Wall Street is losing its head after a group of small investors with a $ 500 to $ 2,500 trading account teamed up to take down the billionaires, Fox Pay host Charles Payne told Tucker Carlson Tonight on Wednesday.
The ‘Making Money’ host addressed the dramatic rise in GameStop’s share price after a group of Reddit users teamed up to buy up the struggling retailer’s call options – pushing the company’s share prices to unprecedented levels and the short sellers of the market.
“These hedge funds that sell this stock, they don’t own the shares, so they borrow it,” Payne explained. “Imagine you borrow a stock that trades at $ 10, then you drive down the stock price and then you buy it back for a dollar. You make the difference, nine dollars.”
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Short sellers, Payne explained, are investors who speculate that the price of a stock or the value will fall in value. The strategy involves borrowing shares to sell them with the hope of buying them back at a lower price in the future.
“They may shorten so much stock,” he said. “Do you know how much stock there was on GameStop? Let’s say 100% of the shares that are not available, they fell 140% of the shares, and they borrowed the same shares over and over, and over the same shares and that sold in the market.
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“Their job, their mission was to drive GameStop to zero,” he added. “Nobody said a word about any financial network, especially CNBC, which always makes shorts come true …”
Cold investors revolted against Wall Street on Wednesday when they decided to raise the share price collectively.
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“It’s called a short press,” Payne said, “and it works.
“Wall Street is losing its head and Wall Street now wants to change the rules of the game because a lot of people with bills of $ 500 to $ 2,500 are taking down the billionaires.”