Wall Street was the real winner of the GameStop saga • Hacker News Board

Re: Wall Street was the real winner of the GameStop saga

#161

Post by cirgue » Mon, Feb 07, 2022, 4:31 PM UTC

wsb_mod2 wrote: post #131

cirgue wrote: post #119

Earlier quoted context omitted.

WSB started as a canard to get more drunk tourists to the small stakes poker tables, in this analogy the poker table is low volume options where you can get a handful of robinhood investors to move the price and make a quick thousand bucks. It’s still that today, but larger players with more money figured out that they could do that too, and potentially on a larger scale. That’s what this has always been about. There…

> WSB started as a canard to get more drunk tourists to the small stakes poker tables 1. WSB was created before Robinhood was released. 2. WSB started as a place for people to discuss more risky strategies than what was being discussed on r/investing 3. Yes. There is no movement. WSB is not your personal army.

“Robinhood investors” is a synecdoche here. Substitute “etrade” if you prefer.

Re: Wall Street was the real winner of the GameStop saga

#162

Post by spywaregorilla » Mon, Feb 07, 2022, 4:32 PM UTC

gruez wrote: post #135

FractalParadigm wrote: post #78

Earlier quoted context omitted.

GameStop has pivoted to some extent. It's incredibly rare that I go into one of their stores, but the last time I did it was less of a games store and more of a gaming merchandise store. Their acquisition of ThinkGeek and subsequent selling of those products in stores is satisfying a niche that nobody else (apart from maybe the mom & pop comic book store) seems interested in.

>it was less of a games store and more of a gaming merchandise store. Their acquisition of ThinkGeek and subsequent selling of those products in stores is satisfying a niche that nobody else (apart from maybe the mom & pop comic book store) seems interested in. Maybe it's just my personal preferences, but I can't imagine myself or anyone I know buying enough "gaming merchandise" in significant numbers. If I need a ga…

It's not an amazing idea but its believably a sustainable business. Not a valuable a business though.

Re: Wall Street was the real winner of the GameStop saga

#163

Post by WJW » Mon, Feb 07, 2022, 4:39 PM UTC

marcus_holmes wrote: post #151

this_user wrote: post #121

Earlier quoted context omitted.

The purpose of stock markets is to find the "correct" price for a stock. To that end, it needs to be possible to express both bullish and bearish views. However, doing the latter is already more difficult because in order to short the stock, you need to borrow it first, and you need to pay for those borrowed shares for as long as you keep holding them. Furthermore, those borrows can be pulled at any time, forcing you…

You don't need short selling for a stock's price to drop. Markets for everything else use the normal mechanism of "if no-one is going to buy this at this price, I need to drop my price if I want to sell it". For example: you can't go to the bakery, borrow a loaf of bread, sell it to a passing punter, and then pay the baker at 5pm when they drop the price to get rid of their stock before it goes stale. The rest of the…

You could absolutely do that bread trade (if you could convince a baker to lend you a loaf of bread), but then a smart baker wouldn't drop their prices at the end of day because they know a short seller needs to buy a bread to cover their position. The example is also wrong because stocks don't go off like bread does. For commodities that keep better like frozen orange juice or steel you can definitely borrow (for a price) a few hundred tons of most commodities if you want to short it.

For some reason people think borrowing a stock and selling it is some super nefarious plot to kill companies, but apart from some special circumstances like secondary offerings or employee equity compensation there is really no reason a company should worry overly much about their stock price. If the company keeps making a profit, no amount of short selling can make it go bankrupt.

Re: Wall Street was the real winner of the GameStop saga

#164

Post by daenz » Mon, Feb 07, 2022, 4:41 PM UTC

FuriouslyAdrift wrote: post #116

Because of my GameStop stock play, I am finally debt free for the first time in my life (after 35 years of paying). No car loan, no college loans, no mortgage. It actually felt good to pay over $10k in taxes for short term gains.

Do you think it's important to acknowledge that you got lucky with a gamble? If you have kids, would you advise them to make a similar move as you did, in the hopes that they also get lucky and win big? If not, advertising only the benefits of your choice just lures desperate people who will statistically lose their investments.

Re: Wall Street was the real winner of the GameStop saga

#165

Post by MomoXenosaga » Mon, Feb 07, 2022, 4:47 PM UTC

wolverine876 wrote: post #81

How do we recognize such madness in the future, before we get caught up in it? After it's metastasized?

Our society does not learn from the past. And the nature of man doesn't change.

Re: Wall Street was the real winner of the GameStop saga

#166

Post by potassiumwreath » Mon, Feb 07, 2022, 4:52 PM UTC

This seems to be a particularly polarizing topic and I may have some insight into why.

There's a supreme value to the widely-held belief that 'the market' just 'works' and is 'fair' or 'free' or something. The only way features like liquidity were possible to offer in the early days of the emerging globalized financial markets was by appointing Market Makers, Authorized Participants, and other privileged positions that could self-regulate and influence the market. There were all kinds of (legitimate) limits to creating a truly 'free' or 'fair' system during the bootstrapping phase. So the system was justified, once upon a time at least...

So that's how we got here: What now?

Well... many of us still expecting a GME squeeze believe that Market Makers got greedy and instead of contenting themselves with the profit channels they were conceived to capture they used their central position to extract revenue from some less scrupulous places than the bid-ask spread. Once MMs realized the haul they could extract by selling shorts throughout the deaths of certain 'surely dead' companies, it doesn't take a stroke of genius to think about inciting these kinds of events themselves. Here's where the rub comes in: Because of the way things were bootstrapped, most of these Market Makers are self-regulating bodies that self-report a lot of critical positions if they even have to report it _at all_. Regardless of how we got here, the reality is that many privileged positions such as Market Makers do NOT need to report their short positions. Even if they were 'required' there are so many ways to 'hide' the position on a balance sheet that I honestly cannot imagine paperwork exists that would conclusively DISPROVE the possibility of a MOASS.

Many others hold the belief that 'the market' is 'working' just 'fine' whatever those words mean to the individual espousing that belief. Their belief is, in general, that the rules of the game are to be trusted. They don't just quote the SEC report citing Self-Regulating Organization short interested coming in at 0% right after Jan 2021, they actually BELIEVE it. They don't even question that these self reporting organizations may be lying. I mean, with their immaculate records how could you not believe them?

So there you have it: One group believes mostly on principle that markets are 'good' or 'functioning correctly' thus MOASS couldn't happen and anyone still awaiting MOASS is doing so because of ideological reasons more than a single piece of evidence.

Disclaimer: I hold some GME

Re: Wall Street was the real winner of the GameStop saga

#167

Post by [deleted] » Mon, Feb 07, 2022, 4:53 PM UTC

JumpCrisscross wrote: post #51

raxxorrax wrote: post #50

Earlier quoted context omitted.

I think it should started a discussion about some excesses of the stock market. Rich people can look for battered companies and severely profit from their accelerated demise which some people wanted to fight against for once. Out of their own motives for profit or just for fun to be able to at least once stick it to speculators looking for easy profit. That trading was halted and "corrected" proved they had an impact…

> Rich people can look for battered companies and severely profit from their accelerated demise which some people wanted to fight against for once You’re describing accelerating creative destruction. It’s painful but good. Prevent it entirely and you cause stagnation. We can make the human impact more compassionate. But trying to stop it is folly.

[deleted]

Re: Wall Street was the real winner of the GameStop saga

#168

Post by ska » Mon, Feb 07, 2022, 5:04 PM UTC

JumpCrisscross wrote: post #51

raxxorrax wrote: post #50

Earlier quoted context omitted.

I think it should started a discussion about some excesses of the stock market. Rich people can look for battered companies and severely profit from their accelerated demise which some people wanted to fight against for once. Out of their own motives for profit or just for fun to be able to at least once stick it to speculators looking for easy profit. That trading was halted and "corrected" proved they had an impact…

> Rich people can look for battered companies and severely profit from their accelerated demise which some people wanted to fight against for once You’re describing accelerating creative destruction. It’s painful but good. Prevent it entirely and you cause stagnation. We can make the human impact more compassionate. But trying to stop it is folly.

> You’re describing accelerating creative destruction. It’s painful but good.

There is this aspect, true - and necessary. An equal folly is to believe this is the only thing, or even the only significant thing, going on.

Re: Wall Street was the real winner of the GameStop saga

#169

Post by [deleted] » Mon, Feb 07, 2022, 5:07 PM UTC

wsb_mod2 wrote: post #128

ggambetta wrote: post #4

It was a weird, fun ride. My writing partner Lutz and I work in tech, but have a real passion for filmmaking. We lost some money on $GME, so we had to tell the story from our point of view. The result is STONKS, a comedy/drama feature screenplay [0], fictional but inspired by the GME events, and a love letter of sorts to WSB. We queried Hollywood producers but were ignored; we shared on WSB itself but we were insta-b…

Jaime Rogozinski is a grifter who repeatedly abused community trust to profit off WSB. This is why he was removed by Reddit admins in January 2020, a full year before the GameStop saga. The only time he ever came to WSB after 2016 was if someone approached him with a way to make money off the community. It's laughable that anyone would buy the rights to his story when he wasn't around at all. If WSJ cared about integ…

[deleted]

Re: Wall Street was the real winner of the GameStop saga

#170

Post by hallway_monitor » Mon, Feb 07, 2022, 5:11 PM UTC

knodi wrote: post #157

FuriouslyAdrift wrote: post #116

Because of my GameStop stock play, I am finally debt free for the first time in my life (after 35 years of paying). No car loan, no college loans, no mortgage. It actually felt good to pay over $10k in taxes for short term gains.

Welcome to gambling.

You misspelled stock market.