Will Gamestop stop the game of Wall Street?

When the rich do it, it’s smart and capitalism at work.

When the masses do it- it’s an affront to the billionaires.

A wealthy friend who said “The small investors are doing the same thing the Wall Street/hedge fund people have been doing for years. The Wall Street/hedge fund people got caught on the wrong side of this deal and now they are complaining. Karma!”

Ohio has one Senator with a brain:

What happened? The super rich “shorted” the stock in GameStop- a retailer of video games. Shorting means they actually bet against the stock price- hoping it will go lower- and they can buy it for less. It’s actually a really heinous manipulation of the stock market which is supposed to create access to capital and help share the value of the company with investors.

However, since the rich have figured out how to trade in milliseconds, and some how get the Washington “Regulators” to allow this- they’ve turned the Stock Market into nothing other than a legalized casino- where they play monopoly, often with other peoples money (your pension, your insurance companies reserves, your mutual funds). Somehow- people like Steven A Cohen who just bought the NY Mets, get really stinking rich off this, until an insurrection finally turned the tables on him.

That started when another Cohen, Ryan, the CEO of Chewy took a run at Gamestop and got on the board of directors. He had figured that Gamestop was undervalued- and starting yesterday, a whole bunch of small investors started to buy it up- pushed by a thread on Reddit- and with some egging on by Elon Musk of Tesla/SpaceX fame (who often says Tesla is overvalued). When the little people gained access to stocks via the app RobinHood, they could buy and sell and tell their friends.

Some are making real money. The stock price shot up- forcing people like Steve Cohen to have to buy a lot of stock to cover his short positions. Well, more accurately, one of his minions, a company called Malvin Capital.

Melvin Capital, a well-respected hedge fund run by Gabe Plotkin, a former top trader for the hedge fund giant Steven A. Cohen, drew the ire of Wall Street Bets after disclosing in filings that it owned puts on GameStop. (Puts are options that produce a profit if the shares of the stock fall.)

The fund’s bets backfired — The Wall Street Journal reported that it was down 30 percent in the first few weeks of January alone — and Melvin said on Monday that two bigger funds, Citadel and Mr. Cohen’s Point 72, had swooped in to inject a combined $2.75 billion into the fund. A spokesman for Melvin said the fund had closed out its position on GameStop.

Citron Capital, a short seller that had made public statements suggesting that GameStop shares would fall, was also bruised. On Wednesday, Andrew Left, who runs the firm, acknowledged in an online video that he had covered the majority of his short position “at a loss, 100 percent.”

Source: GameStop Stock Soars as Reddit Investors Take On Wall St. – The New York Times

The stock was hyperactive yesterday-

GameStop’s market value to increase to over $24 billion from $2 billion in a matter of days. Its shares have risen over 1,700 percent since December. Between Tuesday and Wednesday, the market value rose over $10 billion.


Now that the big boys are taking a bath, the Securities and Exchange Commission has stepped in and limited trading. This is the antithesis of what they’ve done when the big boys are making money hand over fist. Or when they do really stupid thinks like the CDO’s that sank the market in 2009. I guess capitalism is only good when the rich are getting richer – and bad when the poor people make money.

What is sad is the reporting talks about the common man as uneducated dotards, and people like Cohen as sophisticated smart folks. It’s too bad that this kind of language is still passing as legitimate news coverage.

Let’s clarify, there is no such thing as a “professional money manager,” that is a euphemism for bookie. Nothing more.

Wall Street is nothing other than socialism for the rich, a protected class, who have figured out how to buy political protection, the same way a mobster offers “insurance“ for your business in the form of a monthly fee to “protect your right to exist.”

It’s not “investing” if you hold shares milliseconds, or hours, or anything less than the time it takes a business to use your capital to return a profit- usually at least months, but to be realistic it should be at least a year.

Shorting stock is a bet against a company, it’s not investing anything. The practice is despicable and should be considered un-American. You don’t like how a company is being run? Buy it and fix it, don’t be a jerk and kick a company down to fix it for your own benefit. This involves real people’s livelihoods.

Cut this crap about CEO’s being worth millions, based on stock price, especially when their employees are on welfare (Walmart, Amazon, I’m talking to you).

It’s time to end this funhouse for the rich that has destroyed small business, American manufacturing and jobs, and built a wealth gap of epic proportions.

Put a transaction tax on trading. Anything held less than a year has a 95% tax on the profit. Losses are not able to be written off. Make investment real again. End the madness.

I like the rules the guys who started Ben & Jerry’s (btw- is it just coincidence- but Ben is another Cohen- are they all related?) made about executive pay- no one in the company could be paid more than 5x the lowest paid employee.  They first raised it to 7-1, and finally to 17-1 just before they sold out to Unilever and the rule went away. Oh, and everyone got a free pint to take home every day!

I’m sure if this little financial insurrection manages to break the stock market, someone will blame Joe Biden, but, the reality is, the market has made people incredibly rich for adding very little to the wealth of our nation. Wall Street is totally disconnected from Main Street- and if this is the start of tipping that back, great. Let the revolution begin.


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