Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Statement of SEC Regarding Recent Market Volatility

sec.gov

Post reply on HN
Print view View original

161–170 of 906 posts

Re: Statement of SEC Regarding Recent Market Volatility

#161

Post by sidlls »

jancsika wrote: post #121

A Moment in the Life of an HN Genius: 1. Reads a technical document outside their domain. 2. Feels dumb because they don't have a grasp on any of the concepts. 3. Too busy to use the very internet which some of them probably helped build to magically render learning materials to the screen in front of them at zero marginal cost. 4. Sees the word "manipulation" 5. Substitutes the laymen's definition of "manipulation"…

That is pretty accurate even for many software and tech related discussions here (it’s a big field with lots of specialties).

Re: Statement of SEC Regarding Recent Market Volatility

#162

Post by dkrich »

FartyMcFarter wrote: post #131
dkrich wrote: post #75

There’s a long history of similar occurrences that follow along a common line: whatever appears to support individual investors will be the path taken by politicians and regulatory bodies. Right now it appears that the public wants to be able to trade on their terms because there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to…

> there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to this. Which part has little truth to it? The big hedge funds are apparently losing money (billions!) on Gamestop, unless that's being mis-reported. Some of the "little guys" (reddit people) definitely were a part of the reason for that.

That retail is behind a massive short squeeze that is solely responsible for these moves. At this point shorts from significantly lower levels have almost certainly been covered, if for no other reason out of simple necessity. At this point what started as a short squeeze has ballooned into a false narrative that retail is sticking it to shorts when in reality it’s almost certainly HFT traders pushing this stock up and down by now. Retail simply doesn’t have enough cash to move a stock like this especially when by their own admission they aren’t selling any shares!

Re: Statement of SEC Regarding Recent Market Volatility

#163

Post by Dirlewanger »

jeffbee wrote: post #61
Dirlewanger wrote: post #53

Earlier quoted context omitted.

Ever think that they just like the stock?

That's the thing: there is NO QUESTION as to the motives of the r/wsb traders. They are overtly conspiring to raise the price of shares in order to force specific parties to buy it. That's manipulation!

May be for some of them. People invest for all sorts of reasons besides the "fundamentals", you know.

Tell me: what do you think Melvin's intentions were for shorting a dying company's stock for several billion?

Re: Statement of SEC Regarding Recent Market Volatility

#164

Post by OscarCunningham »

blackearl wrote: post #141
TeMPOraL wrote: post #49

Earlier quoted context omitted.

It's in the SEC rules. "Although some short squeezes may occur naturally in the market, a scheme to manipulate the price or availability of stock in order to cause a short squeeze is illegal." From https://www.sec.gov/investor/pubs/regsho.htm . It's an open question whether this case is more of a natural occurrence or "a scheme to manipulate", given that it's all randos who found a Schelling point and are now hyping…

If the SEC isn't going to litigate the naked short selling that preceded this, it's really hard to not cry hypocrisy.

Is there any actual evidence of naked short selling? The only evidence I've seen people raising is that the total value of the shorts was over 100%, but that can happen completely legitimately if the people who buy from short sellers allow the stock to be sold short a second (or third, fourth, ...) time.

Re: Statement of SEC Regarding Recent Market Volatility

#165

Post by Miner49er »

dkrich wrote: post #75

There’s a long history of similar occurrences that follow along a common line: whatever appears to support individual investors will be the path taken by politicians and regulatory bodies. Right now it appears that the public wants to be able to trade on their terms because there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to…

> Right now it appears that the public wants to be able to trade on their terms because there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to this.

The fact that buying was limited yesterday is evidence that the little guy is actually winning here.

Trading was stopped to save the hedge funds, because if they go under or lose too much, the clearinghouse has to front that. If the clearinghouse goes under the whole market will crash.

Re: Statement of SEC Regarding Recent Market Volatility

#167

Post by dagw »

FartyMcFarter wrote: post #131
dkrich wrote: post #75

There’s a long history of similar occurrences that follow along a common line: whatever appears to support individual investors will be the path taken by politicians and regulatory bodies. Right now it appears that the public wants to be able to trade on their terms because there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to…

> there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to this. Which part has little truth to it? The big hedge funds are apparently losing money (billions!) on Gamestop, unless that's being mis-reported. Some of the "little guys" (reddit people) definitely were a part of the reason for that.

The big hedge funds are apparently losing money (billions!)

A few hedge funds (of different sizes) are indeed losing billions. A few other hedge funds have taken the opposite side of this bet and are making money. The vast majority of hedge funds have no position in this stock and are completely unaffected.

In addition a bunch of HFT shops and similar making a lot money off the volatility and order flow all this has caused.

Re: Statement of SEC Regarding Recent Market Volatility

#168

Post by hatsunearu »

zaphod4prez wrote: post #151
FartyMcFarter wrote: post #131

Earlier quoted context omitted.

> there is this narrative that the little guy is finally sticking it to the big bad hedge funds. In reality there is probably very little truth to this. Which part has little truth to it? The big hedge funds are apparently losing money (billions!) on Gamestop, unless that's being mis-reported. Some of the "little guys" (reddit people) definitely were a part of the reason for that.

(Disclaimer I do NOT know what I'm talking about, just repeating what I saw on Twitter) It seems like they've all closed their shorts already, most of them did on like day 2 I believe. In addition, other hedge funds have been on the winning side of this trade. Some of the orders for GME last few days have been absolutely massive, not coming from retail.

There was a CNBC post about Citron and Melvin closing shorts but it was retracted.

Re: Statement of SEC Regarding Recent Market Volatility

#169

Post by rich_sasha »

acover wrote: post #72
rich_sasha wrote: post #20

Earlier quoted context omitted.

From a distance, this is all a storm in a teacup. It's a small handful of stocks, and every single one in S&P500 is waaaay bigger, in terms of trading volumes and market cap. Anything can happen, but in finance terms, this is tiny so far.

The issue isn't GME market cap vs the S&P 500. It's that the clearing houses, exchanges and other intermediaries that guarantee every trade may go bankrupt due to the $15+ billion loss on options that they may have to cover.

I'd be very worried about Robin Hood's solvency, since they let people trade on margins, and retail investors are presumably difficult to get debts out from. I seriously doubt they underwrite their own options, more likely they just sell some broker's options.

Otherwise... sure some funds might lose a lot of money. But a lot of money for a fund (and it's investors). I wouldn't say we're seeing anything like systemic risk. If nothing else, Redditors' pockets are only so deep, and there's only so much meme stocks they can buy.

So where does it leave us? Perhaps Robin Hood might go under (though it looks like they learnt their lesson and got some cash, so maybe not). Some funds went under, and maybe some other will too. But generally, funds are not major systemic risk. They are speculative money. It's been going on for long enough that clearing houses requested the higher margins already. I don't think banks have any real skin in this game.

What was so terrible about 2008 financial crash, from the technocratic point of view, was that it was banks that were affected, and they are, among other things, the very plumbing of the financial system we all depend on.

Of course life can prove me wrong :) but I'm not remotely worried atm.

Re: Statement of SEC Regarding Recent Market Volatility

#170

Post by pbourke »

jeffbee wrote: post #47
willcipriano wrote: post #35

Earlier quoted context omitted.

>Could be? It's an open, publicly-documented market manipulation event. Strange question, what's the bar for market manipulation? For example if a company took out debt to buy their own stock in order to drive up the price would that count?

If the company were to issue a statement that they believed their actions would raise the share price, then yes. https://www.law.cornell.edu/uscode/text/15/78i

So do everything up to specifically stating the effect that you want, and it’s not market manipulation? This is the “emperor’s new clothes” absurdity of this whole system.

The whole fucking market has been manipulated by various parties this year, most notably by the Federal Reserve, yet there’s only a moral panic when some firefighter from Long Island gets a little taste?

Post reply on HN