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Statement of SEC Regarding Recent Market Volatility

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Re: Statement of SEC Regarding Recent Market Volatility

#901

Post by shakezula »

mike00632 wrote: post #748
shakezula wrote: post #651

Earlier quoted context omitted.

I think focusing on how it hurt GameStop isn’t the right perspective here. I think it’s more about how greedy and over-leveraged the short holders were. When average Joe goes crazy over-leveraged, the entire world says “well duhh, you took a risk and now you have to pay.” But when a hedge fund does it, they get to just make a call to turn the market off for a few hours and try to bail out their shorts? The hypocrisy…

"Over leveraged" typically means you traded too much on credit in proportion to how much collateral you have, not that the trade is risky. A very large short position is reasonable for a company that is likely to go out of business.

I understand what over leveraged means. This was /also/ an incredibly risky short to start. I’m not convinced that GameStop was ready to go out of business. Struggling, sure, pandemic and all that, and that would justify a put position, but the market also reacted exactly how it’s allowed to and called out a short positions bluff.

Re: Statement of SEC Regarding Recent Market Volatility

#902

Post by ric2b »

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…

Since when is intent to manipulate the stock price illegal by itself?

If that were true the hedge funds that shorted GME and then released their reports on why they thought it was going to go down would have been operating illegally already.

Or, more generally, any CEO making public statements about their company performance.

Pretty sure you need some extra spice to make it illegal, such as falsifying information.

Re: Statement of SEC Regarding Recent Market Volatility

#903

Post by ric2b »

whimsicalism wrote: post #762
kchr wrote: post #629

Earlier quoted context omitted.

> Melvin has definitely closed, although Citron may still be in partially. Source?

The original CNBC article that was never retracted.

Do you mean this one?

https://www.cnbc.com/2021/01/27/hedge-fund-targeted-by-reddi...

"the hedge fund’s manager told CNBC’s Andrew Ross Sorkin."

So this is completely based on a phone call and Melvin Capital can just claim that Andrew Sorkin misunderstood them.

There's no public statement from Melvin Capital, which makes me suspect that they were indeed just trying to manipulate public perception, they could have just not talked to journalists about their positions, which is their official policy.

Re: Statement of SEC Regarding Recent Market Volatility

#904

Post by ineedasername »

threedots wrote: post #552
ineedasername wrote: post #506

extreme stock price volatility has the potential to expose investors to rapid and severe losses and undermine market confidence It's not the SEC's role to protect investors from risk or losses, rapid or otherwise, and saying that the recent activity "undermines confidence" is just another way of saying "increases risk", which is not their job. They should ensure confidence by guarding against fraud, but not to protec…

Protecting investors is literally the first part of the SEC's three part purpose statement. The SEC came into existence because retail investors lost huge amounts of money in the 20's in speculative bubbles. The same thing is going to happen here so the SEC is literally doing what it was set up to do.

Don't cherry pick the portion of my statement you want to criticize: I did not say it wasn't the role of the SEC to protect investors.

I said it's not their role to protect investors from loss. Clearly it has a role in protecting investors by requiring disclosures that allow informed decision making, policing fraud, etc.

Re: Statement of SEC Regarding Recent Market Volatility

#905

Post by SirSavary »

notapenny wrote: post #531
SirSavary wrote: post #287

Earlier quoted context omitted.

Seems like you struck a nerve. I'm impressed by how many people are replying to this, quoting your points, and then talking about those points as if they were addressed directly at them. When did HN become overrun by narcissists?

Just because people are replying to your take, doesn't mean they are narcissists. Its possible to look at an argument and engage it without being triggered. People that disagree with you are not automatically x-ists. Though it sure is easier to believe they are, since that way you don't need to consider the alternative.

Wasn't my take -- just found it odd how many people wrote back as if they'd been personally attacked by the parent comment.

Re: Statement of SEC Regarding Recent Market Volatility

#906

Post by SirSavary »

snowwrestler wrote: post #403
SirSavary wrote: post #287

Earlier quoted context omitted.

Seems like you struck a nerve. I'm impressed by how many people are replying to this, quoting your points, and then talking about those points as if they were addressed directly at them. When did HN become overrun by narcissists?

How dare you call me, specifically, a narcissist with this comment! (But to be serious, I think it’s easy to accidentally take forum comments personally because the physical act of reading HN comments, social media DMs, and text messages are all basically the same. So maybe it’s easy for our emotions to get mixed up.)

Exactly this :) I should have used a word that carried less weight than "narcissist". Parent comment seemed like an obvious joke but it sucked most of the oxygen out of the thread.
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