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WallStreetBets vs WallStreet: It's not about the money anymore

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Re: WallStreetBets vs WallStreet: It's not about the money anymore

#111

Post by bluecalm »

koolba wrote: post #78
bidirectional wrote: post #19

Once again, this insistence on viewing 'Wall Street' as a monolothic entity. The largest asset management firm on Earth holds over 9 million Gamestop stock, none of the big banks that received bailouts in 08 are affected by this, 99.9% of hedge funds are not affected by this, high frequency traders are probably making a bundle. Institutional money was long Gamestop before this story entered the public consciousness.…

All those institutions are interconnected. A large hit to one player can cascade to the wider market as they're forced to sell off other positions to put up additional capital. That could cause additional sell-offs for more leveraged players. And so on... The phrase " too big to fail " exists for a reason and it's smaller than you think.

Forcing big leveraged players to sell is fantastic for everyone else. There will be a lot of cheap stocks to pick up for everyone else.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#112

Post by afavour »

kev_da_dev wrote: post #50
bidirectional wrote: post #19

Once again, this insistence on viewing 'Wall Street' as a monolothic entity. The largest asset management firm on Earth holds over 9 million Gamestop stock, none of the big banks that received bailouts in 08 are affected by this, 99.9% of hedge funds are not affected by this, high frequency traders are probably making a bundle. Institutional money was long Gamestop before this story entered the public consciousness.…

How is disabling purchases and broker-wide outages not bolstering hedge funds? It's government intervention no matter how you look at it. Just because it's not a direct capital infusion does not make it any less bad

Not sure if I missed something but did the government intervene here? I thought it was all private entities that stopped the trading?

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#113

Post by reyqn »

dcolkitt wrote: post #79
mancerayder wrote: post #55

They are blocking buying, and only allowing selling GME, BB and others. How is this not evidence of a corrupted free market system? A CEO of one company can call up his connections in retail trading platform firms, CNBC, and Nasdaq and protect his profits? Why is Reddit the scandal and not that? Reddit is full of rocket emojis and YOLO jokes. But what we see here, especially with the moralizing about gambling, is an…

Robinhood is a free service. The customers don’t pay anything. If the order internalizers decide to stop paying them for their order flow, then they have to route to the exchanges. which charge fees. Trading is still ongoing at the exchanges. It’s just the free platforms, where it’s shut down. If someone wanted guaranteed access to the exchange, then they shouldn’t have used a free broker. Are you saying that Robinho…

I don't known if the kind of publicity they're getting right now is good for them. They could end up losing way more.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#114

Post by shadowgovt »

One of the more interesting aspects of this story, IMO, is how many people used Robinhood to grab small amounts of GameStop stock.

Robinhood is suspected of having a business model of spying on their clients and selling that data to hedge funds (https://seekingalpha.com/article/4205379-robinhood-is-making...). Essentially, this puts their own clientele at an average disadvantage in all trades; the funds buying their data can set up algorithms to front-run any RH trades and skim a little more value than the people using RH could expect to get.

In this situation, it seems it didn't matter. Even if RH sold to the shorting traders "Hey, our clientele is buying the hell out of this near-junk stock," all the signal told them was how fast the train was coming at them, not which way to go to get off the tracks.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#115

Post by honest_guy »

dcolkitt wrote: post #79
mancerayder wrote: post #55

They are blocking buying, and only allowing selling GME, BB and others. How is this not evidence of a corrupted free market system? A CEO of one company can call up his connections in retail trading platform firms, CNBC, and Nasdaq and protect his profits? Why is Reddit the scandal and not that? Reddit is full of rocket emojis and YOLO jokes. But what we see here, especially with the moralizing about gambling, is an…

Robinhood is a free service. The customers don’t pay anything. If the order internalizers decide to stop paying them for their order flow, then they have to route to the exchanges. which charge fees. Trading is still ongoing at the exchanges. It’s just the free platforms, where it’s shut down. If someone wanted guaranteed access to the exchange, then they shouldn’t have used a free broker. Are you saying that Robinho…

> Are you saying that Robinhood should be forced to continue providing a free service at a loss?

This seems like an honest framing of the situation!

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#116

Post by kasey_junk »

fireeyed wrote: post #76
tenaciousDaniel wrote: post #8

As someone who is not very educated in finance, I'm curious how to interpret today's events. Is nasdaq/robinhood/everyone else transparently manipulating the market on behalf of hedge funds? Or are these standard mechanisms in place for preventing the stock market from swinging wildly out of control? I don't know if it's standard to completely block trading on one or more stocks.

Don't you think the honchos at Robinhood got the call from the man last night ? Its a coordinated ban of serfs from buying up AMC GME BB. Its got too hot for them.

No I don’t. I think the market makers/internalizers who are normally on the other side of retail trades want no part of the irrationality around these symbols so they pulled their orders.

There is no one on the other side of the book so Robinhood can’t execute. It’s standard market dynamics that anyone whose traded before understands.

That a bunch of new retail traders are about to learn an expensive lesson on execution/liquidity risk is a normal cycle.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#117

Post by 12bits »

swiley wrote: post #65
dragontamer wrote: post #23

Earlier quoted context omitted.

I just checked my TD Ameritrade account. I'm able to buy GME just fine (though I didn't hit the "confirm" button). I know RobinHood messed up here. But... they never had a good reputation to begin with. Its an open secret that RobinHood's entire setup is kind of crap.

I just bought NOK this morning on TD. I think it's just robinhood.

My Canadian TD account has been giving me a 502 all morning.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#118

Post by dahdum »

jsjsbdkj wrote: post #39
tenaciousDaniel wrote: post #8

As someone who is not very educated in finance, I'm curious how to interpret today's events. Is nasdaq/robinhood/everyone else transparently manipulating the market on behalf of hedge funds? Or are these standard mechanisms in place for preventing the stock market from swinging wildly out of control? I don't know if it's standard to completely block trading on one or more stocks.

WSB has basically recreated a "boiler room", which is an ages old scam where a small group of insiders would encourage people to buy stock, drive them value up, and then the insiders dump the stock. The key insight here is that for every person selling the stock and making millions, somoene has to be buying. There's a narrative about short squeezes forcing a small number of hedge funds to buy stock, but in practice m…

In this case people buying stock weren't hoping on a greater fool to sell it to later. By a large margin, more shares were sold short by a handful of hedge funds than even exist. As the price rises the expectation was/is they are forced to buy back to cover at any price.

It's entirely possible a majority of retail investors make a killing and a few large funds get liquidated. At least it was until the coordinated action to protect those hedge funds today.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#119

Post by minikites »

willis936 wrote: post #87
luxuryballs wrote: post #75

Earlier quoted context omitted.

That sitting around playing drums and smoking doesn’t accomplish anything productive.

That’s called being civil. Would you prefer they instead break the law to have their voices heard? Do you want wall street suits to fear for their life?

>Do you want wall street suits to fear for their life?

Ideally yes, the rest of us are a missed paycheck or major health problem away from becoming homeless and there's no mathematical reason it has to be this way, it's just how we've structured our society.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#120

Post by ignoramous »

nabla9 wrote: post #63
tenaciousDaniel wrote: post #8

As someone who is not very educated in finance, I'm curious how to interpret today's events. Is nasdaq/robinhood/everyone else transparently manipulating the market on behalf of hedge funds? Or are these standard mechanisms in place for preventing the stock market from swinging wildly out of control? I don't know if it's standard to completely block trading on one or more stocks.

If you buy stock with the purpose of pushing the price up so that other people will buy it, that’s market manipulation. What WSB crowd is doing is market manipulation. That's illegal. WSB is doing everything openly and even celebrating it. Getting mad when openly breaking the law is not rational response. https://www.law.cornell.edu/uscode/text/15/78i Brokers like Robinhood are reacting because they want too keep SEC…

> What WSB crowd is doing is market manipulation.

Shorting GME more than number stocks exist is not market manipulation? HFT isn't? Bailing out greed isn't?

Why is this notion of market manipulation such a narrow one-way street?

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