Our Betters Have Something To Say To Us

Eat The Rich

“The reason the market is doing what it’s doing is people are sitting at home getting their checks from the government, okay, and this fair share is a bullshit concept,” Cooperman shouted on the business network earlier today. “It’s just a way of attacking wealthy people. It’s inappropriate and we all gotta work together and pull together.”

Leon Cooperman is a billionaire Hedge Funder BTW.

The stock market —from all I can tell— is legalized gambling, and so like in the movie The Sting, when an upstart successfully grifts a major grifter, the major grifter gets mad. Anyway, the whole thing is about the little guys out-played the big guys who were short selling a dying brand or two.

Vanity Fair (paywall):

As you’ve probably heard by now, shares of GameStop, the video game retailer, have surged approximately a gazillion percent in the past six months, spiking sharply in the last several days. You might wonder why that happened, given that most people don’t go to the store to buy video games anymore, particularly during a pandemic, and the short answer is that a gaggle of small-time traders, many of them posters on the Reddit forum r/WallStreetBets, decided it would be both funny and a bit of cosmic retribution for them to drive up the price of GameStop’s shares, screwing over the hedge fund managers who’d bet the company’s stock was going to drop precipitously.

Obviously, that didn’t end up happening! Whereas in late 2020, a share of GameStop was worth just $18.84, at one point on Thursday, it was going for more than $500. (Later, its trading was restricted by apps like Robinhood and Interactive Brokers, and shares fell to around $240.) That turned out to be extremely bad for the firms who’d shorted the company and literally ended up losing billions of dollars. As Bloomberg put it, “it’s a humbling turnaround for the hedge fund titans, who in 2020 staged a comeback by pouncing on the wild markets caused by the COVID-19 pandemic. But that crisis helped push thousands if not millions of retail traders into the U.S. stock market, creating a new force that for now the professionals seem powerless to combat.”

The Pod Save Whatevs boys newsletter last night:

The stonk journey continues: Popular online brokerages Robinhood and Ameritrade have blocked purchases of GameStop and AMC shares(plus a handful of other companies), after Reddit investors banded together to drive up share prices and destroy some hedge funds. Robinhood, whose mission is “democratize finance for all,” informed users that they could close out their positions in the restricted companies, but not buy new shares. Hedge funds, meanwhile, were still able to trade freely. That move drew swift criticism from people who couldn’t help noticing that it sure looked like market manipulation to protect the Wall Street establishment. Rep. Alexandra Ocasio-Cortez (D-NY) called for an investigation, Sen. Ted Cruz (R-TX) agreed and got reminded no one wants to hear what he thinks, and Robinhood users filed a class-action lawsuit. Robinhood announced it would allow “limited buys” on Friday, but shares of GameStop and AMC have already plunged more than 40 percent. AOC will be discussing all of this on Twitch tonight, for further Stonk Week analysis.

Again, I’m not a genius about this stuff, but gambling is gambling and sometimes you lose. What I think this event shows us is how the über-wealthy have gamed the system all along (and expected to be able to continue to) and how they got outplayed. If this thing does come to be a criminal hearing, I’m not sure that the Hedge-funders will want that as it will expose their game.

UPDATE 1: Sen. Professor Warren –

“With stocks soaring while millions are out of work and struggling to pay bills, it’s not news that the stock market doesn’t reflect our actual economy. For years, the same hedge funds, private equity firms, and wealthy investors dismayed by the GameStop trades have treated the stock market like their own personal casino while everyone else pays the price. It’s long past time for the SEC and other financial regulators to wake up and do their jobs – and with a new administration and Democrats running Congress, I intend to make sure they do.”

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15 Responses to Our Betters Have Something To Say To Us

  1. donnah says:

    My husband has said for years that the stock market is sanctioned gambling. Rich guys love it until they get pinched. Let them whine.

    Liked by 3 people

  2. sos says:

    But, but … doesn’t past performance guarantee ANYTHING?? 🥺 😢 😭

    Liked by 2 people

  3. Oh Robbing Hood went farther than that. They started liquidating members holding in these companies later yesterday. “To protect their customers from losses”.


    There needs to be a whole lotta defenestration goin’ on. Screw eating ’em, give ’em a 20 story flying lesson.

    Liked by 3 people

  4. Bruce388 says:

    As a non-expert, I’ve never understood how shorting a stock helps anyone. Apparently straight-up betting on stocks isn’t sufficiently exciting for some people. And then there’s trading on margin, where you can REALLY get hosed. Just play with the money you have.

    The stories about unknown investors shorting airline stocks right before 9/11 seemed suspicious at the time and they still do. Never heard anything more about that.

    Liked by 2 people

  5. roket says:

    Next up: Republicans demand bailouts for hedge fund operations.

    Liked by 2 people

  6. spotthedog says:

    Online brokerages, day trading; yeah for sure that is a form of gambling. Nobody asks my advice, so here it is: if you want to invest in the stock market, pick a big old established stock mutual fund, even something very “vanilla” like an S&P index fund, put money into it regularly (as via a 401k, or IRA), never take an early cash out, hold it forever, only look at yearly statements (don’t obsess over day to day fluctuations), let it slow bake for 30 years or so – entirely unexciting but the least gambling form of stock market investing IMHO.

    Good that Elizabeth Warren is weighing in on it, of course she is – she’s actually trying to do her job.

    Liked by 1 person

    • The big issue the Hedgies have with this whole thing is this was their scam. The reason places like RobinHood can offer free trades is because they partner with their real clients (like these hedge funds), giving their trading info to them just before it gets executed so the hedgies can then use that (arguably insider trading) to drive their High-Frequency trading algorithms to skip profits off of other people’s trading.

      The “stock market” has mutated so far from it’s original purpose of providing capital to actual productive business that it is literally a casino, and not even just a casino, but a mob-run casino where the house is “Tails I win, heads you lose”.

      Liked by 1 person

  7. Big Bad bald Bastard says:

    My real problem with his statement is his knocking people for receiving government checks when his whole industry received a government bailout not so long ago.

    Liked by 2 people

  8. laura says:

    Cant help but think of the Bader Meinhof Group or Red Guard and how they would treated the likes of old Leon soft palms. Are memories so short about desperation and entitlement?


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  10. MDavis says:

    Me: Explain this to me like I am six.
    Twitter: Here ya go.


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