u/DeepFuckingValue and the GameStop Reddit mania

Post by fractionalhare » Sat, Jan 30, 2021, 5:15 AM UTC

jewel wrote: post #414

codeisawesome wrote: post #277

Earlier quoted context omitted.

After the sell-off, there’s a lot of cash (yes even more) washing around right? It has to go somewhere , and so it will come back into securities in probably a few weeks or max, months. The value represented isn’t exactly disappearing it’s still in the ‘system’. So why is a crash in equities prices such a big deal?

Money isn't conserved in the same way that matter is. Right now the market cap of gamestop is $22B, which is calculated by multiplying the share price times the number of outstanding shares. If some news comes out over the weekend that causes people to value the stock lower, we could see the first trade at $33/share instead of $330/share. $20B of money just disappears. It never really existed in the first place.

Post by samename » Sat, Jan 30, 2021, 5:23 AM UTC

ivalm wrote: post #320

jpmattia wrote: post #97

Earlier quoted context omitted.

> The overall market is stressed, things are getting weird and I would not be surprised if this is the beginning of another stock market crash. GME short interest was still greater 100% of shares outstanding as of 1pm 1/29 (S3 Shortsight numbers). If forced to cover, short holders will have to liquidate other assets. Could those liquidations force more liquidations in a positive feedback loop? Hopefully no, but certa…

There is nothing special about being short more than 100%, they short shares that are borrowed multiple times. But it also means the “long” interest is more than 200%. Even if you own equivalent of 100% of float there are still other shares that can be used to cover. The only issue starts if someone has lent out more than 100% of float and tries to simultaneously recall all of them.

Post by recursive » Sat, Jan 30, 2021, 5:30 AM UTC

kinghajj wrote: post #173

runarberg wrote: post #165

Earlier quoted context omitted.

Statistically, in a zero sum game, where all players are equally skilled and the winner of each transaction is determined at random. The more transaction made, the more the wealth accumulates. What this means is, that unless you are already one of the richest person on the stock markets, your most likely outcome is that you will loose money by participating. So—unless you are already rich—your optimal strategy is not…

The stock market--just like the economy--is not a zero-sum game. I don't know what to tell you. The S&P500 over the long term has consistently performed quite well, for many decades. Maybe if your picture of participating in the stock market involves day trading, sure, statistically the majority of people who try will break even or come out with a loss. But that's not what financial advisers recommend average people…

Post by cachvico » Sat, Jan 30, 2021, 5:34 AM UTC

rglullis wrote: post #246

asenna wrote: post #236

Earlier quoted context omitted.

Why is adding an incentive mechanism to "pinning" files on IPFS inherently wrong? If you find the right incentives to a tech problem, that pushes the tech forward right? Like Satoshi Nakomoto putting together the right type of incentive to be able to create an almost unhackable network in Bitcoin (along with Ethereum and others). I'm not yet saying that Protocol Labs will ultimately find the success they're looking f…

It's not dismissive. They already got their money. $257 million, to be exact. No one knows how Filecoin is going to make money except for Protocol Labs.

Post by recursive » Sat, Jan 30, 2021, 5:40 AM UTC

pb7 wrote: post #430

runarberg wrote: post #417

Earlier quoted context omitted.

Do you honestly believe that these are equivalent? Or are you just arguing in bad faith? I’m gonna assume the former and explain the difference. The interest you are paying when you take out a loan is a) compensating the creditor for money lost because of inflation, and b) paying for a service. The bank/credit union at the same time will at the same time a) compensate for inflation and b) reward savings accounts for…

It’s odd to me that you see the mutually beneficial transaction there but not in the stock market. I will state this once as simply as I can: stock market investors are rewarded for funding companies by taking on that risk in hopes that the companies they invest in produce a profit. It is overwhelmingly similar to the process you are describing with your credit union, but in a much more distributed way. > Workers don…