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The Battle of GameStop

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Re: The Battle of GameStop

#531

Post by [deleted] »

Centigonal wrote: post #59
0b01 wrote: post #31

Earlier quoted context omitted.

In fact, Citadel Securities has gained a lot money from the $GME event. Citadel Securities pays tens of millions of dollars for Robinhood order flow.

Is Citadel really making a lot of money from the GME squeeze? I know they rebate Robinhood for order flow (I've even commented about it [1]), but I thought events like this were hard for MM firms to capitalize on because of the unpredictable nature of the price action and the high cost of hedging (there are no shorts available, how do you even delta hedge in that situation?). Am I missing something? [1] https://news.…

[deleted]

Re: The Battle of GameStop

#532

Post by runawaybottle »

autoexec wrote: post #125
in3d wrote: post #56

Earlier quoted context omitted.

Getting rich through a greater fool theory and creating a bubble in a small stock is not something I’d be proud of. You’re sticking it to the least knowledge Johnny-come-latelies who will be left holding the bag. Thinking that you’re screwing Goldman Sachs is delusional.

I don't thing anyone is suggesting that this will fix the systemic issues which plague the younger generations today. While this probably isn't going to cause much harm to Goldman Sachs you can be sure the people who'd been shorting gamestop weren't too happy about it and enough random and unorthodox trading will certainly keep day traders on their toes. I'm not about to go gambling with what little spare cash I've g…

Have you seen the volume being traded? Retail investors cannot make moves like that. Other firms are in on the play and cannibalizing their own.

Re: The Battle of GameStop

#533

Post by DangitBobby »

throwaway894345 wrote: post #411
nemothekid wrote: post #188

Earlier quoted context omitted.

> I had a lot of peers who partied through college, skipped classes, hardly worked, majored in women’s studies / art history / literature / etc and still managed to live in the dorms, buy daily lattes, have the latest iPhones, etc. Did you go to a 4 year private school (possibly a non-Ivy)? I feel like you are describing a class of Americans who are oblivious to their privilege, but are mistakenly labeled as the work…

Quite the opposite. I'm from a lower middle class family and that because my parents worked overtime in their blue collar jobs. I went to a public 4 year university. I was successful in college precisely because I didn't have a privileged background. While I also had no idea how to manage that much money, I erred on the side of caution. While my contemporaries lived in dorms, I spent half and rented a house with seve…

Counteranecdote here, I went to a 4 year public university as well, and the students I knew were not living extravagantly.

Re: The Battle of GameStop

#534

Post by piva00 »

jedmeyers wrote: post #470
piva00 wrote: post #214

Earlier quoted context omitted.

> I had a lot of peers who partied through college, skipped classes, hardly worked, majored in women’s studies / art history / literature / etc and still managed to live in the dorms, buy daily lattes, have the latest iPhones, etc. That's what you get when your system is designed to give money easily to young people who don't understand the consequences of major financial debt. Blaming this on the individuals is leav…

> system is designed to give money easily to young people Who exactly designed the system that way? Banks (aka capitalists) were not very keen on doing this exact thing for the risk reasons, and now the government ended up backing most of the educational debt for some reason (aka socialism).

"Who?" is a very loaded question for a process that for happenstance ended up designed this way through the decades. It's not about a single designer, it's about a power structure that has been perpetuated by the elites on this power structure.

And I'm sorry, the moment you use "socialism" to describe the government backing private loans from institutions that are privately held you lost me. This is not even close to a semblance of socialism, this is your government trying to live by the ideology of "free market everything" and patching the holes created by this ideology with a more expensive (and dumber) solution.

If higher education was free for every citizen, subsidised by taxes, you could call it a socialist-ish policy. Having to pay "market price" for your education through government-backed loans to private banks is far, very far from socialism.

Re: The Battle of GameStop

#535

Post by kortilla »

bufferoverflow wrote: post #454
nico_h wrote: post #341

Earlier quoted context omitted.

TESLA is up 1707% since january 2020. Apple and Amazon "only" 70%

Most likely to do with this: https://fred.stlouisfed.org/series/M1 A bunch of money gets dispensed, mostly to the rich corporations. Instead of helping their employees they dump it into stocks of quality companies.

That doesn’t make sense. If it just went to rich corporations, it wouldn’t have gone into Tesla, which is considered massively overvalued by all of these traditional companies.

Re: The Battle of GameStop

#536

Post by silexia »

toomuchtodo wrote: post #486
55555 wrote: post #303

Earlier quoted context omitted.

> I’ve come to think that maybe young person can YOLO a bit against the odds somewhere in life. If something returns poorly on average, but has high payouts at the top it might just work out. Your life won’t be the average case but single sample. This is indeed, after all, a website about founding startups.

The only difference between being a founder and gambling is the social signaling. In both cases, luck is a larger component than grit (lots of amazing folks have failed through no fault of their own). No shame in gambling your way to wealth if you don't care about the social signaling.

Anyone else notice that WSB reads like a religion? And that Trump supporters have faith without evidence, just like religion?

Perhaps most humans cannot truly be atheists, but will always be caught by something to believe in.

Re: The Battle of GameStop

#537

Post by aeternum »

imtringued wrote: post #499
koheripbal wrote: post #365

Earlier quoted context omitted.

I find people who stand in disbelief of the markets often don't understand how they are working, and/or why they have and societal value. Skepticism is healthy, but in this case, it's closer to ignorance. The ability for corporations to go to the open market to secure capital is contingent upon a high liquidity of buyers and sellers present and actively participating. The market doesn't exist without "primary" buyers…

The primary value traders provide is liquidity and decreased volatility. There is a fixed need for these two services. Once you have served every customer the only way to make more money is to take customers away from other competitors, or grow the market as a whole. Traders do not influence the size of the market, they only increase efficiency, so the expectation is that you run into diminishing returns stays. There…

Increasing efficiency is pretty critical. For the vast majority of markets, there's no such thing as 'serving every customer'. Companies can always serve customers more especially if they can reduce the price.

However it takes capital to do this. It's not just about liquidity, investors basically influence the cost of capital for each company which has a big impact on how many customers each company can serve.

Re: The Battle of GameStop

#538

Post by pashamur »

jeffbee wrote: post #342
a_imho wrote: post #280

Earlier quoted context omitted.

I'm not able to follow the logic. Why is it safer? Isn't the exposure from the options additive to holding stock?

Yes the exposure is much worse. If you are long a stock you can sell it whenever you feel like it is about to lose value. When you sell covered options you may be forced to hold the stock until the contract expires. That’s the whole point of the call: the buyer pays you the premium and in exchange you are taking all of the risk for the duration of the contract.

You can actually buy the call back whenever as long as someone is selling (which market makers generally are) to exit the position - you don't have to wait until expiration.

Re: The Battle of GameStop

#539

Post by kortilla »

rank0 wrote: post #492
SpaceRaccoon wrote: post #449

Earlier quoted context omitted.

No, I have friends who have put thousands on the line who are happy to lose it if it bankrupts Melvin Capital.

Your friends are lying through their teeth. Do you honestly believe these people aren't motivated by profit, when they are clearly entering long positions with the intention of driving up GME's price? It's straight up doublespeak.

A $1000 ticket to punch a 0.1% right in the balls is a worthy trade for many. People donate to political parties just to fuck the other party.

Re: The Battle of GameStop

#540

Post by edgyquant »

glazyrin wrote: post #237
edgyquant wrote: post #82

Earlier quoted context omitted.

Except everyone knows about that sub and it does little but get the hopes of the working poor up, who then lose what little savings they have on some yolo being pushed by a more well off individual whose just having fun.

If you put forward a theory like this about Wall Street, markets in general, capitalism in general, or the political system we have, you're an 'extremist'. When it comes to a bunch of people goofing around with meme stocks on a subreddit, suddenly lots of people turn into champions of the 'working poor'.

Pump and dumps have been illegal for decades
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