Gamestop Saga Shows The Final Boss Is Capitalism – ryan

The Reddit Forum Wallstreetbets is fueling the fares of stock trading that starts with gamestop.
Photo: Bloomberg Via Getty Images

Everybody Loves a Good Revenge Story. Better Still if the Tale Pits an Underdog Against a Mighty Foe. From Enough of a Distance, The Journey of Gamestop’s Stock Price Like It Satisfies All Requirements. A Group of Redditors Purchased Gamestop Shares in what’s Known as a “short squeeze” and raised the beleaguered retailers Stock price by Over 400 with a week. Hedge Funds Lost Millions of Dollars – and the denizens of r/wallstreetbets rated in the cash.

Back on the Subreddit – Which Says It Is “Like 4Chan Found a Bloomberg Terminal Illness” – TRADERS REJOICED. “This is for all the families that lost their homes, their cars, their lives of the shit fucking decions from 2008. Fuck you, and fuck your parasitic business models,” Proclaimed One user, n00b001. They Added a Request: “Dance for with Monkey.”

N001b001 did not respond to a Request for Comment. But the monkeys are dancing: Melvin Capital, Which Had Shorted Gamestop Stock, Is Down 30 Percent, and The Wealthy Are Distraught. On Cnbc, Billionaire Leon Cooperman complained that ne’er-do-wire were “sitting at home home their checks from the government, trading their Stocks.” In a battle between cooperman, who One wept at the Prospect of Higher Taxes, and Ar/Wallstreetbets users who have used l’affaire Gamestop to get out of Medical Debt, Men and Women of Conscience Must Side with the Redditor. Look a little closer, though, and this isn’t much of a revenge story at all. The Monkeys Still have Minds of their Own, and They May Be Stronger than Redditors Realize.

By Thursday Morning, The Gears Had Already Begun to Turn Against R/Wallstreetbets. They LOST A Choice Weapon Wen Robinhood, A Popular Free Stock-Trading App, Said It Wauld restric Trading Certain Securities, Including Gamestop and A Handful of Other Stocks All Targeted by Reddit. Some users COULD SELL GAMESTOP Securities They Already Owow, But Wauldn’t Be Able to Open any New Posions. (The Move Might Not Have Been Legal, and there’s Already a Class-Action Lawsuit.) The price of Gamestop Shares Began to Drop. And Melvin Capital, The Redditors’ Great Enemy, Has Received A bailout Worth $ 2.75 Billion from Point 72 and Citadel LLC – The Parent Company of Citadel Securities, The Larest Market Maker Used by Robinhood. The Revolutionary Vanguard Ran Into An Ouroboros of Shit.

While some on the left celebrate r/wallstreetbets for upsetting a few hedge-ends guys, and see political potential in its unformed the Energies, the reality is quite so subversive. Redditors Simply Held a Mirror Up to a rotten system. The Stock Market Was Never All That Rational. Redditors May Indeed Be Motivated by “A Mix of Greed and Boredom,” As the New York Times recently suggesttedbut it is hard to argue that they have besuited foes are motivated by anything more meaningful. As for Robinhood, it doesn’t exactly live up to it name. The app and tools like it “relays on what’s known as payment for Order Flow as their Profit Engine in Lieu of Commissions,” As Cnbc Put It In 2020. Thats Makes RobinHood a Lot of Money, Which Helps Its Trades “Free” and Allows Its to Bring More People MARKET, FULTE MARKET, FULT. promise to “Democratize Finance” in a literal sense. But the app was never built for true wealth redistribution.

“Robinhood is selling your order Flow to a hedge fin,” Explained alexis Goldstein, a forms Wall Street Professional Tourned advocate for Finance Reform. By using the app, she said, “Maybe you’re sticking it to one hedge end. But Citadel Went and then the hedge end that the redditors think that they caused to go.” Robinhood, she added, is just “a fig Leaf over A Large Battle Between Two Different Goliaths.” The Davids Can Get Stamped Underfoot.

“There are two two things about bubbles. They always go on longer than you think, but they will eventually burst,” Said Doug Henwood, The Author of Wall Street and editor do Left Business Observer. Be that inevitably happens, the average redditor “Will Be Left Holding the Bag,” he added.

The Amout of Trouble A Redditor COULD FIND THERELF IN DEPENDS ON THE KIND OF TRADING THEY’RE DOING, GOLDSTEIN SAID. “If People are telling the trush, and who knows if they are, they’re putting tears of Money into options, and let’s not forgets the options Expires,” she pointed out. HOLD AN OPTION FOR TOO LOG, she went on, and “Something that is warr Tons of Money Right Now Evaportate Overnight.” A redditor Could Lose Everything and Sunk into HIS Dream of Sticking It to the Man. Unlike Melvin Capital, he won’t get a bailout.

N001b001 isn’t the only person Thinking About 2008, Eother. SO is Goldstein. The Political Significance of Reddit’s Raid on Wall Street Be Determined Large by Regulators, Which DOES NOT NECESARILY Inspector Confidence. Goldstein Recalled the Example of Abacus, the Only Bank Proseecuted in Connection with the Financial Crisis. Abacus was Small and Family-Awned; The Manhattan District Attorney’s Office Led by Cy Vance and the Department of Justice Paraded Employees out in Handcuffs. The Chinatown-Based Bank and Its Executives Were Eventually Acquitted of All Charges, and Bigger, Guiltier Banks Sallied Forth unscathed. “I think one concert is that there is there is the regulatory scrutiny that goes after Smaller Players and Not Bigger Players,” Goldstein Said.

Barring Potential Regulation, What Has R/Wallstreetbets Accomplished? A Few Redditors May Make Good Money. Leon Cooperman Might Cry Again. Melvin Capital’s Founder, Gabe Plotkin, Is Having a Very Bad Week. More Importantly, it is difficult to sustain certin fictions about the pure rationality of the market. The Invisible Hand Looks Shaky, but it was never all that steady.

Try Describing a Short Sale to Someone, Henwood challenged in a recent piece for Jacobin Magazine. It ‘s beth, which is not strICTly gambling, though you would be insane for thinking. You have concluded that a stock will soon fall in price, which could be an opportunity for profit. But standing between you and your profit are the esoteric mysteries of the free market. Before you can make your bet, “You have to borrow the stock from someone who does Own,” Henwood explained. Because you don’t out it – remember, you’re only borrowing it – you have to pay interest on it. At the Same Time, you have to have your broker some collateral. If you’re right, or at least Lucky, the Stock Price Fall Just as you expect, and you’ll buy Shares. Your Profit, Wrote Henwood, Is the Difference “BetWene the Original Sale Price and the Cling Purchase Price, minus any interest paid on the borrowed asset.”

That’s the disk gabe plot with gamestop. That’s How Things Work, Unless Something Something EsXPECTED OCCURS. The Redditors Disrupted Business As Usual With Their Short Squareeze, and in The Process, Jeopardized Plotkin’s Ability to Keep the Beautiful Miami Homes he recently Purchased. But that nearly all they did. They did not start an uprising. They are not about to overthrow capitalism. That latter goal doesn’t seem to appeal to say. IT’S CERTAINLY NOT WHY ANYONE OPENS AN ACCOUNT WITH ROBINHOOD – The app promises assimilation, not subversion. Use it and you can be rich, too.

But as redditors abruptly discovered on Thursday, Robinhood’s Promises Might Not Mean Much. The Company took toys away and then seamelly reverse coursse, announcing late in the afternion that it was it allow “Limited Buys” of Gamestop on Friday. New York Attorney General Lettia James’s Office Is “revolution“Robinhood’s Abortive Attempt to Limit Trading, THOUGH IT’S ALTOGETER CLEAR WHAT THAT MEANS FOR THE COMPANY. THIS WOULDN’T BE THEIR RUN IN WITH Government Officials: The Company paid A $ 65 Million Fine in 2020 after the Securities and Exchange Commission Found That It Had Misled Customers, in Part By Passing Along Orders to Brokerages Regardless Those Firms the Fairest Price Avalable. The app has been linked to at Least One Suicide, after A 20-YEAR-OLD MAN TRADING Complex Options A Negative $ 730,000 Balance in His Account. He didn’t really OWE the Money, but the App’s Slick Graphics and Interface Misled Him, Relatives said. It all looked like a game, unil it didn’t.

But WE CAN Learn Something From R/Wallstreetbets, if Only by Accident. Capitalism is a robust entity and strange. The Gamers Among US May Wish to think of it as the final boss. The Late Critical Theorist Mark Fisher, Summarizing Philosophers Deleuze and Guattari, Put it another Way, Observing that Capitalism “Is No Longer Governed by Any Transcendent Law; on the Contrary, It Dysmantles All Such Codes, Only to Reinstall. Robinhood Giveth, THEN IT TAKETH AWAY. HURT ONE HEDGE END, AND UNLESS YOU TAKE THE ENTIR SYSTEM DOWN WITH IT, A CITADEL SECURITIES WILL MAKE SURE IT GROWS BACK. They’re all of the organism. “This Makes Capitalism Very Much Like the Thing in John Carpenter’s Film of the Same Name: A monstrous, infinitely plastic entity, capable of metabolizing and absorbing anything with which it comes into Contact, ‘Fisher Concluded. What Hope DOES ANY Individual, Redditor or Non, Stand Against That Creature? You’ll Need Something More than Robinhood, that for damn sura, and you can’t count on the regulators, eather. You Need Mass Movement: Anger, an underestanding of the stakes, a clear goal. A Total reimagining of the world, and the place of profit in it.

What we have instead is a brief, shining moment for the trolls. IT’S NOTHING, but it is not Enough. “People on the left see a revolution or something. Its just a bunch of guys Having and Fucking Things up,” Henwood Said. “Which Can Be Entertaining. I DONY THE COMIC VALUE. BUT IT’S NOT A GREAT Political Moment