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Illustration: Rae Cook/Axios

Warren Buffett is the ultimate buy-and-hold, long-term investor; Robinhood is filled, at least in the popular imagination, with day-trading teens rushing in and out of meme stocks and crypto. So it's hardly surprising they've started trading barbs.

What they're saying: Buffett and his partner Charlie Munger described Robinhood at their annual meeting last Saturday as being a "casino group" that is "deeply wrong."

  • Robinhood hit back with a blog post accusing Buffett and Munger of being "the old guard" who have been "driving a deep wedge between the haves and have-nots."

Where they agree: Robinhood's post takes pains to point out that "a majority of Robinhood’s customers are buying and holding." Pointing to the buy-and-hold investors as paragons of rectitude, however, is an implicit rebuke of the company's most profitable customers.

  • By the numbers: Thanks to Robinhood day-traders, the brokerage took in a stunning $331 million in payment for its customers' order flow in the first quarter of 2021. Of that, exactly $0 came from the virtuous users holding on to long-term investments and not trading at all.

SEC chair Gary Gensler, in congressional testimony on Thursday, took Buffett's side of the debate, making it clear that he's not a fan of "gamification, behavioral prompts, predictive analytics, and differential marketing" — all tools that Robinhood uses to drive growth.

The other side: Even Buffett made mistakes early in his investment career — that's how people learn. And the YOLO crowd is well aware of what they're risking when they go all-in on speculative vehicles like dogecoin.

  • Robinhood is also correct to point out that the people who made fortunes by investing alongside Buffett were overwhelmingly white and upper-middle class, in an era when most Americans were effectively shut out from any access to the stock market at all.

The bottom line: The speculators making (and losing) money on Robinhood don't want to be protected from taking risks. The paternalistic instincts of Buffett and Gensler are understandable, but trading can be fun, especially when, as now, the Extremely Online teens are wildly outperforming their grandparents.

Go deeper

SEC chair Gary Gensler turns his eyes on crypto

Photo illustration: Shoshana Gordon/Axios. Photo: Andrew Harrer/Bloomberg via Getty Images

What a week for cryptocurrencies in Washington. SEC chairman Gary Gensler spent Tuesday in the spotlight when he said at the Aspen Security Forum that not only does he believe virtually all initial coin offerings are securities, but that token exchanges are very likely facilitating trading of unregistered securities.

What they're saying: "While each token's legal status depends on its own facts and circumstances, the probability is quite remote that, with 50 or 100 tokens, any given platform has zero securities," said Gensler.

3 mins ago - Politics & Policy

Democrats brace for staredown over paid family medical leave

House Ways and Means Committee Chairman Richard Neal. Photo: Win McNamee/Getty Images

Senior House Democrats are braced for battle with the Senate over whether paid family medical leave — a key priority for progressives — will be included in President Biden’s final budget reconciliation bill, lawmakers and aides tell Axios.

Why it matters: Sen. Joe Manchin (D-W.Va.) has indicated he wants to cut the program to reduce the bill's price tag. “Paid family and medical leave must be in the final package,” Rep. Richard Neal (D-Mass.), chairman of the House Ways and Means Committee, told Axios on Monday.

36 mins ago - World

Poland showdown is EU's Jan. 6 moment, top official says

Didier Reynders. Photo: Thierry Monasse/Getty Images

Poland and Hungary have forced a moment of reflection on the European Union — similar to the one in the U.S. after the Jan. 6 insurrection, EU Justice Commissioner Didier Reynders told Axios.

What he's saying: "During many years, we have had in our minds that it was granted that if you are a member of the EU, of course you apply the rule of law; you have full respect for democracy, fundamental rights and so on — maybe with some concerns but with a real intention to adapt your legislation to be in full compliance [with EU law]," Reynders said.