UnNews:Sheriff in pursuit of Robinhood
| The news outlet with approval higher than Congress | ✪ | UnNews | ✪ | Tuesday, November 5, 2024, 14:25:59 (UTC) |
| Sheriff in pursuit of Robinhood | 
|
30 January 2021
NEW YORK CITY -- Maverick internet trading platform Robinhood is about to be waylaid in Sherwood Forest.
This is a consequence of a trading gambit of Citadel and other hedge funds, which identified several "Dogs of the Dow":
- GameStop (
GSE), a bricks-and-mortar business engaged in the face-to-face selling of video games that every basement-dweller is now buying on-line, its stores and the surrounding malls declared "non-essential businesses" during the Coronavirus lockdowns. - Bed, Bath & Beyond (
BBBY), another bricks-and-mortar business that was closing hundreds of its stores before deciding to piss off half of its clientele by refusing to carry "My Pillow." - AMC (
AMC), not American Motors but the cinema operator, whose theaters are comparably empty these days.
The hedge funds concluded that these securities would undergo what the Federal Aviation Administration refers to as a "ground loop," borrowed scads of the shares, and sold them, confident that they could close out their negative positions at a price close to zero.
The basement-dwellers were outraged. Using the internet facility Reddit, these sub-editors opened a sub-reddit and sub-mitted a plan for some old-fashioned market manipulation — that is, for everyone and his dog to borrow money and buy up the shares like they were Bitcoin. The youngsters availed themselves of several modern institutions:
- Robinhood, an Internet brokerage specializing in easy account set-up, zero-commission trading, purchase of fractions of a share, and 'round-the-clock trading with no adult supervision.
- Margin, a device by which the investor can borrow money to buy stock, with easy collateral because it is assumed that not everything will fail at the same time, even after massive chat-room collusion.
- Front-running, an institution by which an opinion-leader stakes out his own position just before pumping up newbies to do the same thing and propel his investment upward.
So competing teams set out to manipulate the market for these stocks, the suits-and-ties versus the sandals. There being more of the latter, eight of the front-runners made a billion dollars each, at the expense of the suits, who were constrained by Daniel Drew's signature couplet: "He who sells what isn't his'n / Must buy it back or go to pris'n."
As buying it back now required hundreds of dollars per share, the suits invoked another American tenet: "Good government, for a good price." Word is that word went out to the Biden administration — fresh from ruining industries from petroleum to women's athletics with a stroke of the pen — that the rules of the game needed to change, pronto. Treasury Secretary Janet Yellen — whom Citadel had paid $810,000 to give platitudes about investing imponderables in her signature sleep-inducing drone — may have placed a call to Robinhood.
Whether it was that, or Robinhood founder Vlad Tenev seeing that his firm was standing behind billions of dollars of loans taken out in synch to overpay for worthless companies, Robinhood made a decision. Like Facebook and Twitter, supposed message-switchers now actively intervening to protect their users against hate speech (whether Hunter Biden's Ukraine payola or the petitions to recall California Governor Gavin Newsom), Robinhood ("Democratizing Finance for All") had to rein in democracy and finance. It decreed that investors could buy any number of shares in the companies — provided the number was 1. You could sell or hold, just not buy, and word is that Robinhood sometimes sold for you.
The only remaining step is for government to investigate itself. The last episode of this — the two-year investigation of fraud in the two-year investigation of Donald Trump colluding with the Russians to fix the 2016 election — has resulted in a single charge against Kevin Clinesmith, the FBI lawyer who edited "Carter Page was a CIA asset" to read "Carter Page was not a CIA asset" so the ex-President's men could get a court order to spy on the other ex-President. Clinesmith got 400 hours of Community Service, to be spent scrubbing servers at the Democratic National Committee, where they had been getting filthy.
Sources[edit]
- Jason Aten "Robinhood Destroyed Its Brand in Less than a Day". Inc., January 29, 2021
- Katelyn Polantz "FBI lawyer from Russia investigation sentenced to probation for Carter Page FISA warrant false statement". CNN, January 29, 2021