January 31st 2021
The Country is Ripe for Revolution,
Let's Work to Make it a Bloodless Revolution
If you have been living under a rock in the woods you might have missed hearing about the Gamestop short selling revolution that went down the last week or so. Gamestop is a failing chain of shopping strip center/mall kind of stores that deal in video games including buying and selling used games if I understand it right. The stock price was way down, lowest I heard was $3.00 per share early last year, thanks to some greedy hedge fund companies that had shorted the stock.
Shorting stocks is when buy an option to buy that stock, or borrow a stock, that you believe will go down in value. If the stock goes down, you earn money. If the stock goes up, you have to fork over the difference in order to maintain your control over that stock, to continue to short sell it. Hedge funds can run companies out of business doing this, their stock crash makes it impossible to borrow money as their assets are part stock in the company. It makes it hard to sell stock as the hedge funds are saying the business is going down. Suppliers might demand cash for materials or whatever. Employee bonuses based on stock price evaporate. And many times the hedge funds or a crony are out there spreading bad news in order to force the stock down.
So a few pissed off people on Reddit.com have a group called r/Wallstreetbets and one of them got the idea to throw a wooden shoe into the machine so to speak. He found that hedge funds had shorted Gamestop and realized that if thousands of people started buying the stock the value would skyrocket and they could break the hedge funds. A few days later and the stock is selling for hundreds of dollars, like an 1600% increase in value, costing the hedge funds billions and billions of dollars to get out of their self imposed position.
Soon an app called Robinhood decided to shut down the buying of the stock, allowing the customers/investors only to sell the stock. The hedge funds had to buy back this Gamestop stock because they had shorted more stocks than existed.... something like 119% of the outstanding stock had been shorted, 19% more than ever existed.
So now this stock that was running $4 to $5 per share is now at $325.00 per share. There are around 70 million shares existing, do the math, that is 22.4 billion dollars in valuation as of right now and around 20 billion of that money has been stripped from hedge funds in the last week or so! Some of the hedge funds lost half of their assets in a few days. Nine investors holding the stock made 16 billion in a few days assuming they sell their stock while the price is high.
Michelle Malkin made a good video about the revolution that is worth the time to watch.
What started off with a few people on an internet social site thinking that Wall Street had under valued a business and they thought they could make a few bucks turned into one of the largest transfers of wealth in a few days in history. Once the stock started rising up into the $14.00 range more and more members of this Reddit group pitched in, buying small amounts of stock individually, until they broke the back of several multi billion, tens of billions, hedge funds.
The act of shutting down trades quickly earned Robinhood a reputation and a bunch of new enemies and lawsuits are threatened. They did so to protect the hedge funds, screwing over their customers in the process. Emboldened, the Redditors went at the movie chain AMC who has been struggling because of the Chinese bio attack closures and Blackberry, yes that Blackberry. The little guys cleaned out the evil establishment types and have created havoc with the simple act of acting together to push back on companies making money by trying to bankrupt struggling companies.
Just think of what these people did, stated by one man named Keith Gill, that turned into one of the largest raids on the establishment in centuries if not for all time. They exposed how crooked the stock market is, with the system protecting the large investors and screwing over the little guys and the public. Then one man got the idea to turn their own tactics against them and billions were taken from the hedge funds.
Politics would benefit even more from this thinking that one man can start a revolution but only if the general public gets off their lazy butts and they get involved.
January 31, 2021 at 08:25PM
Read the full report at Sooner Tea Party.
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Al Gerhart & associates bring reform to state & local govt. and organize for the restoration of our conservative principles.