That's the Comparison a Former SEC Commissioner Doled Out to Explain Populist Swell on Wall Street?

Posted: Feb 03, 2021 1:21 AM
That's the Comparison a Former SEC Commissioner Doled Out to Explain Populist Swell on Wall Street?

Source: AP Photo/Richard Drew

The party is not over for those involved in the populist gatecrashing of Wall Street. The populist rebellion from the little folks caused the fat cat hedge funds billions of dollars. Steve Cohen, the new owner of the New York Mets, took a haircut — a big one. Some funds were on the verge of being wiped out. GameStop was the first targeted security by the WallStreetBets subreddit. American Airlines, Blackberry, Nokia, AMC Theaters were other targeted stocks. The hedge funds wanted these stocks to go low. The Reddit rebels thought otherwise. Everyone was in on the action. We have high schoolers working the markets and making coin here. One person’s $4,000 investment surged to $67,000. Sadly, that’s probably been wiped out, as the powers that be turned off the spigot.

Robinhood and other trading apps decided to stop the bleeding that was killing the elite's funds and suspended trading on certain stocks, like all the ones that WallStreetBets was sending through the roof. You can sell, of course — but that’s playing into the hands of the billionaire hedge funds. They want the stock to crater. The game was rigged. And people wonder why populism is on the rise. Elon Musk and Barstool Sport’s Dave Portnoy got in on the action. Rep. Alexandria Ocasio-Cortez (D-NY) was on the side of the Reddit rebels, as was Donald Trump Jr. Everyone saw the dirty tricks here. The elite was getting torched by the little guy playing their own game. They figured it out and started making money. The horror! To stop this trend, the elites called in favors to prevent these stocks from going up any further. It was a financial "storming of the bastille." This game isn’t over. Yes, these stocks have collapsed — but these folks are not just going away.

It was total panic mode too. CNBC was doing their part to defend these poor billionaires who just can never catch a break. Also, we have former SEC Commissioner Laura Unger tossing out the comparison that this populist swell was similar to that of the January 6 riot on Capitol Hill. No, I’m not kidding. She actually made that comparison:

Seriously, lady. Five people died during the riot. She did note that there was no physical harm in this market surge — so it’s an apples and oranges comparison then, right? This isn’t Occupy Wall Street or a war on the rich. The WSB folks make that quite clear. It’s simply about making money. Period. It’s just that some folks up on high are uncomfortable with letting their country club be shared in that venture:

I don't think this is a continuation of OWS. This isn't really political. For our newfriends, WSB was never political. It isn't solely a battle between the rich and the poor, and it's not an attack on the system. It's just the next step for retail and it's obviously scary to someone. We don't need to occupy anything, this subreddit and communities like it are soon to be the 1,000lbs gorilla in the room and we're just not quite sure how to stand yet. Retail money has always loomed large, it's just never had so much information and made most of its own decisions before. It was (mis)lead by hack analysts and at best had to huddle in index funds for safety.

When we come together on platforms like this with similar goals, similar tools, and similar data, we become a force that can, even without any centralization, coordination, or deep pockets, easily destroy well-funded opponents and cause them to have to break the rules just to stay alive. Random people that have never spoken before buying GME [GameStop] for reasons ranging from "haha brrr" to 30 page writeups can cause spikes that can nearly bankrupt the kind of people that aren't used to being the ones on the losing end. They're used to being the only ones with a big stick.

This is only going to accelerate unless the other actors in this space rig the game in their favor even further or trick us into destroying the means by which we can sit at the table. You notice how many circuit breakers there were on the way up vs the way down? Don't accept anything that limits our access to equities, options, futures, etc. Raise hell if they try.

In order to function we need to figure out how to cram as many monkeys on as many typewriters as possible. We need to figure out how to make sure the whole sub sees what those monkeys write, we need to filter noise from signal via millions of self-interested actors. We need to figure out how we can avoid being outmaneuvered by people who will not play fair. We've got problems to solve and there will be growing pains, but we've all got a chance to be part of something that hasn't existed before. Something between a fund, a social network, a union, and an API. Work with us on improving this place and getting settled into this mode of operation instead of breaking into pieces. They'd love that. Apes apart weak.

Nobody should blame you if you love the stock or sold the stock. You should be here to make money. There will be a next time and a time after that. They can only cheat so many times before it catches up with them, they only have so many brains on the task, and we're only getting bigger.

"We're normal people who just want to make money."

It’s sad that’s become a controversial and rebellious concept on Wall Street. Losses are still going to be a thing in this game. Yes, people will lose money. Some people might even go broke, but it’s one thing to suffer losses because the market on its own screwed you. That’s one thing. It happens. It’s a wholly different situation when you make money, are set to make even more, and then the elite comes in to pump the brakes and fix the game. They’ve been doing it for years, and some folks caught on and turned the tables.

Keep at it, fellas. Also, this isn’t like the January 6 riot. I’m sorry I even had to write that, but maybe these folks in their ivory towers can analyze why people are pissed off instead of denigrating the actions of these folks that don’t come from their immediate social circles.

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