:46:27,920 --> 00:46:30,920 Speaker 1: a look at Hailey Sacks a k A Mrs dow 720 00:46:31,080 --> 00:46:35,280 Speaker 1: Jones investment course. And a big thank you to James 721 00:46:35,440 --> 00:46:39,279 Speaker 1: Royal for providing invaluable context for payment for order flow 722 00:46:39,440 --> 00:46:44,840 Speaker 1: and other aspects of the robin Hood business model. And 723 00:46:44,920 --> 00:46:48,160 Speaker 1: if you found this show worth investing in, subscribe to 724 00:46:48,239 --> 00:46:51,160 Speaker 1: the Calling Bullshit podcast on the I Heart radio, app, 725 00:46:51,400 --> 00:46:54,600 Speaker 1: Apple podcasts, or wherever you listen to people speaking to 726 00:46:54,719 --> 00:46:58,440 Speaker 1: your ears. We'll be taking a break next week, but 727 00:46:58,560 --> 00:47:02,400 Speaker 1: we'll be right back in your feed on November. Thanks 728 00:47:02,440 --> 00:47:08,720 Speaker 1: to our production team Hannah Beal, Amanda Ginsburg, d S. Moss, Hailey, Pascalites, 729 00:47:08,960 --> 00:47:13,480 Speaker 1: Parker Silzer, and Basil Soaper. Calling Bullshit was created by 730 00:47:13,520 --> 00:47:17,160 Speaker 1: co Collective and it's toasted by me Time Montague. Thanks 731 00:47:17,200 --> 00:47:17,680 Speaker 1: for listening.