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0 pointselamje6y ago0 comments

> Of course, I do think it can serve a useful purpose, but there is reason early-stage, private investment is restricted to qualified investors.

The expected value of early stage investing is certainly higher than lotteries in the US. Every poor Joe can spend thousands on lottery tickets that expire worthless, but cannot invest thousands in real companies that Joe believes will do very well in the future. Shouldn't Joe have access to companies earlier, if he currently can access lottery games?

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eanzenberg6y ago

Yes, and he can become an accredited investor which has regulations tied around it. Safeguards are needed so your Average Joe doesn't squander his family's $500k retirement and become dependent on the govt's teat.

thaumasiotes6y ago

Wouldn't those safeguards be at least as necessary for lottery tickets?

eanzenberg6y ago

Only degenerates throw $500k away at lottery tix, while significant amounts of the population invest their entire $500k in funds as found in 401k's or IRAs (or whatever). So yeah, I'd rather shield most of the country from the volatility of early stage shitfests, and make that bar high to climb if they really truly want to invest in early-stage.

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thaumasiotes6y ago

But the revenue from Joe would then go to early-stage companies, not the government.

sokoloff6y ago

I think what you'd find is that Joe's money would go to shysters who are today turned off by the prospect by forfeiting their money and sitting the rest of their lives in federal prison (so they become telemarkets, roofing repair dudes that follow hurricanes around, or late-night TV hucksters).

CPLX6y ago

> The expected value of early stage investing is certainly higher than lotteries in the US.

That’s arguable.

State lotteries are highly regulated and transparent and typically return 50% of their capital to participants.

elamjeOP6y ago

That’s fair. For the overall game you can expect to lose 50% though, with a handful of outsized windfalls going to 1/1000000 people.

In principle it’s more about why a poor person can access lotteries but not private investments, not the exact math on E[X]

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0 pointselamje6y ago0 comments

> Of course, I do think it can serve a useful purpose, but there is reason early-stage, private investment is restricted to qualified investors.

0 comments

eanzenberg6y ago

thaumasiotes6y ago

Wouldn't those safeguards be at least as necessary for lottery tickets?

eanzenberg6y ago

3 more replies

thaumasiotes6y ago

But the revenue from Joe would then go to early-stage companies, not the government.

sokoloff6y ago

CPLX6y ago

> The expected value of early stage investing is certainly higher than lotteries in the US.

That’s arguable.

State lotteries are highly regulated and transparent and typically return 50% of their capital to participants.

elamjeOP6y ago

That’s fair. For the overall game you can expect to lose 50% though, with a handful of outsized windfalls going to 1/1000000 people.

In principle it’s more about why a poor person can access lotteries but not private investments, not the exact math on E[X]

j / k navigate · click thread line to collapse