Excerpt from: GameStop saga exposes deep hypocrisy from elite investors and proves US financial market is detached from reality — RT Op-ed
Hedge fund managers have already taken to the airwaves to call on a Securities and Exchange Commission (SEC) investigation, and the Biden administration is "monitoring the situation." The GME rally even drew calls for investigation from Michael Burry, the famed investor who helped launch a retail-investor frenzy in 2019 by investing in none other than GameStop. All of them seem to think that the situation was anti-competitive stock manipulation, which would be extremely difficult to prove since, among other things, Melvin knew what Redditors were doing and stayed firm on their short position.
Elite investors and their foot soldiers in Washington are obviously mad about what’s going on and the most likely outcome here is that new legislation or executive action will go through to shut regular people out of trading in some way or another. It’s hard to say right now what might take shape.
In the interim, some in the media are painting this situation in stark political turns. In a column posted on January 27, CNN’s Chris Cillizza blamed the GME rally on Trumpism, which is a lazy analysis that seems similar to the same liberal smugness that assumes anyone who plays video games is a Trump fanatic – and also dismisses that a lot of the online left supports these Redditors in their Wall Street infiltration.
It’s hardly a political issue in the sense of left versus right, but rather ordinary people on the internet versus hedge funds. In my view, however, the real worrisome part here is that these Redditors are juicing certain stocks based on nothing – certainly not valuation – and only out of pure spite against large investment firms.
While that might be a noble thing to do it exposes the utter absurdity of the stock market, the problem the US financial market has with valuations and why I believe there will be an epic financial disaster soon (I have discussed this topic here, here and here). The GameStop debacle shows exactly how foundationless the financial market really is at a time when Wall Street’s performance looks deceitfully rosy.
