Twitter Meltdown Review - Citadel Securities

In case you missed it, Citadel Securities recently went on a bit of a Twitter rant. This appears to be in response to a trending hashtag (#KenGriffinLied). We’ll break it down tweet-by-tweet with some analysis and commentary.

(This is not financial or legal advice.)

Okay, so the first thing that jumps out here is that Citadel is referencing an article from February 2nd, 2021. This Twitter rant is an obvious attempt to control the narrative. Since that article was published 247 days ago, new information has likely come to light. Like a magician doing a card trick, Citadel is basically saying, “Don’t look at that, look at this. Focus on what I’m doing over here.”

The second thing that stands out is the deflection to Robinhood. By saying, “Robinhood restricted trading…” Citadel seem to be trying to deflect anger away from Citadel onto Robinhood. This is called throwing someone under the bus. It’s a technique used by people in power when they don’t want to take responsibility for their actions. You see this in politics all the time.

Okay, so this is not an email. This is a snippet of a header. The body of the email could contain almost anything. While it may show a margin call being issued to Robinhood, Citadel is again being intentionally obscure. Imagine you sent a snippet like this to your ex. “Here is the email that shows I am not the father of your child.” They would probably want a lot more proof.

Continuing to throw Robinhood under the bus, Citadel outlines how Robinhood proposed to the NSCC that trading be restricted. This one is interesting. Citadel appears to be trying to push a narrative that this entire thing was Robinhood’s idea, but this is not proof that. This is only proof that Robinhood proposed the idea to the NSCC. It’s theoretically possible that Citadel proposed the idea to Robinhood, and then Robinhood proposed it to the NSCC.

Imagine the Big Boss Man from a crime movie. He’s in court because one of his thugs killed a mailman. When asked to prove that he didn’t order the hit, the Big Boss Man submits a statement where his goon admits to killing the mailman. That’s what this Tweet looks like.

All we have here is another statement from another goon. “Yeah, I saw Jimmy shoot the mailman.” But again, this trial isn’t about who shot the mailman, it’s about who ordered the hit. None of this evidence exonerates the Big Boss Man.

This article that Citadel is using to defend themselves is 252 days old. So, two things are wrong with this line of defense. One, defending yourself against old information instead of new information, and two, going with the “Everyone else was doing it,” defense.

If you join a riot and torch a car and someone takes your photo, you’re going to get arrested. It doesn’t matter if all your friends were doing it and you were caught up in the moment. If you do something illegal, “Everyone else was doing it too,” is not a defense. It’s a deflection, which seems to be a recurring theme with this Twitter meltdown.

Another 251-day-old article. You can smell the desperation here. Citadel’s defense is shifting to “You need us. You can’t live without us.” This is the classic line of serial abusers.

If I had to speculate, there might be backroom talks going on about removing/reducing/replacing Citadel as a market maker. Wall Street is a money-printing machine designed to move cash from the small investor’s pocket to Wall Street’s pocket, and this negative press is causing industry turmoil. There’s always a Bigger Boss Man, and he/they might not be too happy with Citadel being in the limelight again.

I hate when people use the term “conspiracy theorist” like conspiracies don’t exist. A conspiracy, by definition, is when a group of people secretly plan to do something illegal. That’s it. It’s not “The Earth is flat,” or “The military is hiding aliens in Area 51.” Those are not conspiracies. Those are just dumb ideas.

A conspiracy is when Volkswagen rigged their emissions.

It’s when billionaires hid their money offshore to avoid paying taxes.

It’s when Bre-X salted their core samples.

It’s when Theranos promised to revolutionize medicine with technology that didn’t work.

Those are actual conspiracies. The idea that Citadel would conspire with Robinhood against retail investors is a lot closer to those examples than a fake Moon landing.

Again, Citadel is making it look like they’re defending themselves in a court of law but using evidence that wouldn’t hold up in a court of law. Just because two people have an instant messenger conversation about being at the mall, doesn’t mean they weren’t somewhere else at the time.

Here we have a mixed bag of bullshit. They hit the conspiracy note again, trying to discredit their accusers as being crazy. Citadel insists they only have the small investor’s best interests at heart, which is a major lol. And finally, they play the pandemic card. “Things are tough right now, so you should excuse our behavior.”

The Citadel Twitter meltdown sounds like the defense of an abusive mobster who had thugs beat his wife because she wanted a divorce.

“She’s crazy.”

“I would never hurt her.”

“She needs me.”

“Times are tough and I’m really stressed.”

Personally, I don’t own any AMC or GME stock. But this is the tweet that inspired me to review this Twitter meltdown.

I hate when people use fringe theories to discredit plausible theories. It’s dishonest and illogical. If someone believes in A, it doesn’t mean that B isn’t true.

Imagine a man walks up to you at a party and identifies himself as religious. He says he has evidence that his neighbor (the Big Boss Man) ordered his employees to beat the boss’s wife and kill the mailman that flirted with her. Would you think this man is lying based purely on his religion? Of course not. That’s ridiculous.

An angry, rambling defense only holds up on social media where you can block or ignore the accuser.

“Other people were doing it too.”

“We’re hard workers and you need us.”

“We swear the markets aren’t rigged despite the billions in quarterly trading profits from a zero-sum game.”

Okay, so at least this time they linked an article that was recently published. Although they seem to be saying, “Look we’re defending ourselves, so this is evidence that we did no wrong.”

This Bloomberg article is light on facts and heavy on statements. It can be summarized as: Citadel has been accused of market manipulation, and their defense is, “No, u.”

This is the only tweet that makes it sound like Citadel is telling the truth. It’s a definitive statement that most people would only utter if their back was up against a wall, or they knew there was no proof out there to contradict it. Had Citadel stopped here, they might not have drawn so much attention to themselves. They just rambled on for too long and I can’t believe their lawyers didn’t tell them to shut up.

Here’s the thing about liars: they don’t stop talking. They get nervous. They hammer you with information until you give up and go away. If you find yourself in a conversation and someone says, “I swear on my grandmother’s grave that it’s true,” it’s probably false.

The more aggravated someone gets when trying to convince me of a fact, the more I believe it’s fiction.

Honest people calmly present their evidence and let you come to your own conclusion. Liars shovel evidence down your throat and then tell you what your opinion should be.

This Twitter meltdown reeks of the latter.

“You need us.”

“We’re the best.”

“I didn’t order the hit on the mailman because I’ve never spoken to the killer.”

“When asked if I ordered the hit on the mailman, I said no. Clearly this means I’m innocent, right?”

Wrong. If anything, Citadel’s Twitter rant has made people even more suspicious.

Another thing I find interesting about this meltdown is that it started on September 27th, 2021. Citadel’s previous tweet was on January 26th, 2021. At no time during the short squeezes of early 2021 did Citadel tweet about Robinhood, meme stocks, or conspiracy theories. It seems that some new (and potentially damning) development has triggered Citadel and caused them to lash out.

As we wrap up here, I would just like to reiterate that I have no investment in AMC or GameStop. A reader asked that I look at this Twitter thread to see what my thoughts are. So here you are. Hope you enjoyed it.

Hopefully one day the truth comes to light. Although even if Citadel is proven innocent, serious questions must be asked about a system where market makers are allowed to trade against retail investors.

Good luck with your investing, and don’t forget to follow us on Twitter.