Wall Street Running Amok Explained


Caleb Silver, editor-in-chief of Investopedia explained this Wall Street fiasco in a very easy to understand way.

This from Investopedia:

The unprecedented volume of trading was prompted by a new class of retail investors and day traders that have flooded the market since the beginning of the pandemic. Many of them were part of a buying boom last year as they chased struggling stocks they believed deserve a second chance. Online forums like Reddit's WallStreetBets have become a place for these new day traders to discuss the stocks.
“Individual investors are being stripped of their ability to trade on @RobinhoodApp,” the moderators of the Reddit forum wrote on Twitter. “Meanwhile hedge funds and institutional investors can continue to trade as normal. What do you call a market that removes retail investors [sic] ability to buy to save institutional investors shorts?”
Law Firm Chapman Albin filed a class action lawsuit on Thursday against Robinhood on behalf of users who suffered losses as a result of investing in Gamestop or AMC. The lawsuit alleged that Robinhood recruited social media influencers to encourage individuals to sign up and purchase shares of Gamestop and AMC, only to place trading restrictions on the securities a day later.

The bottom line is that stunts like this usually don't end well for average investors...or the stock market overall.

If you want to gamble your money, go for it. Just know that risk happens fast...

Listen to John & Ken talk to Caleb Silver about how this got started, what happened and where this situation goes in the future.

Good luck !


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