dChan - Q Origins Project Archive

Melvin Capital loses 53% in January over bet against GameStop thanks to Reddit buying spree

Hedge fund Melvin Capital felt the effects of the buying spree spurred by individual buyers from the r/WallStreetBets subreddit account, with the group losing 53 percent in January.

Despite the loss, Capital received fresh cash from investors by the end of January after taking heavy losses due to the unexpected and record stock gains for companies like GameStop, according to a source cited by Reuters.

Melvin started January with $12.5 billion in assets, but is closing out the month with $8 billion, according to the Wall Street Journal’s report on the losses. It closed out its short position on GameStop in the wake of the massive surge. Other groups like Citron have also felt the squeeze by betting against GameStop and have closed their short positions with heavy losses.

GameStop became the center of controversy after motivated buyers sought to flood the market and increase its stock price aiming to upset Wall Street hedge funds. Trading at a mere $10 a share in October, GameStop closed out Friday at $325 a share. It has seen a total gain of over 1000 percent this year.

Redditors also invested into other surprising companies like AMC leading to a frenzy on Wall Street as longtime investors found themselves trading in a quickly fluctuating and unpredictable market.

Traders who bought into GameStop mainly did so through the app Robinhood, which controversially stepped in and halted trading on certain companies and then limited it, claiming this was a move to prevent market manipulation. Critics, from Republicans like Ted Cruz to Democrats such as Alexandria Ocasio-Cortez, have blasted the preventative measures and argued it is market manipulation in favor of hedge funds who suffered losses because of the individual buyers.

The Security and Exchange Stock Commission (SEC) has promised to investigate the matter, and there will be congressional hearings this week. Some lawmakers have called for the SEC to possibly enact new trading rules, like Sen. Elizabeth Warren (D-Massachusetts) who has called for action from the SEC multiple times this week, urging them to have “clear rules about market manipulation” and the “backbone to enforce” those rules.

“To have a healthy stock market, you’ve got to have a cop on the beat,” she said.

It was reported earlier that short-selling mega-investors lost a staggering $70.8 billion this month. Their losses were partly driven by small traders pumping money into stocks like GameStop.

https://www.rt.com/usa/514215-melvin-capital-gamestop-reddit/

GOP Rep. Kinzinger Says Family, Friends Turned Against Him After Trump Impeachment Vote

On 13 January, the US House of Representatives voted to impeach former US President Donald Trump a second time following allegations from both Democrats and Republicans that his claims of ‘mass election fraud’ had incited supporters to storm the Capitol. Ten Republicans sided with the accusing Democrats.

Republican Illinois Congressman Adam Kinzinger said on Sunday on NBC’s “Meet the Press” that he has faced harsh criticism since he voted to impeach Trump. According to him, everyone who supported him had eventually turned against him, including family and friends.

“Look it’s really difficult. I mean, all of a sudden imagine everybody that supported you, or so it seems that way, your friends, your family, has turned against you. They think you're selling out,” Kinzinger said.

He added that he'd received “a certified letter, twice from the same people”, saying he is “possessed by the devil”.

Commenting on the recent meeting between Trump and House Minority Leader Kevin McCarthy at Mar-a-Lago in Florida, he expressed his frustration about the GOP’s current perspectives. Kinzinger pointed out that the last few weeks he saw "what seemed like the Republican Party waking up” but afterwards “kind of falling asleep again”.

“I think the Republican Party has lost its moral authority in a lot of areas. How many people think that conservative principles are things like build the wall, and you know, charge the Capitol and have an insurrection? That’s what Country1st … is all about — is just going back and saying, ‘Here’s what conservative principles are'," he noted.

According to earlier reports, Trump was making inquiries of ten members of the Republican Party who joined the Democrats to vote for his second impeachment on 13 January. He reportedly met with his political advisers shortly after the vote and demanded to know who these GOP members were and whether he had ever done anything for them.

On 13 January the US House of Representatives voted to impeach Trump for the second time following accusations that he has “incited” the 6 January Capitol uprising. The Senate will supposedly start the post-impeachment trial on 9 February; the indictment article was delivered to Senate last Monday.

https://sputniknews.com/us/202102011081941223-gop-rep-kinzinger-says-family-friends-turned-against-him-after-trump-impeachment-vote/

Forget your family the ENTIRE WORLD hates you SHITBAG

What Comes Next For Robinhood And Reddit After Last Week’s GameStop Trading Frenzy?

Legal experts don’t think Robinhood has much to fear from the class-action lawsuit filed after it restricted buying access to GameStop stock on Thursday.

Securities and Exchange Commission is going to have a hard time proving that the millions of retail investors who forced a short squeeze on GameStop stock violated any laws, the experts said.

“These people may just be stupid. But there are a bunch of them and they’re encouraging each other. It’s not a crime to be stupid,” University of Michigan Law professor Adam Pritchard told the Daily Caller News Foundation.

A class-action lawsuit filed against the investing app Robinhood on Thursday just hours after it prohibited its users from purchasing GameStop stock is unlikely to be successful in court, legal experts told the Daily Caller News Foundation.

And federal regulators with the Securities and Exchange Commission are going to have a hard time proving that the millions of retail investors from the Reddit forum WallStreetBets who forced a monumental short squeeze on GameStop, causing the company’s price to skyrocket nearly 1,500% in January, violated any securities laws, the experts said.

“They may be ganging up, but it doesn’t seem like there are a lot of material misrepresentations being made. And the SEC’s standard modus operandi is to go after people who are making material misrepresentations,” University of Michigan Law professor Adam Pritchard told the DCNF. “These people may just be stupid. But there are a bunch of them and they’re encouraging each other. It’s not a crime to be stupid.”

GameStop’s price explosion in January was made possible because hedge funds and other institutional investors had shorted 140% of the company’s existing shares. When an investor shorts a stock, they’re betting that the security will decrease in value. Short sellers stand to double their investment at best if the stock loses all value.

https://dailycaller.com/2021/01/31/robinhood-restricted-gamestop-stock-amid-mania/