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Statement of SEC Regarding Recent Market Volatility

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Re: Statement of SEC Regarding Recent Market Volatility

#841

Post by [deleted] »

numair wrote: post #274
fallingknife wrote: post #182

Earlier quoted context omitted.

> “lol idk sorry Dick but we’re just gonna let you go and let the Fed bail the rest of us out sorry bro lol.” Like really. That’s how it went behind those closed doors in the lairs of the lizards that control the universe. Says Dick Fuld. I doubt that's true, though, because at the time Lehman was going under, they didn't know that all the other banks were going with them. Remember, the bailouts didn't come until a f…

The unforeseen side effects of what was meant to be a very orderly and master-planned wind-down of one bank for the benefit of all the others — that speaks to the exact point I was making about the ridiculous notion that these are mature, all-knowing, all-wise adults. As far as good and bad people, well... The senior $LARGE_CONSUMER_BANK Vice-President who told me how much he loved the profit he was making off the ov…

[deleted]

Re: Statement of SEC Regarding Recent Market Volatility

#842

Post by dragonwriter »

cactus2093 wrote: post #829
dragonwriter wrote: post #764

Earlier quoted context omitted.

> As I remember it, the advice wasn't "don't wear masks," the advice was "stay home." There was “stay home” but also “stop buying masks because you are stopping medical, first responder, etc. personnel from getting them and they aren't useful for the general public” during the initial PPE supply shortage and hoarding. This wasn't a lie, AFAICT, but Aa statement that was completely correct public health statement in t…

> was completely correct public health statement in the context it was given that was widely interpreted as an individual health statement. There was no misunderstanding, the message was "don't wear a mask unless you're sick, masks don't help the wearer they only help keep a sick person from spreading it to others around them". That was just a lie at the time, we didn't know that for sure and we had every reason to s…

> There was no misunderstanding, the message was "don't wear a mask unless you're sick, masks don't help the wearer they only help

I've heard lots of people say that was the message, but it wasn't the one I heard and it's not the one I find in any of the documented statements from public health officials.

Re: Statement of SEC Regarding Recent Market Volatility

#843

Post by stonogo »

mike00632 wrote: post #750
stonogo wrote: post #648

Earlier quoted context omitted.

Because Gamestop is a business that is in the process of adapting to changing market conditions, which generally requires capital, and when market analysts go big on shorting in public it depresses stock price, and issuing stock is a major common method by which businesses raise capital. As another example, lots of people assume Elon Musk got mad at short sellers because he took it personally, when in fact they were…

This narrative that GameStop is actually a good company and it's turning around despite all the short interest is pure bologna. Worse, it's intentionally misleading and often espoused by people who have a financial interest in the company. It's crazy to see people in this forum, who are typically tech forward, hype up the business model of selling physical copies of video games.

This is a common reaction to people who haven't followed Gamestop for a while. Cohen and RC Ventures bought in a while ago and have been pushing for the company to pivot out of the brick-and-mortar focus. This is why 'people who have a financial interest' are talking this way. Everyone involved recognized this would be an expensive proposition. Then the short sellers showed up.

Re: Statement of SEC Regarding Recent Market Volatility

#844

Post by rasz »

numair wrote: post #107

Okay kids, story time. After the crash of 2008, I spent some time working with Dick Fuld. Yes, the former head of Lehman Brothers. Yes, the one people describe as “disgraced,” among other terms. Here’s the irony, though — Dick was one of the only people I encountered at that level of business/finance who wasn’t a scumbag. Unlike so many virtue-signaling Silicon Valley darlings, the guy behind the curtain was an honor…

but Moooom, my brother was also kicking the puppy, why am I the one being punished, so unfair!!1

Re: Statement of SEC Regarding Recent Market Volatility

#845

Post by stonogo »

sangnoir wrote: post #713
stonogo wrote: post #648

Earlier quoted context omitted.

Because Gamestop is a business that is in the process of adapting to changing market conditions, which generally requires capital, and when market analysts go big on shorting in public it depresses stock price, and issuing stock is a major common method by which businesses raise capital. As another example, lots of people assume Elon Musk got mad at short sellers because he took it personally, when in fact they were…

Short-sellers are part of the free market. They are how the equation balances itself when trying to find the "true value" of a concern, or at least an approximation thereof. Obviously the person who owns stock, or is set to earn billions when the share price reaches a certain level is going to be adversarial to someone whose actions result in the share price being depressed - even if that is the fair value. > Large f…

I would like you to show me where this free market is, because it certainly isn't NYSE. The minute anything unexpected happens we're hit with trading halts, brokers riding the line of insolvency, SEC investigations, and congressional freakouts.

Re: Statement of SEC Regarding Recent Market Volatility

#846

Post by blackearl »

OscarCunningham wrote: post #164
blackearl wrote: post #141

Earlier quoted context omitted.

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.

While shorts were really high, GME also consistently had insane failure to deliver rates and was regularly on the threshold securities list.

Re: Statement of SEC Regarding Recent Market Volatility

#847

Post by blackearl »

SpicyLemonZest wrote: post #333
blackearl wrote: post #129

Earlier quoted context omitted.

The issue with that argument is that it's really not “it’s fine as long as retail investors get to play too," it's “it’s fine until retail investors get to play too”

The point is that it's not fine. The institutional investors who have historically said it was fine were wrong. If the average retail investor comes away thinking scummy tactics are cool now that you and I can use them, it'll be a disaster for the cause of real financial reform.

It's hypocritical to only now be concerned with "scummy tactics" when the little people found a way to turn them on the big money. No one seemed to really care until hedge funds started losing billions due to a situation they created.

Re: Statement of SEC Regarding Recent Market Volatility

#848

Post by sramsay »

caffeine wrote: post #767
numair wrote: post #107

Okay kids, story time. After the crash of 2008, I spent some time working with Dick Fuld. Yes, the former head of Lehman Brothers. Yes, the one people describe as “disgraced,” among other terms. Here’s the irony, though — Dick was one of the only people I encountered at that level of business/finance who wasn’t a scumbag. Unlike so many virtue-signaling Silicon Valley darlings, the guy behind the curtain was an honor…

This "wild new phenomenon" is just boring old market manipulation. The only thing new about it is that the perpetrator is a subreddit instead of a licensed broker/dealer or other regulated entity. The appropriate thing to do is for the SEC to subpoena Reddit and RobinHood, correlate trades with posts to prove intent to manipulate the price (which IS illegal), and charge every individual with market manipulation. Just…

> intent to manipulate the price (which IS illegal)

Is it "illegal price manipulation" even if it's done completely out in the open for everyone to see? (I'm seriously asking this question).

I feel like laws governing market manipulation imagine secret collusion among actors that one might reasonably assume are either competing with one another or pursuing their interests independently.

But in this case, the actors are entirely transparent with their motives. Anyone can go see what they're up to. Figuring out why these stocks suddenly went through the roof required no formal investigation at all, as far I know; it didn't take long to figure out why it was happening.

I also wonder whether those motives are even an issue here. Certain people in the system might be legally bound to be truthful with their clients, they might be required to pursue their clients' interests faithfully, and so forth. But isn't it true that as an individual investor, I am perfectly free to invest in stocks based on my horoscope, my initials, random throws at a dartboard, or anything else?

In other words, are the "lulz" illegal here? Is it illegal to not be "serious" with the market (whatever that means)?

Let's suppose there's a massive oil spill tomorrow. Everyone goes on reddit and says, "Hey, let's destroy this company by executing the following actions with the following securities . . ." (let's assume this is possible for a moment). Is that "market manipulation?" Is that illegal? Is that "abusive" (as the SEC puts it)? After all, in that case, they are trying to abuse the company for reasons they regard as entirely rational and reasonable, and they're doing it for all to see.

[edits for grammar and clarity]

Re: Statement of SEC Regarding Recent Market Volatility

#849

Post by [deleted] »

sumedh wrote: post #806
fnimick wrote: post #794

Earlier quoted context omitted.

100% this. Price manipulation to trigger a short squeeze is explicitly illegal. https://www.sec.gov/investor/pubs/regsho.htm section 7. Anyone who told others to buy and hold with promises of short covering and higher prices is party to market manipulation, and it is absolutely, definitely illegal. Whether they'll be able to unmask and charge people behind the anonymity of WSB is another question though.

> a scheme to manipulate the price or availability of stock in order to cause a short squeeze is illegal. A good lawyer can argue that these people are exercising their first amendment right of free speech. They are not reporting false data and most of these people commenting have "average" net worth not millions/billions. Its also very hard to prove to a jury that a message from such an average joe on a message boar…

[deleted]

Re: Statement of SEC Regarding Recent Market Volatility

#850

Post by JohnJamesRambo »

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…

What an excellent post.
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