Robin Hood, Michael Riedel, Phyllis discussed on Len Berman and Michael Riedel in the Morning
Len Burman, Michael Riedel on 17. W O R This'll whole punks. A tawny Phil thing is a scam. There's not no way he saw a shadow done there and they had a whole thing made up. And he said he saw a shadow and six more weeks of winter. I think, See, I think Staten Island, Chuck Is not going to see his shadow eight o'clock and I'll be short winner. What do you think of that? I wonder if they're ever gonna have a box of 20. Phyllis, don't you think it's about time? Natalie that they have a female ground on down there? Wow, That's a good point. You know what? You're absolutely right. You never made another great point that that whole ground Fog's club out there all mention guys, not one woman. There's a woman in a top hat down there and seeing you ladies there. So, Yeah. Come on, Natalie. Let's go down. Let's go. Protest. You should definitely protest. Thanks to Tony. Phyllis. What a good point. I never here We don't make a good point. That was a good one. All right. So, uh, today, let's welcome in our buddy column Exchange for the Fox Business Channel. Now. Yet, this all this craziness with game stop otherwise known as game store if you're Michael Riedel, but his game stop. That's the name of the company. And, uh, after all, the craziness last week, the other little guys on write it up against the hedge fund guys, So the stock dropped $103 yesterday. In pre market trading today, It's down another 73 bucks. So has this whole thing. Connell. It's a long way of saying good morning as it all come back to Earth. It did when it It came back to Earth when Redl bought the stock at $450, and everybody realized that that was the end of it, right. That's what happened, right Kind. What some, But seriously, is this whole thing now Pastor is just gonna lead to congressional investigations. Both may be. It may be passed in the market, and they're definitely going to be investigations whether they're warranted or not in the House Financial Services Committee Maxine Waters and company there they have an investigation. Um, state attorneys general, some of them are looking into it. I can Paxton on our our show yesterday. He's investigating it. But to be honest, so far, there's not that much to look into. There's there's a lot that's a great story. A lot of fascinating kind of human's insides to it with the little guy versus the big guy and everything else but doesn't seem like there were too many laws broken or rules that need to be rewritten. But They'll look into it. That's what they did so well. We'll have to put up with that for a few weeks, But it may be right now. This morning. By the way, as you mentioned Gamestop is way down in the premarket, even silver Which was the next target for some of these guys on Reddit. That was way up yesterday is often ties this morning things so we'll see. I mean they What they've added, is a new risk to the market. People can't You know, blow these guys off on reddit and say that they're just a bunch of clowns and say, Hey, they could have a real impact. And the big guys on Wall Street got to pay attention to that, you know and work it in is one of the things that they were worried about, or thinking about. So these guys are here to stay, and you think they're just going to move from one target to the next? Maybe or or but I think the larger point is that in the back of your mind if you're managing some multi billion dollar hedge fund you Yeah, You can't just dismiss things that are going on online. There's power numbers. There's power and a Marber crowd getting together on something, and I think that that's probably the big lesson or one of them from all of this is that Wall Street they tend to be. They tend to be arrogant. And sometimes I just say something like that nonsense. Don't worry about that move on to their little world and try to live within it because it hasn't happened before, And they sort of have a tendency that Too. You know when they're putting their risk profile together or there, or the risks that they're thinking about together, they think about things that have happened in the past. This is something new that you could. It could happen in the future, and it will always be in the back of people's minds. Certainly the people who lost Billions of dollars or hundreds of millions of dollars. In all of this, they'll be they'll be thinking about it. That's for sure. Powers of the people. Here's the problem, though we're not when a trading platform like Robin Hood, then cuts back or doesn't allow people to trade, it seems like they're protecting the big guy's not the little guys. Right, but there's no reason and this is, I think an important point lead and all of this. There's no reason to believe that yet not to say that some evidence might not come up. But we went through this whole period of time where we kept saying over and over. Well, this accusation is out there without evidence when we're talking about politics, That's the same thing for what this whole Robin Hood thing at the moment. You know, Robin, it's a brokerage like it is it messes like Schwab or Peopie Ameritrade or If you trade for Merrill Lynch or wherever you're trading Robin Hood does that, too. It's very popular with retail investors because there are no fees, but it has to follow the rules of brokerages and has to have a certain amount of capital. Put aside. Is there kind of a ratio of the trades it has outstanding and things got so out of hand. There were so many trades. It didn't have that and it had the Rabies, According to Robin Hood CEO $30 Billion in a short amount of time to lower it Z's dead it owed to these clearing houses or the clearinghouse in particular. And it went out and did that. And if it didn't do that, Ironically, it may have broken the rules. If that makes sense. In other words, it wouldn't have had the capital that needed to satisfy the SEC rules, and then it may have been in violation. So it was almost this weird, ironic twist where Robin Hood's getting accused of doing something that various or breaking some sort of rules. In fact what it was doing, it appears again. Maybe we don't. Maybe there's something we're missing. But right now, it appears it was following the rules. But that said, what it did do is make its customers very, very angry because of what it also did guys real quick, But also it didn't communicate all of this very well. And then people were going nuts that whole day. So all right. So what does Wall Street think of the meeting in the Oval Office yesterday between the Republicans and the president of the stock market, I guess went up on what optimism that a deal might be struck. I think it's optimism that there's gonna be stimulus. Either way, Michael be honest, because the Democrats have whether they could get the whole 1.9 trillion throw or not remains to be seen, but they could definitely get a good chunk of it through. Through this budget process called reconciliation, So it seems to be Optimism in the market that either way we're gonna get a lot of money pumped in whether Bobby Cutts a vehicle with these 10 Republicans, and maybe they'd come up a little bit from their 600 billion closer to his number or the Democrats, I think this is probably at the moment a little bit more likely, they just push forward and get the trillion plus. In stimulus that way, so either way where you get more money being pumped in,.