Monday, March 4, 2013
He describes the "crowdfunding" provisions -- which allow start-up businesses to solicit funds from unsophisticated investors -- as "pure folly. Buy a lottery ticket instead. Your chance of winning is likely to be higher."
He finds other provisions "less terrifying but still problematic," including the provision that allows private equity and hedge funds to advertise. Since the successful funds have no trouble raising capital without advertising, he wagers that the funds that will resort to advertising are firms that sophisticated institutional investors wouldn't consider investing in.
Rattner concludes that the jobs created by the JOBS Act may be for lawyers "to clean up the mess that it will create."