Young financial nihilism, no American dream is fraught with investment risks

When Jacob Kaplan thinks about financial security, he sees a need to bear great risks.

For years, Kaplan was betting on the main sporting events through online platforms, and often devoted 30 hours a week to the hobby. The 25 -year -old is circulating regularly with his enthusiastic colleagues through Discord and bought a membership of Bookie Beats to help raise his level of stakes.

“There are the risks that fall into every individual bet that takes it,” Caplan told CNBC. “But if you surround yourself with the right people and you know what you are doing, this is a kind of answers that my generation is looking for some financial security.”

Kaplan is part of a group of young people who pay model investment strategies to the side to obtain high alternatives. They are looking for a blow from luck amid wide feelings of exhaustion about the economy, where the prices of homes rise, the debts of loans increase and the tightening of the labor market.

This phenomenon has been named “Financial nihilism.” It can help explain the rise of speculative investments such as Meme shares and the money traded on the stock exchange and encryption, as well as the prosperous attention of forums such as sports platforms and prediction markets.

“I think this is a rational response by young investors who want to achieve certain goals using their investments,” said Simon Oh, an assistant professor at Columbia College of Business.

“Relatively for the past, it has become difficult to do this using the traditional means of the accumulation of wealth.”. “As a result, the rational thing to do is swinging the fences.”

Outside the traditional markets, sports platforms and prediction markets allow people to gamble out the results of everything from The latest game of the American Football Association To whether the singer Justin Bieber A tour will be announced this year.

Digital currency trading has also gained importance, an umbrella that includes everything from Bitcoin to Mimi coins. Gen Z was the most likely generation to say that they are either curious about it or plan to invest in cryptocurrencies over the next five years, according to a survey conducted by the American Bank issued this week.

Inside the stock market, there is madness of the short stocks that started with Gamestop and AMC During the epidemic. This year, a new category of meme stocks like open and Cole It exploded on the scene. OpenDoor shares have increased nearly three times this year. Cole has doubled in the past three months.

Fund is to ride the risk wave with Investment funds circulated in the summonsWhich amplifies investments to provide greater returns or losses. Leveraged etf launch in 2024 hit register Return to more than 15 years, according to data from Vettafi and Bloomberg.

Trading options Investors are allowed to bet on whether they believe that security will rise or decrease. The clearing options company said Total contract size It amounted to 1.2 billion in August alone, by 18 % of the same previous month.

Marcellous Donyae has turned into trading options about five years ago because he was looking for ways to earn money while joining school. He hoped to avoid the fate of their counterparts all over the country, wrestling with the debts of student loans.

“I always wanted to get a source of income this type of financial freedom and control of my life,” said Deni, 22, said.

While there is a sophisticated list of investments on risk, OH from Colombia said that the demand for this type of bet had not changed. Looking at my historical, he said that the goods were once considered a similar way to make the bets high.

High housing prices and high interest rates made a dream Ownership of the house – It is long considered a primary tenant for financial success – it cannot be increasingly achieved. Three out of 10 members at Gen Z abandoned a house completely due to the cost, according to the US Bank survey.

These investors have suffered from adulthood during Spaction inflation That accompanied the epidemic and face now a The slowdown in the labor market. Even if they can get a job, fears from a Social Security cliff Leave them feel uncertain in the long run. The increasing and continuous credit cards debt levels (with the suspension of loans ending under the Trump administration) can dump the cold water on their expectations.

“In this economy?” Said Kayla Sakanoun, an economic commentator and author. Young people “feel out of the market and feel that there is no future, so you may give up.”

Residents said that the social feelings of the rejection related to dating applications and the acceptance of the college could exaggerate the insecurity that young people already suffer financially.

Accordingly, the data followed by the University of Michigan shows that children between the ages of 18 to 34 have the worst readings of consumers in most of this year of any age group. This is a reflection of previous trends.

Adults in this boat admits that this flavor of the investment at risk is not necessarily equivalent to a lifelong market strategy.

Kaplan, sports seats, said that he devotes a lot of his profits to index funds or savings accounts. The resident of Maryland knows one day that he will have to give up this long-time practice-but he hopes to get enough profit by that time to be prepared for success.

“I don’t see this as a sustainable shape in the long run of income,” Kaplan said. “It was financially useful at the present time, and at some point I will put it away and take my money and run.”