Full Tucker Carlson & @cvpayne Segment On The GameStop Stock Market Battle Between Redditors & Hedge Funds
Charles: "Wall Street now wants to change the rules of the game because a bunch of people with accounts ranging from $500 to $2500 are taking down the billionaires." pic.twitter.com/f4Hf87Q3Uz
— The Columbia Bugle 🇺🇸 (@ColumbiaBugle) January 28, 2021
I have always been, and always will be, a defender of free markets. That does not mean that I am not fully aware of all the near criminal activity that goes on by some big investors in such markets. I therefore find this story highly amusing:
Over the past few months, a bunch of Reddit users have worked to push up the value of shares for video game retailer GameStop, despite Wall Street investors betting the company will fail. So far, they’ve won, pushing the stock up more than 10,000% (you read that right.) Then they started spreading their strategy to struggling movie chain AMC, too. And it’s worked. In their wake, these online market players have upended Wall Street, creating a drama filled with memes and weird internet lingo as big-time investors stand to lose billions of dollars.
It’s a crazy story, complete with cameos by Tesla CEO Elon Musk and CNBC financial commentator and former hedge fund manager Jim Cramer. There’s even Michael Burry, one of the subjects of the book and movie The Big Short, who happens to be a prominent investor in GameStop. It’s wild.
Go here to read the rest. This debacle has revealed that many of the people at the helm of large hedge funds and huge institutional investors are no wiser, or no shrewder, than many outside day traders looking at the facts and making their own investment decisions. When meritocracy became merely a matter of credentials from top schools it became dependent upon the quality of the education received at said schools. Spending your time at Harvard taking gut courses and specializing in networking with other elite scions and their families does not make one a better investor. It makes one a bubble dweller and a priest of the cult of the perceived wisdom of the day. Expect more stories like this as our elites continue to reveal themselves as elites in name only.
Update I: The big boys really, really hate to lose money:
NEW YORK (NEXSTAR) — The online trading platform Robinhood is moving to restrict trading in GameStop and other stocks that have soared recently due to rabid buying by smaller investors.
GameStop stock has rocketed from below $20 earlier this month to more than $400 Thursday as a volunteer army of investors on social media challenged big institutions who had placed market bets that the stock would fall.
Among the restrictions announced by Robinhood on Thursday was that investors would only be able to sell their positions and not open new ones in some cases. Also, Robinhood will try to slow the amount of trading using borrowed money.
According to Motherboard, over half of Robinhood users own at least some stock in GameStop.
On Thursday, Alexandria Ocasio-Cortez called Robinhood’s decision “unacceptable.”
“We now need to know more about Robinhood’s decision to block retail investors from purchasing stock while hedge funds are freely able to trade the stock as they see fit,” she said. “As a member of the Financial Services Cmte, I’d support a hearing if necessary.”
In a tweet, Senator Ted Cruz said he agreed with Ocasio-Cortez’s statement.
Go here to read the rest.
Update II: The Class Action suits by the small investors will be a joy to behold and there is criminal jeopardy here for those who conspired to shut down the trades:
This means that virtually every hedge fund that had short positions on was getting hammered. So when dozens of these giant asset managers sat down and decided to polite call one broker after another what do you think happened.
That’s right: Joe Sixpack was quickly sold down the river.
Why? Because the so-called “retail clients” are nothing but a cost center to the “retail brokers” thanks to the recently introduced $0 commission pay scheme. In fact, brokers would be delighted to dump all but their biggest whales clients. So who pays the fees? Well, just take a look at Robinhood’s form 606: Citadel, Virtu, G1X, Wolverine, and countless hedge funds which, like Citadel, are tightly interwoven in the fabric of the market. It’s they that made a few phone call and just put dozens of stocks on a market-wide restricted list.
There’s more. While unconfirmed, there is speculation that that “Citadel reloaded their shorts before they told Robinhood to stop trading GME.” As the source notes, if true the people behind this should be in jail.
Just got a tip that Citadel reloaded their shorts before they told Robinhood to stop trading $GME.
If this is true, Ken Griffin and the Robinhood founders should be in jail.
This is class warfare.
— Justin Kan (@justinkan) January 28, 2021
Perhaps this is true, perhaps not. We’ll find out soon.
But what we really want to find out is when the brokers will again allow trading in GME, AMC, and so on. What will be the catalyst? Will it be when hedge funds have finally covered their shorts, at which point there will be no further need for a squeeze.
If that’s indeed the case, it’ll tell us all we need to know about who truly runs the erroneously called “free markets.”
Go here to read the rest.
Love it. More power to the little guys who ban together to one-up Wall Street. We need a lot more of this. Wall Street and the Federal Reserve are homes for the devil who every day conspire to make the rich richer. and impoverish the masses. It is good to see a little comeuppance.
Yep, these fellows have become quite the heroes according to my sons. According to them, their peers are loving every minute of it, and are they making with the David takes out Gordon Gekko memes. I say more power to them.
The thing I find ironic is how loudly folks whose profit model was based on gaming the system are now howling because…someone gamed it better.
Comment of the week Foxfier! Take ‘er away Sam!
https://www.youtube.com/watch?v=eXeIxtI–uc
Amen to Dave G. and Foxfier.
More on this epic moment.
https://patriots.win/p/11SK7KTZoM/on-gamestop-why-hedge-funds-are-/
Hooray for the mommies’ basement pajama boys and girls! .
One thing, what are they going to do with the two, $10 Game Stop shares they bought at $300?
You thought market were efficient and fair. Think again. The fix is in. The Fed, IRS, SEC, Treasury et al, as Michael Dowd wrote above, pick and choose the winners.
Now, see how they can’t always succeed.
My children, their friends, their friends friends are all universally watching this with the utmost intensity.
https://www.youtube.com/watch?v=NxmrcfbklVg
https://www.youtube.com/watch?v=NxmrcfbklVg
Dave, I have been struck by the relevance of that scene also. Arnold Toynbee would have loved it also I think:
The British historian Arnold Toynbee, who examined 26 world civilizations in his 12-volume A Study of History, saw civilizational decay as resulting from the deterioration of the creative minority—composed of elite leaders—that drives progress. The elite degenerates, growing prideful and dominant even as it loses the ability to innovate and address societal challenges. Instead of leading with a confident sense of virtue and purpose, it turns parasitic and “succumbs to the sickness of ‘proletarianization.’”
Decay is not caused by an external assault or a decline in technology. In Toynbee’s formulation in A Study of History, “. . . the nature of the breakdowns of civilizations can be summed up in three points: a failure of creative power in the minority, an answering withdrawal of mimesis on the part of the majority, and a consequent loss of social unity in the society as a whole.” In this latter stage, the “Creative Minority degenerates into a mere Dominant Minority which attempts to retain by force a position which it has ceased to merit.” Its mores decay and it declines into “truancy” and “promiscuity,” becoming self-serving rather than self-sacrificing. It worships the great achievements of its “former self,” becoming overly prideful in the process, and unable to effectively address the next set of challenges that a society faces.
https://www.the-american-interest.com/2019/10/30/how-do-americas-elites-stack-up/#:~:text=Only%20elites%E2%80%94Toynbee%E2%80%99s%20%E2%80%9Ccreative%20minority%E2%80%9D%E2%80%94are%20able%20to%20shepherd%20a,and%2C%20in%20time%2C%20increase%20its%20power%20and%20influence.
Don, absolutely agree. This is a definite push back on “the establishment”. It’s massive. From what I’m seeing we’d be hard pressed to find a 20 something not involved.
https://www.youtube.com/watch?v=wgYZk9Mc804&feature=youtu.be
I don’t understand stocks at all, but I heard on the news that something has happened where trading has been halted, or something along the lines of stopping what is happening. I know nothing beyond that, and don’t get the details. But I have a strange feeling that it will be stopped soon, some way or another.
Basically all public trading applications have stopped allowing people to buy Gamestop and a few other stocks, though they still let people sell. But if it isn’t proper to allow people to buy a stock, who is the buyer in the sale? Obviously our betters.
I know that there have been a lot of moments that should have opened up the eyes of the common people to the corruption around them, but people are still largely blind. I think that this could be different. The difference is that EVERYONE is against the hedge fund. As much as the media is trying to change things, this isn’t a Trump supporters vs. the establishment, or left vs. right thing. No one but shills is on the side of the hedge funds. So for the collusion between various financial companies and news outlets to be this blatant (and later the government will also collude) it sends a very clear message of “We the elite are all that matters. We hate every single American citizen.”
Oh.
Well apocalypse is here now. Pack up your bags everyone. Here come the end times!
It’s okay. AOC rejected his support, claiming that Ted Cruz tried to kill her.
Not joking: https://twitter.com/AOC/status/1354848253729234944