Founder of WallStreetBets Reddit speaks on GameStop: 'Pandora's box is open'

we are watching this day trading frenzy continue meanwhile robin hood raising an additional 2.4 billion dollars from shareholders following last week's frenzy bringing the total to more than three billion dollars of a money raise take a look at gamestop shares today at the lows of the morning down 42 percent the popular stocks on the platform include gamestop amc they're plunging the video game retailer down as you see 42 percent joining me right now is the founder of the forum that started it all wall street bets founder jamie rogozinski jamie it's great to have you today thanks very much for joining us wow what a moment in time assess the story for us how are you feeling as you look at what took place last week yeah well thanks for having me and this is absolutely very interesting this is fascinating to watch this is uh wonderful to see how everyone not only the people that are actively participating in the training community but people from outside including politicians and businessmen and hollywood and everyone's kind of chiming in and not only on the u.s not only the us but worldwide i think there's a lot of sentiments that have been penned up for a while that are just starting to surface so this is this is just absolutely fascinating to watch well i mean you know retail investors really stepped up a bit of an investor revolution do you think that continues yeah i mean the the pandora's box is open there's there's no going back at this point you know it's been uh i believe this has kind of been a catalyst that has uh shined a spotlight on this but this has been a long time in the making there's been uh over the past 10 years access to the wall street and financial markets through first discount brokers now uh free brokers these app-based brokers that give the little guys access to the system in in wall street for too long it's been too hard and too expensive to inaccessible and now now that the retail traders have retail investors or retail participants have access to this is really difficult to turn the clocks back but but but jamie what i'm really uh trying to understand is how this plays out i mean yesterday a number of wall street analysts were looking at schwab looking at independent brokers to to assess what more regulation means do you think this is where this is going jamie you see this in individual investor revolution fighting back saying okay the hedge funds think this stock is going down we're going to be bidding it up um do you think that is going to lead to a heavy regulatory burden for these companies in terms of costs in terms of what they're able to do well yeah there's there's a lot of things that play right now i just uh learned about the the 2.4 billion dollar cash infusion into robinhood to help them deal with this type of volume uh a lot of people are cheering this them on but the way i look at it is it's too late for that you know these retail investors shouldn't have to worry about these clearinghouse mumbo jumbos it's obvious that the system was not designed with them in mind it's been designed for these large wall street institutions and now that these amateur traders these retail traders are getting involved it's never been more evident that the system was never designed for them to actually participate and have control over uh their participation in the financial markets i think it's a little bit too late i think it's sad that a lot of people ended up losing money i suppose it's good that they're starting to address this but as you said there needs to be a bigger conversation uh regarding the playing field there needs to be a paradigm shift where uh the retail traders are are taking into account what the rules you know for the the system was clearly designed for the big guys and the little guys obviously have a seat at this table and they need to address that yeah i mean that's that's the whole point right i mean for years we've been watching hedge funds decide what they want to do if they want to take down a company they want to bet against it in coordination they do it they've been able to send stocks down in doing so but now you see a group of individuals do it and all of a sudden everybody's up in arms we need regulation we need to make sure there's no market manipulation so i i mean did this make the point or did this push for regulators to go overboard i think it goes one step even further than that you know you look at what happens in 2008 when the the big banks were playing with these mortgage-backed securities and collateralized debt obligations and all these acronym-blading tools that were basically just sophisticated uh financial casino channels what happened in that situation is the government comes in and bails them gives them free taxpayer money i haven't seen any bailouts of the people that lost money last week i haven't seen anybody trying to cheer on to say hey the system clearly was wrong the system would go into sign blame wherever it is i haven't seen the government trying to step in and save the little guy so there has to be a shift in mentality and and that shift in mentality can come many different ways it can come from the regulatory standpoint it can come from a legal standpoint but whatever it is they have to consider the little guys because the little guys have now gotten together in such big numbers that they cannot be ignored anymore yeah so do you want to see but what are your thoughts on how this community has evolved what the future could look like with more popularity and where the regulations go should there be a stronger regulatory backdrop for the big guys look i think the rules have to be the same for the big guys and for the little guys take your pick in which direction wants to go in i understand both arguments they can agree with both arguments uh you know maybe you should allow the big guys to short or whatever it doesn't matter what the rules are but they should be the same for here and over there there shouldn't be two different sets of standards if we're given bailouts give them to everybody if we're uh you know allow if we're banning short sales banned them for everybody but but treat everybody the same that's the biggest thing that needs to take place uh you know with regards to where things are gonna come you know who knows at this point so many people are talking about this implication senators congressmen uh they're talking about the the fairness of the game but the other thing that needs to seriously be addressed is the uh strength of the system in wall street there are it is too weak we saw the entire thing come down fashion uh whatever 12 13 years ago and and we're starting to see cracks of things that were never addressed obviously there's not enough room the clearinghouse process is settling whatever access to these leveraged etfs with very very technical things obviously you know we still get flash crashes we've still got all sorts of different things but so many participants we need to see the system strengthened so that it can withstand uh all the participants inside this market you know you know some people say this wasn't a david and goliath situation at all in fact it was about capital what do you say to that well it was david in goliath situation people on wall street bets and other retail traders that were privately using robinhood were doing they were leveraging their small capital to force the big guys into winning they were lobbing this stone really strategically in order to beat them uh obviously if if the little guys had a lot of capital then i i believe that they would have been paid attention to all along right uh they were really clever in understanding that they didn't have as much money as the big guys did they figured out a way to use some stock options and he's out of the money whatever is to get the deltas and gamma hedging and blah blah blah they force the big guys to buy their stocks they have to use their money for it so the little guys figured out a strategic uh way to push back they knew that their disadvantage was money and they overcame all right we will leave it there jamie please come back soon we need your guidance on this market and really the enormous potential of the retail investor class jamie rozinski we'll see you soon sir thank you thank you very much

Channel: Fox Business

Views: 59,760

Keywords: Fox Business Network, Fox Business, news, business, business news, Maria Bartiromo, Mornings with Maria, Jaime Rogozinski, WallStreetBets Founder, WallStreetBets Reddit, Reddit, Reddit forum, little guys wall st, Wall st, hedge funds, Vlad Tenev, Reddit traders, NYSE, GME, $GME, To the moon, Elon Musk, retail investors, free market, markets, Wall Street, Robinhood, Robinhood gamestop, gamestop amc, gamestop stock, trading, investors, stock news, GME Stock, AMC

Id: db_ek04W9qs

Length: 8min 29sec (509 seconds)

Published: Tue Feb 02 2021