But why are so many prepared to place high-risk bets when the odds are stacked against them? Pandemic stimulus packages certainly handed many Americans some extra cash, but they could have parked that in a mutual fund account instead.
The explanation may be the fatalistic view many have of markets and the economy. Polls since the global financial crisis have shown a growing cynicism about capitalism, particularly among younger Americans, many of whom doubt that they will be better off than their parents, or that their employer will provide a fair wage and decent pension.
That is fuelling a form of financial nihilism which the investor and former ecommerce executive Mike Effle has christened “finihilism”. In an economy too many see as rigged against them, and with markets showing little connection to underlying value, perhaps a bet on the playoffs or a sociable sally against AMC’s short sellers seems as good a use of your money as any.
It is easy to moralise about the upsurge in speculation. But it is hard to fault people for wanting to get rich quick if they have lost faith in their ability to get rich slow.
Andrew Edgecliffe-Johnson: People have been shocked at how much gambling is going on since before Captain Renault walked into Rick’s Café. But there is something different about this new golden age of gaming https://t.co/hO9s8QQqEY
— FT Opinion (@ftopinion) January 14, 2022