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WallStreetBets vs WallStreet: It's not about the money anymore

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Re: WallStreetBets vs WallStreet: It's not about the money anymore

#461

Post by lordnacho »

recursive wrote: post #458
lordnacho wrote: post #352

Earlier quoted context omitted.

Market maker: guy who makes money standing in the market all day so that when you come, you don't have to wait hours for a dude who wants to buy your shipment of pork. Broker: offers you access to the market, and often lends you money as well. Needs scale, is often a lot of marketing, both in getting the customers, and in getting the customers to actually trade. Hedge Fund: Umbrella term for an investment company tha…

So, I am really an outsider to all this, but it's amazing to me that a market maker is a thing. Like, why is that guy not replaced by a computer? They never get tired, and they don't screw up. (usually)

Market makers used to be actual people, nowadays they are in fact computers. The business role is similar though.

For all the things that are "guy" above, computers are heavily involved.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#462

Post by emteycz »

dalbasal wrote: post #411
afavour wrote: post #248

Earlier quoted context omitted.

So, the SEC is hands off and encourages self regulation, so any instance of self regulation is considered government intervention?

Look at the language of SEC (and other regulators outside of technical fields like pharma). There are very occasional "landmark" regulations, often legislated, that are explicit. EG Sarbanes-Oxley. Day-2-day, the SEC works mostly by signalling. They might make a policy declaration, or send letters to CEOs. They'll note things in periodic firm reviews. Publicly raise an eyebrow. Take action against or investigate one…

Agreed, but one point:

> Regulators are usually created in response to firms having won the loophole cat and mouse games, and the prohibitive complexity of actual regulations. If government wanted rules, they can just legislate directly instead of delegating to a regulator.

Large motivation to create regulatory bodies is expertise and focus on one (or more related) subject, and these regulatory bodies often simply recommend to the government/legislators and do the management the law mandates.

IMHO this 'suggestive' mode of operation is not usual outside of finance. (I might be wrong though, I have never seen a full list of regulatory bodies.)

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#463

Post by hbt »

arcturus17 wrote: post #426
isatty wrote: post #272

Earlier quoted context omitted.

Sorry, no. Memes and chicken tenders, sure, but WSB doesn’t push any agenda. Pro or against. Stop misguiding people.

We must not be reading the same subreddit then. There are many, many references of fucking with people or "sticking it to the man", and there have been for years. Whether that constitutes "pushing an agenda" (your words, not mine) is up for debate. For example, do political anarchists "push an agenda"? Maybe not, maybe that's an oxymoron in a sense (the agenda is that there's no agenda) - but they are certainly "anti…

a post to support your comment

https://www.reddit.com/r/wallstreetbets/comments/l6omry/an_o...

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#464

Post by Grimm665 »

FabHK wrote: post #396
FabHK wrote: post #358

Earlier quoted context omitted.

Entity A holds 100 shares and lends 80 to B, who shorts it by selling it to C, who lends 60 to D, who shorts it by selling it to E. Now there are 240 long positions (100 A, 80 C, 60 E), and 140 short positions (80 B, 60 D), for a net 100 long, as before. Short interest is 140/100 = 140% of the shares outstanding.

Oh, and by the way: Now A has 20 shares left (out of a 100 long position), C has 20 shares left (out of a 80 long position), and E has 60 shares (out of 60 long position). Now assume that entity E is redditors/RobinHood/financial justice warriors that pledge to hold, and not let anyone borrow their shares, to squeeze the bad bad shorts B and D. So, FJW/HODLers control 60% of the shares now, and will never ever lend o…

This is fascinating. Is Melvin Capital the "B" in this situation, and that's how they "closed their short positions" earlier today? It just shuffled hands between the other funds?

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#465

Post by alisonkisk »

AndrewStephens wrote: post #361

I have watched this mess from afar and the tone of the conversation has changed from "Hey, here is an opportunity to make some money off a mistake some hedge funds are making" to "Smash the system". Exhibit A - this idiotic article. You cannot use the tools of the system to beat the system. Here is the thing about hedge funds - they hedge. They hedge in the morning, hedge in the afternoon, eat some hedge for dinner a…

"hedge fund" doesn't really mean hedging. It is just a fancy (high fee) name for "actively managed" that usually uses more exotic strategies than buy and sell based on earnings reports.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#466

Post by KLexpat »

boringg wrote: post #201
rcxdude wrote: post #82

Earlier quoted context omitted.

And perhaps money found a new weapon in populist anger.

I just hope it doesn't get co-opted by the "alt-right" or other political groups. Also get ready for the 100+ opinion pieces on every media platform about this so everyone can get their ad dollars.

It won't, but the media will blame it on the alt-right. "White privileged mcdonalds workers oppress poor minority new york billionaires with their greedy market manipulation! "

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#467

Post by jrs235 »

snowwrestler wrote: post #438
mikestew wrote: post #408

Earlier quoted context omitted.

GME is still over $400/share this morning Guess what's changed in the 56 minutes since you posted this? GME: $265.00 Though I think it had dipped into around $380 by the time of parent post, and heading down. But someone bought at $430 this morning.

Is this a surprise? Tons of people wanted to buy GME this morning and were mad that Robinhood was preventing them. We won’t know for days who makes money and who doesn’t. It certainly won’t be everyone.

For a lot of people buying GME, it's not about making money. It's about sticking it to hedgers that they feel didn't just expect GameStop to file bankruptcy but hoped for it.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#468

Post by minikites »

alisonkisk wrote: post #456
minikites wrote: post #441

Earlier quoted context omitted.

These are shame-based punishments, what happens if these people have no shame?

$3B is not shame.

Sure it is, and most of us have enough capacity for shame that it works on us. Do you think Bernie Madoff feels ashamed about the money he lost? People who have no shame are very powerful, which is exactly why we need actual, meaningful punishment for people like this.

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#469

Post by yellowstuff »

beervirus wrote: post #320
paulddraper wrote: post #259

Earlier quoted context omitted.

They're so disconnected that losing billions doesn't matter? The problem is bigger than originally conceived then.

It matters to the investors in the hedge fund. It matters a lot less to the people running it.

"Hedge fund managers typically have a substantial amount of their own capital invested in the funds they manage, and a significant portion of their compensation is based upon the absolute, or positive, performance they achieve for their investors. As New York Attorney General Eliot Spitzer observed recently, the interests of hedge fund managers and their investors tend to be "aligned", largely due to this combination of the managers' commitment of capital to their funds and the performance-based compensation structure."

https://www.sec.gov/spotlight/hedgefunds/hedge-mfa.htm

Re: WallStreetBets vs WallStreet: It's not about the money anymore

#470

Post by yellowstuff »

shin_lao wrote: post #220
risyachka wrote: post #187

Earlier quoted context omitted.

Loosing billions still hurts a lot I would guess.

It's not their money, it's the money from LPs who invested in the fund.

If you know the term LPs you should know the typically senior management at hedge funds have a significant portion of their net worth invested in their own funds.
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