scott squeezed and started losing billions and names like game stop and blackberry . so they completely change the landscape of investing, especially after blowing up on the biggest hedge funds like melvin capital, institutional they trade on fundamentals. they look at earnings, catalysts financials and global climate. and all that to determine price points of dames and their market cap to look for opportunities, but then retail, they rely more on sentiment and hype and to that end, it's a complete divergence from fundamentals because you look at a name like game, stop are an see and any institutional would be like that's dead money short it. but then all the retails bound together under their love of gamey and saving the movie theaters and movie business and managed to squeeze out all the hedges game. stop rallied over 2000 per cent this year, which is just unheard of. and now credit suisse estimates that a 3rd of all u. s. market trading this year has been dominated by retail. and they've seriously managed to move the markets and make ways and really all thanks to robin hood who wanted to bring trading to the masses by making it a super easy user interface with beautiful u i, u x. and most importantly,

game of fi at making it a social experience, because this is the aid of social media where everybody tries to gain cloud, whether it's followers are twitter or on instagram or tech talk. this is just another platform to brag about how many followers you have, how many people you can get to listen to. how big of an influence are you are. and robin hood, basically capitalize and game of fight by giving these amateur traders a platform to band together an army, which is more powerful than any hedge fund or tells about these investors. who are they and what makes them unique compared to say, the traditional investor? yeah, there's a, there's a couple of things that are pretty significant here and talking about the median age, right. the median age of these retail investors, it's 31 years old, which is pretty remarkable. if you consider the fact that this isn't, i guess you can say this is not your daddy's investing game anymore, right. it's a, it's a totally different group of people from the past. i think everything chrissy just laid out explains why that is right for the 31 year old and younger. these are folks who want

a game of fight system who love the idea of being able to move markets by moving in mass together. if you think about, you know, older investors, they would never have considered a time when you would kind of move markets together by going online 1st discussing what traits to make and then making something go to the moon diamond hands and all the other thing you have to look at is if i could of some of these other entities like apex clearing, take a look at some of the new folks who have been signing up for accounts in the last year since 2021 over a 1000000 new accounts have been made on these retail brokerage sites for people who are 19 years old, a 1000019 year olds have joined into the system. so it gives you an idea of how young the people are who are involved in this. and the fact that for them it is social, and it's a totally different kind of experience than anything that we've seen in the past. and christie, traditionally it's large institutional investors, not the individual retail investors that we're talking about have had this profound impact on stock prices because they make large trade. but recent research shows

that the new wave of retail traders are making their own impact health about that yet seriously. and the large hedge funds they have these big impacts because they buy huge blots given their size and assets under management. know me, tell investor i can even match a fine, but now as we tell traders are banding together in one name and trading individually. all of the common goal of popping up a name. it's having a really big impact on stock pricing. and now they're buying stock with ernie surprises that are positive or negative that's pushing up their prices. because usually and accompanying mrs. ernest, it gets a sold off. it got sold off with very heavy discrimination in normal market condition. but now even with a miss retailers, they continue to pile in. and this research paper by wharton used aggregated trading data from robin hood as a proxy to conclude that retail investors react to these earnings announcement itself. and not the actual news contained in the announcement whether it was good, whether it was bad, it found that these robin hoodies are more active and buy

a company's shares around earnings announcements, as a catalyst event, rat with garlic of whether it's good or bad. and this influence, it's even more pronounced and smaller firms where their shares are relatively more expensive to short sell. and while this is good news for, we tell it kind of disrupt the market a little bit because short sellers have their place in the market. they're like the shark that keeps a seal population check because short sellers lead out bad companies. we'd weak companies and they punish them. and then invest in the profit then gains into growing companies. they have a role in distributing and redistributing and allocating capital where it's needed to put the greatest possible use by rewarding growing companies. and that entire ecosystem has now been disrupted by retailers who only want name to go up. boom bust runs on and christy, i think you both for your time. thank you. thank you. while retail trading has grown in popularity, it caught the air of wall street and even the united states congress as the means

dot creates picked up earlier this year. now the most prominent means stuck as we just mentioned to gain attention was video, game retailer, game stop it all started as read. it uses on wall street bet sub read. it moved forward with a short squeeze game stop. after the citrus research predicted, the stock price would fall. now the global pandemic had taken a toll on retail as a whole, and game stop was struggling to keep up in digital delivery and video game became more and more popular. the move, it was so severe it pushed the price from just over $17.00 at the start of january to highs of nearly $350.00 by january 27th. now, dow jones market data showed it became so popular $175000000.00 shares in the company were traded on january 25th alone at the end of january read, it's moved on to a short. we the movie theater chain m. c, which was also struggling amid the pandemic. us trading volumes as a whole on the 27th of january when both were taking place. hit new hi, surpassing those scene during the financial crisis of october,

2008. think about that. now since then, we've seen other companies entered the mean stock trend, including many outmoded companies like blackberry, kodak, or even nokia, as well as fast food chain. wendy's, which had a brief moment in the sun because rudders loved to use the term 10 days for chicken tenders. so for more on all of the, let's bring in tobin's met the to see of transformed research. and peter schiff, he is the chief academy and global strap just at euro pacific capital. thank you both for coming on to join us to talk about what seems silly, but it's a look at those number. that's pretty important. tobin we had you on the show when all this started back in january and you pointed out a short squeezes, nothing new. so it is all about the power being put into the hands of regular people in retail trading. well, it's a couple of things 1st. if peter and i wanted to get together and make a stock go up and we had an agreement, we'd buy x amount of stuff that would probably be illegal. there's no law here that

says though you can't be on read it or beyond. you know, wall street bags and a symbol, a team of you know, 50000 people who want to buy it. and there is no law yet. that says you can't do that. but clearly if you punch the, you know, the good guys are the bad guys in the nose, depending where you're coming from. there's going to be blood and you're going to see, i believe that you can't go in a situation where you organize. clearly tell lies clearly have people on youtube and other things telling also the expansive lies to get for one thing, the people who shorted that stock to get the price rise in the people who did it early are going to make a lot of money. it's just like a ponzi scheme, so it's fun while it last. but if you can't have price discovery in the stock market, if we're going from mean stock, that means stock. now to that point, peter, i mean, we can talk about how fun it is for the moment, but do you think retail investors really understand the risk involved with trading?

highly volatile means stocks. most of them probably not. i don't think they have much of a conception of investing at all. you know, the, the whole thing is, is, is, as tobin said, it's a ponzi. it's a pyramid. by the way, it's nice to be i with you, toby, it's been awhile. but a long time for, you know, i don't think there's, i don't think there's a future in mean stops. i think this is a flashing, and unfortunately a lot of people are going to lose a lot of money. a small number of people will make a lot of money and those are the people that get in early, get the crowd all you know, ginned up and get him to buy and then get him to hold on. but then there's going to be a lot of bag holders because these stocks were being shorted for a reason. they've got flaw business models. maybe they're going out of business. smart money, new enough to bet against these stocks now. does money piled in? they bid them up to these ridiculous prices. there's no way these prices can be sustain like any ponzi scheme or chain letter. you run out of chain and eventually

the bottoms going to drop out and there's going to be a lot of bag holders. i left it when this crazed over i was in is they had done lenny as a way to describe tow van i the big corporations behind these companies that have been able to take in all of this cash i. they benefiting from something that was almost started as a joke. oh my gosh. game stop played it perfectly. by issuing almost what $3000000000.00 were the stock when the stock was probably worth $4.00 and it was selling for $385.00 or about a bag holder. when they sold those shares, they sold those 2 institutions. they didn't tell them to individual. so there's a bunch institutions that are sitting with $250.00 game stock stock. that's not trading for $250.00. you know, you listen, this is a motion. this is also sort of a tribal behavior. i've written a few books on travel media behavior, and when you get all together it's fun, you get the dope, i mean, go and you're like, how much put it look,

how much smarter i am and those stupid idiots who are not making money as soon as you identify as a tribe member, then man, if you're subject to tribe psychology on the up and down. peter, you know some of the go ahead go ahead. yeah. some of the real winners were the bottom holder. there are a bunch of bondholders that we're going to get pennies on the dollar when the company went bankrupt. and now they get paid in full. i mean that was the thing is if you remember back in amc in last summer, so about july, august of 2020. there was a lot of talk about amc going bankrupt. obviously they got funding from other folks but, but the fact was that was where they were, i missed the stock craze happened now. now peter, we hear about the diamond hand. they were a big deal in the middle of the crazy. the renters you know, wanted you to hold on to stand strong on those stock. i mean, does the bottom eventually drop out or do they just hold it? and amc for some reason continues to be a stock that is way, way over value. both the diamond hands is all part of the height because the people

who want to sell have to make sure that other people don't because you don't want to be in competition with other sellers. so you have to convince everybody never sell, hold on forever. well, what are you holding on to? it's a company that doesn't have any earnings. it doesn't pay any dividends. you're holding nothing. you're holding air, you're holding height. the smart money is dumpy, while those people with diamond hands have been conned in the holding. not ever bitter. it is one more follow up on that. i mean, i know we talk about this regularly and i know we, we tend to talk to you occasionally about crypto, which you're not necessarily a huge believer it. but is there some truth to the idea that something has value if you decide it has value? well, not really, because something actually has to have legitimate value. there's a difference between price and value. warren buffett talks about that price is what you pay. value is what you get. you can put a price and game stop. you can put a christ on bitcoin as long as somebody is willing to pay. that's the price and as

long as the bins are there and you own whatever it is, you can get out by hitting that bid. but there's a big difference between what something is fundamentally worth and what's some idiot is willing to pay for it. but eventually, the supply of idiots runs out, and all these bubbles collapse, you just never know how big they are going to get before they do. unfortunately, there's a lot of foolish people out there to be a fool, but eventually the last fool again is old. the back is going to happen with am, c is going to happen with game stop. it is going to happen with not only big coin, but all these crypto currencies. all right, have been sending that for us. do you see this chain continuing as we move forward? or will it die out as wall street continues to win? well, if we're, if we're talking crypto, your listeners have to understand that, particularly bitcoin is a religion. it's an instrument of faith. it is tribal, digital tribalism. when you say i'm a crypto person, that means those

a theory of guys are knuckleheads. i feel great about that. it makes me feel great and smart when the things going up and value man, i'm getting dopamine. hips like crazy. i love it. that is an addiction and it's, it's tribal psychology if, if you're, if your listeners really want to learn something to look up tribal psychology because every thing that happens with bitcoin in with any of the criptos follows the path. there's a leader. it's like you get to go to heaven and religion. well here you get to hang out with eli musk. i mean it's, it's, it's an absolute construct of digital tribalism and digital tribalism. as long as it's giving you the dopamine hips, the psychological rewards it's, it's got to stay. it's not going anywhere. and you're right, they and they're always trying to bring in new converts with me. it's like they're that mot modern day harry kirsten. they're always trying to get into the end of the faith, you know, to believe it's work for more. it's work from mormonism for like a 150 years. you go out and proselytize, you go out and you know,

bring new people into the flock and what people don't understand is if, without that a really religious fervor, there is no crypto oven. smith of transformative research at peter, chef of euro pacific capital. thank you both for your time. thank time now for a quick break, but when we come back, we turn to the regulatory side of retail trading. as the u. s. government has ramped up in scrutiny of companies like robin hood will bring you an expert insight just on the other side. the team will be right back with anytime now where we receive so many inputs on a daily basis that are completely i will need to already. so think about how on social media people know thursday and they basically will present themselves in a very unrealistic way. and so when we come down to fomo, there is any involved. but more than that, it's about the sort of envious or something that may not exist. and is also really

tied to the fact that as humans, we want to be part of the crowd. lack of universal health care makes america the country of every man for himself. we have a retirement crisis in this country and we have a health care crisis for seniors in this country as well. so private business has come up with a special mechanism for that. it's called the life settlement market. we are a life settlement provider, which means that we buy life insurance policies from primarily seniors throughout the united states who are no longer want or can't afford their life insurance policies. if you're sick and for the want to live a few more years, you consillio life insurance that way you get more money right away and the company collects your insurance payment off to your death. a group of people out there, i guess, hoping that people die soon. what kind of motivation is i give them when i start

crying about him dying? that's usually what it's about. it's just the sheer unfairness of it all. of course, after 40 years of fat interventionism by simply expanding and pretending and printing a lot of money, they got into this cargo called you call it mentality. where simply waving a flag, you know that essentially printing more money is going to make all the problems disappear. meanwhile, politically, what we've seen in america is really remarkable the, the liberal left and their cohorts in the media. even though that this policy is caused incredible of human suffering in america. they effectively marginalize those people as quote, deplorable and really made scape of the victims of j pow. they've often said that this is a victimless crime, money printing and extortion that's practice at the fed. and yet i look at those $90000.00 dead americans last year for mobiles overdose. i'd say j how you got blood on your hands because that's a direct result of mal investment,

money printing, and rogue economics that you're practicing as a charlatan. moved to no one. no, no, no admiral, who are you? no, no what door more real to what they should end up unit 731 was a unique organization in the history of the world. what they were trying to do was to simply do nothing short and build the most powerful and most deadly biological weapons program that the world had ever known. and real no, to production, it was it said sure, sure. did enough. good candidates. good on you, son. new quarter, she'll keep on more more general manager thought this

meant new again from all one of our new and i got the much sale. i got ya. i go on monday. i wish to know about julie whole new food room, or more or less than a jr. let's i had to put a couch. nice. oh boy festival. to go on. what on this to? well, she might new on it or i can send more a month on or put them out. thank you bye. ah, ah, welcome back. the viral means dock craze. and the response from some online firms

to cut off and limit trading was quick to attract attention from congress. earlier this year, the ceo of robin hood was called to testify, where he was asked about whether his company was acting in the interest of the hedge funds that were losing billions of dollars. robin, the securities put the restrictions in place in an effort to meet increased regulatory deposit requirements, not to help hedge forms. we don't answer to hedge funds. we serve the millions of small investors use our platform every day to invest. robin hood was hit with dozens of private law suits, and it went on to face charges of $70000000.00 over sweeping regulatory allegations that the brokerage misled customers approved ineligible traders for risky strategies and didn't supervise technology that locked millions out of training. as a result, the companies i p o filing mentions the numerous class action lawsuit that is currently facing and it also warns of their risk of regulation from the federal

government. while robin hood has made its name popular with the promise of 0 commission, stock trades is practice of relying on payment for order flow, or sending customer stock to 3rd party. firms has drawn criticism from the se. see, the agency hasn't made any moves to ban the practice just yet, but the question of what it can do has created concern that it could change the trend of retail training. as we know, it says earning it's not just us is international, regulatory attorney miles edwards miles. it's great to have you on the show to day and we know that when we look at s c c, chairman gary gansler. he has repeatedly pointed to the fact that payment for order flow is illegal and other countries like the u. k. but even though there is some bipartisan support here in the u. s. do you think that there's enough support for a full ban on the practice? i think there's no support at all for the van. i mean, if you look at it and the $200.00 to $20.00 election financial services firms

contributed over $2000000000.00 to politicians. and most of those people are now currently serving on the house of financial services committee. and you know, the financial services firms did it correctly. they gave about 47 percent to republicans and 53 percent to republican. so it has to go through these legislative hurdles. it's really going to be dead on arrival. i, i don't see any sort of support currently on for any type of repeal on payment for order flow. and even if they did ed, it would still have to go through the se, see rule making process as well. so it's a, it's going to be a very long and diff, difficult um, process to begin with. so i, i just don't see it happening at all, but i am sorry, miles, i just have to clarify something. you're telling me that big business in the united states, donates millions of dollars to congressional members and whole. yeah. and so does

in my millions, 1000000000 in hopes that they will follow through with the policy that they want. i'm, i'm absolutely shocked. i, i, i know you're shocked and you can ask michael bloomberg, why they contributed a $160000000.00 and sigma the trade organization for financial firms like robin heard contributed $15000000.00. so they've always been politically active in this area. and so how much power to the fcc happier, even if it doesn't move to ban as you just mentioned, there's no appetite to do so. are there other ways of looking at moving to limit companies like a like a robin hood or td ameritrade that focuses on retail banking or retail on trading? i absolutely. and i think the easiest way to do it is through finra. so robin hood is not only registered with securities and exchange commission, they're also a fin, remember, broker dealer, the fcc has complete authority over finra. so i think the se c puts pressure on

finra. to look at robin hood to look at their practices, to start examining them, and to put pressure on them to change the way that they do business. and more importantly, the change the relationship say have with both the retail and institutional customers. now when it comes to those losses that have been filed against robin had by customers who had their trades limited earlier this year, that companies easier agreement requires just needs to be settled and arbitration rather than civil court. so are these lawsuits likely to stick and are these people likely to actually had their day in court? now, because the courts have even recently said, arbitration agreements are binding as long as are in writing and the customer agrees to it. so what's gonna happen is, it's not only arbitration, it's finra arbitration, which means that you're gonna have to go through the finra process, and you're gonna have to appeal to the arbiters, arbitrators, to have it removed to maybe a state or federal court. and that's a very, very difficult situation to be in because all these claims relate to their accounts

with the securities firms, which is a member of finra. so i think that it's, it's of, it's really an up her up uphill battle um, for these lawsuits to survive and miles that before we go quickly here, there's also been a call for real time settlement, which also could have avoided some of the issues that all of these major retail brokerage firms had. now, if it is with the se, se, se would be a massive undertaking is the move to real time sentiment, something we're likely to see in the future as this becomes more and more popular or not. maybe in a decade when the technology and maybe even employee block chain technology to do it. but right now the technology is not in place for this to occur. and i just want you to know that back in 1969 wall street basically shut down because they couldn't process and settle the trade. they want to technology. now we're back to the point

where we cannot get away from trade plus to for settlement, unless the technology increases. so i don't see that happening any time soon. excellent wins against that. are here. international, regulatory attorney, mouse edwards, thank you for your time. thank you. well, rachel, i mean, you know, we've covered a lot of this retail trading boom. and it seems like, you know, there is some criticism we see from both the trading side of the regulatory side. but, but the fact is, i mean when you look at the way wall street has always worked for big institutional . so it definitely feels nice to see that real everyday people can have an impact on markets and, and be able to trade and make money in the sense that gave them a taste of what could happen, even if we don't see a mean stock crazed, quite like that one, they're still the possibility for them to rally together and really cost us has run some money. and if you're, if you're betting on shorts, you definitely want to be careful in this situation. that's for sure. and that's it

. for this time on boone bus catches on portable t v. you can find it at portable dot tv will see you next time. ah. ah. moved to no one no, no, no. no, no, no, no. well door, more shrill than what they should end up. unit 731 was a unique organization in the history of the world. what they were trying to do was to simply do nothing short and build the most powerful and most deadly

biological weapons program that the world had ever known. and grill. oh, you know, to production issue or sure, doug did that. they're not gonna kill to when you saw new rochelle. he on more more general manager thought this meant union from all one up on there and i got to learn much sale. i got your name up. i underscore. i wish to know about joy. oh, new. i know you didn't offer more or less enough, jr. let's i had to put the sky there, mother and all your buddy bill could you could help us out. nice. oh boy, that's good to go on. what the on this the well she my a new other i'm all i can send more a month or put them out that they give us

a little while and i make no sense. no borders line nationalities and you as a merge, we don't have a charity. we don't have a back seen. the whole world leads to take action and be ready. people are judgment. come with we can do better, we should be better. every one is contributing each in their own way, but we also know that this crisis will not go on forever. the challenge is great to response has been met. so many good people are helping us. it makes us feel very proud that we're in it together with

these are the full people who pulled the trigger and survive something on survival . one of the hardest things that i had to face was not having a face adult expectation to life. i accepted the accept the fact that i made that it's work. we had no fears. jell change pretty fast. 4 shots, different stories behind the bullets. francis mc chrome recently said, quote, the europeans must stop being naive when we are under pressure from powers which at times harden their stance. we need to react and show we have the power and capacity to defend ourselves, vold words. but does europe have the political will to actually defend itself?

a gas prices in europe hit a new record with the german government and warning people to prepare for a close to freezing month. meanwhile, that countries energy regulator is yet to grant an operating license to the now fully completed nor to stream to gas pipeline. white house d classifies a report revealing its suspected for years that the mystery surrounding those sounds supposedly attacking us government staff abroad were not unknown. russia weapons but rather chirping crickets. and tolling accuse of the e. u. of blackmail for threatening to withhold cache from regions that don't recognize l g b t, right? we'd get some reaction on that.