ShmoopTube

Where Monty Python meets your 10th grade teacher.

Search Thousands of Shmoop Videos


Econ Videos 216 videos

Finance: What does "Breaking the Buck" Mean?
7 Views

What does “Breaking the Buck” mean? Breaking the buck means that a money market fund’s value has dropped to less than $1. This happens becaus...

Finance: What is the Tax Reform Act of 1986?
4 Views

What was the Tax Reform Act of 1986? Hit play to find out.

Finance: What is Disinflation?
4 Views

What is Disinflation? Disinflation is a term used for an interim slowdown of inflation rate. For example, a reduction of inflation growth from 3.5%...

See All

Finance: What is Market Manipulation? 2 Views


Share It!


Description:

Market manipulation is manipulation of the, uh... market. Like...illegally. Yeah, any sort of "scheme" is probably something you want to avoid.

Language:
English Language

Transcript

00:00

Finance allah shmoop What is market manipulation All right people

00:08

Ah sleazy hedge fund trader guy with a huge friendly

00:11

smile has been shorting shares of a vaguely known tech

00:16

name Thingamabob thingamabob Dot com Yeah that's it and yeah

00:20

even they don't know what this thing does Well heggie

00:22

mk sludge is betting the shares will go down soon

00:25

and he'll profit from the short sale Well they aren't

00:29

going down so he's panicking Well he just jumps into

00:32

action calling with a disguised voice a bunch of financial

00:37

journalists who have next to no training in finance He

00:40

whispers to them about fraud in the reporting of the

00:43

books of thing He finds an ident him to a

00:46

cod ical to an addendum on page four hundred eighty

00:49

two on their filings from their uh who's becca stan

00:52

office And then he whispers money laundering being unschooled in

00:57

hungry for a headline The journalists have no idea what

01:01

to dio who to call to actually get a real

01:03

reading on this issue S o they do what most

01:06

financial journalist d'oh which is just vomit letters on their

01:09

blogged writing about potential fraud at this thing All right

01:12

Well about eight seconds after the headlines start hitting the

01:15

tape well and they come from a four different journalists

01:18

So those headlines must be accurate right Well things doc

01:23

it's cut in half Heggie mix sludge covers is short

01:26

by buying back the shares he shorted and he makes

01:29

a fortune and the market has been perfectly manipulated illegally

01:34

Yeah you can't do this people This is not legal

01:37

and it's just one illustration of tons of market manipulation

01:40

schemes out there Other schemes Well today an obvious one

01:44

lives inside all the social media world where fake news

01:48

can be planted anonymously with few if any repercussions for

01:51

the violator if you can even find him Another more

01:54

nefarious scheme involves collusion of that quote respected unquote wall

01:59

street sell side analysts who when filled with truckloads of

02:03

negative data about a company voluntarily given to him by

02:07

heggie mk sludge is finally swayed under the promise and

02:11

boss pressure of massive commission revenues from that hedge fund

02:15

teo write something negative That is if the sell side

02:19

analysts will only accede and write a very highly critical

02:23

report of the company confirming at least a few points

02:26

Made by the hedge fund that things were not so

02:28

rosy While then the remaining legions of wall street penguins

02:32

will all follow suit jumping into the waters of cell

02:36

mortimer cell they'll crater the stock and let the hedge

02:40

fund make a fortune again covering his short Well the

02:42

same goes in the other direction of course with a

02:45

little whisper that well google wants to buy them for

02:48

one hundred eighty two dollars a share I heard this

02:51

in the the restroom there well in the real world

02:54

there's a close knit club of market manipulators you know

02:57

birds of a feather and they all tend to live

02:59

eventually right here f y i visiting hours are from 00:03:04.368 --> [endTime] ten to four tuesdays and fridays

Related Videos

GED Social Studies 1.1 Civics and Government
39794 Views

GED Social Studies 1.1 Civics and Government

Fake News
11938 Views

How do you tell fake news from real news?

Finance: What is Bankruptcy?
260 Views

What is bankruptcy? Deadbeats who can't pay their bills declare bankruptcy. Either they borrowed too much money, or the business fell apart. They t...

Finance: What is a Dividend?
1777 Views

What's a dividend? At will, the board of directors can pay a dividend on common stock. Usually, that payout is some percentage less than 100 of ear...

Finance: How Are Risks and Rewards Related?
589 Views

How are risk and reward related? Take more risk, expect more reward. A lottery ticket might be worth a billion dollars, but if the odds are one in...