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Chamath Palihapitiya on Wallstreetbets [audio]

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Re: Chamath Palihapitiya on Wallstreetbets [audio]

#141

Post by anonAndOn »

xadhominemx wrote: post #128
jnwatson wrote: post #92

Earlier quoted context omitted.

Did you forget about AIG and Merrill Lynch? BoA was "strongly encouraged" to buy Merrill. And the Fed just loaned AIG a boatload of money. All the banks got loads of direct (via capital infusions) and indirect support (the "Fed put" on steroids). The owners of bank equity did fine while the working class got screwed. This is the environment the millenials started their investing opportunities in. That the game is rig…

Owners of bank equity did not do fine in the global financial crisis

Which banks went out of business? Weren't many (all?) major banks about to be insolvent before getting saved by their buddies (aka, future bank Directors) in government?

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#142

Post by radihuq »

polka_haunts_us wrote: post #80
paulgb wrote: post #73

Earlier quoted context omitted.

Let me put it this way, if someone bought GME over the last few days and sold it at 3x what they paid, what fraction of that gain (on average) came from a hedge fund covering a short vs. from another retail investor buying in? The assumption seems to be that it comes purely from a short cover but that’s not at all obvious to me.

I agree. The holding the bag metaphor comes from a gang of thieves robbing a place and then leaving a patsy behind with all the evidence of the crime and none of the loot. Right now, in my opinion, a lot of the Robinhood faction of the gang are funneling into the vault thinking Joe Wallstreet is that patsy, not realizing that the savvy senior members bailed out an hour ago and the cops are about 2 blocks over and clo…

Reminds me of a phenomena calling merchanting clans[0] on the video game RuneScape.

It would start with a small group of players convincing a bunch of casual players to join their clan and buy out as much of the supply of a specific item on the market as they could. They claimed if everyone held on to the items for two weeks the price would rise and they'd all get rich.

Of course, the leaders would then sell their items one week in. This would cause the price of the item to drop, resulting in the other members of the clan panic-selling all of their items. The price of the item would then crash resulting in most players losing their money.

Eventually the game developers made the organization of such clans a bannable offense since too many casual players were losing a lot of their wealth participating in these events.

[0] https://runescapeclans.fandom.com/wiki/Merchanting_Clan

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#143

Post by ericmay »

xadhominemx wrote: post #17
curiousgal wrote: post #15

I think the funniest part of this entire phenomenon is that Robinhood is now taking money from the rich and distributing it to the masses in a more literal sense. At least for now. On a more serious note, I don't get how a stock can be 140% shorted. Does that mean once you return a portion of the shares you borrowed you have to rebuy part of it and return it again? Also when would these short sellers get margin calle…

Yea money is flowing from hedge funds who are short to retail investors as the stock runs up, but once it inevitably moves back down it will be the retail bag holders inflicted with massive losses.

People say that, but plenty of hedge funds and other investors will lose money too. It’s not “hedge fund win, retail loses”. There is a mix. Not just do some of the shorts (maybe many?) lose money, some of the hedge funds on the buy side will get caught too if this comes down fast enough.

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#144

Post by jdjfktkrnj »

Ataraxy wrote: post #100
IkmoIkmo wrote: post #96

What I don't get is that, if this trade (140% short) was really so obviously wrong. Could a wealthy hedge fund not simply have made the same bet as the million strong WSB army, but even more pronounced? Why isn't a Carl Icahn short squeezing these guys if it's so easy and obvious? Simply buying calls and buying stocks and forcing a short squeeze, could a bigger established fund have made this bet? I think the general…

They realistically are. It's pure media fiction (and scapegoating) that a bunch of regular people are somehow moving markets. In practice they're just the smoke screen for the actual wealth making plays against their peers that screwed up in this scenario.

Retail is 25% of the market these days. Google it.

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#145

Post by ericmay »

Ataraxy wrote: post #100
IkmoIkmo wrote: post #96

What I don't get is that, if this trade (140% short) was really so obviously wrong. Could a wealthy hedge fund not simply have made the same bet as the million strong WSB army, but even more pronounced? Why isn't a Carl Icahn short squeezing these guys if it's so easy and obvious? Simply buying calls and buying stocks and forcing a short squeeze, could a bigger established fund have made this bet? I think the general…

They realistically are. It's pure media fiction (and scapegoating) that a bunch of regular people are somehow moving markets. In practice they're just the smoke screen for the actual wealth making plays against their peers that screwed up in this scenario.

This, 100%.

Even if WSB users and other retail holders held like, 30%, Burry holders 3%, and Cohen holds 10%, there is still more than 50% out there which may be bought by others. There aren’t enough interested Americans to buy the rest of the company.

Other hedge funds and big investors are in on the action. These shorts got caught in a bad spot and now they are paying for it. Once all the retail traders get screwed in the media, others on Wall Street will quietly take their bonuses and go out for drinks or a new car. Nobody will report how much money they made. Why would they?

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#146

Post by zpwe »

shuckles wrote: post #122
zpwe wrote: post #108

I was one of the first if not the first people to post weekly options yolo on WSB that gained traction years ago, I get a bit more into it in other posts. Most of these top firms have a specific pipelines from top ivy schools, they are very very selective for a specific person usually from an upper class upbringing. I think Chamath has a point in that there's a lot more people capable of understanding the dynamics of…

Isn’t this just Zero Hedge at scale? ZH at least tries to formally ape analyst reports.

In my opinion Zero Hedge is more doom and gloom boomer centric and racist/hate filled. Despite Wall Street Bets use of what would be considered foul and derogatory language, giving back and donating to charities is encouraged. There was a post showing a donation of $420.69 encouraging others to donate gains to an autism charity given how freely the term is thrown around and how the majority of the community is a self proclaimed autist.

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#147

Post by mysore »

nceqs3 wrote: post #67

The Chamath Craze is ridiculous. The guy is a stock promoter through and through. It's really sad to see people fall into this guys trap. He has an incredibly story (coming from nothing) but lets look at his career: He "leaves" (aka fired) Facebook for being a D*ck head. Nobody is willing to work with him because he is rude and a jerk. His direct reports would cry regularly. Steven Levy talked about this in his book…

man you dont know this guy or his life story. people say all kinds of stuff in books. who cares about his dating/marriage life? That is really low to bring that kind of stuff up in this context. the fact that this is the highest comment speaks to how toxic this community has become.

His "VC" fund is a social good company that prioritizes people's wellfare over profits. and who cares if its a success or failure, VC is hard.

He isn't a hero and he isn't a "Dickhead". He's just a human.

If you don't know him personally you really shouldn't be making these kinds of baseless adhominem attacks.

Reading your comment history, its nothing but black and white opinions and pointless preferences.

I am leaving this community forever. This whole place has gone down hill. There are no more hackers here. There is no more real discussion of anything. I feel bad for paul graham. This website is a disgrace.

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#148

Post by anonu »

nceqs3 wrote: post #133
viscanti wrote: post #127

Earlier quoted context omitted.

> He starts a VC fund. The fund has no "major" wins. Box, Slack, Yammer, Palantir. I guess I don't know what the definition of "major" is, but those seem decent. The VC fund did eventually "burn down", but not because of bad investments but because he had some personal issues. I don't have a strong opinion about him as a person. I just don't understand why a criticism was that he was a bad VC. It seems like he probab…

Palantir was obv the biggest win. By major I mean over 50 bil market cap. He was literally writing checks during the best founding period ever (2008-2013) and didn't get any of the huge companies (Stripe, Uber, Airbnb, etc.).

I like your previous point but I can't wrap my head around this one. There are 1000s of VCs and many 1000s of startups. You can't get em all

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#149

Post by tedfernau »

tpmx wrote: post #126
nceqs3 wrote: post #67

The Chamath Craze is ridiculous. The guy is a stock promoter through and through. It's really sad to see people fall into this guys trap. He has an incredibly story (coming from nothing) but lets look at his career: He "leaves" (aka fired) Facebook for being a D*ck head. Nobody is willing to work with him because he is rude and a jerk. His direct reports would cry regularly. Steven Levy talked about this in his book…

It's just as ridiculous as the fact that r/wsb insiders are obviously abusing their positions to get rich at the cost of newcomers, basically constructing a public pyramid scheme, while everyone there keep repeating it's a way for the average person to avenge wall street, because that shit really works with the average young reddit person. https://i.pinimg.com/originals/f3/f9/6c/f3f96c06ddc73aa35cfa...

I find this, similar to the arguments against robinhood and extremists on social media, basically boils down to treating people as sheep and wanting to protect them from themselves.

I think it is a stretch to say r/wsb insiders are obviously taking advantage of newcomers. You can’t spend much time with WSB without developing some financial literacy, and there are compelling ideas. It is not just flexing and hype. Also, I don’t think there is a precedent (such as the pyramid scheme) for what they are doing in the market.

I think there is some truth to your mention of young Reddit person being vulnerable, but I think it is risky trying to protect them with regulation.

Re: Chamath Palihapitiya on Wallstreetbets [audio]

#150

Post by jdjfktkrnj »

cwkoss wrote: post #124
taylorwc wrote: post #20

Earlier quoted context omitted.

Here's a pretty good explanation of that how that can happen: https://nope-its-lily.medium.com/gamestop-power-to-the-marke...

Hmm, i wonder how accurate this article is, particularly around melvin capital's positions. If they only had put options, why did they need a $2.5B bailout this week? I was under the impression they also had short positions or sold naked calls in order to get into as much trouble as they seem to be in based on the bailout announcement. Or were their put options' value being used as basis other leveraged investments?…

Indeed. WSJ:

> Melvin Capital Management, which managed $12.5 billion at the start of the year, had lost nearly 30% for the year through Friday due largely to its array of bets against companies including GameStop, said people familiar with the fund.

Quite interesting that parent article, as detailed as it is, somehow missed a much reported 30% drawdown.

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