What the Media Gets Wrong About Robinhood

Amanda Heckman|April 24, 2021

Robinhood… villain or savior?

Stock gamifier… or wealth equalizer?

The popular trading app has been back in the news under some harsh light…

First up… regulators in Massachusetts are asking for its brokerage registration to be revoked, which would effectively bar it from the state.

This follows the state’s wrist slap in December, when regulators said the app “used techniques to make investing seem like a game, such as showering users’ screens with confetti, in hopes of encouraging unsophisticated customers to make more and more trades.”

Those same folks now say Robinhood has not seen the error in its ways. More drastic measures are needed.

Next, The Wall Street Journal told the story of three young first-time investors who lost money using the app.

The rag put the blame on Robinhood and made it clear a lack of investing knowledge led to the losses.

Robinhood, it concludes, should step up its educational game.

And finally, Bloomberg mused this week about whether the trading app has addictive and habit-forming qualities… by design.

Not good.

Casino tricks have no place in retirement savings.

But when you look from Robinhood’s point of view…

The app remains insanely popular. The pandemic-created surge in new accounts continues to gain pace.

Robinhood had more than 3 million app downloads in the month of January, its highest on record.

It revolutionized investing by making trades free… and allowing users to purchase fractional shares.

Robinhood says its design is what brings Wall Street to Main Street.

When you compare its simple, easy-to-use platform with the platforms of more traditional brokerages, says its Head of Design Rich Bessel:

Everything about these companies reeked of a system designed for the 1%, with complicated, confusing and often intimidating user interfaces.

Hmmmm…

But here’s the thing…

We say it’s not an either-or proposition. It’s not a question of whether Robinhood is friend or foe.

What the media fails to mention is the sad fact that most Americans are woefully unprepared to handle their finances.

And this goes further than pointing fingers at our education system.

Yes, 4 out of 5 youths will fail a basic financial literacy quiz. And, yes, less than half of states require a financial education class to graduate high school.

But the schools don’t teach what we don’t prioritize.

As a society, we’ve got a long list of things that come above educating people about investing.

And if you’ve been reading us for any amount of time, you know how we feel about that…

It’s much easier for the government to reign over its citizens when so many folks are dependent on that next stimulus check.

It keeps all the power in Washington… and not with the people.

So if more folks get interested in investing thanks this disruptive platform, we say that’s a step in the right direction.

But clearly there’s a lot more work to be done.

In fact, we know a fella who’s working overtime to get the job done.

He’s a world-class entrepreneur who’s got a reputation for shaking things up and empowering people.

And in a fight to show that financial freedom isn’t nearly as hard as it sounds… he’s currently showing people how they can make $500 in two hours without any prior investing knowledge.

Click here for all the details.