

Ask HN: Gambling & smoking limited but not entrepreneurship and stock trading? - amichail

There are dangers involved in gambling and smoking.  Consequently, governments provide limits/warnings to mitigate those dangers.<p>But why do governments not do the same with entrepreneurship and stock trading?<p>For example, 3rd party developers could receive a warning that gives them the expected profit from a particular platform.  Without such warnings and in cases with very low expected profit, companies would be essentially getting free labor to promote their products.
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asimjalis
I assume you are joking. Gambling is a closed system with fixed rules. The
expected winnings form a Gaussian bell curve. Entrepreneurship is an open
system. You can change the game. The idea of expected profits assumes that
profits will follow a bell curve. But in fact they don't. There is really no
upper bound. To use the terminology of Taleb's Black Swan, entrepreneurship
profits are Mandelbrotian. The outliers can completely change the average, to
a point where the concept of the average or expected becomes meaningless.

~~~
amichail
You could give the median profit, which is not sensitive to outliers.

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profquail
Why should the government be required to help you out here. Contact the
company and find out some more about their platform. If they won't give you
some straight answers, then it's time to move on. It's a private company, and
it's totally within their right to refuse your information request, but they
will also be driving themselves out of business...

~~~
amichail
Why would a company voluntarily give out information that would discourage
third party developers?

Does Facebook for example give out the median profit from a Facebook app?

~~~
profquail
They wouldn't. And if they lied to you, that's fraud, and you can press
charges against them.

If they don't lie, but they don't tell you good things about their platform
(you'll have to judge the amount of 'spin' on your own)...then move on. It's
really that simple.

From your example, you could contact Facebook and ask for some stats about
their application platform (telling them that your company is thinking about
building an app for that platform). If they refuse to give you stats, either
ask to be transferred to a 'higher-up', or tell them you're sorry you couldn't
work together and get off the phone. If they do give you stats, you need to
judge for yourself if building your app will be profitable on that platform.

There is absolutely no company (or person) in the world that is going to be
able to quote you a hard number on the amount of profit your app is going to
make before it exists.

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SwellJoe
Oh, yes, more government involvement in the tech industry is _exactly_ what we
need at this juncture in American history. It's worked so well for
automobiles, railroads, health care, and drugs, what could possibly go wrong?

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profquail
I think that if you develop something for a 3rd-party platform without knowing
what you're getting into, any negative (i.e. non-profitable) outcome is 100%
your fault. I'm certainly not going to ask for my tax dollars to go toward
someone that was so excited by greed that they didn't even bother to google
around a bit and find out some more about that platform.

If you do some preliminary web searches on small business statistics or
entrepreneurship, you'll find that plenty of them fail right off the bat. I
think that a large part of the reason that people love 'corporate culture' is
because it's very secure, unlike when you start your own business and have to
actually take some risks with your future.

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zandorg
I see the difference between gambling and stock trading as this: Gambling has
a negative long-term percentage, but stock trading is the opposite: a positive
long-term percentage.

If you gamble at roulette for long enough with any strategy, you'll lost 2.6%.

If you play the stock market for that long, again randomly, you'll GAIN 2.6%
(just a made up number - it could be 1% depending on the economy).

Postscript: At stock trading, like in a casino, you have to make enough to
cover the "house cut", which is the fees you pay to brokers to sell and buy
stocks (in roulette, it's 2.6%).

~~~
amichail
I suspect most people lose money in the stock market because they need the
cash so they may end up selling low.

~~~
profquail
It's called Risk Aversion:

<http://en.wikipedia.org/wiki/Risk_aversion>

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bkovitz
There are dangers involved in eating at McDonald's, going to grad school,
talking to strangers, thinking things through very carefully, dressing funny,
starting religions, getting married, staying single, doing meaningless
homework, getting a cubicle job, and heeding the advice of your high-school
guidance counselor. The dangers are quite severe, including heart disease,
getting beaten up, and living a wasted, unfulfilling life (a fate worse than
death).

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sarvesh
Why not right? You may soon get more than just protecting 3rd party developers
when the bill to regulate VC funds is passed. I think it will be big blunder.
Nobody who is an entrepreneur has any delusions of safety, we know the risks
we are taking. The whole reason that this model has worked so far is because
people have the freedom to take these risks. Take that away and you will
probably end up killing a lot of innovation.

~~~
amichail
_Nobody who is an entrepreneur has any delusions of safety, we know the risks
we are taking._

Not true! <http://news.ycombinator.com/item?id=683810>

~~~
sarvesh
Sorry, an article in businessweek doesn't disprove the fact that fact that
Apple, Microsoft, Sun and a gazillion other startups were created by
entrepreneurs and VCs who were willing take those risks.

