Dear Reader,
This is Dylan Jovine with Behind the Markets.
Happy Wednesday. Today is Wednesday, May 20th.
Today we get to discuss dumb things the government does from time to time.
The SEC is readying a plan to allow trading in crypto versions of stocks.
Tokenized stocks.
Here is how it works.
A third-party issuer — not the company itself — creates tokens named after real stocks.
Nvidia tokens. Intel tokens. Whatever they want.
These tokens would trade up or down based on events like earnings, but the actual company — Nvidia, Intel, whoever — would have no say in any of it.
No voting rights. No dividends. None of the protections built into the stock market over the past 100 years.
They would trade 24 hours a day, 7 days a week, on decentralized crypto platforms.
And they would create arbitrage situations between the token price and the actual stock price — generating more volatility in your portfolio, not less.
What This Actually Is
Financial heroin.
That's all this is.
More gambling dressed up with a fancy name.
The only people who actually want this are the gamblers — and more importantly, the casinos.
The people who set up the infrastructure to shear the sheep.
And of course, the elected officials who took billions from the crypto industry and are now writing the laws to pay them back.
My friends have been gently teasing me about this one because they know exactly what I think.
It tweaked my mood.
The America First Argument That Actually Makes Sense
Here is what really gets me.
I've been spending most of my time lately thinking about our competition with China.
Thinking about what it actually means to do America First.
And then I look at this tokenized stock nonsense.
We have 13 million middle school students in this country.
We have 450,000 math teachers.
You want to do America First?
Hire a million math teachers.
When you look at the leadership of the Mag 7 companies — the seven most powerful technology companies in the history of the world — almost all of them are Asian.
That is not a conspiracy.
It is a much more mundane explanation.
We have to import our math and science talent from Asia because we don't produce enough of our own.
So you really want to do America First?
Focus on the thing the whole country can get behind.
Invest in the next generation of American engineers, mathematicians, and scientists.
That is what sets us up for the next 50 years.
Not gambling on tokens that don't even give you any rights.
Anyway, forgive me.
This is my "get off my lawn" moment.
Once in a while I have to do one of these or I'll just lose my cool entirely.
Hope you have a good day.
I will see you tomorrow.
“The Buck Stops Here,”
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Written by Dylan Jovine