Bill Ackman Warns Stock Market Has Become a “Casino,” Blaming Leverage-Fueled Speculation

“Every number of days, I feel like markets are broken.”

Bill Ackman, the billionaire investor and chairman of Pershing Square Capital Management, has compared the current stock market to a “casino,” criticizing the rampant speculative activity gripping financial markets. Appearing on CNBC on Nov. 3, Ackman said repeated episodes of stock prices surging and plunging regardless of companies’ underlying value are seriously undermining market health.

He described the current market as having returned to the kind of casino-like environment seen in the past, when leverage reached 95%. In his view, stocks are trading at prices that make little sense, and this phenomenon offers no benefit to society or the economy. He expressed particular concern about the widespread growth of speculative trading aimed at generating short-term profits.

Ackman identified excessive leverage as the main driver of extreme market volatility. He argued that the growing popularity of leveraged products that track multiples of daily returns, as well as perpetual futures with no expiration date, has made the stock market increasingly dependent on short-term supply and demand rather than companies’ fundamental value. He also pointed to the recent sports betting boom as evidence of a growing appetite for quick profits.

This speculative environment is producing sharply different outcomes for different types of investors. “ It’s good if you’re a long-term investor and you can buy at a stupid price. I don’t think it’s good for the country generally,” Ackman said. Indeed, Pershing Square bought Microsoft shares earlier this year when the stock fell amid so-called “SaaSpocalypse” concerns — fears that artificial intelligence (AI) would threaten the software-as-a-service (SaaS) industry. Ackman also said the firm bought Amazon shares after they declined amid U.S. President Donald Trump’s tariff policies, as well as Alphabet shares when its stock experienced sharp swings following the launch of ChatGPT. The firm has effectively used market mispricing as an opportunity for long-term investment.

Individual investors relying on short-term leveraged products, however, face serious risks, Ackman warned. When stock prices move against their positions, leverage can magnify losses rapidly. Forced liquidations triggered by insufficient collateral can also lead to further selling, creating a vicious cycle that deepens market declines.

Ackman stressed that betting on short-term price movements could ultimately have disastrous consequences for investors. Rising markets can fuel speculation by raising expectations of high returns, but when markets turn downward, leveraged positions can unravel and inflict substantial losses.

His remarks serve as a warning that the stock market’s price discovery function may be weakening as speculative trading gains influence. Ackman suggested that investors should focus on companies’ underlying performance and financial condition rather than being swept up in short-term price movements.