Reuters reports massive losses for hedge funds that shorted the GameStop (GME), but were thwarted by Reddit retailers, who decided to put a turd in their punch bowl, raising the price, leaving short sellers to hold the bag.
Sellers are soon on an estimated $ 70.87 billion in losses from their short positions in U.S. companies so far this year, data from data analytics firm Ortex said on Thursday.
Strong losses occur as short-circuited GameStop shares have risen more than 1,000% in the past week for no apparent business reason, forcing short sellers to buy back the stock to cover potential losses – defined as a short cut – in while retail investors then piled up to benefit from the growth.
The heavy losses on hedge funds are exactly what many retailers are claiming, considering it a bailout for the 2008 bailout after the collapse of homes that left many Americans homeless as Wall Street flourished, fattened by government money.
While many have criticized retailers for using the market as a tool of revenge, so far it seems to work. To get caught up in the story behind it, read the following: