Reply To: Military Effects

[JimmyT]

Frankly, I’m wondering if we asking for the right thing. I think a letter writing campaign is a good idea, but maybe we should be asking for something different.

Right now laws restrict stock purchases in IPO’s to accredited investors (investors of high net worth and/or high earnings). This restriction is allegedly put in place to “protect” people who are not rich from investing in “risky” start-up companies. These restrictive laws could just as easily be characterized as restricting all but the very wealthy from the best investment opportunities. In fact the recently passed Dodd-Frank bill makes the definition of accredited investors even more restrictive by excluding home values from the net worth test.

Now I understand that Derick does not want hundreds of individuals each investing twenty dollars. The paper work hassles wouldn’t be worth it. But I strongly suspect that there may be a lot of people who would love to invest thirty thousand dollars or so, but don’t meet the accredited investor standards.

Everyone goes to legislators with their hands out (understandably). But maybe a more fruitful approach would be to ask for a abolition of this restriction.