"There was absolutely nothing wrong or illegal about anything that was happening on the part of the army of small investors." Wrong. While many jumped on the bandwagon after it got going, many others coordinated to get it started. Colluding to manipulate the price of a publicly traded stock is securities fraud. It is being investigated and will be prosecuted by the SEC.
And this is not, as it's being portrayed, a victory for the little guy over Wall Street fat cats. Whenever the stock market is gamed, it's the little guys who always get hurt the most. In addition to small time investors investing directly in stocks, many of the institutional investors are investing the money of thousands of small investors.
Some
hedge funds will be hurt, but hedge fund managers don't lose any of
their money when their funds go down. They share in profits, but they
don't share the losses. They don't pay any price for losing their
investor's money. If the fund goes bust, they just start a new one.
Blatant manipulation and the resulting bubble that ultimately pops creates great instability in the Market and that often results in downward moves across the board. Individual investors are usually slow to react, if at all, while the professionals quickly adjust.
Those who seek to make quick profits at the expense of "Wall Street Fat Cats" need to remember that the Market is always a gamble, not an investment. You too can lose, and lose big. If you can't afford to lose, you can't afford to play.
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