Sports Betting and Meme Stocks

Stonks, Christian films that repel men, rising above unfairness and more in this week's roundup.

Readers here know I’m a critic of legalized gambling, and especially sports betting on your phone. A recent study by Scott R. Baker, et. al. looks at the effects and finds that, no surprise, financially stressed households get hit. Here’s the abstract:

We estimate the causal effect of online sports betting on households' investment, spending, and debt management decisions. Employing household-level transaction data and a staggered difference-in-differences framework, we find sharp increases in sports betting following legalization. This increase does not displace other gambling activity or consumption but significantly reduces households' savings allocations, as negative expected value risky bets crowd out positive expected value investments. These effects concentrate among financially constrained households, who become further constrained as credit card debt increases, available credit decreases, and overdraft frequency rises. Our findings highlight the potential adverse effects of online sports betting on vulnerable households.

Relatedly, someone sent me this 2021 blog post that insightfully compares meme stocks like Game Stop to gambling.

The key quality of a stonk or crypto is that it must have no objective value, and with no objective value, its value could be anything. Communities form around these memes that are emotionally meaningful to the participants, including a penchant to engage in infantile bonding behavior (literal baby talk with words like "tendies").

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It is impossible to analyze the casino business from an objective perspective. Objectively, they provide no real economic value (or at most very expensive entertainment value), which is one of the reasons most jurisdictions severely restrict or ban their operation. Nevertheless, where they are allowed to operate, they are consistently profitable. Perhaps the best explanation for the emergence of meme stocks and the crypto bubble is in-person gambling being shut down during Covid, along with the more recent crackdown on online poker. Those animal spirits demanding their dopamine hits (and frankly, a salve for the profound loneliness in the culture) had to find an outlet somewhere.

I think some value investors are operating under an old paradigm where a stock's value is equal to the net present value of cash flows delivered to the investor. But stonks and crypto can pay a different type of dividend in the form of neurotransmitters to gamblers. Once a stock or crypto becomes a meme, it is as useless to attempt to short it or otherwise predict its crash as it is to predict when the lotto will pay out. With the recent short squeeze of Gamestop, short sellers have to be extra cautious that they will be targeted with a campaign of forced bankruptcy and margin calls before their bets can achieve their "rational" value.

Click over to read the whole thing.

If You Want Young Men to Leave Christianity, Have Them Watch ‘The Forge’

Joseph Holmes, our film correspondent here who wrote a great review of the film First Man, has a brutal takedown of the Kendrick Brothers film “The Forge.” The Kendrick Brothers are very well known Christian filmmakers known for titles such as War Room and Facing the Giants. Holmes writes:

The film deserves credit for tackling the problems of wayward young men. Men in our society are falling behind in school, dropping out of the workforce, abandoning marriage and parenthood and increasingly ending their lives. So it’s great to see faith-based industry films trying to address helping men achieve their potential. Furthermore, the empathy shown to moms of such sons is vivid, with Cynthia struggling with wanting the best for her son but being unable to draw it out of him because she’s not a man and “it’s hard for a woman to call out the man in her son.”  

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But therein lies the problem. This is clearly not a movie for the men who are lost; this is a movie for their moms. Worse, it’s a movie that will probably not inspire lost men to turn around, but rather push them further away.

The film largely ignores putting us in Isaiah’s point of view or understanding his perspective. The movie starts out with a parade of scenes where Isaiah is a stereotypically frustrating young man. He plays video games instead of doing his chores or looking for a job. He rolls his eyes at his mom when she confronts him and whines when she threatens to charge him rent. He obnoxiously tries to hit on a girl at a coffee shop and is disrespectful to her dad. Each of these scenes ends with an eye roll or a lecture from the adults in the room, whether that’s his mom, the coffee girl’s father or an office receptionist. 

Click over to read the whole thing.

The Kendrick Brothers were a target of the old Christian manosphere because their films embody the worst of the “blue pill” thinking that is dominant in evangelicalism. This worldview, at best, has highly twisted story about gender and at worst is outright hostile to men. You can go back and read the review of the divorce themed film Fireproof by a former blogger who went by the name “Dalrock” to get a flavor of their take.

When Life Isn’t Fair

I wrote an article last week that life is not fair, and as a man you need to learn to deal with reality as it is.

Last week’s Lunch with the FT column in the Financial Times was an interview with Nigerian businessman Tony Elumelu, who speaks very well to this point.

At the personal level, he talks about being forced out as the CEO of his back by a change in government regulations.

Elumelu and his band of young bankers renamed the entity Standard Trust Bank and cleaned up the mess they had inherited, turning it into one of the more stable banks in the country. In 2005, his bank merged with United Bank for Africa (UBA) and Elumelu came out on top in an almighty struggle to become the chief executive of the new operation.

Elumelu was at the helm of UBA for another five years until a central bank edict that turfed out long-serving bank bosses put him out of a job. “2010 was a pivotal year for me,” he tells me of his ouster as UBA boss. “The central bank ruling was a complete surprise . . . Was it fair? Look, as someone who believes in governance, it probably makes sense, but it was a shock. But it was also liberating, catalysing.”

By the end of that year, he had formed Heirs Holdings, the investment engine that launched the second act of his career and turned him from a banker to a multi-sector magnate.

He also applies this at the societal level, encouraging African countries to look beyond the injustices of the past.

If Elumelu is thriving, his country decidedly is not. Nigeria is in the grip of its worst economic crisis in a generation, with growth stalling and inflation at levels not seen in almost three decades.

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“We can sit here today and the easiest part of the conversation would be to talk about all the things that have gone wrong, all the things that people have failed to do. “But therein lies the philosophy of Africapitalism. For far too long, we have blamed foreign powers. We have blamed our own leaders. But what are we as the private sector doing to make things better? It’s a call on the private sector to stand up and show the way. Let us show the way through what is in our own power. We have the power to make investment decisions.”

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Why has Nigeria largely failed to live up to its post-independence potential, I prod. I don’t expect him to give much away, in view of his closeness to the country’s leadership. His younger brother was a member of the national parliament for more than a decade before losing his seat in last year’s vote.

“Leadership,” he says, without hesitation, becoming animated for the first time. “It’s leadership in all facets.”

Then he launches into a broader point unlikely to earn him an invitation to speak at a liberal arts university. “We all grew up being taught about imperialism, colonialism, oppression, struggle and emancipation. But the truth is, in the 21st century, are we still going to be talking about that? America was colonised too and look at where they are.

“We need to take our destiny into our own hands,” he continues. “And also, stop blaming people and stop this entitlement mentality that we were put where we are by others, therefore they must rescue us. If they put us where we are, why do you think those people will come to your rescue? Struggle, strive!”

I offer that colonialism and imperialism did set Africa back.

“They did,” he concedes, before continuing with his argument. “But so was India and other economies. Why do you keep crying over this and not taking this in our hands? Let us be saying that in spite of colonialism we have succeeded and not that we have not succeeded because of it. Otherwise, it will go on forever.

“We got independence in 1960. Sixty-four years, please. It’s about time — it’s almost a century. We shouldn’t still be talking about this. We should move on. It’s arguable that the country they bequeathed to us is better than the country we have today.”

Click over to read the whole thing (although the FT has a very hard paywall.

I don’t know much about Elumelu. The reality of his life may not match this interview. But rhetorically he has the right attitude. Not ignoring unfairness, but seeking to rise above it.

Best of the Web

Ross Douthat: Masculinity is on the ballot

Richard Reeves: On the Ballot: American Manhood

Daniel Cox: Active Fathers Are Exacerbating the Two-Parent Privilege

Brett McCracken: As a Single Man, I Felt Little Pressure to Get Married. I Wish I Had.

CNN: US fertility rate dropped to record low in 2023

Jesse Smith: Old wine in new wineskins: Christian nationalism, authoritarianism, and the problem of essentialism in explanations of religiopolitical conflict - This sociology paper is a really interesting perspective on Christian nationalism. Here’s the abstract:

In 2001, John Levi Martin published a critique of authoritarianism scholarship, arguing that it was marred by fundamental biases of tautology, selective interpretation, and overtheorization of some research subjects but neglect of others. Drawing from this critique, I argue that Christian nationalism scholarship in sociology operates as a variant of authoritarianism research, exhibiting similar claims, strengths, and shortcomings. In a short span of time, the Christian nationalism research agenda has come to dominate the sociological study of religion and enjoyed a high profile in public discourse, presumably due to its relevance to matters of acute political concern. However, this literature interprets empirical results based on unverified assumptions of essentially authoritarian goals and motivations while ignoring plausible alternative explanations. It further neglects respondents who are low on Christian nationalism measures, despite evidence that these respondents play a role in religiopolitical conflict. The result is an essentialist account of Christian nationalism that is politically resonant but theoretically problematic. I propose that these issues can be addressed by a shift away from essentialist and toward social models of belief systems, which offer important advantages: greater consistency with current theories of political polarization, a stronger sociological element, and less susceptibility to researcher bias.

It’s also the third anniversary of American Reformer. Happy birthday, AmRef!

New Content and Media Mentions

I was a guest on the City Journal 10 Blocks podcast talking about Life in the Negative World.

I got mentions this week from Rod Dreher, Michael Young in American Reformer, and Firebrand magazine.

New this week:

• My podcast was with Oren Cass of American Compass on the American economy and the future of the American worker.

• I wrote about five ways young men can destroy their lives.

• And John Seel contributed an essay arguing that we are not in an age of change but a change of age. Rod Dreher wrote up some very nice perspectives on this.

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