News & Politics

Robinhood Protecting the Rich? GameStop Buys Halted in Massive Game Of High-Stakes Chicken

AP Photo/Patrick Sison

Robinhood and interactive brokers that allow small trades for retail traders have restricted the sale of GameStop (GME) stocks and others like AMC that Redditors were buying. The action was taken after retail traders on Reddit’s Wall Street Bets (WSB) drove up the price of GME from $6 to just under $500 in two days.

The WSB guys are occupying Wall Street their way, by bankrupting hedge funds they view as vultures that operate with the help of government bailouts. “Too big to fail” was the excuse for our government bailing out Goldman Sachs and the rest, and there are a lot of people out there who have been stewing in hatred for these companies they see as predatory.

Many in the WSB movement feel this is a financial coup to transfer power from Wall Street fat cats to Main Street America. After Robinhood shut down buying (not selling) of GameStop, the stock price dropped from $482 to $297 and is currently dropping. CNBC reported:

Retail brokerages restricted trading on Thursday in GameStop and other stocks caught in a frenzy that has captivated Wall Street and caused big losses for hedge funds. In some cases, investors would be able to sell only their positions and not open new ones.

After the announcement of restrictions by free-stock trading pioneer Robinhood and Interactive Brokers, shares of GameStop initially reversed their gains, sliding quickly into negative territory. The stock, which traded above $500 at one point in premarket trading, was below $290 per share shortly after the opening bell. An hour later, it gained another $100 per share for a gain of 11% from Wednesday’s closing.

Many traders on WSB expressed a desire to sue Robinhood for manipulating the market.

CLASS ACTION AGAINST ROBINHOOD. Allowing people to only sell is the definition of market manipulation. A class action must be started, Robinhood has made plenty of money off selling info about our trades to the hedge funds to be able to pay out a little for causing people to loose money now.

The restriction forces small investors who only buy percentages of stocks out of the market. For example, if Robinhood was currently allowing buys, an investor could buy 1% of GameStop stock for around $2 a share and participate in the massive game of chicken that is currently playing out. These micro-investments are an excellent way for mom and pop to invest in Apple or any other company that is too pricey for a middle-American budget.

The financial powers that be are in a tizzy trying to stop the retail investors from driving up a stock that isn’t worth the $6 it started at. They are protecting hedge fund billionaires who will lose big if the market is allowed to continue operating normally. While the market forecast may have shown that GameStop was a loser (and I’m sure it is), no one seems to be upset when hedge fund traders short sell companies, causing a selling frenzy and driving the price way down—hurting businesses. Tesla was a target of the hedge fund billionaires and Elon Musk is probably still sore about it, as illustrated by his interest in the populist takeover. He signaled that he’s following Discord—which was then banned by Big Tech for “hate speech” as they tried to stop the traders from talking to one another.

The WSB Redditers have already delivered the pain to Wall Street. Melvin Capitol suffered billions in losses and more hedge fund losses are on the horizon if the squeeze holds. WSB says they’re in it for the long haul.

Posts on WSB like this one, entitled “Open Letter to Melvin Capital, CNBC, Boomers, and WSB,” detail years of pent-up hatred for Wall Street’s role in the housing bust of 2008.

To Melvin Capital: you stand for everything that I hated during that time. You’re a firm who makes money off of exploiting a company and manipulating markets and media to your advantage. Your continued existence is a sharp reminder that the ones in charge of so much hardship during the ’08 crisis were not punished. And your blatant disregard for the law, made obvious months ago through your (for the Melvin lawyers out there: alleged) illegal naked short selling and more recently your obscene market manipulation after hours shows that you haven’t learned a single thing since ’08. And why would you? Your ilk were bailed out and rewarded for terrible and illegal financial decisions that negatively changed the lives of millions. I bought shares a few days ago. I dumped my savings into GME, paid my rent for this month with my credit card, and dumped my rent money into more GME (which for the people here at WSB, I would not recommend). And I’m holding. This is personal for me, and millions of others. You can drop the price of GME after hours $120, I’m not going anywhere. You can pay for thousands of reddit bots, I’m holding. You can get every mainstream media outlet to demonize us, I don’t care. I’m making this as painful as I can for you.

How a Bunch of Redditors with $600 Stimulus Checks Outsmarted Wall Street Hedge-Fund Managers

After the announcement of the brokerages halting trading, GameStop is now at $126 and falling. How is this not market manipulation?

#HoldTheLine and #DoNotSell are trending on Twitter