By Sasha C.
Russell, Communications Speacialist, Massachusetts Council on Compulsive Gambling
A couple
weeks ago, my husband and I decided to go see The
Wolf of Wall Street. My
interest was sparked by the trailer and the reviews from family, friends and
critics describing the movie as a “must see.” Please know that, although this
is not a review of the movie, there may be some spoilers throughout.
You may
wonder how day trading, often known as an investment, is gambling. According to
Gamblers Anonymous, gambling is any betting or wagering on an event where the
outcome is unknown or uncertain, where the stakes are high enough to cause
significant concern or illicit an emotional response. Anytime you invest in the
stock market, you are taking a chance. I imagine that day trading can be
appealing to people at risk for problem gambling because results happen
day-to-day, rather than long-term like in your 401k, or other similar
investment plans.
Back to the
movie. What I found most frustrating about the movie was that it’s a true
story. It’s essentially a story about a man, named Jordan Belfort, who starts a
day trading company, and takes advantage of people (starts with the poor and
moves up to the rich), all the while making tons of money, and knowing
full-well that he is potentially ruining the lives of others while making his
own better.
He
recognized that it was easy to teach people to “sell” and take advantage of
others. In his book, with the same title as the movie, Belfort explains,
“And
what secret formula had Stratton discovered that allowed all these obscenely
young kids to make such obscene amounts of money? For the most part, it was
based on two simple truths: first, that a majority of the richest one percent
of Americans are closet degenerate gamblers, who can’t withstand the temptation
to keep rolling the dice again and again, even if they know the dice are loaded
against them; and, second, that contrary to previous assumptions, young men and
women who possess the collective social graces of a herd of sex-crazed water
buffalo and have an intelligence quotient in the range of Forrest Gump on three
hits of acid, can be taught to sound like Wall Street wizards, as long as you
write every last word down for them and then keep drilling it into their heads
again and again—every day, twice a day—for a year straight.”
In the
movie, Leonardo DiCaprio makes a similar statement while portraying Belfort, as
well as referring to himself as a “degenerate gambler,” drug addict, and sex
addict – essentially summing it up to being just another guy on Wall Street. However,
when I look at those traits, I don’t see high-class business men, instead I see
the faces of everyday people who are struggling with co-morbid addictions.
One unique
thing that I have observed that separates a gambling disorder from any other
disorder is the element of hope that’s attached to gambling. In the end, much
of gambling is about the action – but hope is usually where it all starts. The
hope that you’re going to make enough to pay off all your debt, the hope that
you will be able to live comfortably, the hope that this will solve all your
problems, the hope that you may never have to work again – hope is there, but
hope can be easily taken advantage of.
Watching
Belfort play off the element of hope saddened me. However, despite Belfort
taking advantage of people who were either struggling with some level of
gambling problems, or at risk of developing a problem, he obviously had his own
struggles.
Recently I
came across an interesting article by Peter Kenter of the Financial Post, “Addicted
to Trading: When Online Investors Become Gamblers.” In the article,
Michelle Nogueira, Addictions and Problem Gambling Counsellor, Homewood
Community Addiction Services, explains, “Online trading fits the profile of
problem gambling when it compromises, disrupts, or damages important areas of
peoples’ lives. If there’s a preoccupation with online trading, a loss of control
and continuation of the behavior in the face of negative consequences, then
it’s crossed the line into problem gambling.”
She also
noted that traders with a gambling problem present a unique challenge to
treatment. “In their minds, gambling is bad, but they see their activity as
investing —something positive. Heavy trading losses are seen as a part of their
education.”
Other
similarities between experiencing problems with gambling and experiencing
problems with trading, are the loss of time and the need for excitement and
action. The loss of time – whether missing school, work, or other activities –
is a huge factor for people who are experiencing both of these problems. As for
excitement and action, Bill L., a participant in the Council’s Wisdom Exchange Program for
people affected by problem gambling, explains that even though he wanted to
win, it didn’t always matter. He said, “I just wanted the action.” The same is true
for people experiencing problems with trading.
In Kenter’s
article, Martin Jeffery, Financial Planner, Investia Financial Services,
recalled a client who quit his job to become a day trader. Jeffrey said, “I
don’t recommend individual stocks to clients, but when I looked at some of his
transactions I noticed that he often bought and sold the same stock on the same
day, every time it fluctuated by 10 cents. I asked him why he didn’t just hold
that stock and save himself the transaction fees. He told me that holding the
stock wasn’t exciting enough for him.”
Unfortunately,
there are not many direct resources for people who feel they are having
problems with trading. This is partially due to the paradox that Noguira
discusses, when talking about “investing” one doesn’t necessarily feel as
though they are “gambling,” and therefore, may not know the proper channels to
seek help, should their trading become a problem.
The Council
recognizes online trading as a form of gambling, and should that activity
become a problem for you, your loved one, or a client of yours, please do not
hesitate to call our 24/7 helpline: 800.426.1234. We understand the problem. We
can help.
By Meaghan Lyver, Communications Intern, Massachussetts Council on Compulsive Gambling
