Analyst: In GameStop Battle, ‘The Little Guy Has Been Winning’
“The generic backdrop to all this is kind of a little guy against the big [Wall] Street firms. And, in this case, the little guy has been winning,” analyst Jeff Carlson told The Epoch Times’ “American Thought Leaders.”
“This is a very unique situation unlike anything I’ve seen before, at least of this magnitude, and it is kind of David versus Goliath. There’s a lot of people cheering for the retail investor and you’re clearly seeing these large investors a bit back on the ropes,” he added.
So-called retail investors began pouring money into GameStop, a struggling video game company, earlier this month after learning hedge funds had bet on its demise.
The purchasing, orchestrated on Reddit’s WallStreetBets, sent the stock from $17 to as high as $347, devastating at least one of the funds and earning the smaller investors large chunks of money.
The shocking rise in price drew consternation from some veteran Wall Street players, who have called for some kind of regulation and seemed to weigh in in support of the funds.
Carlson said financial pundits browbeating over what happened “is somewhat ironic,” pointing to the financial crisis of 2008.
“It was the same hedge funds that were being pilloried for shorting a lot of these different companies and it was these financial firms that ended up getting a ton of bailouts,” he said. “Now, we stepped forward to the situation we have today and suddenly, it’s the retail investor that’s being pilloried for driving up the stock of the price and it’s the folks doing the shorting that are not being called out as aggressively.”