Billionaire Mark Cuban has now scrutinized the SEC for only protecting Wall Street, stating “I wouldn’t trust them to do the right thing ever”.
During a Reddit ‘Ask Me Anything’ (AMA) in the WallStreetBets forum in February 2021, billionaire investor Mark Cuban expressed strong criticism of the U.S. Securities and Exchange Commission (SEC).
In a post from his verified account, Cuban stated, “The SEC is a mess.
I wouldn’t trust them to do the right thing ever.
It’s an agency created by and for lawyers to win cases rather than to act in the interest of investors.”
He further criticized the SEC for prioritizing Wall Street over the protection of everyday investors.
Cuban argued that if the SEC truly focused on investor safety, it would establish clear guidelines regarding insider trading and market manipulation.
Instead, he claimed, “they would rather litigate to regulate,” suggesting that the SEC prefers to develop rules through lawsuits, which leaves the public uncertain and favors Wall Street.
Today, the SEC remains under scrutiny.
Gary Gensler, the current chair, has been advocating for new regulations aimed at enhancing market transparency and protecting investors.
While these initiatives aim to tackle emerging risks, they have sparked controversy within the hedge fund and banking industries.
Critics argue that the new regulations can be overly complex.
The SEC chair has been unable to solve issues retail investors have been facing for decades now — much of which revolves around the manipulation of stock prices by hedge funds short on securities.
Mark Cuban’s criticism of the SEC underscores an ongoing debate regarding the agency’s role and effectiveness.
As the SEC works to adapt to contemporary financial challenges, its success will hinge on finding the right balance between enforcement and market facilitation.
Whether it can respond to retail investors and rebuild trust is still uncertain, but its efforts to evolve are essential for its future influence.
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Market News Today – Mark Cuban Has Now Scrutinized The SEC For Only Protecting Wall Street.
The SEC now charges a hedge fund for compliance failures when it failed to establish and enforce policies within its insider information material.
Note: The SEC has updated their PR to charging Sound Point for ‘compliance failures’ — the title of this article previously read ‘illegal trading’.
As a result, the Securities and Exchange Commission (SEC) has charged Sound Point Capital Management LP a $1.8 million penalty.
The SEC has found that the investment management firm Sound Point violated securities laws related to the management of collateralized loan obligations (CLOs) and the firm’s access to material non-public information (MNPI).
Sound Point managed CLOs and traded its own CLOs as well as CLOs managed by third parties.
Through this work, the firm sometimes came into possession of MNPI about the companies whose loans were held in the CLOs that Sound Point traded.
While Sound Point began conducting pre-trade compliance reviews to address the potential impact of MNPI related to loans in its own CLOs in 2019, the firm did not adopt formal written policies and procedures to handle MNPI from third-party CLOs until much later, in June 2022.
The SEC emphasized that investment advisors with multiple business lines must have reasonable policies and procedures in place to address the risks of accessing MNPI, including through their roles as lenders that may expose them to sensitive information.
As a result of these violations, Sound Point has agreed to pay a $1.8 million penalty and will be subject to a cease-and-desist order and censure by the SEC.
The investigation was conducted by the SEC’s Division of Enforcement and Division of Examinations.
“Fund managers – including those with multiple business lines or strategies – must consider how they may come into possession of material nonpublic information and then adopt and implement reasonable policies and procedures around those risks,” said Andrew Dean, Co-Chief of the Enforcement Division’s Asset Management Unit.
“Among other things, advisers must evaluate how their roles as lenders could expose them to MNPI that may relate to their CLO trading positions.”
A spokesperson for Sound Point told FrankNez:
“We are pleased to enter into the settlement with the SEC on a “no admit or deny” basis.
We cooperated with the SEC in this matter, which relates to certain compliance policies and procedures, the majority of which were modified in 2019.
We have enhanced our controls since then.
This matter does not include any findings of insider trading or misuse of material nonpublic information by Sound Point or its employees.
Sound Point takes its fiduciary responsibilities very seriously and remains committed to operating with the highest standards of governance and compliance.
As an organization, we continue to seek ways to further enhance our policies, procedures and practices and to adapt to changes in regulation, our business and the market.”
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This year we’ve been able to increase push notifications slots making it more convenient than ever for new readers to receive their daily market news and updates.
In this article, we’re going to go over some of the latest developments in AMC, it’s history since redditors took over, and an AMC short squeeze update for the year of 2023.
AMC keeps on keeping on, and although AMC has been on discount recently, retail investors continue to buy and hold it.
Retail investors remain excited about the data that has been collected for years now.
Will we see an AMC short squeeze while we continue to ride today’s bear market?
And if so, how soon?
Welcome to Franknez.com – the blog providing you with content on stocks, crypto, and market news. Today we’re discussing AMC Entertainment stock and its short squeeze update and history.
Lets get started!
How soon will we see an AMC short squeeze?
Retail investors all want to know.
Is it this week?
Will it be next week?
Or, are we looking at a longer game here?
Here’s what we know.
Key Highlights
AMC closed at $3.68 on August 15th. The stock continues to be heavily shorted. AMC Entertainment is set up for a short squeeze despite its split.
Shareholders continue to buy and hold the stock.
AMC’s short interest data shows us the stock has the perfect setup for a short squeeze.
Below is a series of documented facts and positive news that all influence AMC’s potential towards a short squeeze.
“Since reopening our first theatres with AMC Safe & Clean in August, AMC has welcomed back nearly 10 million moviegoers nationwide without a single reported case of COVID-19 transmission among moviegoers at our theatres. We look forward to welcoming back our New York City guests to the big seats, big sounds and big screens that are only possible at a movie theatre.”
Adam aron, President and CEO of AMC Entertainment
For those who thought AMC was a dead company, think again.
The company is now generating big revenue since it’s reopening and has beat every quarter since 2021.
Today, AMC shareholders have saved the movie theatre company again after two major proposals were finally passed following an exhausting lawsuit.
A reverse stock split and conversion of APE shares to common stock will now go into effect later this August.
AMC’s 1-for-10 reverse stock split will go into effect on Thursday, August 24.
The conversion of APE shares into AMC common stock will occur the following day, Friday August 25.
The litigation settlement will then take place on Monday, August 28.
CEO Adam Aron says these dilutive proposals will help AMC Entertainment raise plenty of cash to survive another catastrophic event.
Similarly, Anchorage Capital also closed its doors after betting against AMC stock.
Here’s why this matters:
Hedge funds who try to go against the retail wave will get burned
This is a huge win for retail investors over ‘smart money’ Wall Street
Unless shorts close their positions, hedge funds may suffer big consequences again
Today’s borrow fee rates are higher than they were in 2021 when AMC surged to $72 per share
An AMC short squeeze might be closer than we think
There are a few things retail investors did in 2021 to trigger massive price action:
They held their positions during the ups and downs
Shareholders purchased the dips
Investors shared information relating to a short squeeze (such as this article, 2021) to raise awareness
Kept tabs on charts to know when to buy (during drawdowns)
The incredible thing is 93% of market participants said they will still hold AMC stock in 2023 for a short squeeze.
Will Shorts Cover in 2023?
AMC Entertainment answered questions on short sellers covering prior to its newly approved conversion proposal.
Shares of the company fell more than -30% after hours on Friday as APE shares rose +30%.
On Monday, AMC stock is down more than -33% while APE is up nearly +18%.
Will short sellers be required to cover their positions before the Reverse Stock Split and Conversion?
According to AMC’s new 8-K filing, AMC expects that the deliveries under stock borrowing arrangements will be adjusted in the regular way to account for the Reverse Stock Split or, in the case of contracts on APEs, the Conversion.
However, AMC states that it “does not determine and is unable to provide interpretive advice on the impact of these events on the contractual terms governing stock borrowing arrangements.”
How will short sellers be affected by the Litigation Settlement Payment?
“AMC does not determine and is unable to provide interpretive advice on the impact of the Litigation Settlement Payment on the contractual terms governing stock borrowing arrangements.”
AMC’s reverse stock split will go into effect on Thursday, August 24.
The conversion of APE shares into AMC common stock will occur the following day, Friday August 25.
The litigation settlement will then take place on Monday, August 28.
Will there be large failure-to-deliver (“FTDs”) like when the APE was distributed?
AMC Entertainment states that while they cannot predict the trading impact of these corporate events, given the significant transactions that will occur over successive trading days, it is possible there will be large FTDs like when the APE was distributed.
Looking Back at the Events Prior to AMC’s Short Squeeze in 2021
Adam Aron gives positive news on AMC Entertainment – Archive 2021
AMC Entertainment has raised more than 2.2 billion dollars in cash
90% of AMC theaters in the United States are now open with New York and Los Angeles finally reopening
Vaccinations and policies are making movie theaters safe
New movie titles are guaranteed to increase sales revenues
CEO and President Adam Aron expresses an optimistic future for AMC Entertainment
AMC Entertainment has implemented a Safe & Clean program under the advisement from Harvard University’s prestigious School of Public health as well as well as the No. 1 U.S. cleaning brand, The Clorox Company. This means movie goers can now return at ease knowing a proper sanitation program has been put in place.
Hedge fund affiliate partners such as MarketWatch, The Fool, and other finance website tried to redirect the public from investing in AMC stock while the company was finally reporting positive news.
That’s primarily because hedge funds were losing so much money daily as share prices continued to rise.
A short squeeze became the ultimate threat to hedge funds with massive bets towards the downside.
Today, AMC Entertainment is in a whole other world compared to where it started in 2021.
Is AMC Shorted?
AMC’s current short interest is around 27.76%, which is much higher than it was when AMC shares skyrocketed to $72.
As of 8/15, we’re seeing 200,000 shares have been made available to borrow, via Stonk-O-Tracker.
While shorts might have the capability to short AMC stock, this is only temporary.
The retail community has made big enough ruckus to where regulators are finally investigating naked shorting, or at least acknowledging the problem.
What does this mean for the AMC shareholder?
Short sellers have used this rinse and repeat process for years now.
The important thing in 2023 is that AMC is able to continue raising cash to eliminate the short thesis.
Not only has bankruptcy been off the table since 2021 (via. Los Angeles Times), but AMC movie theater attendees have increased drastically in 2023.
This in turn has increased revenue and helped AMC Entertainment pay off more debt in the past two years.
AMC Entertainment Quarter Earnings History (2021)
Below are AMC’s quarter earnings for 2021, the year the ape movement began.
AMC announced their Q1 earnings for 2021 on Thursday, May 6th.
Things have been looking particularly bullish and optimistic since that point.
The only thing getting in the way has been market makers who have big advantages over the average retail investor.
If you missed the conference call years back, you can view it here for your viewing pleasure.
It’s really hard to tell when an AMC short squeeze may occur.
Experts, analysts, and shareholders can’t identify an exact date and time because of how random the probability may be, as seen in 2021.
However, the possibility of an AMC short squeeze is certainly possible given that it is still a very heavily shorted stock.
We also now have more data then ever before that indicate a massive short squeeze is almost certain to happen.
Especially now that the SEC has announced some crackdown on shorting.
With Melvin Capital and other hedge funds out of the picture, it’s only a matter of time before others close their positions.
That is if retail investors can build enough buying pressure in 2023 like they did in 2021 to drive share prices up.
In the end, it truly is all up to retail investors!
Will investors be able to create another AMC short squeeze in 2023?
That might be a little harder now with all of the company’s dilutive proposals going into effect soon, but it doesn’t mean it’s still not possible.
Trey’s Trades AMC prediction
With that being said, Trey’s Trades predicted a short squeeze in 2021. Trey was a leader in the AMC community back in the day, though he’s recently taken time off from stock content on YouTube.
Data points towards AMC stock reaching $1000+ per share according to his research.
See what Trey had to say.
AMC short squeeze – AMC Stock Forecast – AMC Stocktwits | Trey’s Trades on AMC Short Squeeze.
The real question is, how can retail investors make this AMC short squeeze happen?
We know that short-sellers eventually have to close their positions. This means that they will eventually have to buy AMC stock at the current share price.
If retail investors continue to drive the share price up by buying the dip and holding their positions, short-sellers will have no other option than to buy from the retail investor at a higher share price.
2. Retail investors will also need to buy the climbs in order to show a demand for the stock. This doesn’t have to be huge buys, rather incremental to validate the current share price.
This play essentially creates a supply and demand scenario between retail investors and short-sellers.
However, demand must exceed supply by a monstrosity amount, as we saw in June of 2021.
The results? A short squeeze.
Just make sure to take your profits this time.
The last thing you want is to see your gains turn into losses.
Hedge funds are doing everything they can to prevent a short squeeze
How are they doing this?
By promoting false information through MSM (we’re certain you’ve seen it)
Through strategies such as short-ladder attacks in the market
Dark pool/off exchange trading
HFT and Spoofing
And, by restricting certain brokerage accounts from allowing its retail investors to purchase or buy shorted stocks as seen with Robinhood (Robing hood)
This is what retail investors can do to fight corruption:
Share content that presents facts, like this article and others to raise awareness (blog posts, analysis videos, etc.)
Continue to educate yourself and make investment decisions based on your personal analysis
What is interesting however is that Goldman Sachs has now given AMC Entertainment a price target of $175 per share in 2023.
MarketBeat reports that on July 24, 2023, Goldman Sachs gave AMC Entertainment a ‘Boost Target’ action and ‘Buy’ rating with a whopping price target of $175.
And CoinCodex is predicting AMC Entertainment stock to soar more than +9,000% by the year 2030.
“Based on the average yearly growth of the AMC Entertainment Holdings stock in the last 10 years, the AMC Entertainment Holdings stock forecast for the beginning of next year is $ 8.19.
Using the same basis, here is the AMC Entertainment Holdings stock prediction for each year up until 2030.”
The long-term AMC Entertainment Holdings stock price predictions are as follows:
By year 2024, AMC Entertainment is predicted to soar +90.66% from today’s current share price to $8.19.
In 2028, AMC stock is predicted to trade around $108.21 per share, a gain of +2,419% from today.
And by 2030, CoinCodex predicts AMC will trade near $400 per share, up more than +9,000% from today’s trading price.
In 2023, investors will need to identify the primary reasons to invest in AMC Entertainment stock today.
Redditors have touched base on this topic and are determined anything below $100 is a buy, for a short squeeze that is.
However, with so much dilution happening in 2023, you might want to consider writing and coming up with your own best-case and worst-case scenario plan.
The approved proposals is a massive win for the movie theatre company whether you strongly agree with them or strongly do not.
Identifying why you’re still invested in this company or why you would like to is something that will vary from individual to individual.
“The steps we will be taking now are shareholder approved and mean the following to AMC:
AMC will be more resilient: Were it not for our ability to have raised equity over the past three years, AMC simply would not have survived the pandemic-induced decline in our business. Looking forward, the flexibility to raise equity capital at the appropriate times is an absolutely vital tool for any large company, and AMC is no exception.
We eliminate capital raising inefficiencies of APE units trading at a significant discount to AMC shares: Converting APE units to AMC shares results in a single price for all AMC equity. This single price eliminates the unnecessarily high dilution caused by the lower market price of APE units. For the past full year, for example, to raise cash, AMC could only sell APE units, and they only could be sold at a great discount to AMC shares. With single equity capital structure, I believe AMC will be able to raise equity capital more efficiently and on better terms in the future.
“Some of you fear dilution is a mistake no matter what. You are wrong.
To the contrary, sometimes raising money is an absolute imperative.
Over the past twelve months, for example, AMC raised $418 million of cash through the sale of APE units.
As of the most recent June 30 quarter end, AMC had $435 million of cash on hand.
Can you imagine how dire our circumstances would have been if we hadn’t had the foresight to raise that cash?
Companies that run out of money face financial ruin.
Just ask Cineworld/Regal shareholders, or ask Bed, Bath and Beyond shareholders.
But at AMC at the moment, we have a positive market cap, and we are so much stronger because we raised money along the way,” said Adam Aron on Monday.
Where was AMC trading at before the pandemic?
AMC was actually trading between $30-$35 back in the booming party economy of 16′!
AMC stock started to decline as their debt increased and hedge funds began to heavily short it.
However, AMC Entertainment Holdings, Inc. is in a completely different world today than it was during the pandemic with box office number reaching pre pandemic levels.
AMC Announced a new record high earnings report last Tuesday.
Analysts have been expecting big earnings results from the movie theatre chain due to the rise of this year’s second quarter box office numbers.
“While we still have much work ahead of us on this front, AMC’s glide path to eventual recovery continued with significant pace in the second quarter of 2023 as our results set new records and represent AMC’s strongest second quarter in four full years.
Following an impressive start to the year in the first quarter of 2023, the second quarter yet again showed great progress.
AMC saw more than a 12% growth in attendance, a 15% growth in total revenue and a 71% increase in Adjusted EBITDA compared to the second quarter of 2022.
Indeed, Adjusted EBITDA was $182.5 million, the highest such quarterly figure since the fourth quarter of 2019,” said AMC CEO Adam Aron.
Barbenheimer Produces Big Results in 2023
Towards the end of July, AMC Entertainment broke a 4-year weekend high record as “Barbenheimer” produced results bigger than expected.
The results demonstrate AMC’s path to recovery is also strong in Q3 of 2023.
“Barbie” ended up with $162 million in its first weekend of release, above Sunday’s already record-breaking estimate of $155 million. The Warner Bros. film, starring Margot Robbie declined just 9% from Saturday to bring in $43.7 million on Sunday.
Those ticket sales rank as the biggest opening weekend of the year, besting “The Super Mario Bros. Movie” ($146 million).
“Barbie” also marks the biggest debut ever for a film directed by a woman, overtaking Anna Boden and Ryan Fleck’s 2019 blockbuster “Captain Marvel” ($153 million), says Variety.
“Oppenheimer,” also beat expectations with $82.4 million, slightly higher than Sunday’s huge $80.5 million projection.
At the international box office, Oppenheimer added $98 million for a global tally of $180 million.
“The box office powered to its fourth-biggest weekend in history with over $300 million industrywide, said Variety.
What If a Short Squeeze Doesn’t Happen?
If an AMC short squeeze doesn’t occur, AMC stock price should still go up during the longer term process allowing shareholders to make at least some sort of profit.
That is, as long as the company continues to improve going into 2024 and the rest of the decade.
With AMC theaters now open since 2021, it’s inevitable that the company will begin to see bigger sales revenue every time a new title is released.
Keep in mind that AMC’s share price during the booming party economy of 16′ was roughly around $30 per share.
If a short squeeze doesn’t happen, fundamentals will continue to bring the stock up as more investors are buying the stock.
It’s also important to keep in mind that majority of the float is also held by retail investors, so the company has a huge support.
AMC hasn’t squeezed yet primarily to two main reasons.
The stock requires volume to drive the stock price action up
Shorts need to close their positions
Volume will surge as more and more retail investors (as well as institutions) get in on AMC stock.
Regarding shorts closing, retail investors need to squeeze them out of their positions by holding their positions and helping increase AMC’s short borrow fee.
You can keep tabs on AMC’s short borrow fee as it changes every day via. Ortex, or Fintel.
As of 8/15 AMC’s short borrow fee rate is a whopping 921.1%.
Interactive Brokers Chief Strategist Steve Sosnick says there’s big demand to short AMC Entertainment (NYSE:AMC) stock.
He says the biggest reason aside from the company’s fundamentals is its new merge with its equity (NYSE:APE).
“It’s very hard to keep the momentum in these things because economic reality does take hold.
Bed Bath & Beyond, at one point was the best performing stock on the board until reality set in and they began defaulting, averted bankruptcy, but using a deal that is so dilutive that it’s unavoidable.”
Sosnick says AMC is in a very special situation because of the proposal to merge APE with AMC common shares.
“Right now we’re seeing such a demand to short AMC partly because of its difficulties but partly because of the special situation.
This really is what they were looking for in some ways as the mother of all short squeezes.
The borrow rate, it costs you 700% to borrow the shares overnight — if you can find them,” said the Interactive Brokers Chief Strategist on Yahoo Finance.
Is AMC Entertainment stock about to squeeze this year?
“Redditors, thank you so much for helping create the best pipeline we’ve ever had”, said Ken Griffin on Business Insider.
Ken Griffin, on how the GameStop frenzy helped raise Citadel’s profile with potential hires.
Business Insider says the SEC found no truth to any of the conspiracy theories but how can the SEC really go against one of the most powerful hedge funds in the world?
Transcripts showed Citadel and Robinhood did in fact have “blunt negotiations” the night prior to the halts.
A Miami district court judge admitted the Citadel and Robinhood transcripts were suspicious.
However, the federal court has dismissed the case due to a ‘lack of evidence’.
Let us know in the comments section below what an AMC short squeeze would mean for you!
If you’re an AMC shareholder let us know in the comment section below.
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Market News: Citadel and friends are entering the crypto space | Ken Griffin.
Ken Griffin and friends are entering the crypto world very soon — investors are concerned as Citadel has a history of several violations and fines.
EDX Markets plans to bring ‘traditional finance’ to the crypto space, a not so ‘traditional’ space to begin with.
The exchange made up of Citadel, Sequoia, Paradigm, Virtu, Charles Schwab, and Fidelity is debuting in November.
EDX Markets will start trading a limited number of spot, crypto tokens starting with a November trial period, with the official launch in January, per Bloomberg.
Similar to trading equities and options, EDX will allow investors to buy and sell digital assets through their existing broker dealer, rather than an outside venue or directly through a crypto-native exchange.
“We’re taking some of the best features of traditional finance and bringing it to the digital markets to make it more efficient, and bring that cost saving to investors,” Nazarali said.
Nazarali is the former global head of business development at Citadel Securities.
But as many are aware, these financial institutions have a long history of playing unfair.
Will these sharks taint the crypto space too?
Let’s look at Citadel’s market manipulation history as well as other Citadel violations and fines in the past.
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Citadel Market Manipulation
Citadel violation and fines – market manipulation.
2015
In 2015, an account operated in China by the brokerage arm of US hedge fund Citadel was suspended.
It was the latest casualty of regulators’ hunt for market manipulators and short sellers at the time.
The China Securities Regulatory Commission said that the Shanghai and Shenzhen stock exchanges had suspended 24 accounts as part of a probe into high-frequency trading.
The investigation focused on a practice known as “spoofing” in which an investor submits a buy or sell order but then withdraws it before a sale is completed — a practice that can mislead investors by creating the false impression that a stock is trading at a particular price.
Citadel confirmed that one of its accounts managed by Guosen Futures was among those suspended.
2017
In 2017 Citadel was fined by the SEC $22.6 million to settle charges of misleading conduct.
The hedge fund misled customers about the way it priced trades.
The SEC found that between 2007 and 2010, Citadel used two algorithms to execute stock trades on customers’ behalf that gave investors a worse price for their trades, even when Citadel knew better prices existed elsewhere.
“This affected millions of retail orders,” said Stephanie Avakian, the acting director of enforcement at the SEC at the time.
Citadel neither admitted nor denied the findings.
2021
Citadel violations and fines – market manipulation.
In 2021, Failure-to-Delivers (FTDs) rose dramatically in the period leading up to January 28th, 2021, a phenomenon consistent with increasing short interest by market makers such as Citadel Securities.
FTDs are indictive of naked short selling, which occurs when a short seller does not actually possess the security it is supposed to borrow.
This practice is largely inaccessible to individual investors but accessible to market makers.
At the time, Citadel, Robinhood, and others restricted retail investors from buying ‘meme stocks’ in order to prevent escalating institutional losses.
Citadel eventually lost billions after betting against AMC Entertainment in 2021.
The Chicago Tribune published a piece explaining exactly what retail investors have been warning the SEC about.
Citadel Securities’ dark pool dominates a big part of the financial world, accounting for as much as half of U.S. stock market activity.
The Chicago Tribune says this prominent dark pool is run by Chicago Billionaire Ken Griffin’s Citadel Securities and has been targeting small scale retail investors.
And they’re not wrong.
Dark pools are typically involved in payment for order flow (PFOF), where they pay broker firms to receive retail order flow.
Brokers such as Robinhood and TD Ameritrade accept payment for order flow.
But retail investors have been bringing these nefarious practices in the market to light.
Gary Gensler says 90%-95% of retail orders don’t go through lit exchange.
Gary Gensler announced exclusively on Bloomberg (see below) that 90-95% of retail orders don’t go through the lit exchange.
The SEC Commissioner says these orders are rerouted to dark pools rather than the NYSE.
It was only a year after the ‘meme stock’ frenzy that the community receives this official news.
The ‘ape’ community has been labeled as conspiracy theorists but have proven to be correct time and time again on the market injustices that have been occurring for decades.
Here’s the latest market news.
Welcome to Franknez.com – Gary Gensler has confirmed the market manipulation that the ‘ape’ community has been exposing all for years now.
This is big for the retail community because for some time, ‘smart money’ was referring to investors as conspiracy theorists.
And can the SEC suspend dark pool trading?
Let’s dive right into it.
Gary Gensler on Dark Pools via Bloomberg
Gary Gensler confirms 90%-95% or retail orders are processed in dark pools
SEC Chairman and Commissioner Gary Gensler says payment for order flow is partly the reason why orders aren’t processed on the lit exchange.
He says retail orders go to wholesalers on an order-by-order competition.
Citadel’s Ken Griffin has praised PFOF stating it’s good for retail investors.
However, PFOF allows market makers to process retails orders in the ‘dark markets’, or dark pools.
This means retail buying volume is out of sync with AMC’s actual share price.
AMC’s share price is synthetic, it only reflects a small portion of buying volume.
Market Makers Have Been Stealing from Retail Investors
Market makers have been stealing from retail investors with absolutely no consequence from regulators.
Now that the cat is out of the hat, what is going to be done about it?
How does one account for all the orders that have been derailed from the lit exchange market and fix the share price to reflect the correct amount?
Banning PFOF is one thing but what about the money that has been masked by dark pools?
Will these financial institutions be held accountable for financial treason?
The integrity of the stock market has been tainted for far too long, now it’s time to take action.
Will PFOF get banned in the U.S?
Will PFOF get banned in the United States?
According to Gary Gensler, PFOF is banned in the UK, Canada, Australia, and in Europe.
However, because the U.S has a very strong capitalist economy, it could prove to be difficult.
Gensler says, “I think it’s natural that we look to say, how do we drive great competition and efficiency in this market, and use the tools that congress has given us.”
Here the SEC Chairman is saying their solution is to find someone who can compete with these market makers rather than banning PFOF in general.
IEX is a lit exchange that reflects much more accurate share prices and eliminates the predatorial strategies used by market makers and hedge funds.
These strategies include PFOF and high frequency trading.
Recently, Citadel, Charles Schwab, and the NYSE have teamed up to destroy new SEC Proposals.
However, ‘We The Investors’ has challenged Wall Street by submitting more than 1,300 letters supporting the SEC’s proposals.
Retail Wants Orders Processed Through the Lit Exchange
The SEC is supposed to be protecting retail investors from nefarious market practices.
Therefore, it is the SEC’s duty to find a solution and locate the money that retail is missing.
Retail wants orders processed through the lit exchange.
Market makers do not have the consent to move retail money through dark pools or other foreign markets.
#MarketMakersDontHaveConsent
Can the SEC Suspend Dark Pools?
Yes, the U.S. Securities and Exchange Commission (SEC) has the authority to suspend dark pools if it believes that they are violating securities laws or posing a risk to investors or the integrity of the markets.
Dark pools are private trading venues that allow institutional investors to buy and sell large blocks of securities without revealing their trading intentions to the public.
While dark pools can provide benefits such as reducing market impact and improving execution quality, they can also raise concerns about transparency and fairness.
The SEC has taken action in the past to regulate dark pools and address potential abuses.
For example, in 2014, the SEC brought charges against a major dark pool operator for making false statements to investors about the operation of its trading platform, leading to a $12 million settlement.
In 2020, the SEC proposed rules that would increase transparency and disclosure requirements for dark pools.
If the SEC determines that a dark pool is engaged in unlawful activities or poses a risk to investors or the markets, it can suspend the dark pool’s operations, require it to take remedial actions, or take other enforcement actions as appropriate.
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Market News Today – Can the SEC suspend dark pools?
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The fee is going up after being down for many months.
What is AMC cost to borrow?
The cost to borrow fee is the interest shorts pay for borrowing shares of AMC stock.
This means shorts are losing money every day by not closing their positions.
A surging short borrow fee rate could incentivize shorts to close their positions due to higher borrowing costs.
Why does the cost to borrow rate matter?
It costs shorts interest to hold while it costs the retail investor absolutely nothing to hold.
Shorts are losing money month they hold because of this interest fee for borrowing the stock.
For some reason shorts still think AMC Entertainment can go bankrupt, although they have enough money to continue doing business.. I know, I don’t understand this either.
As hedge funds like Citadel lose money, the short borrow fee only increases those losses.
AMC’s share price might be on discount right now, but hedge funds are experiencing losses on top of losses.
They’ll eventually have to close their short positions; will you miss it?
Vanguard has proven to be useful, and it has never failed me before.
Important Advisory
It is important to note that I am not a licensed financial advisor.
Like many traders and self-taught investors, all speculation is based on educated estimations based on highly reliable analysis, patterns, and documented news charts.
On another note: It would be wise to not invest more than you can afford to lose. In other words, invest money you would be okay with losing for simpler terms.
Avoid bogus headlines from The Motley Fool and other sources
AMC and r/wallstreetbets have been given lots of negative press from the likes of The Motley Fool and other sources; shaming the purchase of the stock.
Fortunately, the AMC community has been backed up by Mark Cuban, Chance the Rapper, and other big names.
Influential outlets with powerful hedge fund partners (institutions who short the stock) have been attacking traders and investors by providing false information wherever they can.
What we’re seeing right now is that the big guys are losing money due to the price of shorted stocks going up.
They will say and do whatever they can to divert the public from trading this stock.
My personal suggestion to you is to not let these sources intimidate you.
Do your research to see how the stock price has been manipulated through bogus headlines and short-ladder attacks.
