Congress should make it easier, but leave it to Harry Reid to screw it up.
One thought on “Crowdfunding”
Hard to blame Reid. A lot of his investors would take a hit (eg, the gambling and finance industries) with this liberalization of investing. He’s just providing good ROI.
For example, one of the several big obstacles to a real money prediction betting market based in the US has been that either it has to be regulated by the SEC, for whom such a market would default to being treated as gambling, or that only accredited investors could trade on the market. The gambling industry doesn’t care about the serious applications of these markets (they tend to be very low volatility compared to sporting events or games of chance and the house can’t command a good cut). But it wouldn’t take much for an internet betting market to take away a lot of the gambling industry’s profit by simply providing better games.
Same goes for stock markets and the people who dwell in them. One of the great powers of brokerages is that if a company wants to sell to small investors, they have to be publicly traded in one of a few stock exchanges and follow those regulations. The brokers get to be the middlemen in this and have all sorts of lucrative options available due to their position and inside knowledge (such as fronting trades of their customers and various transaction fees).
Hard to blame Reid. A lot of his investors would take a hit (eg, the gambling and finance industries) with this liberalization of investing. He’s just providing good ROI.
For example, one of the several big obstacles to a real money prediction betting market based in the US has been that either it has to be regulated by the SEC, for whom such a market would default to being treated as gambling, or that only accredited investors could trade on the market. The gambling industry doesn’t care about the serious applications of these markets (they tend to be very low volatility compared to sporting events or games of chance and the house can’t command a good cut). But it wouldn’t take much for an internet betting market to take away a lot of the gambling industry’s profit by simply providing better games.
Same goes for stock markets and the people who dwell in them. One of the great powers of brokerages is that if a company wants to sell to small investors, they have to be publicly traded in one of a few stock exchanges and follow those regulations. The brokers get to be the middlemen in this and have all sorts of lucrative options available due to their position and inside knowledge (such as fronting trades of their customers and various transaction fees).