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Judd Legum Profile picture
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16 Nov, 10 tweets, 5 min read
1. The GameStop controversy has largely faded from the headlines but a class action lawsuit has surfaced EXPLOSIVE internal messages involving Robinhood and Citadel, a massive hedge fund

Follow along if interested

popular.info/p/gamestop-rev…
2. The core issue is that Citadel has two roles

- Citadel makes bets on stocks. Citadel bailed out another hedge fund that made a huge bet shorting GameStop.

- Citadel is a market maker. It buys "order flow" from Robinhood and facilitates trades.

popular.info/p/gamestop-rev…
3. When Robinhood limited the ability to trade GameStop, tanking the price, some questioned whether they did it to benefit Citadel.

Citadel and Robinhood vociferously denied they colluded

The internal messages paint a more complex picture

popular.info/p/gamestop-rev…
4. The complaint of the class action lawsuit alleges "the day before the restrictions were implemented, high-level employees of Citadel and Robinhood had numerous communications with each other that indicate that Citadel applied pressure on Robinhood"

popular.info/p/gamestop-rev…
5. The lawsuit includes supporting evidence. Robinhood's COO told Robinhood's CEO, Vlad Tenev, that she and two other execs were meeting with Citadel at 5PM on 1/27.

She said she believed Citadel was going to threaten to limit payments to Robinhood

popular.info/p/gamestop-rev…
6. Tenev appears concerned. He responds by asking his CEO to try to set up a "chat" between Tenev and Ken Griffin, the CEO of Citadel.

This all happened the day before the restrictions on GameStop stock were put in place

popular.info/p/gamestop-rev…
7. After the call, one of the execs who participated confirmed that Citadel and other large hedge funds were having a "really bad night."

"you wouldn't believe the convo with Citadel. Total mess."

popular.info/p/gamestop-rev…
8. There are other messages along these lines. None of them is a smoking gun, because we don't know precisely what is said during the calls. But it's a far more complex picture than the blanket denials by Robinhood, Citadel, and Griffin.

popular.info/p/gamestop-rev…
9. We may learn more as the lawsuit progresses. @EpsilonTheory believes that the messages show that Citadel successfully pressured Robinhood without breaking the law or making explicit demands to restrict trading

popular.info/p/gamestop-rev…
10. For more independent accountability journalism that makes complex issues easy to understand, check out my newsletter, Popular Information.

It's free to sign up --> popular.info/subscribe

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More from @JuddLegum

Judd Legum Profile picture
15 Nov
1. In less than a week, North Dakota enacted a sweeping new law banning "Critical Race Theory" in K-12 schools

The measure illustrates the acute danger these laws pose to free expression and historically accurate instruction

Follow along if interested

popular.info/p/new-north-da…
2. The new law prohibits any instruction "related" to the idea that "racism is systemically embedded in American society" or the American "legal system."

That includes written materials. Whether or not any of this is endorsed by the teacher.

popular.info/p/new-north-da…
3. Faced with these constraints, how can a teacher discuss slavery, the civil rights era, or the history of redlining?

All of these topics are inextricably related to systemic racism in American society and its legal system.

popular.info/p/new-north-da…
Read 9 tweets
Judd Legum Profile picture
12 Nov
1. Claims by Walgreens and other corporations that San Francisco is facing an epidemic of "organized retail crime" is not reflected in citywide crime data.

popular.info/p/the-truth-ab…
2. In 2020, shoplifting in San Fransisco reached its lowest level since statistics began being collected 45 years ago.

It has increased slightly in 2021 but still remains well below 2019 levels.

popular.info/p/the-truth-ab…
3. The false narrative is being relentlessly pushed by a far-right website run by a former Republican consultant (and business partner of Jared Kushner) who received a pardon from Trump

popular.info/p/the-truth-ab…
Read 5 tweets
Judd Legum Profile picture
12 Nov
1. Very illuminating list from @DefendingEd, a dark money group linked to the Koch political network, of what it claims is evidence of Critical Race Theory being taught in K-12 schools in Virginia

I want to highlight some examples of things they find objectionable
@DefendingEd 2. A Fairfax county social studies coordinator who says African-American history “deserves a truer and fuller account.”

This is an example of "Critical Race Theory," according to the group
3. A message from a high school principal that says: "While I did not come from a family with economic means, the color of my skin has given me privileges that others do not have."

This is an example of "Critical Race Theory," according to the group
Read 13 tweets
Judd Legum Profile picture
10 Nov
1. Everyone is talking about rising prices and there are a lot of factors that contribute to inflation but one important factor is almost never discussed: concentrated corporate power

Follow along if interested

popular.info/p/how-concentr…
2. In a competitive economy, profit margins should approach zero (as long as there are reasonable substitutes)

In the US, corporate profits as a share of the American economy have risen dramatically over the last two decades, from 5% of GDP to nearly 12%

popular.info/p/how-concentr…
3. In other words, corporations are not being *forced* to raise prices to stay afloat.

They are choosing to raise prices to maintain large profit margins because they have enough market power to do so without losing customers

popular.info/p/how-concentr…
Read 9 tweets
Judd Legum Profile picture
9 Nov
UPDATE: Republican lobbyists are "frustrated," pushing corporate PACs to resume contributions

This reflects the reality that dozens of major corporations have stuck by their pledges and have not resumed contributing to GOP objectors

popular.info/p/update-repub…
2. Politico wrote a story with the headline: "GOP lobbyists say corporate America is coming back into the tent"

But when you READ the story you'll find that this is GOP lobbyists PREDICTING that corporations will end their donation freeze soon

popular.info/p/update-repub…
3. Lobbyists have been making similar predictions since February.

And while some major companies like @Cigna and @ATT have violated their pledges, dozens of other major corporations have kept their word.

popular.info/p/update-repub…
Read 6 tweets
Judd Legum Profile picture
8 Nov
1. Right-wing operatives have deployed a MASSIVE network of fake local news sites to weaponize Critical Race Theory in political campaigns

Follow along if interested

popular.info/p/right-wing-o…
2. The Rosetta Stone of this effort is this tweet by @lansing, the president of @WinRed, the main GOP online fundraising vehicle

Lansing credits an article in "West Nova News" as "starting it all" and helping deliver a win for Glenn Youngkin

popular.info/p/right-wing-o…
3. West Nova News is part of a massive network of 1300 "news" sites linked to conservative businessman Brian Timpone

Timpone has a long history of leveraging "low-cost automated story generation"

He's been accused of faking bylines & quotes & plagiarism

popular.info/p/right-wing-o…
Read 11 tweets

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