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Jordan Belfort and Stratton Oakmont (Wolf of Wall Street Explained)

Jordan Belfort and Stratton Oakmont (Wolf of Wall Street Explained)


what’s going on everybody welcome back
to another video my name is Chris and in this video I’m gonna be explaining the
true story behind Jordan Belfort and his Stratton Oakmont company from the widely
known movie wolf of Wall Street and what exactly happened in the 1980s. It’s about three
hours long and it’s a complete documentary of what sort of went on back
in the 1980s with Stratton Oakmont what was going on with his company selling
stocks and scamming people off of them so it just sort of goes like a sort
of like a little snippet of what actually went down back then. Danny porush which was Jordan Belfort’s partner he actually said that
the movie is a far relative from the book and a book is a far relative from
the truth. There’s a lot of details that are left out in the movie,
but I’ve done a lot of research on my own so I’m giving you
guys exactly what I have learned and what I’ve concluded about what actually
went on. So Jordan Belfort started off selling meat and seafood until this
company eventually just came down and went out of business and then after that
in 1987 Jordan cancelling stocks as a stock broker for LF Rothschild this is
the part of the movie where he meets Matthew McConaughey and he gives him all
the secrets of being a successful stockbroker and if you guys have seen
the movie you know exactly what I’m talking about the three keys to becoming
a success on Wall Street during the day and then still functions he’ll do your
job you
right now for this video hopefully will be monetized sometime in the future so I
don’t want to go over break any roots YouTube regulations say anything I’m not
supposed to so I’m gonna just sort of leave out the exclusive details I’m sure
you guys all know what I’m talking about though. So this is where he meets Matthew
McConaughey, he gives him the three keys to being a successful broker on Wall
Street and this is really what just opens up Jordans mind to how business
is done in on Wall Street and what he needs to start doing in order to be
successful and as shown in the movie he is laid off by them in 1987 after Black
Monday, so that that part is true to the to the real story. They called it Black
Monday by 4:00 p.m. the market had dropped 508 points the biggest plummet
since the crash of 29 Shortly after in 1989 Jordan Belfort and Danny
Porush who is played by Jonah Hill which is Donnie Azoff in the movie
so Jordan and Danny porush founded their own brokerage firm Stratton Oakmont and
this company was a over-the-counter firm so what they did is they sold
over-the-counter stocks instead of the big blue chip stocks that you’re
familiar with they sold the penny stocks off the Pink Sheets and so these stocks
are a lot more manipulative, they had a lot lower volumes. I’m gonna be going into
how that worked and what happened a little bit in the future. Where are your quotetrons? Quotrons? Yeah, your computers. No no we don’t even need computers here we just trade right off
the Pink Sheets here. Yeah they’re penny stocks, you know companies that can’t get
listed on NASDAQ they don’t have enough capital. Their shares trade here. Penny
stocks, six cents a share. Who buys this crap I mean honestly mostly Schmucks that
postmen there’s always postman, plumbers I just want you guys right now if you do
find yourself enjoying this video, if you would’nt mind just hitting that like button up
here for me it’d really mean a lot to me and that subscribe button should be
down on one of these ends if you are interested so to get that out of the way
and if you guys do want to stay tuned to the end of this video I’m
gonna be giving some awesome fun facts about what actually is true to the story,
some of the crazy stories that Jordan says some which ones are true, which ones
are a little far from the truth so stay tuned stick around to the end for that
let’s keep going. So getting back to Stratton Oakmont they were an
over the counter firm which means that they weren’t regulated very much these
stocks were really under the radar you know nobody was buying them they’re
really crappy companies so they mostly sold over-the-counter stocks which is
where they made their huge 50 percent commissions as seen early on in the
movie but that’s not how they ended up making all their money. What they ended
up making their money is by the stock market manipulation so Stratton Oakmont
ended up taking 35 different companies public including the notorious Steve
Madden IPO which that’s in the movie as well so. The Steve Madden IPO you know this
was huge they made ended up making a ton ton of money and profiting off this and
Steve Madden actually in the end he ended up getting in trouble as well with
Jordan and Danny, so what they actually did to get in trouble and what was
breaking the law is the pump and dump scheme right. So we all know what the
pump and dump is hopefully. So a pump and dump essentially is where you find a
stock with a very low trading volume which means not very many people
are buying it and selling it throughout time period such as just a day so you
find a company like this with a very low stock price where you can entice
investors who want to get rich right you tell them it’s only 2 cents you know if
it goes up to 10 cents you’ll make five times your money so you find something
like that and they just started selling this to everyone
they were just cramming it down people’s throats from what I concluded from
researching this they were just using high pressure sales tactics and just forcing
this down everyone’s throat and what they secretly did is they secretly
bought a bunch of shares first so they owned a lot of the company right.
So they have a high percent ownership of the company and then they start shoving
it down people’s throat which artificially drives the share price up
to ridiculous levels, once it hits the top that’s when they start unloading all
their shares and that all that selling triggers a massive sell-off which then
droppes the price dramatically leaving everyone else that they pumped up and
forced the stock on with empty pockets. Another thing that I learned from
research is that they actually refused to process some sell orders in
order to keep the price artificially inflated, so let’s say they forced you to
buy this company and you were trying to sell, right you saw it just started
shooting up but think you’re gonna get rich you know, they wouldn’t let you
actually sell the stock, they wouldn’t process the order and you know
until they finished selling all their shares and then they’d let you sell
and then you’re left at the bottom right no profits for you. So Stratton Oakmont at their peak had over 1300 employees and if that doesn’t sound like
a lot to you this is one building in wall street 1,300 employees. 1,300 people
trying to scam you out of your money and take your money from you so I mean
that’s pretty ridiculous to me that’s a lot of people that are trying to take
your money from you, especially you know on Wall Street there’s. There’s not too many
big firms up there so that’s a little scary thought that back in the 80s there
was a high percentage chance that someone you knew or that you would have
known someone that had been a victim of this scheme. Now Stratton Oakmont made a
ton of money Wikipedia estimated it to be a $3,000,000,000 worth of
gross revenue, so with all this money Jordan Belfort and Danny Porush they
ended up hiding their money offshore overseas through Jordan’s wife which was
the Duchess and this is basically what the money-laundering charges for is
laundering all their money overseas, keeping it offshore. They ended up
getting popped for that too so it didn’t work out for them in end but at least they
tried you know give him a participation badge. And I’m sure he’s got some money
still somewhere. So Jordan Belfort and Danny porush you know there were young
guys back in the day so whenever they owned this company you know they were
giving these insane pep rallies. “Are you behind on your credit card bills? Good, pick
up the phone and start dialing! Is your landlord ready to evict you? Good pick
up the phone and start dialing! I want you to deal with your problems by
becoming rich!” You know they were paying for women to come to the office during
parties, they were tossing midgets around. These are all true stories that I found
from researching they did in fact all have all that and if you have seen the
movie you know exactly what I’m talking about, but these young guys you know they
were just making a ton of noise on Wall Street which led the feds curious
about what was going on. “I mean honestly what what what is it that you think that we
did or do why I don’t get it” So they began being investigated in 1989 and
eventually got shut down in 1996. In 1999 Belfort and Porush were for both indicted for
securities fraud, money laundering, and plead guilty. They ended up ratting on a lot of
their other co-workers and co-founders and to ultimately get a reduced sentence,
and this plea landed a Belfort 22 months in a federal
prison which was supposed to be four years. So 48 months so he served a little
less than half of the entire sentence. Belfort was also ordered to pay a $110.4 million dollars in restitution charges, but they
say that about 97 million of this has still not been paid yet, so Belfort
lacking a little bit on paying back everyone that he scammed, and there’s a
bit of a gray area about where his income is now you know
he’s written a book, I think he’s written two books actually about it and you know
the wolf of Wall Street movie so he says that he’s taken big cuts of that
money all the royalties are going back to his victims of this and restitution
charges but you know this is but still big gray area about what his net
worth is and how much he owes. You can see this quote here he says that he’s
not gonna feel better about it until everyone’s got their money back you know it’d
just be better for everyone is basically what this says if I
remember correctly, but yeah so a lot of this is still unpaid and no one
knows his like how much he’s actually making in a year or his true net worth so
this is all just a big gray area. He also does motivational speeches all around so
who knows how much money he is actually making from those guys. A quick fun
story real quick; this past Halloween I actually dressed up as Jordan Belfort
for a Halloween party I’ll put a picture up right here. There’s a me and couple of
my buddies at a Halloween party so this movie had a huge influence on me. You
know Jordan did do a lot of things wrong but I do have to hand it to the guy he
did whatever he had to do in order to make it to the top, and that he did.
Although he was scamming people out of their money he did it because that was his true dream to just get rich, which ended up coming true, but then like
the chain of reaction of events that happened after, but again like the ride
was crazy. It looked like it was a ton of fun though while they were doing it
from what I concluded from like their office parties they sound like pretty
off the hook, but again not a good idea if you would have been working for these
guys you probably would have ended up in a lot of federal charges,
maybe even some jail time. But all in all this movie inspired me in so many ways
just if you have dreams just follow them and do whatever it takes to get there so
those are the positive that I can take out of the movie and other than the fact
that it’s just incredibly entertaining and fun to watch. Even though it’s three
hours long you know it’s a great movie to watch it’s great about Wall Street
and investing about how there’s so many financial gurus out there that are just
out there to take your money and scam you. You can learn a lot from this movie.
So all in all I just absolutely love the movie I watched it for the first time
back when I was in eighth grade it was on an Amazon Prime video I watched it because
the title looked cool and you know Wall Street I’ve been interested in Wall Street for a
long time, so I watched the movie and yeah I just loved it all it all together. Now
the part you guys have been waiting for Some of the true stories that
actually happened in the movie that happened in real life.
They were hiring women to the office parties and paying with them with
company money, and it’s not just that they were writing them off on their
taxes as well so I think that’s hilarious, that’s pretty funny to me.
Forbes did indeed call him the twisted Robin Hood you know stealing from the
wealthy and giving to himself. He was driving on the loodes, although it was not a
Lamborghini it was a Mercedes Benz. As I said earlier they did toss some midgets
at their company parties as well so that part in the opening scene of the movie is true
as well. He was under the influence and crashed his helicopter in his front yard.
He did sink his yacht in Italy and he actually has a video on YouTube where
it’s like the full explanation of the yacht story, it’s just really cool you
get to hear his voice, he narrates the entire story of what went down on the
yacht and how they sunk it and got rescued and all that so if you guys are
interested I highly recommend checking that out was super fun to listen to.
Danny porush so Donnie Azoff in the movie played by Jonah Hill. Danny in real
life did actually marry his cousin so that’s true.
These guys were absolutely crazy back in their day they ended up serving their
time. I think that would be better you know if they did pay all the restitution
back which who knows if that’s actually going to happen. I think that’d be good for
them to see the whole turnaround of these characters and their development
you know. Things went crazy and they started making a ton of money
in the stock market scamming people, and then things went awful when they got in
trouble with the law, and then you know it’d be awesome to see it go back up
again after paying it back and making their wrongs right again. So that’s about
all I have for this video this was a pretty quick explanation maybe I’ll go a
little more in depth in a future video if that is something you guys would be
interested in and just let me know down below in the comments. Like this video
subscribe as I already said and I think there should be a couple more of my
videos over here if you guys want to check those out and then you can hit
this button right here if you want to subscribe to me for more thank
you I’ll see you next time

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