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Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

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Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#921

Post by dang »

speeder wrote: post #9

This sort of stuff will put people more and more on edge, there is the deplatforming going on, people asserted their power financially, and now getting that removed too, the powers that rule USA don't realize that soon the only tool left to common people is violence? Even more with some irresponsible newspapers blaming the whole thing on GamerGate and Alt-Right, effectively pushing away people that previously could b…

Some people are complaining to me that this comment is an implicit call to violence. It's not so hard to see why they might be reading it that way.

Please don't post like that to HN. Instead, either post comments that are unambiguously within the site guidelines to begin with, or be careful to disambiguate your intent. Otherwise we end up in flamewar hell or something even worse than flamewar hell.

https://news.ycombinator.com/newsguidelines.html

https://hn.algolia.com/?dateRange=all&page=0&prefix=false&so...

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#922

Post by zby »

Eighteen years ago flashmobs were disrupting some retail stores - but I knew they have a potential for more. Now we see flashmobs in the US Senate and then disrupting capital markets. It is funny - but also ... disruptive.

Actually politics has been a part of entertainment for some time already - but I don't like it like that and I am afraid capital markets will also be worse.

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#923

Post by ivalm »

beachwood23 wrote: post #673
wyldfire wrote: post #26

Can someone help me understand Robinhood's POV? This just seems so outrageous that there must be some sane rationale that I'm not seeing. Why do Robinhood, Reddit, Discord, etc feel like they have to respond to this? Whether the investments being made are responsible or not, it doesn't seem like it should be their place to intervene. If the hedge funds over-shorted GME and WSB recognized that and traded against that…

I don't think this was Robinhood's choice. Robinhood doesn't actually execute any trades. They sell user's trade orders to Citadel, a trade executor. Citadel then buys the shares on the market, and sells them to Robinhood for a slight markup. It's how Robinhood offers trades for $0 fees. You pay pennies more per share, but don't have to spend $5 per trade. Citadel, and other trade executors, are refusing to buy share…

> Citadel then buys the shares on the market, and sells them to Robinhood for a slight markup

This would be front running and is fundamentally not how citadel or other MM function.

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#924

Post by biztos »

bufferoverflow wrote: post #746
notahacker wrote: post #685

Earlier quoted context omitted.

99.99% of people who buy lotteries know it's a gamble rather than a moneymaking strategy. Nobody is advising people buying lottery tickets that they should borrow money to buy as many of them as possible because they will make a nice easy profit at the expense of the rich. It's often said lotteries are a tax on people that don't understand probability, but at least people playing don't think they're doing arbitrage.…

> Nobody is advising people buying lottery tickets That's demonstrably false. There are literal ads on TV that show how wealthy you can become if you just buy a lottery ticket. > that they should borrow money to buy as many of them as possible because they will make a nice easy profit You clearly haven't read any of the GME threads on WSB. Pretty much everyone is saying to only invest what you can afford to lose. Mos…

Somewhat off topic but I was in Spain before Christmas, and there the Christmas Lottery is a big deal: it has a huge jackpot but costs 20€ for a ticket. The drawing of the numbers is a massive televised affair, with children singing out the numbers, I kid you not. Lots of interviews with winners big and small.

There were lines outside the ticket shops (semi social distanced and with masks). Street vendors of tickets were walking around asking people “don’t you want 200 million Euros?” Or whatever the number was, I didn’t win so I forget.

Point being, with the Christmas lottery all but personally endorsed by the Pope and the King, and with millions of poor and poorly educated people watching this spectacle, I’d be shocked if some people didn’t cause themselves real trouble as a result. Just one more ticket...

(My friends there treat it mostly as a joke but still do buy one ticket each, every year, on principle.)

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#925

Post by Karunamon »

foobarbazetc wrote: post #822
beachwood23 wrote: post #673

Earlier quoted context omitted.

I don't think this was Robinhood's choice. Robinhood doesn't actually execute any trades. They sell user's trade orders to Citadel, a trade executor. Citadel then buys the shares on the market, and sells them to Robinhood for a slight markup. It's how Robinhood offers trades for $0 fees. You pay pennies more per share, but don't have to spend $5 per trade. Citadel, and other trade executors, are refusing to buy share…

Citadel != Citadel Securities. Most clearing firms aren’t clearing GME or AMC anymore. It’s not just RH.

Same owners at the end of the day.

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#926

Post by okprod »

wyldfire wrote: post #26

Can someone help me understand Robinhood's POV? This just seems so outrageous that there must be some sane rationale that I'm not seeing. Why do Robinhood, Reddit, Discord, etc feel like they have to respond to this? Whether the investments being made are responsible or not, it doesn't seem like it should be their place to intervene. If the hedge funds over-shorted GME and WSB recognized that and traded against that…

Rh wants to go public and relies on Citadel. Both major reasons why Rh does the larger funds' bidding. Rh's trading for the people angle is a bunch of BS

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#927

Post by drewcon »

MrMan wrote: post #683
drewcon wrote: post #408

Trading stocks is not the 1st amendment where we basically say we don’t really care about the outcome of your speech (as an individual). Say what you want even if its dumb and hurts you. With capital markets...there absolutely is a goal, and it’s not speculation/gambling. The goal is to have a place where corporations can raise capital and investors can hold them accountable for how they return value to them...and th…

to the extent that the market needs speculators, I think it is part of the "goal" of capital markets. a market of only long-term risk-averse allocators wont have the liquidity necessary to create fair prices nor is it likely to attract as much capital when companies issue shares, as a market that has a "healthy" amount of speculation.

I have no problem with individuals or fiduciaries investing on short time horizons because they believe they understand something fundamental the next guy doesn't. But mass coordinated speculation isn't that; it's using a mob to affect the underlying system for profit -underlying equity be damned.

And for all those that say "well Wall St has been doing that for years"...fine, let's address that too. Financial regulations are essentially a history lesson of past failure we've tried to correct. Let's be consistent.

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#928

Post by KMag »

wrsh07 wrote: post #521
JumpCrisscross wrote: post #385

Earlier quoted context omitted.

> Can someone help me understand Robinhood's POV? Robinhood is a margin-lending options-trading broker. If a customer falls down on a trade, it is ultimately liable. If a retail customer loses money and makes a FINRA complaint that Robinhood induced them to buy through its gameified interface, it is liable. Risk and compliance likely made this call. Also, Robinhood makes its revenue from market makers. They are the c…

You could also imagine that they have concern about the volume causing issues on their servers. A literal thundering herd might mean owners of GME can't sell during the collapse which would put robinhood in a bad situation

> A literal thundering herd might mean owners of GME can't sell

I can assure you there are very few cattle, bison, or caribou near the exchange.

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#929

Post by drewcon »

Dirlewanger wrote: post #723
dixego wrote: post #427

Earlier quoted context omitted.

Perhaps this is proof regulations on the market should be stricter, then. After all, if a bunch of barely coordinated randos on the internet can do this through the power of 'meme magic', imagine what people with real resources and power and influence could do.

>imagine what people with real resources and power and influence could do. You mean what they already have been doing for decades? Are you seriously in favor of clamping down on retail investors??

Who has been doing this for decades? When has "Wall st." coordinated a random attack to squeeze cash out of an entity just for the hell of it?

You may disagree with the outcomes of short pressure, or private equity actions etc., thats fine, but I think there is an important distinction between actors in the market doing something profitable because they actually believe it, and the hysteria of a mob just randomly committing financial mayham because they can.

I don't think we want to live in a world where markets are increasingly led by irrational forces simply amplified by media and misinformation...its not good in media right now, I shudder to think what happens if that behavior gets a foothold in markets.

Re: Robinhood is limiting purchases of stocks: AMC, Blackberry, Nokia, and GameStop

#930

Post by drewcon »

layoutIfNeeded wrote: post #421
drewcon wrote: post #408

Trading stocks is not the 1st amendment where we basically say we don’t really care about the outcome of your speech (as an individual). Say what you want even if its dumb and hurts you. With capital markets...there absolutely is a goal, and it’s not speculation/gambling. The goal is to have a place where corporations can raise capital and investors can hold them accountable for how they return value to them...and th…

>it’s not speculation/gambling What is short selling if not speculation? It's speculating that an asset will be worth less than it is now.

There is a world of difference between playing a game of chance, and playing a game where you happen to believe you have real better/different information about how the future unfolds. Speculators tend to act mostly on emotion and inertia from the game, not any real understanding of any underlying fundamentals.

Short sales can be good. Downward pressure can be healthy. If you think a company is overvalued because its fundamentals are misjudged, the short is a corrective force in an overly optimistic market

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