So here we are, where everyone from staff at the White house, to old dinosaur Wall Street denizens, to SEC members to brokerages, are all trying to figure out what to do with these upstarts. It’s really quite funny to watch.
All week the main news flow has been about the Reddit/Robin Hood traders that ganged up via social media and drove several highly shorted stocks, to nosebleed levels, causing some big-time hedge funds major pain. Like billions in losses.
The kings of Wall Street don’t much enjoy the peon’s playing in their sandbox and actually winning. No folks… the market is there for one and only one purpose and that’s to make themselves rich. If you get some crumbs along the way that’s great, but let it be known, that if you pull off something that costs them money, they’re going to get excited about it and try and shut you down.
So here we are, where everyone from staff at the White house, to old dinosaur Wall Street denizens, to SEC members to brokerages, are all trying to figure out what to do with these upstarts. It’s really quite funny to watch.
It has been perfectly fine for the big Wall Street outfits to sell short 150% of the float of a company, and no one says a word. But having people legally band together and buy one of those overshorted stocks is now a national emergency? Sort of a double standard there, no? Indeed.
So “they” did what they always do. They had to find some way to stop the little guys from steamrolling the big guys. At first they simply said you can’t buy any more stock in a handful of names such as NOK, GME, AMC, etc. You can only sell stock. Now wait a minute! Why can’t I buy stock in GME???? Because more of your Wall street buddies might get hit? Too damn bad, they’ve been screwing folks for years on end.
How is that legal, to just ban me from buying a stock?? It isn’t probably, but this is Wall Street and legal means as much to them as it does to Biden and Harris. Nothing.
Here’s some of the panic that is rippling through the media, the CNBC talking heads, WallStreet and the idiot lawmakers:
*SCHWAB, TD NOT ALLOWING CLIENTS TO SELL NAKED CALL OPTIONS
SENATE PANEL TO HOLD HEARING ON CURRENT STATE OF STOCK MARKET
WARREN SAYS SEC NEEDS TO 'STEP UP' AMID GAMESTOP TRADING
*PETERFFY WARNS CHAOS COULD SNOWBALL WITHOUT BROKERS' ACTION
ROBINHOOD ADDS AAL, CTRM, SNDL, OTHERS TO RESTRICTED TRADING
Robinhood will not allow opening positions in $GME $AMC $BB $BBBY $NOK $KOSS $NAKD
REP. KHANNA ON GAMESTOP: MORE REGULATION NEEDED IN MARKETS
To which someone made a very proper statement: The Fed throws in trillions in liquidity & stocks fly higher it's cool.Pelosi loads up on $TSLA calls the stock flies higher it's cool.Bunch of little retail guys load up on calls & stocks fly higher it requires White House & Treasury monitoring & servers get shut down
Or this, to quote Portnoy: Is there 1 human on the planet who thinks of it were the hedge funds and suits making all this money and gaming the system they’d change the rules?
Indeed. So, we’ve got the little guy fighting the big guys, and winning, which has all their panties in a bunch. Quick, we have to change the Rules!!!! How sad.
This market has been corrupt, and manipulated for years on end, and this is just exposing a little sliver of it. How can it be okay for a fund to sell short an entire companies float, but if average every day traders buy all the shares they want, it’s somehow bad?? Again it’s simple. Wally ( Wall street) doesn’t like to lose to pissant peons.
And lose they did. Some estimates say that hedge funds have lost north of 10 billion dollars covering shorts on KOSS, AMC, GME, NOK, BBBY, etc. And money?? The Reddit folks have done well for themselves. One Gent put 50 grand in GME, and preached he would hold it. At one point that 50 grand was worth 45 MILLION dollars.
So here’s that lunatic lying “what ever she is: with a statement:
WARREN TO SEC: TAKE STEPS TO ENSURE PRICES REFLECT FUNDAMENTALS
What? She is certifiably insane. To make sure prices reflect fundamentals, 80% of ALL stocks would have to lose 40+%. But then she wouldn’t understand that.
One thing is sure, they’ll find some way to make new rules that only benefits them. I’m not sure what they have in mind just yet, but you can bet that something’s coming. In fact, here’s their “reach out” for ideas to solve the “problem” ( of which there is none) Of course they couch in as “trying to keep the individual investor safe.” What Bullshit that is.
Hey commissioners….if you want to keep investors safe, why do you allow a stock to close the day at 1100 dollars and then overnight there’s bad news and you let the stock open at 700? Where is/was the protection and worry over investor safety there??? No where, that’s where, and Gap up and downs should be illegal. But since they make your Wall street cronies money on gap ups, and protect them from losses on gap downs, the small guy gets reamed.
Anyway, here’s their statement:
Commissioner Hester M. Peirce
Commissioner Elad L. Roisman
Commissioner Caroline A. Crenshaw
Jan. 29, 2021
The Commission is closely monitoring and evaluating the extreme price volatility of certain stocks’ trading prices over the past several days. Our core market infrastructure has proven resilient under the weight of this week’s extraordinary trading volumes. Nevertheless, extreme stock price volatility has the potential to expose investors to rapid and severe losses and undermine market confidence.
As always, the Commission will work to protect investors, to maintain fair, orderly, and efficient markets, and to facilitate capital formation. The Commission is working closely with our regulatory partners, both across the government and at FINRA and other self-regulatory organizations, including the stock exchanges, to ensure that regulated entities uphold their obligations to protect investors and to identify and pursue potential wrongdoing. The Commission will closely review actions taken by regulated entities that may disadvantage investors or otherwise unduly inhibit their ability to trade certain securities.
In addition, we will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws. Market participants should be careful to avoid such activity. Likewise, issuers must ensure compliance with the federal securities laws for any contemplated offers or sales of their own securities.
The Commission will continue our work on behalf of investors and the markets. In this regard, we hope to facilitate a robust public dialogue among market participants and investors on the structure and operation of our securities markets. Members of the public can submit tips or complaints through the Commission’s website using this online form. Members of the public with questions should contact the Commission’s Office of Investor Education and Advocacy at 1-800-732-0330, ask a question using this online form, or email us at Help@SEC.gov.
All this brings me to the market itself. It’s so overbought, so rigged, so ridiculous, that we do have to wonder what happens next. See, the only reason the market has risen for the past 11 years is Fed intervention with their goofy stimulus. QE 1, QE2, the “twist” then zero rates, then bond buying, then corporate bond buying and on and on. A significant amount of all those trillions, goes straight to Wally.
They are currently keeping rates at 0, and they’re still buying 120 billion a month in assets. Around the world, other Central banks, like the Swiss national bank, they don’t even hide it. They show the world how many tens of billions in US stocks they’ve bought. So, the common thinking and what has happened is that except for a few quick wiggles, the market has gone up and up and up.
If the Feds and global central banks are not going to stop “printing” so to speak, then it makes sense that we catch our breath here and head even higher. But I ask a question. Is it possible that the tens of millions of Robin Hooder’s that have an agenda against Wally, might actually be able to create a situation, where the Fed money can’t push stocks higher any more? We have to consider it.
We also have to consider that FACT, that if Wally gets ticked off enough, he is more than willing and capable to crash this market, just to teach the peon’s a lesson. While it’s one thing for the Reddit’s to buy a few hundred shares of AMC or GME, the hedgies have TENS OF MILLIONS of shares of big names. AMZN, NVDA, MSFT, NFLX, AAPL, etc. If they want, they can yank the rug on some of them, and create a snowball that takes everyone down. Big.
I’m not predicting that will happen. All I’m suggesting is that 7 sessions ago, the DOW was 31,272. And at the mid day low Friday, it was 29,856. Was that just an organic “correction” or was that because Wally had to liquidate holdings to pay for the losses in covering shorts? Maybe some of both?
The market is in a dangerous place here folks. If it was just the market that was broken, that would be one thing. But our Government is broken, our Healthcare is broken, our covid situation is broken, you name it. The only thing keeping the plates in the air is Fed money, and ya know what? They can turn it off if they want.
Tread carefully in here friends. Everything’s weird.