christina bart's neverland she's been
following this like no other outside
game stop right now but it really
doesn't stop
really if you think about it christina
with gamestop
yeah you said that it was a perfect line
the game's not stopping with gamestop
because you have this tug of war that
still continues between wall street
and retail investors we pretty much know
this story
gamestop is at the center of all of it
you have retail investors that rallied
together
online to push up heavily shorted stocks
wall street lost billions but the story
gets a little bit more complicated now
because
it involves the trading platform a lot
of these retailer investors
use robinhood robinhood put restrictions
on thursday so that means that people
weren't able to
buy those volatile stocks like nokia
like amc
like blackberry they've eased those
restrictions not completely but they
have since then
and yet so many people are furious neil
you spoke to senator toomey not too long
ago just about this and he said maybe
this is for a good
reason i think there is a very plausible
explanation that has to do with the
additional capital required
when stocks become extremely volatile
but let's make sure we understand that
people are so angry that there's two
class action complaints filed against
robin hood you have two probes coming
from texas and new york they're looking
into those massive market swings
the sec just yesterday issued a stern
warning and they said that they would be
looking for the swings or looking into
the swings and checking for any type of
market
manipulation and it's not all just about
the actual
trading movement you have social media
getting involved
several social media platforms are
banning and closing down these stock
trading groups
facebook tells us vaguely that they
closed down one of those stock trading
groups
because it violated their community
standards and it had nothing to do
with the the frenzy in the rally for
cert some of these stocks
and there was a one interesting thing
that came out yesterday afternoon
a job posting so it looks like robin
hood may be preparing for a call from
washington
they are currently looking for someone
that is based in dc eight years
experience
on capitol hill as well as experience
with
legislative affairs and regulations
interesting timing neil yeah to put up
miley christina thank you so much she
works every day saturday it doesn't
matter that's christina
uh all right christina mentioned the
securities and exchange commission here
this will be a big test after for joe
biden's uh man who's going to head up
that uh
that group and that's gary gensler right
now i want to go to charlie gasparino on
the implications of all of this because
there's a lot of this
washington sniffing around going on
charlie where is it leading
uh you know we don't know just yet i
mean we were first to report that they
were looking at a market manipulation
case a pump and dump essentially uh
to pump up these stocks these stocks
that are in question meaning
there are certain players on message
boards pumping them up drawing people in
keeping the price going higher and then
dumping the shares at some point when
they reached their highs and there's
some evidence that that did occur
um those cases are really hard to prove
particularly anonymously
um and you know what's fascinating here
it's like the sort of media mainstream
media meme
is that it's uh it's the little guy
against the big guy
and that's the the sort of tension here
this is really kind of the little guy
against the little guy
when when this when the dust settles in
my view it's going to be
the little guy that's on that smart
enough on
on those on social media on on using the
robinhood app and they might not be so
little
pumping these stocks up ginning up
interest in a short squeeze
and then getting out at the top and then
there's going to be the little guy
who really believes that they should
stick in this because maybe um
game stock is going to a thousand
instead of 500
and uh loses his or her short when it
goes back down to five
um because the the the sort of metrics
of of the
its business model is just not worth
five hundred dollars a share and that's
probably
my bet because it's it history repeats
itself is probably going to happen and i
really think
you know regulators are meddling in this
it just
are not going to allow the market to
take care of it the market will take
care of this the market will
show that gamestop is not a 500 stock or
a thousand dollar stock
it's a five dollar stock that's that
might happen when that happens people
are going to get
feel a lot of pain they deserve that
pain that'll create
consequence to their action that's the
way markets work listen
there was a market mechanism screwed
over those hedge funds by the way it's
not all of wall street
it's a couple of hedge funds that a
bunch of hedge funds that went
short stocks that probably that's not
the way as you know charlie
the alexander ocasio-cortez and believe
it or not the ted cruz is united on this
feel about it now uh
the congresswoman court has said this
for so many people at home that are
seeing this happen
people were feeling like everyday people
were finally able
to proactively organize and get back at
the folks that have historically had all
the marbles on wall street
and forced one hedge fund into an
existential crisis
so this is seen as going against the man
pretty much
yeah i would be i i'm hesitant to uh
take market advice from alexandria
cortez
um just uh she we her and i graduated
from the same high school believe it or
not yorktown heights high school
but uh i i actually they've united uh
odd forces right ted cruz kind of shares
this sentiment it was espoused by rush
limbaugh
and and it gets to be pervasive let me
ask you this because listen
um jenkins writes and today so i just
want your reaction
in today's wall street journal that the
truth here appears to be something far
less scandalous at least three
brokerages said
they had been forced to impose trading
restrictions because of rules put in
place by
clearing firms so there was no sinister
cabal he says
between let's say a robin hood and some
of these big hedge funds
just an understanding that just to
process these
over-the-top high-volume trades
clearinghouses were just back to the
wall
and it was more mechanical than it was
uh tyrannical what do you think
a hundred percent and neil i reported
that on your fox business show
over the last couple days um robin hood
just did not have the
plumbing and some of the other firms
just don't have the plumbing to handle
this type of training
there's simple explanations here listen
politic i just find it fascinating that
paul
that this has become a political issue
uh but we live in an era where
you can and i think holman mentioned
this in his column which i really
enjoyed this morning that you know you
on social media
you can get a bunch of people to riot in
the capital i mean you know that's kind
of what's going on here if you can get a
bunch of people
to riot in the capital you can get a
bunch of people to buy a stock
on social media now is should should the
government regulate that
i don't think so there are going to be
consequences for the people who rioted
in the capital
as we know people are being arrested uh
there will be consequences for the
people that engaged in gambling gear at
some point
and there should be consequences uh the
markets will correct because
that's what they're asking charlie is
whether the same standards apply for
those
running up a stock as those running it
down
um i think do we speak guys the short
sellers as much
i think well i think it does the short
sales are losing money and by the way
if the short sales are violating the law
by publishing research that's inaccurate
there are the government the sec has
gone after short sales in the past
trust me on this i've done a lot of
reporting on this my view is we need
more short sellers
we need more the natural inclination of
the markets neil
is to tout stocks that stocks should go
up
we need short sellers to be cynical that
helps people
decide what what stocks to buy and sell
my view is we need more short selling
not
less and one of the i think problems out
of this whole thing is we're going to
get less short selling maybe
so let me ask you this finally um
there's a fear that a lot of people have
been asking me charlie then why is this
spilling over
to the general markets now a pat
response would be
that a lot of these guys who are losing
money on these bets have to sell some of
their
winning positions and some of the big
names that have run up the amazons and
uh
you know the apples or what have you and
it's going to impact those stocks and
the averages that house those stocks
do you think that's a legitimate fear
that it has a
spreading sort of a virus effect
yes it's a legitimate fear i and by the
way
yes they are you're absolutely right
they are selling their their long
positions
to pay to pay to raise funds to cover
their short positions obviously
um and because the the short positions
to cover it is so expensive right now
they have to sell more and more stocks
there is a few more than a theoretical
scenario where
if there's so many hedge funds that are
short these stocks
they're selling their their long
positions that's going to cause massive
market disruptions i i we're not there
yet
neil i don't think we're at the point
where the markets are shutting down
all right charlie thank you coming in on
saturday appreciate it my friend shelly
gasparino