Trading is big business, worth billions of dollars, and the big players are taking millions of dollars in fees. Fees charged directly to the user are the most obvious ones. Robinhood is commission-free but not a non-profit. This post will talk about some of the ways their business grew to be worth billions of dollars, helped along the way by some slick marketing tactics.
Why the name? As per the source of truth:
"provide everyone with access to the financial markets, not just the wealthy"
The original Robinhood stole from the rich and gave to the poor. The modern-day Robhinhood, perpetuated as an LLC, takes from the poor and gives to the rich.
How exactly? One way is through the hidden tax of inflation.
Stimmy checks went out in the mail. Most of the people who didn't need this money, turned around and put it into the markets. As a result, stock prices shot up in price. Who did this benefit the most? The wealthy.
The wealthy own huge swathes of the financial market. The benefit the most when the market spikes.
Housing prices shot through the roof. The wealthy own hundreds of millions of homes.
Data from the Bureau of Labor Statistics show that housing prices for renters and homeowners this spring were up 2.2%, while other data, like the S&P Case-Shiller home price index for March, showed home prices were up more than 13% compared to last year.
U.S. home sales soared last year at their fastest pace in 14 years, when low mortgage rates and the rise of remote work during the pandemic sent buyers scrambling to find larger living spaces.
In 2019, Blackstone exited from the single-family rental business when it sold its last shares in Invitation Homes, which had become the largest U.S. firm in this industry with 80,000 homes for lease. The firm put its toe back in the market in 2020 by investing $240 million to buy a preferred equity stake in Toronto’s Tricon Residential Inc., which buys single-family rentals in North America.
The firm is rejoining an expanding roster of Wall Street powerhouses that have acquired single-family rental companies. Canadian property giant Brookfield Asset Management Inc. recently acquired a stake in a landlord that owns more than 10,000 U.S. homes. J.P. Morgan Asset Management and Rockpoint Group LLC also have made big investments in single-family rental operators.
Wealthy people own the largest stakes in these companies, and they are buying up the homes so the poor can't do so.
Blackstone is buying Home Partners through an investment fund named Blackstone Real Estate Income Trust, which primarily raises money from small investors and tends to hold assets longer than the firm’s opportunistic funds. That strategy is a sign that Blackstone thinks the housing market rally could last many years.
Housing prices going up, means rental prices will go up as well. This is the largest transfer of wealth in history. Transferring wealth from the "not wealthy" to the wealthy.
WeInvest is open source code, is decentralized, and is a distributed autonomous organization. Anybody can invest in WeInvest, you don't have to wait for the IPO, and you don't need to be privileged at an investment bank to have access.