The story of how Robin Hood met Wall Street.
Art by Pete Whitehead
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Story performed by: Aaron Calafato
Audio Production: Ken Wendt
Original Art: Pete Whitehead
Podcast Coordinator: Cori Birce
Creative Consultant: Anthony Vorndran
TRANSCRIPT
[00:00:03.510] - Cori Intro
You're listening to seven minute stories with Aaron Calafato, please keep on subscribing and leaving those five star ratings and reviews. It helps others find our podcast and that helps us out. Also, we want to hear from you. We set up a number you can call or text. It's 216 352 4010 use it and share some feedback about one of Aaron's stories or a story of your own. We might feature your message on an upcoming episode. This episode: Robin Hood.
[00:00:44.510] - Aaron Calafato Story
I love the legend of Robin Hood. I love it because in these stories and in these myths and folklore, what he did was revolutionary. He went against a system that was purposely and designed to maintain inequality. That's what the medieval feudal system was. You had a select few who were royalty, who had money, who had family name and wealth, and they were all concentrated and they all lived together and they all lived an incredible, opulent life. And they all lived in a castle. And that castle was protected by a moat and an army. And by the way, everybody in the castle, everyone in that system, they made the rules.
[00:01:27.800]
They were the judges. They were the referees. They made the rules of the society. Everybody outside of that castle, they lived on the land or in the woods and their entire existence as a servant or a serf or a craftsman or whatever. Their entire existence through exploitation and taxation was to service the few. There were no rags to riches stories back then. It was rags to more rags or riches to more riches. There was no equal opportunity. And that's why when Robin Hood was tired of the sheriff screwing around and stealing his lands and tired of Prince John trying to, you know, go behind the back of what he viewed as a noble king and his own people, in his own class suffering, and they're all living in the woods and barely getting by. He steals from the rich and he gives to the poor. That was a revolutionary act because it was the only way to spark the reality of some democratization of access. Access of resources, access to pursue happiness or to pursue a quality of life, and at that time that was unheard of. Now, let's look at modern times and let's look at the stock market and Wall Street.
[00:02:45.640]
Since its inception, the stock market and Wall Street created its own community of people, its own civilization, its own castle, surrounded by a moat of people with access and privilege and money and power and influence. And they would use that to influence the government and legislation, and that would then create profit and influence in a cycle. And it was its own castle. Right? And everybody outside of that was living in the woods or they were living on the land. And it's been that way for years. And really, the history of Wall Street is littered with corruption. This wasn't a history of fairness and rules and equity. This was a casino, a fraud.
[00:03:25.390]
How many bad stocks were sold? Insider trading, stock market crashes, exploitation of stockholders, exploitation of the American family, and in the financial institution with homeowners and lenders. The list goes on and on and on and on. Historically, it has been a disaster, if you really think about it. Except for a select few. And by the way, when there were people that were finally held accountable or firms that were finally held accountable for foul play, it took years. It took Senate hearings, committees, conversations for decades to be able to point these people out and bring them to justice. And what's hilarious is most of them were then bailed out by the American people, the people that they defrauded in the first place. And on top of that, a lot of the CEOs who instigated some of this behavior were given bonuses and paid after they were fired! It's.. You couldn't write this. Actually. You could write this. And they did. It's called The Legend of Robin Hood. It's just a different part of history and a different continent. And the sheriff of Nottingham, his spirit is not only alive, it's been running Wall Street forever! The inmates are running the asylum and they're making all the rules.
[00:04:51.610]
But a couple of years ago, something happened that would set off a chain of events that would turn Wall Street upside down just this week.
[00:05:01.460]
An app was created and it was called Robin Hood, and it was metaphorically designed to do the same thing. The difference was, it wasn't about stealing from the rich to give to the poor. It was about giving access to regular people like you and me so that we can individually buy and sell publicly traded stocks on our own. See, for years, people weren't necessarily shut out of the stock market, but most people had to do it through a third party, a broker, a brokerage firm. Unless you wanted to be a day trader or a stockbroker, you essentially had to depend on someone else to manage that money and make those decisions.
[00:05:35.840]
And for a lot of people, that third party or that person would mismanage the money. I mean, if I told you, hey, you're going to give 20,000 dollars to someone that just says," hey, trust me, I'm going to do the best thing with it", you wouldn't necessarily want to do that. But that happened for years. But this Robinhood app and other apps that followed changed the game. It allowed you and me to be able to democratize this process, to be able to make good and bad choices and invest in what we wanted to in the free market.
[00:06:04.550]
Speaking of the market, here's what happened this past week. As I said before, in the world of Wall Street, these folks figured out ways to game the system, to be able to make a profit and at times exploit it. But those techniques and strategies were all normalized. They were all legal and they were all done in the name of free market capitalism. Well, recently a group of hedge funds and wealthy individuals decided to take a short position or short several unhealthy companies like GameStop.
[00:06:30.410]
Now, a short position is created when a trader sells a security first with the intention of repurchasing it or covering it later at a lower price. What does that really mean? That means you're betting against a company or betting on it to fail and making a profit from it. Well, in response to that, a bunch of regular folks who now have access, democratized access through apps like Robin Hood and other apps, decided to get together. These folks were on Reddit, on social media. They banded together and decided to buy a ton of GameStop stock. And when that Gamestop stock was purchased, it went through the roof! And that was great for the stockholders of GameStop. But for the folks that decided to short it, they lost billions!
[00:07:11.540]
And when that happened, an alarm was sounded. (sound of a horn) It's coming from the Wall Street establishment and all the talking heads. (sound of a horn) What does that sound? It's the sound of the morality police. It's moral posturing. It's a call for justice. The system has been upended. Well, where was that call for justice for all the millions of Americans that have been exploited for so many decades? It didn't exist. But now the backlash and the anger when the chickens came home to roost was unbelievably hypocritical. It's like having a willing and proud drug addict get on a podium and preach about the importance of sobriety. It got so bad that even the Robin Hood app stopped acting like Robin Hood. The CEO and the team shut down trading for the day for its customers, people like you and me. Why? I don't know. But here's what I do know. This is the real story. When a system is designed to benefit the people, it's supposed to benefit. And it does that. It's applauded, strengthened and upheld. But when a system benefits people, it wasn't designed to benefit. It's criminalized and called anarchy. And sometimes you need a revolutionary Robin Hood like act to bring into focus this truth: that maybe it's the system itself that's flawed and knowing that is the only path forward for a better, more inclusive democracy.
