I was listening to Jason Calacanis interview Dave McClure on his This Week in Startups podcast and had to share this amazing rant on the sorry state of investing in the United States. Dave rants on the lopsided, systemic governmental bias towards the real estate business. The worst you can do when you invest in a start-up is lose all your money while, with real estate, you can leverage your down-payment to the point where you’re upside down on your mortgage and have to have your backing institutions bailed out by the taxpayers.
There will be people in their 70’s who are clearly credited investors with millions of dollars who should not be investing in fucking startups and there are kids with $10 in their pocket who know more than you or I do. Net worth is not the intelligence test for investing in startups.
There’s a certain amount of money that anyone should be able to fucking burn or blow on startups. We encourage a ridiculous amount of money to go into the residential real estate market which has burned people fucking terribly in the last five years. Ridiculous numbers of people in this country are upside down on their mortgages and bankrupt because legitimate, regulatory-approved agents have shoved real estate fucking mortgages down their throats. We have subsidized this with our tax dollars, we are the people.
Like you fucking blame the investment bankers? Fuck You.
It’s you voting for your representatives who are in the pockets of Sallie Mae Ginnie Mae, Fannie Mae, whatever who are shoving shit down the pipe. Like Moody’s and all these other people who have crap verification. . .
If you want to protect the small investor, don’t let them buy a house in this country, because that is the most dangerous thing you can do with your money. Period.
Investing in startups which might fail? You only lose $1. You invest in a house, you put 5% down or sometimes 0% down and you can lever up a ridiculous amount of money. You can lose 20 times your investment and people do it every day and they think it’s a good idea.
The whole interview is amazing but scroll forward to the 1:00:00 for the rant on “accredited investor” requirement for start-up investors.