TommyBryson's video: my thoughts on Robinhood and GameStop Lawsuit

Today I’ll give you my thoughts on everything that’s going on, and this will probably be the last video I make on this. Unless something crazy happens. 💲1 on 1 Talk + My Budget + Stock Investments💲 https://www.patreon.com/tommybryson 💰MY M1 FINANCE PORTFOLIO💰 PLUS $10 Link: https://m1.finance/fQsrul1PZcHM 1. Summary of what Happened - Wallstreet ( which is the name people are using ) was shortened GameStop, because they thought GameStop was going out of business - Reddit people: say this trend in shortening the stock, and wanted to force a Short Squeeze - This means, you increase the price of the stock by adding artificial demand ( and then the people that were shorting the stock have to keep investing more or get squeezed out ) Now Remember: - When people short a stock, what they do is borrow shares from a broker and sell it instantly - When the price goes down, they rebuy for a discount and pay it back, and keep the difference - But the price goes up, they have to keep adding more and more money to hold their position, but eventually, It gets so expenses where they get squeezed out The second Part of Happened was this: - After doing this to game stop, the Reddit guys ( which is the people being held responsible I guess) - Wanted to move on to AMC, blackberry, and other companies - And obviously, this artificial demand is not ethical, its not good for the market Third and Last part of the Story: - Robinhood, Webull, and other platform halted trading on these positions ( because of what was going ) – usually, just Buy but you can sell - And now they are being threatened with lawsuits - However, I'm pretty no investor has read everything disclosure these businesses have against a lawsuit to make sure they get hurt According to Robinhood, and Webull - The reason this happened was because market dynamic and how expensive it got with all the volatility - Because most of these brokers, use a clearing firm to cover the liability of those shares, until they settle in 2-3 business days - This then means because of all the liability, they couldn’t put up all that collateral 2. My Thoughts - this event prove 2 things - a lot of these brokers are not equipped for real market volatility - Second, we found a gap in the market because of technology ( more people can organize and take advantage of this of these gaps ) Solutions: - It means these brokers have to expand and hold a lot more cash, to help settle investments when volatility gets like this again in the future - Second: the SEC needed to step in to talk about what they are going to - There is always massive scandal for example, when a celebrity gets paid in stock, promotes the stock, and then sells all their shares ( people organizing to pump a stock, doesn’t really legal ) However: - We’ll see what the SEC has to say - I'm pretty sure all sides are going to learn from this - Brokers, Wallstreet and Reddit guys Tip: if you’re like me, and want to passive long term income, then you know this is not the way. * PRO TIP* INFORMATION IS EVERYTHING 👕Merch👕 https://teespring.com/stores/tommybryson ✅2 FREE AUDIOBOOKS✅ https://amzn.to/2Enayo8¬¬¬ 💰M1 FINANCE $10💰 Link: https://m1.finance/fQsrul1PZcHM 🎁ACORN FREE $5🎁 Link: https://acorns.com/invite/38EYSU ⚡FREE KINDLE UNLIMITED⚡ (traditional reading) Link: https://amzn.to/2VGbxt9 👨🏽‍💻DISCORD PRIVATE GROUP👨🏽‍💻 https://discord.gg/EcZEHpA My Camera Gear: https://www.amazon.com/shop/tommybryson ✔ Help Us Reach 500,000 Subscribers: https://goo.gl/0wvm6w 😎All My Social Media😎 Link: https://linktr.ee/tommybryson *Some of the links and other products that appear on this video are from companies in which Tommy Bryson will earn an affiliate commission or referral bonus. Tommy Bryson is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. I'm an Accountant but I'm not your Accountant, always review information with your Accountant/CPA and your Financial Advisor.