For most of the past month, the stock market has been going through all sorts of gyrations, when millennial members of trading platform Robinhood, engaged in huge amounts of trading of stocks that were previously quite unloved. The companies GameStop (a retailer of new and used video games), AMC (cinema chain), and Bed, Bath, and Beyond, have all been adversely affected by Covid closures and the move to online retailing, with concomitant lowering of their stocks’ value in the market. Large hedge funds had taken short positions in those stocks, with massive amounts of money, essentially betting that the stocks would sink, thus making them profits.
Well, it seems that those hedge funds have gotten somewhat of a comeuppance lately, as all those individual traders got together, bought huge amounts of the beaten-down stocks, and caused their market values to skyrocket. As you can imagine, those hedge fund managers weren’t too happy to see their bets go south, so they took action, as did the managers of the stock exchanges, and the managers of the trading platforms.
Today, on his show, Rush discussed how this situation can mirror what is going on in national politics today, with the Elites ruling over, and trying to squash, the Peons. And, just now, there is a new story about the trading platforms are selling their customers’ holdings, without their direction or permission. This is very worrying, as the stocks and accounts are owned by the Customers, not the Platforms, and their selling may be illegal.
In their opposition to the ordinary investors, and their attempts to stop them from “manipulating” the market, the Hedge Fund Giants may just be reaping the whirlwind that they have sown. They should be very careful what they ask for, they might get it. I understand that now Congressmen of both parties are paying attention, and the weeks ahead might bring unwanted attention to those big financial players on Wall Street who tend to heavily support Democrats (the new Party of Big Business and Big Finance).