There was a great piece yesterday in the New Yorker about the impossibility of the ‘language of finance‘. READ it! The message:
The language of money is a powerful tool, and it is also a tool of power. Incomprehension is a form of consent. If we allow ourselves not to understand this language, we are signing off on the way the world works today—in particular, we are signing off on the prospect of an ever-widening gap between the rich and everyone else, a world in which everything about your life is determined by the accident of who your parents are. Those of us who are interested in stopping that from happening need to learn how to measure the level of the Nile for ourselves.
When we started Stocktwits, I called it the ‘Human Ticker’ and wanted to make sure people had a place to ‘learn’ the language of finance and markets. Chris, our founding CTO called it ‘$Cashtagging’. I thought the best way was giving people a place to journal and others a place to look over their shoulders. Most people eavesdrop on every social platform. That was 2008.
Last year, even Carl Icahn started ‘$Cashtagging’ and he thought $AAPL was undervalued. CNBC was horrified. Wall Street too. I called it a huge acceleration point in the slow cycle of social finance. Here is a rare CNBC appearance explaining it in the moment LAST August:
Flash forward a year and $AAPL is 40 percent higher. I can’t figure out how this is not GREAT. Last August, the angry Twitter and Stocktwits mobs were calling for Tim Cook’s head. Apple was dead. Those investors that were long and journaling such now have a timeline to point at. They now can build audience and trust and the right people can rise to the top to mentor the next generation of investors.
For the last few weeks I have been brainstorming with a very talented woman – Brenna Hardman on the future of Wall Street She started a Chicago firm called Buy Side Design. Brenna chimed in on the ‘Great Wall of Wall Street’ back in April:
Fom loud trading pits to quiet twitter streams, something is unusually amiss in the world of financial media. There is one group that is largely missing and unheard – the registered representatives. The majority of registered reps I know are discouraged or blatantly prohibited from speaking with the press. Some registered reps may have an industry spokesperson yet many times that person has zero trading experience and never had any skin in the game.
Websites like Linkedin and Twitter are entirely blocked at most firms and some even block CNBC and Bloomberg. The financial industry has been encapsulated by a Great Wall. This Great Wall of Wall Street has caused a skewed perspective of the financial industry because the greatest participants do not have a voice in the media.
I have first-hand experience because I was registered with the Series 3, 4, 7, 24 and 63 which allowed access to sell futures and options to clients (Series 7), and also supervise other employees who sell securities and futures (Series 24 and 4). Yet, I could not post on social media outlets or explain where I worked while broadcasting on CBOE TV.
What I find alarming is that registered representatives are not allowed to represent the industry to the public. Perhaps the reason why so many financial institutions seem like these faceless, lawless places is because there is no one publicly representing the choices of these institutions. According to Edelman PR, public trust in asset management is a mere 46% compared to public trust in the technology sector which is at 79%. Financial companies need to act more like tech companies and share their story and successes digitally.
Brenna has been a Stocktwits believer since 2008 and has long asked ‘Do You Cashtag’? I am excited to be working directly with her on some projects for the Stocktwits community.
‘Those investors that were long and journaling such now have a timeline
to point at.’
Every time I post new models(charts) I get this strange surge of apprehension. I know there will be hundreds of brains picking apart everything in the images. I know there will be some percentage of comments that are derisive and possibly even borderline insulting. (My models are… not standard.)
And I know that some of those brains with their comments might show me something I missed. I know those brains might see something in my work that THEY missed. And I know without a doubt that posting these models is the best thing I can do with my financial time. Even the hecklers teach me at times.
And then the next day, and the next week plays itself through and the feedback on my models continues. If my model is flawed, we all see it. If it is true, we all see it.
And in the end, to me, that is the gain. We all see it.
Great post, Howard. One of the greatest benefits of the internet is that it affords us as human beings the ability to transcend borders and thus share ideas that would otherwise remain unheard of except to our immediate social circles.
In the world of the stock market, new ideas are constantly sought after in order to grow as a trader and develop one’s experience. Platforms like Stocktwits and others allow stock enthusiasts to see what’s trending amongst the collective group of traders that make up the market and to come to their own conclusions.
Perhaps in the future it may be necessary for thought leaders to reconsider the definition of what it means to be a sophisticated investor in light of continued advances in the internet social trading space and the displayed willingness of market participants to assume greater personal accountability for their investment/trading choices.
Ultimately, we all can benefit from each others thoughts with the realization that we are responsible for our own actions and decisions in the market. Writing about the market is is an especially great way to keep a trading log, which is useful in tracking one’s progress and development in both planning and executing trades.
Its not about how often you are right or wrong, but whether you learn and grow from the process itself. That is what I hope to do through my writing and it is good to know there are others out there doing the same as well.
thanks and I agree
Brenna’s characterization of “the Great Wall of Wall Street” is vitally important for understanding why the sell-side runs the risk of becoming an anachronism. As a long-time sell-side analyst, I’ve understood the compliance underpinnings of the social media bans that persist at broker dealers. However, barring sell-side employees from access to social channels denies them a voice in the media, and a distribution outlet for communicating their message to new generations of investors. Barring Wall Street from access to social media also deprives Wall Street professionals an important path to “personal branding,” along the lines that Gary Vaynerchuk has written about. I wrote “Social Media Strategies for Investing” with these same issues in mind.
thx
Everything you say is spot on, especially how the financial industry needs to stop being “Faceless institutions”. Where Stocktwits is the place to go to learn what is going on in the markets, and I love it. Harvest is now the place to go to see WHO is saying something about the markets, and communicate that message direct from the source. Would love to see you post this to Harvest where FAs and RIAs represent 22% of the professional audience.
Summarized
write up! The reading of the topic is terrific and comes with a great writing
technique.
BontonWear
Jennifer Lawrence Jacket