Episode 72: Are We Raising a Generation of Gamblers?

Segment 1:

HELLO Lower Alabama! Hello Gulf Coast! Welcome in. Welcome to Coasting in Retirement! Thanks for joining us today, Josh Null here, with a very special guest host today, he’s a double major at Auburn and the producer of our radio show, Payton Null. Payton, how are you doing? We are back in Coastal College’s recording studio, beautiful downtown Fairhope, ready to put together another great show for those of you tuning in!

Listeners: Payton and I are here to discuss financial topics relevant to those of you in or near retirement, living your best life along our part of the Gulf Coast. Here’s what we’ve got in store for you today: First segment – deep dive on our topic of the day. 2nd segment - at about 30 minutes past the hour - “Headlines of the Week”. Then at roughly 50 minutes past the hour, stick around for our 3rd segment, we call it” Josh’s Crystal Ball and Big Mouth”. So buckle up, we’ve got a lot to get to!

Quick background on me for those new to the show. Again, my name is Josh Null, I am a fee-based financial advisor, I hold my FINRA Series 65 securities license, and I am the owner of Gulf Coast Financial Advisors, that is a 100% locally owned, 100% independent investment management and financial planning firm with offices in Fairhope, Orange Beach, and Mobile! You can find more information on me and the team at Gulf Coast Financial Advisors by visiting our website gulfcoastfa.com, or feel free to give us a call at 251-327-2124. If you missed that contact info, get a pen and pad ready because we will repeat our contact info several times throughout the show!

For today’s show, we are going to attempt to answer the question: Is my generation and any other generations old enough to have adult children, are we raising a generation of gamblers? When we were doing show prep, Payton corrected me when I called him a millennial. If you’re not a millennial, then what generation are you? (Payton). I’m 50 years old. I grew up in an era where 'investing' meant reading the newspaper, calling this dinosaur thing called a broker, or at best, logging into a clunky website on a desktop computer. It was slow. It was deliberate.

Contrast that with today. "I look at the tools our kids and grandkids are using, and I have to ask a hard question: Are we raising a generation of investors, or are we raising a generation of gamblers?". We (Gen X and Baby Boomers) might be accidentally encouraging this by not teaching the difference between buying a business (investing) and betting on a ticker symbol (gambling).

To a 25-year-old with a trading app, the stock market can look like a high-speed video game. To a 65-year-old planning a retirement in Daphne, Alabama, it’s supposed to be the long-term, reliable engine that powers their future. I think there is a significant difference in how the different generations view not only stock market investing, but how closely that ties into gambling, and on a bigger picture, how to create wealth in 2025 and beyond.

So let’s do a little compare and contrast between gambling and traditional investing to see if we can answer this question – are we raising a generation of gamblers? While both gambling and investing involve putting money at risk for a potential gain, the fundamental difference lies in mathematics, ownership, and time. Let’s start with math:

1. The Math: Positive vs. Negative Sum Games

The most critical difference is the "expected return."

Gambling is a Negative-Sum Game: In a casino or a sportsbook, the "house" takes a cut (the vig or the edge). Statistically, the longer you play, the more likely you are to lose everything. The house always wins because the math is rigged in their favor.
Investing is a Positive-Sum Game: When you buy stocks, you are buying a piece of profitable companies that create products, hire people, and grow. Historically, the S&P 500 has a positive expected return of about 9-10% annually over long periods. In this game, both the company and the investor can "win" at the same time.

2. Ownership vs. Wagers

Investing = Ownership: When you buy a share of a company, you own a literal piece of that business. If the stock price drops, you still own the same percentage of the factory, the patents, and the brand. You can hold it until the value recovers or it pays you a dividend (a share of the profits).
Gambling = A Contract on an Event: When you bet on a game or a horse, you own nothing. You have a contract that is either worth "everything" or "zero" at a specific moment in time. Once the event is over, your money is gone.

3. The "Time" Factor

Gambling is a Sprint: It is a time-bound event. You win or lose in hours or minutes, or even seconds. There is no such thing as "compounding" a bet on a football game; you simply start over at zero every Sunday.
Investing is a Marathon: Time is the investor's greatest ally. Through compounding, your earnings begin to earn their own earnings. Volatility (the market going up and down) is just noise that smooths out over decades

Let’s talk about The Robinhood Effect: The Casino in Your Pocket. The Gamification of Finance

When Robinhood launched, it literally rained digital confetti when you made a trade. It turned a serious financial transaction into a "level up" in a video game. User engagement on these apps looks more like social media addiction than financial planning. That leads to the "dopamine hit" of a quick trade vs. the boredom of compounding interest.

Let’s talk about the Gender Divide: Young Men & The Crypto Obsession

Recent studies show young men are disproportionately drawn to high-risk assets like Crypto and 0DTE (Zero Days to Expiration) options. It’s the modern version of the "hot rod" or the "poker night." It appeals to the male desire for:

1. Status (Showing off massive gains on Reddit/X).

2. Speed (Getting rich now, not at 65).

3. Distrust of the System: They saw 2008 (even as kids) and 2020. They don't trust the "slow path" that worked for their parents.

Whether we like it or not, the Future is Here (And It’s Risky): 2026 Trends

24-Hour Trading: The market never closes. You can trade Tesla at 3:00 AM on a Saturday. Nothing good happens at 3:00 AM—especially with your life savings. This removes the "cooling off" period that protects us from emotional decisions.

Direct Indexing (The "Build Your Own S&P 500"): Instead of buying an ETF, technology now lets you own all 500 stocks individually. It sounds sophisticated, but will it lead to tinkering? "I don't like Apple this week, I'll delete it." It invites active management mistakes into passive strategies. How about AI-Driven Portfolios? Do we really trust AI be the sober "co-pilot" that stops you from making a bad bet? Or will it just find "patterns" that aren't there, accelerating the gambling speed? Direct indexing is like buying a Ferrari to drive to the grocery store. It’s a powerful machine designed for a specific track (high net worth, complex tax situations), but for the average person, the maintenance, the cost, and the risk of crashing it (behavioral mistakes) might not be worth the trip.

Finally, and speaking of something that is all over the financial news: Stablecoins.

A quick definition of stablecoins: In 2025, the conversation around stablecoins has shifted from "speculative experiment" to "regulated financial infrastructure. Stablecoins are trying to move away from just being for crypto-traders and towards becoming the new rail for moving and storing money.

1. The Big Shift: The GENIUS Act of 2025

The most important thing for investors to know right now is that the GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act), signed in July 2025, has brought "bank-like" rules to the industry.2

1:1 Reserve Backing: Regulated issuers (like Circle/USDC or Paxos) are now legally required to back every coin with 100% liquid assets—specifically U.S. dollars or short-term Treasuries (93 days or less).3
Monthly Disclosures: CEOs must now certify their reserves under penalty of perjury.4 This eliminates much of the "black box" mystery that haunted the industry in years past.

2. The "Yield" Trap: Investing vs. Parking Cash

Under the new laws, stablecoin issuers cannot pay you interest directly.5 This creates a critical distinction for your listeners:

The "Safe" Path: Using a regulated stablecoin as a digital wallet to move money across borders quickly and cheaply.
The Pitfall: The GENIUS Act protects the coin itself, but it does not protect you if the platform you lent it to goes bust. Many investors confuse the stability of the dollar-peg with the safety of the lending platform.

3. Don’t be fooled by the word “stable” in the asset title

Even with new regulations, investors should watch out for these "cracks in the floor":

The De-Pegging Risk: Even in 2025, we've seen "algorithmic" stablecoins (those not backed by dollars but by code) fail. October 2025 saw a major de-peg event where an algorithmic coin dropped to $0.65.11 If it’s not 1:1 backed by Treasuries, it’s a bet, not a buck.
Run Risk: Unlike your bank account, stablecoins are not FDIC-insured. If everyone tries to "cash out" at the exact same second during a market panic, even the best Treasuries take a few days to sell. That delay can cause the price to dip below $1.00 temporarily.
Operational Friction: Turning stablecoins back into "real" cash at your local bank still takes an "on-ramp/off-ramp" process that can be clunky and involve fees.

Stablecoins are trying to be the digital plumbing of the future. To be fair, they can potentially moving money faster than a Zelle transfer. But don't let the word 'stable' lull you into a false sense of security. If you’re chasing double-digit interest rates on a 'safe' coin, you aren't coasting—you’re participating in a high-stakes lending market. Keep your 'coasting' money in FDIC-insured accounts and use stablecoins for what they are: transportation, not a destination."

So. Much. New. Stuff. And so many temptations. It can be a little overwhelming. But that’s why were here.

Listeners, if you want to set up a follow up conversation with the team at Gulf Coast Financial Advisors, it’s easy. You can call us at 251-327-2124, or find us on our website gulfcoastfa.com. One our site, click on the blue button in the upper right-hand corner to set up a meeting on my calendar. There are flexible meeting choices for your convenience – it can be as simple as a 15-minute introductory phone call, a 30-minute zoom, or my preference, an in-person meeting at any of our 3 office locations: Downtown Fairhope, Orange Beach just down the road from the Wharf, or in Mobile off Dauphin St and I-65. Reach out to us - we would love to meet you!

Alright folks, coming up next - There’s always a lot going on in the world! Particularly the world of finance, investments and money. Every week we scour the internet for financial articles relevant to those of you in or near retirement, then give you our honest opinion about these headlines. So join us after the break to hear Payton and I discuss this week’s relevant headlines in our “Headlines of the Week” segment. Stay tuned!

Segment 2 - News of the Week:

Welcome back to Coasting in Retirement, your host Josh Null here, alongside guest co-host Payton Null. As we discussed before the break, every week we scour the internet for financial articles that pertain to those of you in or near retirement. Our job, or at least we tell ourselves it is, is to help you all understand how these headlines impact you, especially when it comes to your money! Note – if you want to read our referenced articles yourself, we also include the links in our show transcript, which you can find on our website gulfcoastfa.com under the podcast tab. Now without further adieu, here’s the Headlines of the Week!

1. Payton: Let’s get started with The New York Post. The Post - and just about every other major financial outlet this week—is reporting that JPMorgan Chase just officially launched its first-ever "tokenized" money market fund. It's called the "My OnChain Net Yield Fund," or MONY for short. JPMorgan Chase is seeding this with $100 million of their own money and running it on what’s called the Ethereum blockchain. They’re saying it’s the future of finance because it allows 24/7 trading and near-instant settlement. But here is the kicker for our listeners: to even get in the door, you need to be a "qualified investor." We’re talking a $1 million minimum investment, and for individuals, you usually need at least $5 million in total investments just to play. My question – given that money market funds are generally considered a cash equivalent - if the biggest bank in the country is moving their "safe" money-market funds onto the blockchain, does that mean our retirees should finally stop calling crypto "witchcraft" and start looking for a digital wallet? Or is this just another case of Wall Street building a shiny new toy for the ultra-wealthy that doesn't really change anything for investors?

The GENIUS Act: You can mention that this move was accelerated by the GENIUS Act passed earlier in 2025, which finally gave banks the green light and regulatory clarity to do this.

Tokenization vs. Bitcoin: Point out that this isn't "buying Bitcoin"—it’s just taking a traditional, boring money market fund (short-term debt) and putting it on a digital ledger.

1. The "Liquidity Mismatch" (The 3:00 AM Problem)

The Pitch: JPMorgan says this fund offers "24/7 settlement" because it's on the blockchain. The Skeptic's View: The tokens might move 24/7, but the underlying assets (U.S. Treasuries) do not. You can't sell a billion dollars of Treasury bonds at 2:00 AM on a Sunday.

The Pitfall: If there is a "run" on the fund or a market panic during a weekend, the bank may not be able to liquidate the actual bonds fast enough to cover the blockchain redemptions. This creates a "liquidity mismatch" that has led to every major crypto collapse in history.

2. High Fees for "Beta" (The Wealth Tax)

The Pitch: It’s an exclusive fund for the "qualified" $5-million-plus crowd. The Skeptic's View: JPMorgan is essentially charging wealthy investors a premium for a product that is, at its core, a boring money market fund.

The Reality: You can get the same yield from a standard, non-blockchain money market fund for a fraction of the cost and with much higher regulatory protection (SIPC). JPMorgan is charging for the "cool factor" of blockchain while providing the same "beta" (market return) you could get at any local branch.

3. Disintermediation vs. Centralization

The Pitch: Blockchain is about "decentralization" and removing the middleman. The Skeptic's View: This is the ultimate irony. JPMorgan—the world's largest "middleman"—is using a technology designed to destroy middlemen to keep themselves relevant.

The Motive: By building their own "token," they are trying to stop their wealthy clients from moving money into independent stablecoins like USDC or Tether. It’s not about innovation; it’s about building a digital fence around their clients' assets so the money never leaves the JPMorgan ecosystem.

4. The "Guinean Pig" Factor

The Pitch: This is the future of institutional finance. The Skeptic's View: Why is this only for "qualified investors" with a $1 million minimum? Because it’s an experiment.

The Risk: JPMorgan is using their wealthiest clients as beta testers for their new software (Kinexys). If there is a smart contract hack, a bug in the code, or a "fat finger" error on the blockchain, these "sophisticated" investors are the ones who will take the hit first while the bank works out the kinks.

Let’s call this what it is: Wall Street FOMO. Or as I like to say, FOLO. Jamie Dimon spent years calling Bitcoin a fraud, but now that he realizes he can charge wealthy people a premium fee to hold 'digital tokens' instead of a bank statement, he’s all in.

My biggest concern here isn't the technology—it's the liquidity. They're promising 24/7 trading on-chain, but the U.S. Treasury market still closes at 5:00 PM. If the world catches fire on a Saturday, these 'qualified investors' might find out the hard way that a digital token is only as good as the guy on the other end willing to buy it. For my listeners? Stick to the boring stuff that actually settles when you need it.

https://nypost.com/2025/12/15/business/jpmorgan-launches-new-crypto-fund-for-wealthy-investors/

2. Payton: Alright Dad, we just talked about the big banks moving their cash onto the blockchain, but our next headline serves as a serious reality check for anyone thinking the 'Wild West' of crypto has finally been tamed. The Bank Policy Institute—which represents the nation’s largest traditional banks—just released a report titled, ‘Stablecoin Risks: Some Warning Bells.’ In the first segment we talked about the GENIUS Act and how it was supposed to bring 'bank-like' safety to these digital dollars. But BPI is sounding the alarm that these so-called 'stable' coins are still prone to massive depegging events—like the cratering we saw just this past October—and that retail investors are often the very last ones in line to get their cash back when the 'exit doors' lock. When the word 'stable' is in the name, but the underlying plumbing is still full of risky leverage and these 'looper' speculators, is this a tool our listeners can actually trust for their retirement, or is it just another 'putting lipstick on a pig' situation?"

Josh: This is the established banking industry's "I told you so" moment. This article, published just weeks ago, highlights that even with the new GENIUS Act (the 2025 stablecoin law), the system is still built on a foundation of sand. Let’s talk about the risks:

1. The "Depegging" Illusion (The $0.87 Reality)

The pitch being made is that stablecoins are "fixed" at $1.00 and safer now because of federal law. Law or no law, a stablecoin is only worth a dollar if you can actually get a dollar for it.

The "Warning Bell": BPI points out that retail investors can't actually redeem coins with the big issuers (like Circle or Tether); only big institutional "market makers" can.
The Risk: If those big players get scared or "capital-constrained" (i.e., they run out of cash), the price on the exchanges crashes. BPI reminds us that USDC dropped to $0.87 during the SVB collapse, and the algorithmic coin USDe just cratered to $0.65 on October 10, 2025.
The Line: "Investors are being told these are 'cash equivalents,' but in a panic, your dollar might only be worth 65 cents. That's not a bank account; that's a casino floor."

2. The "Leverage Loop" (The Looper Trap)

The pitch being made is that you can earn 4-6% interest by "lending" your stablecoins on platforms like Aave. OK. Fine. But where is that interest coming from? It’s coming from "Loopers"—speculators who borrow your "safe" stablecoins to place massive, 10x levered bets on risky crypto assets.

The Danger: BPI highlights a "liquidation downward spiral." When crypto prices drop, these platforms automatically dump collateral to pay back loans. On October 10, 2025, a record $20 billion was liquidated in a single day.
The Line: "When you lend your 'safe' JPMorgan tokens to earn a little extra yield, you’re basically funding a gambler's habit. When his bet goes south, the whole 'loop' snaps, and you're the one holding the empty bag."

3. The "Locked Door" Problem (No Maturity)

The pitch is that you can withdraw your money whenever you want. However, unlike a bank deposit, these DeFi loans have no "maturity" and no "Lender of Last Resort" (the Fed).

The Reality: You can only get your money back if there’s a surplus of new people putting money in. If everyone tries to leave at once (a "run"), the exit door locks indefinitely.
The Line: "This isn't a high-yield savings account; it's a room with no fire exit. If you’re the last one to the door, you're stuck in the building while it burns."

Here’s the bottom line: the Bank Policy Institute’s report should be required reading for anyone thinking about these new 'tokenized' funds. They’re warning that the GENIUS Act created a loophole—it makes these coins look like regulated money, but it doesn't stop the crazy leverage happening behind the scenes.

JPMorgan is dressing this up in a suit and tie, but it's the same 'Wild West' plumbing. They’ve even started 'hard-coding' prices of certain assets to keep the liquidations from triggering—which BPI says just shifts the risk directly onto you, the lender. If you want 5%, go buy a Treasury bill. Don't play 'Looper' with your retirement."

https://bpi.com/stablecoin-risks-some-warning-bells/

3. Payton: Final article of the day, from one of your favorites, Michael Kitces. The blog is titled “'The Future of Financial Advice”. This article argues that we are entering an era where artificial intelligence and new 'engagement tools' are going to handle the heavy lifting of financial planning—everything from data gathering to building the actual models. The premise is that technology will become a 'commodity,' and the real value of an advisor will move away from picking stocks and toward the 'human experience' and specialized niches. As I was reading through this vision of a tech-enabled future, it sounded a lot like a double-edged sword. Is this technology actually going to give retirees better, more personal care, or is 'reshaping the service model' just a fancy way for the industry to automate the 'human' right out of the room while still charging a premium fee? Are we moving toward better advice, or just a more expensive version of a chatbot?

Josh: We’ve talked a lot about this on a previous episode titled “Your broker is a dinosaur”. This article is right about one thing: the math of financial planning has become a commodity. Between AI and automated software, calculating a safe withdrawal rate or rebalancing a portfolio is now practically free. Wall Street loves this trend because it lets them 'scale.' In plain English, that means they can handle five times as many clients by replacing human conversations with digital dashboards and automated emails. They call it 'high-tech engagement,' but for a retiree in Fairhope or Orange Beach, it often feels like digital ghosting.

The real value of an advisor isn’t the software—it’s the behavioral coaching. A computer can tell you that the market historically recovers from a 20% drop, but a computer can't sit across the table from you, look you in the eye, and talk you off the ledge when you're worried about your legacy.

If your advisor’s 'future of advice' looks like you spending more time with an app than a human being, they aren't improving the service—they’re just increasing their profit margin. My advice? Use the tech to do the boring stuff, but make sure you’re paying for a partner who actually knows your name and your fears, not just your login credentials.

Alright folks, coming up next: Josh’s Crystal Ball and Big Mouth. What have been some of my predictions? Have I been right? Was I ever wrong? How wrong? What do I think is going to affect investors in the near future, or maybe the distant future? We talk about all of these things and poke a little fun at my big mouth. Stay tuned!

Segment 3 – Josh’s Crystal Ball and Big Mouth:

Welcome back! Your host Josh Null here, joined by guest host Payton Null . So, I am opinionated, I have strong opinions at times, I would say a radio show host that isn’t probably wouldn’t be very interesting to listen to. And I am paid in my profession to offer professional guidance and opinions to my clients, so if I don’t anything intelligent to say, just replace me with AI. I like making predictions, sometimes I hit the bullseye, sometimes I swing and I miss. Is there any crow to eat? Let’s get at with Josh’s Crystal Ball and Big Mouth and find out.

Well, listeners, I hope you enjoyed a little peek into how we form our opinions and make predictions. We invite you one last time, if you would like to have a no-pressure, no-obligation conversation about your investing goals and retirement dreams, you can call us at 251-327-2124, or find us through our website gulfcoastfa.com. One our site, click on the blue button in the upper right-hand corner to set up a meeting on my calendar. We have several meeting choices for your convenience – it can be as simple as a 15-minute introductory phone call, all the way to an in-person meeting at any of our 3 office locations. You can find GCFA offices in downtown Fairhope, or Orange Beach off Canal Road, or in Mobile off Dauphin St and I-65. Reach out to us - we would love to meet you!

That’s our show for this week! I want to give a huge thank you to my guest co-host and the producer of the show, Payton Null, thank you to our show sponsor, Providence Partners and Jay Stubbs, thank you to our awesome radio station, FM Talk 106.5 out of Mobile, many thanks to the provider of our show music, local band Sloth Racer, and as always my sincere appreciation for all of your out there that have been listening and joining us on this journey. We would love to be a part of your journey as well! Until we talk again, have a wonderful and productive week. This has been Coasting in Retirement with Josh Null!

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