Insight and investigations from our expert reporters
Jonathan Spicer’s special report on dumb money in the stock market shows how a few powerful financial institutions make money from retail investors, and why the system is coming under scrutiny.
If you’re wondering what “dumb money” is, it basically refers to most trades by amateur investors like you and me.
To read the story in multimedia PDF format, click here.
Here’s what the Columbia Journalism Review had to say about it.
Leah Schnurr and Edward Krudy report today on retail investors fleeing the stock market. Will the Lost Decade create a Lost Generation of investors who avoid the market in a way not seen since the Great Depression?
Here’s what one of the authors had to say about the story:
By Edward Krudy
The perception that the stock market is a place where the average person can share in the wealth of the nation has been a cornerstone of American society throughout the twentieth century. That’s why we felt it was a big deal when small investors started to abandon the market.
Wall Street and golf have had a long and storied love affair. And over the years, many a hedge fund manager has given up the trading game to spend more time on the links.
But the revelation that SAC Capital has hired a former institutional stock broker to spend most of his time on prestigious golf courses, schmoozing corporate executives and wealthy investors, is another stark example of what separates hedge fund managers from mere mortal investors. As several securities experts told me, it doesn’t really matter whether or not a corporate executive says anything of real substance to Steve Cohen’s unofficial golf pro, Sam Evans. What matters is that Cohen and his traders are getting the kind of unique and intimate access to corporate executives that ordinary investors can never dream of.
We’re getting a lot of good feedback on our special report on cozy ties between Wall Street and the Fed. As one Wall Street economist put it: “I’ve never seen the ‘Fed Alumni Association’ used more extensively for back-channel communications with the Street than has been the case since June.”
The story pulls back the veil on the privileged access that Federal Reserve officials give to big investors, former Fed officials, money market advisers and hedge funds.