Economic Collapse News
The Exact Same Thing That Is Happening To GameStop Is Eventually Going To Happen To The Stock Market
.A few days ago, GameStop stocks soared to over $300 a share, and several investors that were in the middle of the market frenzy thought they have suddenly become rich. But the thing about the stock market is that you only really make money on the way out. During the last two trading sessions, GameStop was sent down, with shares of the volatile retail-trader favorite sinking 60% and closing at $90 per share on Tuesday.
Many have seen the value of their stock holdings experience a steep decline. Amongst them, Keith Gill disclosed he suffered a loss north of $13 million on Tuesday alone from his GameStop bet, but he has no plans of selling it. He was one of the main heads behind the epic short squeeze in GameStop. Gill unveiled he has been holding 50,000 shares of GameStop as well as 500 call options. As the short squeeze in GameStop started to lose strength this week, a large chunk of Gill’s massive gains has disappeared. And while he is still refusing to sell and GameStop stocks are on a free fall, more losses are likely to occur over the next few days.
After some major backlash, Robinhood decided to roll back the trading ban but decided to keep a limit on the amount of shares traders can buy in some stocks. Now, the platform is allowing clients to buy up to 100 shares of GameStop, up from the previous limitation of 20. The platform reported that the restrictions had to be put into place after an increase in capital requirements from the Depository Trust & Clearing Corporation in the face of the WallStreetBets investing frenzy. The wild trading has sparked varying reactions amongst high-profile investors and other public figures. Yesterday, billionaire Mark Cuban said he didn’t expect the Reddit army to go away even after the GameStop story is over, and he blamed brokerages and regulators for not being more transparent about the potential for trading restrictions.
In a recent statement, Senator Josh Hawley has exposed the fact that Robinhood “wasn’t really about its users. Its bread was buttered by selling the data on users’ trades to the big players – the elite guys, like Citadel – to give them inside tips on where retail investors were sending their money,” he wrote. The economic collapse writer Michael Snyder outlined in a recent article: “The talking heads on television are preaching to us about the dangers of “the GameStop bubble”, but the truth is that our entire stock market has become one gigantic bubble”.
Indeed, the stock market has been hanging by a thread for a long time now. Doomsday predictions for an 80% correction were becoming regular amongst experts way before the WallStreetBets short squeeze had started. This is just one of the numerous bubbles inside the market, and just as GME stock seems to be returning to its fair value, price to earnings ratios always return to their historical averages. Although no one can predict the exact time a crash will occur, it was set to happen regardless of the latest events. So sooner rather than later the stock bubble will pop and it will end badly for everyone, but we cannot say they didn’t have it coming. As Zero Hedge likes to remind its readers, “on a long enough timeline the survival rate for everyone drops to zero”.
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