I’m sure by now you’ve all heard about the attempted GameStop short squeeze that’s playing out in the market. What the media is not telling you is that the hedge funds are playing a dirty game in an effort to keep the stock price down while they unwind some of their trades in an effort to limit their losses.
To do this, they’re manipulating the stock price using what’s called short ladder attacks. In these attacks, they buy and sell shares in rapid succession between themselves using supercomputers to trick the algorithm that sets the market price into thinking there’s a sell-off, when in reality there is no sell-off.
To make this even more devious, the brokerages used by retail investors have limited the number of shares those investors can buy while allowing the hedge funds full access.
Those same brokerages are even going so far as to loan out the shares of the retail investors (without notifying them) to the hedge funds so they can use them in their short ladder attacks.
Crazy right? But this is what’s really happening and you deserve to know.
I think you’ll agree this is not right but the bigger question is how is this market manipulation legal and how are these parties allowed to collude in this manner?
As a GameStop shareholder, I have my own option on the legality of this event and hope Congress, the SEC and the courts will take the appropriate actions to hold them accountable and make this right. Our financial system is clearly broken. So, if you’re as disturbed by this as I am, please let your elected officials know. The only way we can put an end to this kind of corruption is if we collectively speak out against it.
Mark Krantz, Sandy