The economy bears the full weight of the entire society. It is, after all, at the center of both political and personal decisions. Individuals are careful not to exceed their budget limits, whereas politicians consider the effects of legislation or taxation on the economy over lengthy periods of time.
In a world where money is king, it seems essential to instill financial values in children. Especially since this can be learned through video games. For example, there is a program for pre-adolescents that uses the game Minecraft to explain economic principles. They become familiar with concepts such as taxation, budgeting, and even mortgages. Except that for some, all of this is not enough. It is necessary to go further and teach them about stock market investing.
Learn to Get Richer
As a matter of fact, a large part of the world's economy is based on stock market indexes and investments put into different stocks. Thus, for some, it would be imperative to introduce them to stock market investment, so that they can begin to understand and profit from it as soon as possible. Savings accounts pay such low-interest rates and many people do not have enough money set aside for retirement. This graduate school professor uses his financial analysis class to instill investment concepts in his students. As a result, he shows them how to build a portfolio and then invest wisely.
Many people in the United States stress the significance of getting started as soon as possible. Learning to invest in the stock market, according to some, is the best way for more marginalized communities to become wealthy. It is important to understand that it is best to start talking about money when you are young but it is also important to take action. As a result, parents or teachers explained to their children that the concept is to buy a little piece of a business that can be profitable if everything goes well or a loss of money if the stock market falls. Consequently, it's important to remember that it's not about instant wealth (or very little of it) but rather a long-term approach.
There are different, often fun solutions for teaching these stock market principles. One of the most cited is The Stock Market Game which offers young and old alike to invest a virtual $100,000 in the stock market and see how it goes, learn how to buy and sell at the right time, etc. The game is presented with an educational version, which includes lessons that teachers can use. In the same vein, Personal Finance Lab is aimed even more at schools since the site and game are really designed as a long financial literacy course.
Furthermore, it is possible that this will be replicated in real investments by these young people. Because in the U.S., a minor can own stocks. They cannot really trade since they cannot sign, but with a cooperative parent, they could very well have their little portfolio. This could even be an educational approach where, with the guidance of the parents, the teenager sees how investments take place.
Speculating Is Not Gambling
In fact, stories of American teenagers speculating are becoming less and less rare. They are having fun investing a little and discussing investments on popular youth platforms like TikTok.Everything has never been easier than it is now with the applications for selling and buying stocks on the stock exchange. Now, with Apps like Wealthsimple or Robinhood on one's phone, there is no need to go to a lawyer, just jump in.
Except that speculating is not a game, despite the impression these apps give. Besides, people are learning this the hard way as this columnist reminds us. Yes, it is sometimes possible to gain a lot of money but it is also possible to lose a lot of money. Interest in speculation grew in early 2021 with the Gamestop case where many small users drove the price of a video game retailer very high, causing major declines for hedge funds and short-sellers. So some people thought that being smart was enough to make a lot of money. A serious misperception that also reminds us of another problem with this idea of teaching the stock market.
In fact, there is no mention of the risk of suffocation in any of the American journals. Yet we know very well that speculative bubbles are possible and when they erupt, it usually leads to economic crises. Why does this fact, which has marked the history of financial markets since the early 20th century, seem to be ignored by all those who advocate this teaching? Could it be a problem of overly liberal ideology that does not want to show the negative effects of speculation on the economy? It is not for nothing that experts dismiss the stock market from the "real economy," i.e., commercial exchanges, because speculation does not produce any wealth, and is primarily concerned with its distribution.
Certainly, ignoring the realities of finance, such as the stock exchange, would provide an incomplete economic education. Or, to emphasize only the positive features of financial gains and investments while ignoring the negative aspects equally misleads. And what if financial literacy painted a more nuanced picture of the system in place, allowing children, adolescents, and young adults to form their own opinions on the subject?
Illustration : Nick Chong on Unsplash
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