• Privacy policy
  • T&C’s
  • About Us
    • FAQ
    • Meet the Team
  • Contact us
TLE ONLINE SHOP!
  • TLE
  • News
  • Politics
  • Business
  • Sport
  • Opinion
  • Elevenses
  • Entertainment
    • All Entertainment
    • Film
    • Lifestyle
      • Horoscopes
    • Lottery Results
      • Lotto
      • Thunderball
      • Set For Life
      • EuroMillions
  • Food
    • All Food
    • Recipes
  • Property
  • Travel
  • Tech/Auto
  • JOBS
No Result
View All Result
The London Economic
SUPPORT THE LONDON ECONOMIC
NEWSLETTER
  • TLE
  • News
  • Politics
  • Business
  • Sport
  • Opinion
  • Elevenses
  • Entertainment
    • All Entertainment
    • Film
    • Lifestyle
      • Horoscopes
    • Lottery Results
      • Lotto
      • Thunderball
      • Set For Life
      • EuroMillions
  • Food
    • All Food
    • Recipes
  • Property
  • Travel
  • Tech/Auto
  • JOBS
No Result
View All Result
The London Economic
No Result
View All Result
Home Business and Economics

Traders in meltdown as Reddit forum leaves hedge fund on the brink of bankruptcy

Footage shows one trader throwing his chair, while reports of people crying have surfaced.

Jack Peat by Jack Peat
2021-01-28 14:06
in Business and Economics, Economics
FacebookTwitterLinkedinEmailWhatsapp

Reports of people crying and traders going into meltdown have surfaced after a Reddit forum called WallStreetBets waged a war against hedge funds who had shorted stock on gaming outlet GameStop.

Sellers were caught in a short squeeze as members of a fast-growing discussion board pumped money into shares they had bet against, increasing its value by nearly 2,000 per cent in the past month in an act of defiance.

Melvin Capital has been particularly hard hit by the uprising, as has CitronResearch. The former has been forced to close its position on GameStop after encountering devastating losses on a short position that pays out when the stock depreciates.

Open letter

Today an open letter has appeared on the WallStreetBets forum, explaining the rationale behind the move.

The resentment for Wall Street investment firms, especially those that were betting billions of dollars on the decline of struggling businesses, stems from the Financial Crisis of 2007 and 2008, it read.

“To Melvin Capital: you stand for everything that I hated during that time,” user Ssauronn states.

“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.”

RelatedPosts

McDonald’s to pay France huge sum in tax fraud case

Real wages fall at record rate in UK

‘Strip club test’ suggests US recession could be imminent

Lloyds hands workers £1,000 bonus to ease cost-of-living worries

Meltdown

On the ground the reaction has been one of mass panic, according to the latest reports.

One portfolio manager at a hedge fund in Mayfair told Financial News London that “the retail folks are targeting EVERY stock with a lot of short interest”.

“It is short-squeeze hell,” said another portfolio manager at a London hedge fund. “People are crying. Once every few years people get to learn all over again the meaning of gamma squeeze,” he said.

Elsewhere videos such as the one below have been doing the rounds on social media, seemingly summing up the sentiment among investors.

It begs the question; have they finally got their comeuppance?

Got these suits mad, live footage from the offices of @CitronResearch & Melvin Capital ??? #FreeWallStreetBets #wallstreetbets $GME $AMC $NAKD $PLTR $TSLA @wallstreetbets pic.twitter.com/P4tsjHp7y9

— Brad Buffett (@SecureProfit) January 28, 2021

Related: GameStop – Are shorted UK firms next to see huge share price growth?

Related: These are the companies profiting from the COVID economic collapse

Since you are here

Since you are here, we wanted to ask for your help.

Journalism in Britain is under threat. The government is becoming increasingly authoritarian and our media is run by a handful of billionaires, most of whom reside overseas and all of them have strong political allegiances and financial motivations.

Our mission is to hold the powerful to account. It is vital that free media is allowed to exist to expose hypocrisy, corruption, wrongdoing and abuse of power. But we can't do it without you.

If you can afford to contribute a small donation to the site it will help us to continue our work in the best interests of the public. We only ask you to donate what you can afford, with an option to cancel your subscription at any point.

To donate or subscribe to The London Economic, click here.

The TLE shop is also now open, with all profits going to supporting our work.

The shop can be found here.

You can also SUBSCRIBE TO OUR NEWSLETTER .

Subscribe to our Newsletter

View our  Privacy Policy and Terms & Conditions

Trending on TLE

  • All
  • trending
Abdollah

‘Rescue us’: Afghan teacher begs UK to help him escape Taliban

CHOMSKY: “If Corbyn had been elected, Britain would be pursuing a much more sane course”

What If We Got Rid Of Prisons?

More from TLE

Positive signs in Europe over coronavirus ‘tempered by UK’, WHO says

Brexit ‘tragedy’ stopped UK accessing ‘€30-50bn’ of EU pandemic aid

Do you think NHS workers deserve free parking? Here’s how you can do something about it

Liverpool hero insists aim is to ‘win as much as possible’

£40bn UK budget deficit in 2020 if chancellor sticks to spending cuts

‘You’re a nutcase’: Chris Bryant slams ‘dangerous’ Dan Wootton over herd immunity

Six steps to perfect glowing summer makeup

Government introduces bold new plan to fix broken housing market

Review: Green Room

Everything Everything: Film Review

JOBS

FIND MORE JOBS

About Us

TheLondonEconomic.com – Open, accessible and accountable news, sport, culture and lifestyle.

Read more

© 2019 thelondoneconomic.com - TLE, International House, 24 Holborn Viaduct, London EC1A 2BN. All Rights Reserved.




No Result
View All Result
  • Home
  • News
  • Politics
  • Business
  • Sport
  • Entertainment
  • Lifestyle
  • Food
  • Travel
  • JOBS
  • More…
    • Elevenses
    • Opinion
    • Property
    • Tech & Auto
  • About Us
    • Meet the Team
    • Privacy policy
  • Contact us

© 2019 thelondoneconomic.com - TLE, International House, 24 Holborn Viaduct, London EC1A 2BN. All Rights Reserved.