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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

#451

Post by breck »

NickM wrote: post #448
breck wrote: post #243

Earlier quoted context omitted.

The bubble only needs to pop though if GME management screws it up. GME has now become a $25B hedge fund with a gaming focus. They absolutely have the ability to become long term successful given these black swans they just experienced. Now, I know *nothing* about their management, but they at least have been given a chance. Their's an Eminem song that they should be playing throughout their buildings right now. If I…

GME has now become a $25B hedge fund with a gaming focus. I think you're confusing their market cap with their balance sheet. A $25B hedge fund has $25B in assets, but a $25B market cap does not mean that they have access to anywhere near that amount of capital. Sure, maybe they could issue a dilutive follow-on offering and bring in some cash, but who knows where the stock price will be by the time they get through t…

You're right, I'm off by an OOM. I think perhaps comparing them to a $2.5B hedge fund might not be out of the ballpark.

Didn't know about the $500M lost on $6B in revenue, but gaming is a growing market, they just got a ton of free advertising, so seems like they have a chance to do something great.

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

#452

Post by StillBored »

cainxinth wrote: post #450
StillBored wrote: post #305

Earlier quoted context omitted.

Last I checked steam/etc doesn't allow one to resell their games. So they do provide a convenient service in that regard.

You can sell used games on craigslist, ebay, facebook marketplace, or any number of places... often for better prices than GameStop will give you.

Yes that works, but in many cases your still paying a middleman. Be that ebay, or the post office. And the convenience of one stop selling the old game, and picking up the new is pretty strong.

Frankly, its sometimes hard for me to understand how game-stop profits on some of that stuff. Every time I go in there, someone is selling their old xbox/whatever to get the new one, and I just about never see anyone buying the old hardware.

Anyway, what I'm trying to say, is where I live the only bookstores that seem to be doing well are the half-price bookstores which operate with a similar model (and are also headquartered in TX and resell games). So I don't think its all gloom and doom for them.

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

#453

Post by alisonkisk »

bilekas wrote: post #295
bvirb wrote: post #225

Earlier quoted context omitted.

https://www.powercycletrading.com/what-is-a-high-short-inter... . > Short interest as a percentage of float above 20% is extremely high > A high NYSE short interest ratio means that the stock market as a whole is vulnerable to a “short-squeeze.” It could rise quickly if new economic data, political news, or other types of information are released that make investors more optimistic. GME was shorted 140%. No idea if 2…

I'm pretty stupid on this, but how does one short for +100% is that not naked shoring ?

When you buy a share and return it to the lender, you can buy it again from the lender. 200%, not naked.

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

#454

Post by alisonkisk »

gizmondo wrote: post #280
philip1209 wrote: post #246

Earlier quoted context omitted.

A lens to look at this through is - "why is short selling allowed?" Advocates cite increased "liquidity." But, does society really benefit? Short-selling really just lets trading firms extract value from the failure of others. In that sense - professional trading firms that participate in short-selling could be grouped into a monolithic "Wall Street" in the sense that they are extracting value without a benefit for s…

No, advocates cite improved "price discovery". You know, the only rational reason why stock markets exist in the first place.

Markets also exist for capital allocation.

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

#455

Post by alisonkisk »

ufmace wrote: post #398
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.…

I'm wondering about this. I was a little skeptical of the whole David-vs-Goliath bring-down-wall-st thing. But if it's really true that this is just one small and low-relevance hedge fund getting their ass handed to them for doing something dumb, then why does it feel like there's a whole machine trying so hard to tear down /r/wallstreetbets and distort the entire retail investing market to stop it? Why did Discord b…

Because like anything that gets suddenly popular, r/wsb and discord wsb got flooded with spammers.

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

#456

Post by alisonkisk »

minikites wrote: post #441
bidirectional wrote: post #245

Earlier quoted context omitted.

Losing billions of dollars in one of the biggest trading stories ever seems fairly consequential and will likely affect their future behaviour. That combined with the newfound knowledge that the type of trade they made can be picked up on and exploited is also likely to affect their future behaviour (i.e. don't do that again).

These are shame-based punishments, what happens if these people have no shame?

$3B is not shame.

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

#457

Post by alisonkisk »

bidirectional wrote: post #106
zouhair wrote: post #81

Earlier quoted context omitted.

Ah the good old "it's just some bad apples", the system is great, trust it.

I'm not talking about good vs. bad, but winner vs. loser. This is Wall St vs Wall St with retail investors taking some off the top on one side. This is not retail investors vs Wall St.

Retail is getting fleeced also.

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

#458

Post by recursive »

lordnacho wrote: post #352
recursive wrote: post #260

Earlier quoted context omitted.

And... what would that be?

Market maker: guy who makes money standing in the market all day so that when you come, you don't have to wait hours for a dude who wants to buy your shipment of pork. Broker: offers you access to the market, and often lends you money as well. Needs scale, is often a lot of marketing, both in getting the customers, and in getting the customers to actually trade. Hedge Fund: Umbrella term for an investment company tha…

So, I am really an outsider to all this, but it's amazing to me that a market maker is a thing. Like, why is that guy not replaced by a computer? They never get tired, and they don't screw up. (usually)

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

#459

Post by gizmondo »

alisonkisk wrote: post #454
gizmondo wrote: post #280

Earlier quoted context omitted.

No, advocates cite improved "price discovery". You know, the only rational reason why stock markets exist in the first place.

Markets also exist for capital allocation.

Yes, and in order to have efficient capital allocation, you need price discovery.
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