GameStop Is Rage Against the Financial Machine • Hacker News Board

Re: GameStop Is Rage Against the Financial Machine

#691

Post by grecy » Thu, Jan 28, 2021, 1:40 AM UTC

gpm wrote: post #682

noncoml wrote: post #654

There are 100 cows. A hedge-fund believes that the milk consumption will go to zero, so they borrow the 100 cows for one month and sell them for $1 each. Then they borrow them again, and sell them once more for 90c. Certain that they will worth $0 at the end of the month A Redditor notices this. She knows that in a month's time, the hedge-fund will have to buy 200 cows, and there are only 100 available. Her plan is s…

> Hedge-fund cries foul. Doesn't like being beaten in it's own game. Have any of the hedge funds actually cried foul?

Who do you think complained to the SEC and is having them investigate?

Re: GameStop Is Rage Against the Financial Machine

#692

Post by ClumsyPilot » Thu, Jan 28, 2021, 1:40 AM UTC

joseph_grobbles wrote: post #627

cbozeman wrote: post #623

Earlier quoted context omitted.

It wasn't David vs. Goliath. CNBC, Financial Times, WSJ, etc. can't tell you what it really was, because they're beholden to all these Wall Street types. They don't get stories unless their relationships are cordial. This was arrogant idiot billionaires vs. autistic retards of the Internet, and the arrogant billionaires in this case (Melvin Capital) had the chance to walk away when they got their $2.75 billion capita…

The assumption that this is a bunch of robin hood everyday-man sorts conspiring on Reddit seems incredibly naive. The GameStop play (as with BBB, AMC, Express, etc) are classic pump and dumps, albeit with a short-squeeze magnifier (basically equal to a DDOS amplification). And if you really traced back to the origin, I highly doubt you're going to find some Joe Nobody -- you're going to find some very well financed,…

"I highly doubt you're going to find some Joe Nobody -- you're going to find some very well financed, planned player."

Such as? It's been a week and thousands of reporters and traders can't identify a whale moving billions? Or are you just making this up?

Re: GameStop Is Rage Against the Financial Machine

#693

Post by hagy » Thu, Jan 28, 2021, 1:41 AM UTC

SatvikBeri wrote: post #574

fredophile wrote: post #330

Earlier quoted context omitted.

It's a short squeeze. The guys left holding the bag are people that are covering their short positions in the company. The average retail investor is not shorting stocks.. There will probably also be some people that try to jump on the trend too late but that isn't who is being hurt right now.

There were 70MM shares of gamestop short around the beginning of the month: https://www.marketbeat.com/stocks/NYSE/GME/short-interest/ Around 1BB shares of gamestop have been bought/sold over the last two weeks. So shorts covering represent at most 7% of the volume.

I think it's disingenuous to compare those two numbers. The mass majority of that trading is alogos trading within short time spans, not entities entering or exiting long positions. This includes all the market makers that have to hedge options under the insane stock volatility by exiting and enter both short and long positions as the stock moves. It further includes every flavor of HFT that can potentially syphon some value from high volatility combined with momentum.

This volume doesn't tell us anything about the actual change in stock held by various entities nor how easily 70MM shares could be obtained from entities.

Re: GameStop Is Rage Against the Financial Machine

#694

Post by crb002 » Thu, Jan 28, 2021, 1:42 AM UTC

Reddit "wins" by buying enough to take GameStop private so they can exit in an orderly fashion 100% screwing the shorters and not letting Citadel front run the exist.

I think the GameStop CEO can offer up a class "R" share that retail investors will be happy with.

Re: GameStop Is Rage Against the Financial Machine

#695

Post by aaron-santos » Thu, Jan 28, 2021, 1:42 AM UTC

AlexCoventry wrote: post #678

noncoml wrote: post #654

There are 100 cows. A hedge-fund believes that the milk consumption will go to zero, so they borrow the 100 cows for one month and sell them for $1 each. Then they borrow them again, and sell them once more for 90c. Certain that they will worth $0 at the end of the month A Redditor notices this. She knows that in a month's time, the hedge-fund will have to buy 200 cows, and there are only 100 available. Her plan is s…

I agree. The anger seems like an ancillary phenomenon. People seem to be buying because they think it's a sure thing that the asset price will increase. Maybe anger at shorters helps justify exploiting their error, but it's not the primary motive.

Anger/vengence seems like a primary motivator. Let me put it this way: how much money do you think these folks would pay to see a hedge fund manager crap his pants?

Re: GameStop Is Rage Against the Financial Machine

#696

Post by joseph_grobbles » Thu, Jan 28, 2021, 1:43 AM UTC

ClumsyPilot wrote: post #692

joseph_grobbles wrote: post #627

Earlier quoted context omitted.

The assumption that this is a bunch of robin hood everyday-man sorts conspiring on Reddit seems incredibly naive. The GameStop play (as with BBB, AMC, Express, etc) are classic pump and dumps, albeit with a short-squeeze magnifier (basically equal to a DDOS amplification). And if you really traced back to the origin, I highly doubt you're going to find some Joe Nobody -- you're going to find some very well financed,…

"I highly doubt you're going to find some Joe Nobody -- you're going to find some very well financed, planned player." Such as? It's been a week and thousands of reporters and traders can't identify a whale moving billions? Or are you just making this up?

"Or are you just making this up?"

What a funny retort. Wait, are you just making up the notion that we can "identify" whales moving billions? Do we check the central trade registry and cross reference with billionaires?

Do you know how any of this works? Or are you just making this up?

Unless you're the SEC, this isn't possible. Reporters can't do that, so if you're taking the absence of that evidence as evidence, you are simply ignorant.

Re: GameStop Is Rage Against the Financial Machine

#697

Post by [deleted] » Thu, Jan 28, 2021, 1:43 AM UTC

wolverine876 wrote: post #673

astrange wrote: post #669

Earlier quoted context omitted.

Are there any claims in that post?

I'm not making claims, if that's what you mean. The burden of proof is on the person I was replying to.

[deleted]

Re: GameStop Is Rage Against the Financial Machine

#698

Post by mewpmewp2 » Thu, Jan 28, 2021, 1:43 AM UTC

cbozeman wrote: post #642

joseph_grobbles wrote: post #627

Earlier quoted context omitted.

The assumption that this is a bunch of robin hood everyday-man sorts conspiring on Reddit seems incredibly naive. The GameStop play (as with BBB, AMC, Express, etc) are classic pump and dumps, albeit with a short-squeeze magnifier (basically equal to a DDOS amplification). And if you really traced back to the origin, I highly doubt you're going to find some Joe Nobody -- you're going to find some very well financed,…

> you're going to find some very well financed, planned player. You're going to find Dr. Michael Burry. He started buying GameStop under his Scion Capital shop back in June 2020, and /u/DeepFuckingValue on Reddit / Roaring Kitty on YouTube made the case for GameStop as far back as June of 2019. EDIT: Corrected "Mr." to "Dr.". Corrected the timeline of DFV / Roaring Kitty to the correct dates.

DFV was buying GME since 2019 june though and he was making text based case long before June 2020.

Re: GameStop Is Rage Against the Financial Machine

#699

Post by sircastor » Thu, Jan 28, 2021, 1:44 AM UTC

noncoml wrote: post #654

There are 100 cows. A hedge-fund believes that the milk consumption will go to zero, so they borrow the 100 cows for one month and sell them for $1 each. Then they borrow them again, and sell them once more for 90c. Certain that they will worth $0 at the end of the month A Redditor notices this. She knows that in a month's time, the hedge-fund will have to buy 200 cows, and there are only 100 available. Her plan is s…

Wait until someone figures out how to automate this for small small small investors. Distribute across millions of Redditors

Re: GameStop Is Rage Against the Financial Machine

#700

Post by AlexCoventry » Thu, Jan 28, 2021, 1:44 AM UTC

AdmiralAsshat wrote: post #20

> These points doubtless make me appear to be a complacent shill for the financial industry, talking down to the rubes. For the record, I’m still angry about the way workers were ripped off in Britain more than three decades ago, and about the way the little guy ended up bearing the brunt for the financial implosions of 2000 and 2008. But it looks horribly to me as though the same thing is going to happen again — and…

> Who is this hurting, exactly?

I think the narrative around this trade is a bit simplistic, and a lot of people in it are likely to wind up disappointed by the details it ignores.

For instance, with potential losses this big, counter-party risk is huge. Even if everything works as the trade intends, and the losers have to chase after an ever smaller pool of increasingly expensive GME shares, it may make more economic sense for some of those losers to declare bankruptcy instead.