The Irony in the GameStop Story • Hacker News Board

Re: The Irony in the GameStop Story

#61

Post by paradox242 » Fri, Jan 29, 2021, 2:44 PM UTC

spiderfarmer wrote: post #35

drewcon wrote: post #8

I still feel like these stories are missing a core distinction. If these WSB folks rallied around GME because they were true believers of a beloved brand with faith in a turn around plan, god love em. I think that’s an interesting phenomenon that upgrades retail collective trading in much the same ways mutual funds behave on behalf of loads of retail investors. But that’s not what happened. The brand is irrelevant. I…

I think you don't understand what wallstreetBETS is all about. It's not investments. It's playing the casino. They are betting. And proud of it. And this is one of the first times they have an advantage over the rest of the table. Because a couple of hedge funds overplayed their hand on a stock small enough to be influenced by the people active in that sub. They are ready to lose it all just for the lulz. It's entert…

This is what so many people who aren't familiar with the WSB culture are missing. They wring their hands and worry that the "retail investors will be caught holding the bag". True, someone will, but even for those too slow to move on the eventual reckoning I think they are already more than okay with any losses. There has been enough publicity now that it's pretty clear that this stock is a battlefield and any casual observers had best stand back until the dust settles. For the most part the only people getting hurt here are combatants who are ready for this sort of thing.

Re: The Irony in the GameStop Story

#62

Post by briefcomment » Fri, Jan 29, 2021, 2:44 PM UTC

tosser0001 wrote: post #45

briefcomment wrote: post #23

Earlier quoted context omitted.

I'm pretty sure bringing up fundamentals is intentional FUD. Nobody is investing in any of these because of fundamentals. It's the public vs hedge funds and GME et al is the battlefield. The more people take part and have strong hands, the more the losses will be democratized, on the way to the real desired outcome against naked shorting hedge funds. I don't mind losing a couple hundred bucks investment for this.

I'm sure there is some core set of people that want to "stick it to Wall Street" but the vast majority are probably just along for the ride. The irony is, once this stock finally comes crashing down, it will be the small retail investors losing a lot of money, and a different set of Wall Street investors will be the ones reaping the reward.

Probably. Those small retail investors should be responsible for their actions though right? This is obviously a highly risky trade, and it takes just a couple minutes to see that's the case.

Re: The Irony in the GameStop Story

#63

Post by swader999 » Fri, Jan 29, 2021, 2:45 PM UTC

danhak wrote: post #44

swader999 wrote: post #22

Earlier quoted context omitted.

It is actually. The housing market had real collateral even if it was overly appraised.

No, it's not. Not even close. The current market cap of GME is $25 billion. Meanwhile, the size of the subprime mortgage market in 2008 was in the neighborhood of $50 trillion.

Shorting losses can be infinite. Then add in the derivatives at play. Who backs these trades? Who backs them? What gets triggered when any of these default on their contracts?

Re: The Irony in the GameStop Story

#64

Post by bilbo0s » Fri, Jan 29, 2021, 2:45 PM UTC

briefcomment wrote: post #23

drewcon wrote: post #8

I still feel like these stories are missing a core distinction. If these WSB folks rallied around GME because they were true believers of a beloved brand with faith in a turn around plan, god love em. I think that’s an interesting phenomenon that upgrades retail collective trading in much the same ways mutual funds behave on behalf of loads of retail investors. But that’s not what happened. The brand is irrelevant. I…

I'm pretty sure bringing up fundamentals is intentional FUD. Nobody is investing in any of these because of fundamentals. It's the public vs hedge funds and GME et al is the battlefield. The more people take part and have strong hands, the more the losses will be democratized, on the way to the real desired outcome against naked shorting hedge funds. I don't mind losing a couple hundred bucks investment for this.

It’s not really public v hedge funds, because the vast majority of both of them will be on the losing side. The reality is that market makers are probably gonna be the only winners here.

Re: The Irony in the GameStop Story

#65

Post by SilasX » Fri, Jan 29, 2021, 2:47 PM UTC

This feels like "damning with faint praise": "Yeah, yeah, sometimes they break the rules but they say there's no significant court case they lost."

>They are very open about the fact that they or their clients may already have short positions in the stocks concerned and as I said, most of what they say is publicly available information. Clearly, they are not doing anything illegal, or even underhand. They have been sanctioned a few times by regulatory authorities and lost legal battles overseas but, as founder and Executive Editor Andrew Left has frequently pointed out, they have never lost a significant court case in America.

Re: The Irony in the GameStop Story

#66

Post by ghaff » Fri, Jan 29, 2021, 2:48 PM UTC

gonzo41 wrote: post #4

moolcool wrote: post #3

I swear, GME is the feel-good story of the year.

Gotta say I agree, after hearing non crap news for a year. It's nice to see a hedge fund eat their hat.

The financial institutions will be fine. Meanwhile some unsophisticated investors who saw this as the financial opportunity of a lifetime will lose their shirts and their homes.

Re: The Irony in the GameStop Story

#67

Post by downrightmike » Fri, Jan 29, 2021, 2:48 PM UTC

user_error wrote: post #7

> Left claims that the “mob” has overstepped the mark and harassed him and even his family in a way that is actually illegal. If that is true, shame on them, and those involved should be prosecuted. This must be condemned without hesitation; nothing excuses that type of behavior. Online harassment of those with different opinions, particularly in pursuit of profit, is disgusting and becoming all too common, and stand…

It's a smear campaign plain and simple. Louis Rossmann the apple repair guy on youtube has laid it out: https://www.youtube.com/watch?v=k_oNLeMuxvg

Re: The Irony in the GameStop Story

#68

Post by heartbreak » Fri, Jan 29, 2021, 2:48 PM UTC

xwdv wrote: post #33

drewcon wrote: post #8

I still feel like these stories are missing a core distinction. If these WSB folks rallied around GME because they were true believers of a beloved brand with faith in a turn around plan, god love em. I think that’s an interesting phenomenon that upgrades retail collective trading in much the same ways mutual funds behave on behalf of loads of retail investors. But that’s not what happened. The brand is irrelevant. I…

I don’t know why people keep saying it won’t be a good outcome for anyone. That’s irrelevant. This is like going to war, all will give some, but some will give all. At least we’re talking about money and not lives.

> At least we’re talking about money and not lives.

Are we?

https://www.businessinsider.com/robinhood-office-installed-b...

Re: The Irony in the GameStop Story

#69

Post by flatfilefan » Fri, Jan 29, 2021, 2:49 PM UTC

drewcon wrote: post #50

spiderfarmer wrote: post #35

Earlier quoted context omitted.

I think you don't understand what wallstreetBETS is all about. It's not investments. It's playing the casino. They are betting. And proud of it. And this is one of the first times they have an advantage over the rest of the table. Because a couple of hedge funds overplayed their hand on a stock small enough to be influenced by the people active in that sub. They are ready to lose it all just for the lulz. It's entert…

No I do understand that. And I’m suggesting that is a bad thing. It’s also illegal, which seems to have been left out of all the conversations. “ The rush by short sellers to cover produces additional upward pressure on the price of the stock, which then can cause an even greater squeeze. Although some short squeezes may occur naturally in the market, a scheme to manipulate the price or availability of stock in order…

I’m sorry if I’ve just missed that in your linked text but doesn’t sec text concern only short selling and not actual buying?

Re: The Irony in the GameStop Story

#70

Post by beefield » Fri, Jan 29, 2021, 2:50 PM UTC

drewcon wrote: post #8

I still feel like these stories are missing a core distinction. If these WSB folks rallied around GME because they were true believers of a beloved brand with faith in a turn around plan, god love em. I think that’s an interesting phenomenon that upgrades retail collective trading in much the same ways mutual funds behave on behalf of loads of retail investors. But that’s not what happened. The brand is irrelevant. I…

I think there are two internally consistent approaches here.

Either you go full on Eugene Fama and claim that you do not even understand what market manipulation means as long as there is no hidden information, as markets are efficient and it is just market reflecting unidentified changes in the fundamentals or random fluctuation around the correct value or whatnot.

Or, you can say that yes, this is just exhibit N about how prices can be manipulated, which means that prices are not always correct. Which means that we can't trust blindly on markets to allocate resources efficiently, but we need to have careful discussion about in which circumstances it is prudent to restrict the market operations (including price, supply and demand).

What is weird, is how rare it is to find either of these approaches in public discussion. (For the record, I am in the latter camp. And no, I do not propose fullo on communism and regulated markets, but "to have careful discussion about in which circumstances it is prudent to restrict the market operations")