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

81–90 of 182 posts

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

#81

Post by pierat »

hunter2_ wrote: post #63
fmajid wrote: post #47

> Depending on who you talk to, Lebed was either viewed as a person who knowingly abused the system and broke the law, or someone who acted no differently than Wall Street analysts acted Both of these statements can be true at the same time.

> Depending on who you talk to, Lebed was either viewed as a person who knowingly abused the system and broke the law, or someone ... actually performing no wrong-doing. Funny how selectively quoting a bit differently makes that appear far less so.

It all comes down to selective enforcement by the not-actual-real-judges at the SEC.

You have to go through their kangaroo court with an ALJ, and arger likely getting a judgement against you, can you actually go to a real court.

And this is combined with different rules for different income classes.

Kid from middle income family gets smacked down hard. Whereas billionaire employees doing work on wall street either get low scrutiny, or pay 2% of what they made (Read: cost of doing business).

The "rights" of the rich are not for the rest of us.

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

#82

Post by seadan83 »

cmcaleer wrote: post #10
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.

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…

Not a surprise it is loser stocks.

The pump and dumper wants cheap, low volume stocks, preferably those with a plausible turnaround story.

The pump and dumper does not disclose holdings or the prospect for them to acquire or sell. Hard to then know if the shilling was unsuccessful or not.

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

#83

Post by seadan83 »

mauvehaus wrote: post #48

He can afford college? In seriousness though: are analysts allowed to have an interest in stocks they're publishing analysis for? It seems like a fine line between creating an obvious conflict of interest (see: TFA perhaps on a more subtle level) and wanting them to have skin in the game so they're incentivized to provide useful analysis (rather than YOLO: stock goes up/down and I don't care because it's other people…

The difference, an analyst states if they have a long or short holding and if they intend to buy or sell in the future.

The scammer does not, that is the key difference.

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

#84

Post by jldugger »

cmcaleer wrote: post #10
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.

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…

Not sure how it came to be that every article publishes this kids name, but I'm starting to find a tragic arc to this guy's life. Dead twitter account, no LinkedIn account, and apparently was booked for narcotics possession in 2016. All I found was an arrest record[1]. Maybe he was just on some bad meds and the police caught him before things got worse, maybe they made the whole thing up, but many citations from his Wikipedia page(!) 404 now, and I have my theories as to why.

[1]: https://www.northjersey.com/story/news/passaic/wayne/2016/03...

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

#85

Post by d0gsg0w00f »

dehrmann wrote: post #40
paulryanrogers wrote: post #8

> Lebed professes that he did nothing wrong – he did nothing different from Wall Street analysts. He states that he learned how people react to the stock market and acted on that knowledge. So you trick people by lying to them, and it's ok because you take their money indirectly via the stock market. And because some analysts also do this (often suffering legal consequences), then it's definitely not wrong? Shameful.…

> So you trick people by lying to them, and it's ok because you take their money indirectly via the stock market No one was arguing that it was indirect; the people who lost money took advice from an anonymous user on a forum on tiny companies they'd never heard of. The morality question is still interesting because it hinges on whether or not people knew they were playing a game with deception.

These situations always remind me of a quote from Clark Howard who was a radio host of personal finance shows.

"It's almost impossible to get scammed if you're not a greedy person"

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

#86

Post by __MatrixMan__ »

seadan83 wrote: post #74
__MatrixMan__ wrote: post #35

Earlier quoted context omitted.

> 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…

Money gets created when people take out loans which creates debt which is then traded in the markets. That's not money flowing into the markets, that's just the markets doing their own internal bookkeeping (much like D&D uses HP for internal bookkeeping about character health).

If you want to convincingly argue that markets are positive sum you have to demonstrate that markets produce more than they consume in terms of something besides money. E.g. when some of the factory workers quit to go be day traders, the factory ends up producing more while consuming the same or less due to the positive effects of the investments enabled by the increased trading activity.

This might be the case in some cases, and it won't be the case in others, and I don't know how to sum it in aggregate. Presumably somebody does.

Whether it comes out positive or negative, asset prices are an implementation detail, not the thing we're measuring.

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

#87

Post by xyst »

Rookie mistake. Always got to add in the fine print: "Not financial advice" and disclose current positions. You don't even need to say the exact positions (ie, long call option, X shares, ...).

This is how the "stock analysts" on TV get away with it. When those credits role at the end of the segment, it will say something to this effect. Or TV show will disclose it at the bottom of the screen.

It's a grift.

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

#89

Post by AnthonyMouse »

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?

> How in the world is anyone defending this?

Suppose you're an ordinary trader who likes high risk bets. You find a stock you like, you buy some. Now you go on message boards telling everyone you think the stock is going to the moon straight away. This is your sincere belief. Soon the stock goes up 300%. You thought it was going to go up 1000%, that's what you said before, but hey, it still went up 300%, that's still a tidy profit, so you sell.

Whether this is fraud or not basically hinges on whether you were being intentionally dishonest, right? But now how do you distinguish between malice and stupidity?

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

#90

Post by giarc »

sour-taste wrote: post #54

There was a recent decision out of Texas that pump and dumps are legal if you do them without directly selling stock to the victims. So I guess that according to Texas what this guy did is totally fine! [PDF] https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rmMOgPQg... or coverage from Matt Levine: https://www.bloomberg.com/opinion/articles/2024-03-21/pump-a...

Wouldn't that mean that you can have a friend do the pump, and you do the dump? Sounds like the guy in the original article did both and therefore wouldn't be saved by that Texas ruling.
Post reply on HN