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

What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

kentlaw.edu

Post reply on HN
Print view View original

71–80 of 182 posts

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#71

Post by hallway_monitor »

peteradio wrote: post #56
Thorrez wrote: post #22

Earlier quoted context omitted.

>The entire trading industry is a zero-sum game bro. For someone to win someone else has to lose. Traders add liquidity. That liquidity allows me to easily buy and sell stocks without waiting long periods or worrying about getting ripped off by the spread. And since the economy isn't zero-sum, it's possible for everyone to end up better than before.

Does trading stocks somehow cause an increase production of actual stuff? If not, I don't see how everyone ends up better off.

People are saying that pump and dump schemes are unethical even if they're not always illegal. I would assert that investing for short-term gain is always unethical and the only way the stock market really benefits retail investors is when people invest and hold for long-term gains.

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#72

Post by [deleted] »

pc86 wrote: post #65
gmd63 wrote: post #30

Earlier quoted context omitted.

I didn't take you as believing it, just as framing what others might think. I've seen the sentiment too and it frustrates me.

Almost as frustrating as people who posit the penalty for lying/fraud/hucksterism should be death.

[deleted]

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#73

Post by op00to »

dehrmann wrote: post #31

> Lebed professes that he did nothing wrong – he did nothing different from Wall Street analysts Except analysts usually can't trade stocks. Short sellers can. In theory, libel law makes that safe, but when it's a 15-year-old playing the penny stocks, the company won't notice or have the legal firepower to chase down a /r/wallstreetbets user.

analysts can trade stocks, though they are not supposed to trade counter to their recommendations.

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#74

Post by seadan83 »

__MatrixMan__ wrote: post #35
everforward wrote: post #23

Earlier quoted context omitted.

> The entire trading industry is a zero-sum game bro. It's not, and even a cursory understanding of what zero-sum games are and how the stock market works would tell you that. How does the market grow if all trades are zero-sum? How do recessions happen if all trades are zero-sum? Some portion of trades are zero-sum, maybe even most of them. Stock markets don't function if every trade was zero-sum. Pump and dump sche…

> How does the market grow if all trades are zero-sum? The same way a cancer does: by repurposing adjacent systems in service of propagating itself, often to the determent of the function of those systems. In the case of a financial market this means people spending their time watching lines squiggle around on a screen instead of finding real problems to solve. Referring to the increase of stock prices as an indicato…

Outside money flows into the market, this allows it to be positive sum.

For the DnD analogy, it is as if you had a cleric.

Eg: IPO sells at $2, next seller buys at $4, next at $6, etc. Everyond makes money in that scenario. Eventually there can be losses, do all the losses counter balance these profits? No, because on net everything went up. If there were always trades that had losses to balance the gains, only then it would be zero sum.

What's more, people convert types of holdings all the time, and it is the big players that move things. When a mutual fund allocates 1% more to stocks, or 1% less and putd that to bonds, those are very big net new or net negative money flows. So, it's not just paychecks being added in, there are lots of sources of dynamism to make the stock market system anything but closed. There is net new money flowing into it all the time.

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#75

Post by gmd63 »

pc86 wrote: post #65
gmd63 wrote: post #30

Earlier quoted context omitted.

I didn't take you as believing it, just as framing what others might think. I've seen the sentiment too and it frustrates me.

Almost as frustrating as people who posit the penalty for lying/fraud/hucksterism should be death.

I didn't suggest that. Just illustrating how the incredibly moronic logic of "weeding out people who don't meet my standards of fitness is a civic duty" can be easily extended to non-financial areas of life.

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#76

Post by darby_eight »

dataflow wrote: post #62

> The messages that Lebed posted would predict marked increases in the stocks value [...] In response to Lebed’s messages, trading volume of these stocks would soar I'm so confused reading the comments here. How in the world is anyone defending this?

It's not hard to mock peoples' trust of the market.

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#77

Post by adventured »

ProjectArcturis wrote: post #41
hilux wrote: post #4

Interesting. A little googling turns up that 25 years later, he's still in the pump-and-dump business! Do what you love, I guess.

If you made half a million bucks doing something in high school, it'd be pretty hard to go the college route and hope to eventually get a job grinding $100k a year.

If you're good at a thing, you can easily make a lot more than that on Wall Street. $500k is just your bonus.

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#78

Post by seadan83 »

voisin wrote: post #17
EGreg wrote: post #13

Earlier quoted context omitted.

The entire trading industry is a zero-sum game bro. For someone to win someone else has to lose. As is the advertising industry and surveillance capitalism industry that powers the “free web”. (Only at the edges is new value created. Most of it exists to have large institutionals take money from the small newbs, you’re the fish at the poker table.) And more broadly, capitalism exploits people. This is like blaming An…

I concur - we as a society have agreed implicitly (since I think around the 1980s) that it’s everyone for themselves so take whatever the hell you can for yourself, consequences be damned. If you’re lucky, you’ll be dead before the world burns and society devolves into chaos.

There are places in the world that is an apt description. The US is closer to that than previously (as judged by effective tax rates on millionaires comparing the 1950s to today), but nonetheless, the US us not "there" yet and still has a ways to go

Re: What Happens When a Fifteen Year Old Pumps and Dumps with a Net Profit of $800k? (2002)

#80

Post by Frummy »

shnock wrote: post #59
cmcaleer wrote: post #10

Earlier quoted context omitted.

I found this Twitter account last posted to in 2014. https://twitter.com/lebedbiz I checked a good few of the stocks he listed. I figured he would have struck a lucky score at one point but he seemed to have an uncanny ability to always pick losing stocks. I was hoping for a happy ending like how many of the people I played Runescape with who hosted dicing games, speculated and flipped in-game assets became successfu…

Really? Merching in RS3 always seemed to be more of a pump and dump than anything that overlapped with real life quantitative investing

If theyre working as quants now, they were probably around before RS3 as well. I remember daytrading the grand exchange personally. There were plenty of profitable patterns that were basically guaranteed to work. I can see how someone who could program at the time could get much higher volumes by automating multiple accounts. The problem was finding profitable new trades at different levels of wealth, what worked at one volume would have to be replaced eventually. I never got into clans and such. I got scammed a few times especially memorable was a scam with a sort of party of social proof around the scammer and they would rinse repeat in every world, some things were so organised that you got really surprised by the intricacy of the scams.
Post reply on HN