- Shares of GameStop, the video game retailer, have climbed more than 900% since the start of the year after members of the Reddit community WallStreetBets banded together in an effort to push the stock higher.
- At some point, the thinking goes, shares of GameStop will stop climbing, either because most of the shorts have given up and are no longer forced into buying the stock to cover losing positions or because brokers or U.S. market regulators intervene.A demonstrator holds up a placard saying Robin Crook in front of the New York Stock Exchange, January 28, 2021.John Lamparski | SOPA Images | Sipa USA via AP Images
The war between hedge funds and retail investors over shares of GameStop has one logical conclusion, according to executives and traders of a major Wall Street firm.
Shares of GameStop, the video game retailer, have climbed more than 900% since the start of the year after members of the Reddit community WallStreetBets banded together in an effort to push the stock higher.
The campaign pushed a stock worth $19 at the start of the year to as high as $482.85 on Thursday. Gains by retail investors have come at the expense of sophisticated investors like Melvin Capital and Citron Research, which were forced to close out their short positions as the stock rose in what’s known as a short squeeze.WATCH NOW
At some point, the thinking goes, shares of GameStop will stop climbing, either because most of the shorts have given up and are no longer forced into buying the stock to cover losing positions or because brokers or U.S. market regulators intervene.
At that point, human nature kicks in: Retail investors will watch as their paper profits evaporate, and the natural impulse will be to sell, according to the executives, who spoke on condition of anonymity to speak frankly. Latecomers to the party will sell in fear, contributing to a stampede for the exits and a drop in the shares, they added. The same forces that helped the stock catapult higher will contribute to a rapid decline.
It’s possible we got an early sign of what the unraveling will look like. Shares of GameStop fell for the first time in six trading sessions on Thursday, tumbling 44% after Robinhood and Interactive Brokers restricted activity in GameStop and some other heavily shorted stocks.
Still, there is no telling when a true unwinding will occur or how long it will take. The shares were rebounding sharply in Friday’s premarket, up another 80% to $332 a share, after Robinhood reversed course and said it would allow limited purchases of the stock.
Despite costing hedge funds billions of dollars, GameStop remains one of the most shorted stocks in the market, according to FactSet data. More than 120% of GameStop’s available shares have been borrowed, down from about 140% earlier in the month.
“Typically a short squeeze ends with a sharp sell-off, but there are buyers in waiting, often those covering shorts,” said CC Lagator, co-founder of brokerage Options AI. “That can provide temporary support in a stock that’s unwinding a short squeeze.”
If retail investors get burned in the GameStop trade, it’s likely the Securities and Exchange Commission will step in to prevent similar scenarios from occurring, according to another Wall Street source. Gary Gensler, President Joe Biden’s pick for SEC head, has a reputation for tough enforcement.
“The hedge funds are big boys, they know how the game is played,” said the banker, who spoke on condition of anonymity. “When the little guy gets hurt, that’s when Washington gets involved. We’ll have an SEC leader who is much more activist.”
Bubbles in stocks including GameStop are just the latest sign of unusual activity in markets since the coronavirus pandemic struck, forcing central banks to unleash trillions of dollars in support for economies around the world.
Early on in the crisis, a collapse in demand resulted in negative oil prices for the first time in history. Equities and other asset classes rapidly recovered, thanks to central banks, and have since hit record after record, leading to eye-popping valuations despite high unemployment and a rising death toll. Bitcoin prices surged from around $6,000 at the start of the pandemic to as high as $41,000 this month.
Now, with millions of Redditors wielding free trading apps, full saving accounts and not much else to do, it’s possible that there is a new playbook for fast gains in the stock market.
“Is this a new platform for investors to make decisions, does it even the playing field?” said Mark Williams, a Boston University finance lecturer and former Federal Reserve examiner. “You could argue that what happened with Reddit is them putting the shorts on check, and that’s a positive.”
Robinhood’s move Thursday to limit the ability of its users to bid up GameStop and other companies targeted by Reddit investors drew bipartisan criticism from lawmakers who claimed that the brokerage was favoring big institutional traders over small investors.
“I do sense there’s a double standard here,” said a former Goldman Sachs trader who now works for a technology firm. “Put it this way, if Goldman Sachs were doing this, it would be called `arbitrage’.”
But time after time, Clinton has spun the Lewinsky thing into a story about how he was treated unfairly during this thing that simply occurred while he was president.
This is how he put it in his “do-over” interview with Stephen Colbert: “But the important thing is, that was a very painful thing that happened 20 years ago, and I apologized to my family, to Monica Lewinsky and her family, and to the American people.”
He uses a version of this locution all of the time. The scandal was a thing that “happened” as if he was not the author of it. It reminds of that scene in Diner where Steve Guttenberg (“What an actor!” — The Stonecutters) makes his fiancée take a football-trivia test to prove she’s worthy of marriage. If she fails, Gutenberg explains, “it’s out of my hands.”
..For Clinton — both of them — all of his or her misdeeds were scandals because other people, nefarious forces, Comstocks and prudes, vast right-wing conspiracies, talk-radio critics, et al., unfairly turned them into scandals. For Clinton, the real story of the impeachment drama was that he did nothing wrong. “I did the right thing,” he said. “I defended the Constitution.”
.. I particularly enjoyed when Bill snapped, “You think President Kennedy should have resigned? Do you believe President Johnson should have resigned?”
This is precisely the argument Clinton used on Donna Shalala and the rest of his cabinet the day after he publicly admitted he’d been lying — and had forced his cabinet to lie
.. When Bill Clinton had to “apologize” to his cabinet for playing baron-and-the-milkmaid with an intern and lying about it, he asked if anybody had a problem with it. Donna Shalala foolishly assumed he was being sincere. She chimed in and said she had a problem. He berated her for her effrontery, explaining that her prudish standards would have prevented JFK from being president. And while those of us not ensorcelled by the cult of that charismatic mediocrity might respond, “Yeah, so?” this was a debate-settling argument for many liberals.
Correct me if I’m wrong, but I was under the impression that the whole premise — right or wrong (I think right) — of the Me Too movement is that being powerful or even doing good things professionally is no excuse for piggish, exploitative, or abusive behavior. Clinton’s rhetorical question about Kennedy and Johnson proves that he doesn’t actually agree with the Me Too movement. Or, to be more accurate, he agrees with it — so long as it doesn’t apply to him. Which is just about the purest distillation of Clintonism — in both its Bill and its Hillary strains — you could come up with.
.. If we are to take Me Too seriously, then surely, say, Juanita Broaddrick deserves a hearing, no?
.. focusing entirely on the Lewinsky stuff was a great favor to Clinton, because it allowed him to cite polls and offer his bovine-turd-taco claim that he was “defending the Constitution.”
.. I think Bill Clinton is partly correct when he says the press is “frustrated because they’ve got all these serious accusations against the current occupant of the Oval Office, and his voters don’t seem to care.” It’s not just the current occupant of the Oval Office — but it seems obvious to me that the liberal punditocracy would not be turning on Clinton so much if he weren’t inconvenient to the anti-Trump narrative.
.. Turning the Miss America Pageant into a contest to find the most confident, woke, and earnest young woman regardless of her looks strikes me as a silly idea, along the lines of Burrito Brothers getting into the heating and insulation business.
.. More to the point, the charge that Miss America “objectified” women never bothered me much. The point of beauty pageants is to judge beauty. That’s how they started. Judging people on their earnest wokeness is why we have Oberlin.
.. it seems that a lot of the people who like to mock and belittle “science deniers” and “creationists” are the very same people who insist (hetero)sexual desire, beauty, etc. are entirely socially constructed.
.. If there is a single industry in all of Christendom that does more to treat women as sexual objects without meaningful agency or dignity, it’s the porn industry and, relatedly, strip clubs. Yeah, yeah, I get that Stormy Daniels is an assertive, independent businesswoman. And, as I am not a close student of Stormy Daniels’s particular contributions to this oeuvre, it may be the case that Dripping Wet Sex IV is full of empowering messages for women, but I’ll remain skeptical until I review the evidence.
.. the Offended Wars are a kind of Potemkin conflict for the true battle over double standards.
The assumption is that liberals’ hearts are in the right place, thus, when they stray off the path rhetorically or in some other way, it’s not seen as revelatory of something darker or more sinister. Of course, conservatives do the same thing. We assume the best of our own tribe and can dismiss a joke or errant tweet quite easily from one of our own.
.. I think one of the reasons we got here is that liberals were truly blind to the double standard they benefit from and the norms they were happy to see violated when the people violating them were “the good guys.”
.. the principle of religious tolerance was a last resort, an utterly utilitarian practical compromise, after the combatants in Europe’s religious wars recognized what C. V. Wedgwood called “the essential futility of putting the beliefs of the mind to the judgment of the sword.”
.. First, we need to return to the idea of ideological and theological pluralism but moral consensus. People are free to believe whatever they like, and they are free to act on those beliefs so long as they don’t harm others. Second, we need a lot less nationalism (for want of a better term). What I mean by that is that the federal government and various national elites need to stop thinking that the whole country needs to think and act in one way.
.. Fox News likes to do stories that boil down to “Can you believe someone in San Francisco believes X!?” MSNBC likes stories that boil down to “We have troubling reports that someone in Wyoming believes Y!” The underlying assumption is that in America everyone is supposed to think alike. Well, unless someone is actually being harmed — and I don’t mean in the terminally asinine construction, “words hurt”
.. Lastly, we need to get as much power out of Washington as conceivably possible.
.. As long as we think that the federal government, especially the executive branch, has monarchical power to impose a vision on the whole country, we will turn political contests into cultural warfare. The Whigs couldn’t abide a Catholic on the throne because they believed the king would impose his vision on all of England. The Catholics felt the same way about the prospect of a Protestant crown. The solution is to restrain the power of the crown — so that the faith of the monarch doesn’t matter.
Limbaugh called it “faux rage” and said much of it was an act for the cameras and microphone.
“All I can tell you is I have been there,” Limbaugh said. “I have been in the midst of these kinds of firestorms, folks. And I can tell you this is all faux rage. It is faux anger. It is faux outrage. It is made up. It is for the cameras. It’s for the microphones. It’s for the audience. It’s based on the presumption everybody finds Trump reprehensible and always has and this is just the final straw. And I don’t believe these people are sincerely outraged. They are sincerely excited because it is yet what they believe is another opportunity to get rid of Trump.”
You can’t turn on the televisions without being bombarded by trash. You’ve been told that you have to accept all sorts of junk under the guise of enlightenment from the schools your kids go to. You’ve been told to shut up, forced to accept the cultural rot, the mocking of your religion, with malice and impunity. People who mock and insult your religion are praised. They call you idiots, prudes, small-minded. And these people who are responsible for all this, claim to be offended over the use of a slang word.
Let’s say that Obama starts trashing talk radio.
I’m trying to expose the double standard of the deviancy ..
Beyond partisanship, the feminist record is unhelpful. From the inception of “second wave” feminism in the 1960s, the movement embraced sexual “liberation” as part of women’s liberation. Feminists weren’t so much upset that some men behaved like pigs as they were that women couldn’t do the same without loss of reputation. It was the “double standard” they took aim at, not sexual license itself.
.. Womanizers used to at least make an effort at seduction. Now they seem to act out repellent narratives from porn movies.
“It’s not about the victims, nor even about Ramadan as a sexual predator anymore, but about two clashing views on secularism and the place of Islam in the political debate,”
.. Ramadan — the grandson of Hassan al-Banna, founder of Egypt’s Muslim Brotherhood — has vigorously defended Muslim communal life in ways that have alienated French intellectuals on the political left and right.
.. Ramadan is sometimes seen as attempting to explain — and even condone — the actions of the attackers
.. As he wrote in 2012: “The young people who join extremist groups are clearly suffering from massive deficiencies in religious knowledge, and are often politically gullible (when they are not attempting to salve pangs of conscience by cutting themselves off from a life of delinquency).”
.. French Muslim leaders have attacked what they see as a double standard: intense public outrage over abuses alleged against a prominent Muslim but nothing comparable in other cases, such as the rape allegation against the former presidential hopeful and International Monetary Fund chief Dominique Strauss-Kahn in 2011.
.. “We have Islamized a question of law and ethics, if you will. Instead of focusing on the crimes at hand, the trial of one man has become the trial of the entire Muslim community,”