A Project for Better Journalism chapter

Betting on a Fool’s Paradise

Gambling is never a good idea. I mean, come on, it literally means to take risky actions in the hope of a desired result. Risking money on the value and suit of a card, the outcome of a football game, the the speed and endurance of a horse is an easy way to burn a hole in your pocket. But if this is the case, then why did 41.1 million people visit Las Vegas, the gambling center of the world, in 2014? The answer is simple: people are drawn to the idea that there’s a chance that the numbers will be on their side and they will walk away with some money.

But the absurdity of a gambler’s everlasting faith is stretched to the extreme when it comes to buying and selling stocks. The stock market requires betting on something that is completely imaginary. There is nothing tangible about the stock market. You cannot touch a company’s stock value. It is no more real than Bigfoot or the Loch Ness Monster. It’s an illusion created by numbers, graphs and charts that represent the success of a company. It is, to put it simply, unpredictable. Even the experts who are paid more than six figures a year to pick the right stocks to buy or sell cannot be counted on to accurately guess what a stock may or may not do. Yes, some people are better than others at predicting the rise and fall of a particular stock, but the fact of the matter is that the best they can do is make an educated guess and use their judgement.

So why do so many people put money into the stock market? Because it’s addicting. It’s addicting in the same way that the nicotine in a cigarette can dominate your life in just one puff. And the effects of the stock market can be just as harmful to your wallet as cigarettes are to your lungs. Say you’ve just graduated college and are looking for a way to start making some money. So you invest a small amount of money in a stock even though you do not know a lot about how it works. The stock does well, you get some money in your pocket, and you’re hooked. You feed off of that feeling that you experienced that first time you made money. And even if you lose money in your new investments, you continue to pump money into the stock exchange. The same way a drug addict chases a high, you chase that feeling of making quick money.

On the other side of the spectrum, you have the success stories of the stock market. Some have bought a few lucky stocks and sold them for a huge profit. For example, people bought stock in Apple in 1983 when a share was less than $2 and several years later in 2011 the price of one share was about $380. There are experts who spend years studying the radical movements of the stock exchange and have correctly picked which stocks would succeed and which stocks would fail. But for every success story, there are hundreds of thousands of people who have lost money and even ruined their lives because of the stock exchange.

The performance of a stock can determine who succeeds and who fails. It’s impact can be felt by people not directly connected to the stock market. When it thrives, national GDP tends to increase, while things like unemployment and poverty decrease. But if the stock market crashes, people lose all their money, and there are mile long lines at the grocery store.

Investing is risky business. We should not rely on it as a source of income, no matter how small. Don’t put money into anything, especially the stock market, without first doing some research. I’m not saying that the stock market is bad (even I have some money invested in it). What I’m saying is be careful. If you’re trying to play the stock market, you’re betting on a fool’s paradise.