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I would like to hear more about this. Has anyone found details in this particular case?
this is a good thread: https://twitter.com/matthewstoller/status/135450879463882342...
It's really not. Because eventually retail is going to get destroyed. Yes, some hedge funds have lost their shirts, but those are the first ones who were in the short before the squeeze. The hedge funds and more importantly day trading shops making money right now are the ones who saw the activity and are goosing the stock price right now. I don't know if people realize that there are thousands of day trading shops w…
I'm here just puzzled, why exactly would you need hundreds of people? And why would all of them "jump on the same stocks" as opposed to a single person doing that? Do stocks care how many people jump on them, or what?
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You can expect whatever you want. What actually happens is something else. On any given trade you can end up with something worth more or less than what you started with. Even if you sell and cash out, you may end up "losing" because things went on to perform better than you expected and the person/entity on the other end of the trade knew something you didn't. The market owes you nothing.
You're loudly and carefully missing the point. The expectation is that investment is done to derive ownership of something with actual value. This is a public pump and dump scheme masquerading as a righteous uprising. Nobody said the market owed anyone anything. Save the sophism. Idiots are getting bilked, those are the answer to your question, and they still exist even if you want to re-define around them. This is i…
Whether or not Elon's tweet brought in a bunch of people who want it to be a pump and dump is another story.
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And (no one seems to be talking about this) but there's definitely a systemic cost. Going forward, how do you effectively manage the risk of one of your positions becoming a meme? This happening once is an interesting situation and I've certainly enjoyed watching it play out. If it happens repeatedly it will definitely start to undermine the investing public & market participant confidence in the market. That's certa…
> Going forward, how do you effectively manage the risk of one of your positions becoming a meme? Don't take short positions. They add nothing of value to anyone. They are just fancy gambling.
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but a stock is partial ownership of a real business, which has revenue and owns other assets
What that means tangibly varies from business to business. You might get a cut of the profits in the form of dividends... unless you don't. Plenty of stocks never pay dividends. A lot of companies pay more to charity than to dividends to investors. Or, you get a vote on company policy at the stockholder's meeting... But if the founders own more than half the stock, that doesn't actually matter. And that's assuming th…
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The second that the shorts have covered the price isn't going to drop to $90, it's going to drop back to $20 and most of the WSBers who were holding out for $2000 will lose their shirts. The shorts are going to lose, no doubt. But once they've lost, the stock price is probably $20. A lot of WSBers are going to be holding stock at that point, and possibly on margin. And that stock is going to be a crappy retail stock.…
I sold a GME call option with a strike price of $320 and expiration in July today for $200. A pump and dump by novices is easy money if you know how to play it. Everyone knows this is going to crash, the question is when?
Caveat vendor.
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It's entirely possible for short sellers to have legally borrowed more stock than is actually outstanding. There is no evidence that I've seen that they've done so illegally.
Can you explain how it's possible to borrow more stock than is outstanding?
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For the interested: https://www.ft.com/content/1fcb4d60-b1df-11e8-99ca-68cf89602... "Was this the right call? I think so. All our competitors also shunned any photos of Manhattan bank branches. The right to free speech does not give us right to shout fire in a crowded cinema; there was the risk of a fire, and we might have lit the spark by shouting about it." Enraging. You're allowed to shout fire in a crowded theate…
It's more like no one actually saw fire, but the back half of the theater snuck out and ran away because there were rumors of a fire. Authers saw this happening and had a chance to tell the people in the front of the theater that the whole back half had thought there was a fire and ran away, but he decided to just slink out the back and leave the front half to get burned. I'd be ashamed to call myself a journalist if…
The thing about bank runs is that if everyone, everywhere thinks there's a bank run happening, this will actually cause the financial system to collapse. It's a self-fulfilling prophecy.
But if most people don't think a bank run is happening, then the system can weather a few bad banks popping.
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Why do you think those in it from the beginning are less greedy than those coming in later?
Because at the beginning there is no evidence the plan will work, and you could very well just be blowing a bunch of money. It’s like the people who mined Bitcoin very early and stashed them in their hard drives. Once the stock picks up steam though, it attracts people who purely just want to make a fast buck, and less true believers.
But you think making a gamble that seems like less of a sure thing is less greedy than if you think it's a sure thing? The more of a sure thing you think it is the greedier you are? That's not really clear to me.
But maybe it's really about the "true believer" thing. You think people in later were only there to make money, but those in earlier were "true believers" in something other than making money? What? They also planned to make money though?