Market news and updates: CEO confirms AMC received 6 million shares from National CineMedia for free.
Adam Aron announced on Twitter AMC had received free shares of National CineMedia.
Barrons, a news site owned by News Corp. falsely claimed AMC purchased the stock of a failing company.
Shares rose for both AMC and NCMI stock on Wednesday.
Some of you have noticed that AMC now owns about 6 million shares in National CineMedia, the theatrical advertising company. What you may have missed is that we got those shares for free. They came to AMC because we grew our circuit by adding theatres in 2021. Playing on offense!
Ken Griffin accused the retail community of destroying teacher’s pension plans by taking down Gabe Plotkin’s Melvin Capital.
Melvin Capital is a hedge fund that was short on ‘meme stocks’ holding a large position in GameStop.
The company is scheduled to shut down in June after it had suffered a 50% loss in 2021, and an additional 20.6% in the first quarter of 2022.
Sources say Melvin Capital has already begun to liquidate its positions to pay back investors in cash.
In this Bloomberg exclusive, Ken Griffin plays a role of the victim, defending Mr. Plotkin and the hedge fund whose mission it was to bankrupt GameStop.
Ken Griffin’s Citadel is also short on AMC Entertainment – the hedge fund lost billions last year betting against retail.
Let’s discuss it.
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CNBC mourns the loss of Melvin Capital
CNBC says Melvin was one of the biggest victims from the meme stock frenzy last year due to its large short position in GameStop.
They say Citadel and Point72 had to provide Melvin Capital with a lifeline to stay above the water.
The hedge funds combined provided Gabe Plotkin with $2.75 billion in capital last year.
However, as things went south quick for Melvin, both hedge funds demanded the capital back.
Something Ken Griffin and his affiliates fail to mention.
Mainstream media has also danced around the fact that hedge funds planned to wipe American companies by overleveraging their short positions during the pandemic.
Success in doing so would delist AMC, GameStop, and other meme stocks from the stock market.
Betting against companies with intention to bankrupt them to the ground is no charity work.
It’s un-American and a nefarious practice that has dragged out for too long.
Ken Griffin blames retail investors
In the video below, Ken Griffin gives his thoughts on retail investors and the entire ‘meme stock’ phenomena.
Ken Griffin take on Retail Investors, today on Bloomberg TV
Ken Griffin takes a jab at the retail community saying retail investors who aimed to bankrupt Melvin Capital also wiped-out pension funds from teachers.
But Ken, retail investors don’t get up in the morning and think to themselves, “let’s wipe out a multi-billion-dollar hedge fund.”
Melvin Capital lost because he went against retail – the first time in history the people fight back corruption in the stock market, and win.
AMC shareholders continue to buy and hold the stock until short sellers exit their positions, which will result in a short squeeze.
Today’s retail investors are armed with education, they understand what they hold and what it’s doing to hedge funds.
While Ken Griffin and affiliates might be pumping a narrative as victims, high profiles such as Elon Musk, Jon Stewart, and Ryan Cohen have stood up against short sellers.
For the first time in history, Wall Street is getting their a** kicked, and these hedge fund managers certainly do not like that.
Hedge funds should prepare for bigger losses
Institutions are about to lose a massive amount of collateral due to executive order 14032 in early June.
This presidential order is prohibiting Chinese securities to be used as collateral starting June 2nd, 2022.
It was responsible for initiating margin calls when AMC Entertainment stock rose to $20 per share in January, and $72 per share in June of last year.
With liquidity drying up in global markets, it’s going to be quite difficult for hedge funds to keep up with margin requirements on heavily shorted ‘meme stocks’.
Massive selloffs in the market have proved just how distressed financial institutions are.
We’re seeing for the first-time hedge funds begin to shut down as they take the lead in liquidity burn.
Retail investors have been the majority of buyers in today’s markets according to Bank of America.
Hedge funds are headed towards a larger train-wreck of disaster they cannot get off of.
As they continue to tank the markets, margin requirements go up thanks to DTCC B16845-22.
Hedge funds have lost control.
But I’m curious to know what you think.
Leave your thoughts in the comment section of the blog below.
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AMC’ shares on loan reach 157.87 million
AMC shares on loan – AMC short interest
The shares on loan of a stock are the number of shares that have been borrowed and have yet to be returned.
We see this data when looking the short interest data of a ticker symbol to determine how much of the float is being shorted.
So, what does this mean?
AMC’s shares on loan essentially looks like debt to short sellers because they eventually have to return these shares back to the lender.
These shares amount to approximately 21.88% short interest (updated daily on the blog).
This is a very high short interest percentage – something mainstream media will not talk to investors about.
AMC’s short high short interest is what allowed it to reach $20 per share in January and $72 per share in June of last year.
Hedge funds lost billions, which is why mainstream media has focused on scaring retail investors out of their money by pumping out ‘DO NOT BUY AMC’ content.
Nothing has changed this year except AMC’s shares on loan and short interest keeps climbing.
AMC’s short interest was only at 20% when it surged to $72 – it’s now close to 22%.
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Largest pension in America sells 605,501 shares of Netflix (NFLX)
Largest pension fund in America buys AMC, sells Netflix
CALPERS sold a whopping 605,501 shares of Netflix stock (NFLX).
It ended the first quarter with a total of 1.2 million shares in the streaming platform giant.
Netflix stock is down almost 69% this year-to-date.
It dropped 38% the first quarter of 2022 alone.
Netflix received backlash in April after announcing the company plans to advertise on the platform with commercials.
Viewers argued that the company had already built too strong of a foundation to make such a change to its business model and that going that route would hurt its memberships.
Things did not get better after Netflix announced the crackdown of password sharing.
Netflix lost 200,000 customers in the first quarter of 2022.
Now America’s largest pension fund is dumping its Netflix stock and buying AMC Entertainment stock instead.
CALPERS keeps buying and holding AMC stock
Largest pension in America buys AMC, sells Netflix
CALPERS increased their stake in AMC and GameStop throughout the 2021.
AMC and GameStop were two of the highest profile stocks in the market for 2021.
AMC saw gains upwards of +3,000% while GameStop saw gains half of AMC’s.
This year, AMC and GameStop continue to be high profile stocks as their short interest continues to be extremely high, sitting above 21% each.
Last year CALPERS quadrupled their stake in AMC during the 4th quarter where they accumulated a total of 619,400 shares of the largest movie theatre chain in the world.
The pension fund now owns a total of 775,392 shares according to Barrons.
Analysts and corporate media reporters have been saying for over a year now the movie theatre industry was dead due to the rise of online streaming.
While the narrative might support a short sellers view, it’s definitely far from the truth.
People aren’t willing to let go of the movie theatre experience for the convenience of online streaming; lockdowns are over.
There is a massive demand for AMC stock
AMC stock is not done running.
The ‘ape’ community that saved the movie theatre from bankruptcy saw something no one else saw.
AMC has always had a massive short squeeze potential that has yet to be fulfilled.
Mainstream media might have spun the narrative killing the hopes and dreams of newcomers of the possibility some time ago.
But AMC’s short interest data says a third runup will be larger than what the world witnessed in May/June of last year when the stock ran up to $72 per share.
Institutions know hedge funds are overleveraged and the closing of short positions is inevitable.
Buying the stock now as the markets are at an all-time low could bear fruit very soon.
I’m curious to learn what you think.
Leave a comment at the bottom of the blog below.
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Retail investors didn’t leave then, and they’re not leaving now.
AMC’s current trading volume is more than double its average of 48.1 million.
GameStop’s is also more than double its average of 4.1 million.
We saw high buying pressure early in the market as the two ‘meme stocks’ took the lead and left corporate media pinched.
No matter how much mainstream media lies and says these two plays are dead, the truth is still the truth.
Both AMC and GME have incredible short squeeze potential, and the only thing keeping them from skyrocketing is open short positions.
Volume, however, could create big panic and set off a chain reaction enabling shorts to close their positions.
Short interest data
Just how AMC and GME’s high volume proves there is still a massive demand for the two stocks, the short interest proves these are short squeeze plays.
Both AMC and GME have very high short interest.
AMC short interest:21.44% | GME short interest:21.52%
Both these stocks have a record high number of shares on loan that have to get bought back and returned at some point.
Short sellers have their foot on a bouncy betty.
These stocks will squeeze whether shorts get out at their current share prices, lower, or even higher.
Because AMC and GME’s shares on loan are at an all-time high, this also means that when they do skyrocket, share prices will surpass their last record highs.
This is why people around the globe are buying these stocks.
The upside potential is too large to pass on.
When will these two stocks squeeze?
No one can say for sure.
But this bear market could prove to be a great time for shorts to close their positions, at least while stocks are at temporary low.
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Is AMC doomed?
AMC just announced an incredible Q1 earnings call for 2022 where the company raised more than $1.4 billion in liquidity.
The movie theatre chain seated 39 million guests in Q1 and earned $785.7 million in revenue.
CEO and President Adam Aron reported AMC had its best Q1 in two years.
Not to mention, the company was able to repay $45 million of deferred rent reducing their balance to approximately $272 million.
They plan to reduce the deferred rent by another $125 million by the end of the year.
So, is AMC doomed?
Absolutely not.
See, a bear market doesn’t take any of this into consideration.
If the suits need the markets to be on a downtrend, they’ll be on a downtrend, momentarily that is.
So, if we’re going to play their game, we’ll just have to sit tight until we begin to see a reversal again.
Can Adam Aron do anything about what’s happening to AMC stock?
Unfortunately, Adam Aron and any other CEO doesn’t have any power over how the stock of a company moves.
I’ve always pictured nerds behind the scenes looking at the boss for confirmation on whether they should move a stock down or up based on business or economic news.
Jokes aside, all Adam Aron can do is focus on AMC’s fundamentals to hopefully convince these ‘bosses’ the stock is not worth shorting to the earth’s core anymore.
Notice how he always addresses the suits in every earnings call, it’s for a good reason.
And finally, we’ve seen a little bit of praise on AMC’s Q1 earnings this year, but it’s not enough.
There’s an older generation of folk running our system that cannot see what ‘apes’ or Adam Aron see yet.
The entire market is having a challenging time finding a bottom.
This leads me to believe AMC is not done downtrending, but oh boy would I love to be wrong here.
SPY stock (S&P 500), which tracks the top 500 companies in the U.S. can’t seem to find the brakes either as it continues to pull the entire market downhill.
There are currently no signs of resistance levels in the market.
And for this reason, AMC might not be close to seeing a rebound so soon.
But it doesn’t mean AMC won’t rebound at all – the entire market will eventually go through a reversal where stocks will begin to trend upwards again.
How long will this take?
Only time will tell.
What you can do in the meantime is plan, strategize, and execute.
Focus on your financial goals, your income goals, your family goals.
Despite this dreadful bear market, learn to make every day a great day.
And if you aren’t earning money trading options yet, I actually teach you how to do it here so you can hedge against your unrealized losses in the interim.
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Feds crack down on Goldman Sachs dark pools
The fed is looking into various matters relating to Goldman Sachs’ businesses and operations.
One of which stands out to retail investors as being its dark pools.
The fed is investigating the supervision and controls relating to Goldman’s high frequency trading (HFTs) and its alternative trading systems (ATSs), also known as dark pools.
Dark Pools (also benignly called Alternative Trading Systems or ATS) are effectively unregulated stock exchanges being run by the same megabanks on Wall Street that blew up the U.S. financial system in 2008 and received the largest taxpayer bailout in U.S. history. – Wall Street On Parade.
The name of Goldman Sachs’ Dark Pool that trades in the U.S. is called Sigma X2.
It used to be called simply Sigma X.
According to a publicly-available document, Sigma X is now used by Goldman Sachs to designate the Dark Pools it operates in foreign jurisdictions, which include Europe, Japan, Hong Kong and Australia.
Dark pools are the gateway that allow financial institutions to manipulate the stock market without any regulation.
Now the fed is cracking down on Goldman Sachs and it comes as no surprise since the bank has been criminally charged on many occasions before.
In October of 2020, Goldman Sachs admitted to the charges of a bribery scandal where they were fined $2.9 billion.
Other operations being looked into
The fed is looking into the institution’s advisory services and conflicts of interest.
They are also tackling the following:
Research practices, including research independence and interactions between research analysts and other firm personnel, including investment banking personnel, as well as third parties.
Transactions involving government-related financings and other matters.
The offering, auction, sales, trading and clearance of corporate and government securities, currencies, commodities and other financial products and related sales and other communications and activities.
As well as the firm’s supervision and controls relating to such activities, including compliance with applicable short sale rules, algorithmic, high-frequency and quantitative trading, the firm’s U.S. alternative trading system (dark pool), futures trading, options trading.
And finally, insider trading.
The SEC said in past years they were tackling dark pools but failed to competently execute the plan.
The issue was brought to the light by the ‘meme stock’ crowd who also exposed naked short selling and received attention by mainstream media.
Dark pools have been able to suppress stock prices across the market from reaching full demand potential.
Gary Gensler said 90%-95% of retails orders do not get processed through the lit exchange (NYSE) but rather through these dark pools.
Goldman Sachs and others have essentially stolen from retail investors as only 5%-10% of retails money actually creates demand for a stock.
For every dollar retail puts in the market, only this small percentage is reflected on a security.
That’s what happens when financial institutions like Goldman Sachs redirects orders through its dark pools.
This is a developing story.
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Bill Hwang’s Archegos essentially used a ton of leverage to pump stock prices up.
As the price of stocks rose, they would buy more shares with those profits, and continue to borrow money from the bank to further pump the prices.
Archegos only held a small portfolio consisting of a few selected companies, of which whom they had many shares of.
When a few companies’ share prices began to plummet, Hwang’s entire empire crumbled almost instantaneously.
As the value of their portfolio sank, the hedge fund was forced to liquidate even more assets due to margin calls, further escalating the situation, and losses.
Archegos was forced to default, causing investors and banks billions of dollars.
Still, Bloomberg vouches for Bill Hwang publishing an article he has done nothing wrong.
What was Bill Hwang charged with?
Hwang and Chief Financial Officer Patrick Halligan were charged with 11 criminal counts overall, including racketeering conspiracy, market manipulation, wire fraud and securities fraud.
Hwang was arrested early Wednesday and was expected to appear in Manhattan federal court later in the day.
This is a developing story.
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