We're going bust playing Wall Street slot machine

America's going bust on the Wall Street slot machine

Date published: 9/19/2008

IMAGINE sitting down at a slot ma-chine and putting in a $20 bill.

You start pulling that handle, just to have a little fun, when, about $10 into the game, you hit a $100 jackpot.

All of a sudden, you're not playing for fun anymore; you're playing to make money--incredibly easy money. And while you know you should take your $90 in winnings and walk away, you don't. Greed takes over and you want to win more.

Anyone who has ever played a slot machine knows what happens next. The $110 that you had dwindles, and finally you end up losing both your winnings and your initial investment.

Oh, but that machine hit once and you know it can hit again. So you invest another $20, but this time you hit nothing. Then you put in another $20. Now you forget about winning big. All you're trying to do is get back to even.

That's the game that some people who are heavily invested on Wall Street are playing right now. With many stocks floundering and America's economic future filled with uncertainty, they're just trying to get back to even.

The difference is that the guy who sits down at the slot machine is usually playing with some extra money he really doesn't need, while investors are often gambling with their life savings.

In both cases, however, greed is the fueling factor.

We live in a society of people who don't want to work. Now, few people in history have loved to work, but we somehow feel that we can break free from the chains of everyday bills if we just invest wisely.

In fact, stockbrokers tell us that all the time: Put you money in stocks and you can retire when you're 50 and live the good life!

Such assurances started to seep into the American culture in the mid-1980s, and we began to believe this in the late 1990s when stocks soared. Suddenly, the word "portfolio" replaced "passbook savings" in our financial thinking.

The big plan, of course, was to outsource the physical labor and the 9-to-5 grind to someone else while we sat back and watched our stocks make us rich.

Follow us on

Date published: 9/19/2008