Posted by: ReductiMat
I suspect GME is going to make the market extremely frothy. The ewoks have taken down an AT-AT. I have a feeling a lot of institutions will be covering their shorts a lot sooner than they normally would.
Perfect analogy. Crowdsourcing may be the best way to fight the Empire. I have often thought about how helpful citizen's lobby groups could be. Get some good lawyers in the group to write up legislation and crowdsource the bribes... I mean funding.
Posted by: Couch_Surfer
Posted by: heckler
GME is pretty frightening what a horde can do. What’s next? NBR takeover of M&T Bank Corp?
Meh. Good on the Reddit crowd for sleuthing out that 140% of GME’s float was shorted then trapping the hedge funds. It’s a great show to watch.
Capitalism is a bitch.
Short selling is part of the reality of modern markets, but the problem starts when large players are manipulative. Pushing out articles loaded with false narrative in order to push a stock down is now a regular part of the hedge fund's arsenal and imo should be exposed as the fraud it is.
Posted by: KenN
Posted by: Couch_Surfer
Posted by: heckler
GME is pretty frightening what a horde can do. What’s next? NBR takeover of M&T Bank Corp?
Meh. Good on the Reddit crowd for sleuthing out that 140% of GME’s float was shorted then trapping the hedge funds. It’s a great show to watch.
Capitalism is a bitch.
Short selling is part of the reality of modern markets, but the problem starts when large players are manipulative. Pushing out articles loaded with false narrative in order to push a stock down is now a regular part of the hedge fund's arsenal and imo should be exposed as the fraud it is.
Should it be though? The stock market has lost it's purpose if it is no longer there to serve to public interest. It was never intended to be a casino and I have a hard time understanding how something like high speed trading isn't anything more than a tapeworm.
Posted by: chupacabra
Posted by: KenN
Posted by: Couch_Surfer
Posted by: heckler
GME is pretty frightening what a horde can do. What’s next? NBR takeover of M&T Bank Corp?
Meh. Good on the Reddit crowd for sleuthing out that 140% of GME’s float was shorted then trapping the hedge funds. It’s a great show to watch.
Capitalism is a bitch.
Short selling is part of the reality of modern markets, but the problem starts when large players are manipulative. Pushing out articles loaded with false narrative in order to push a stock down is now a regular part of the hedge fund's arsenal and imo should be exposed as the fraud it is.
Should it be though? The stock market has lost it's purpose if it is no longer there to serve to public interest. It was never intended to be a casino and I have a hard time understanding how something like high speed trading isn't anything more than a tapeworm.
Well, short selling provides the incentive to investigate and expose poor management and/or fraudulent business activity. Some of the most infamous implosions of fraudulent corps has been by short sellers, eg., Enron, Theranos, Wirecard, Luckin Coffee ...
Serves a purpose in exposing bad businesses.
Imagine borrowing the same car from two different people and having the Government take your side when the two ask for it back.
Posted by: KenN
Posted by: chupacabra
Posted by: KenN
Posted by: Couch_Surfer
Posted by: heckler
GME is pretty frightening what a horde can do. What’s next? NBR takeover of M&T Bank Corp?
Meh. Good on the Reddit crowd for sleuthing out that 140% of GME’s float was shorted then trapping the hedge funds. It’s a great show to watch.
Capitalism is a bitch.
Short selling is part of the reality of modern markets, but the problem starts when large players are manipulative. Pushing out articles loaded with false narrative in order to push a stock down is now a regular part of the hedge fund's arsenal and imo should be exposed as the fraud it is.
Should it be though? The stock market has lost it's purpose if it is no longer there to serve to public interest. It was never intended to be a casino and I have a hard time understanding how something like high speed trading isn't anything more than a tapeworm.
Well, short selling provides the incentive to investigate and expose poor management and/or fraudulent business activity. Some of the most infamous implosions of fraudulent corps has been by short sellers, eg., Enron, Theranos, Wirecard, Luckin Coffee ...
Serves a purpose in exposing bad businesses.
OK, I can see that there is a potential positive in that case, but I would think potential for harm is greater. Take Goldman when they realized the housing market was screwed but instead of taking the hit they kept quiet and screwed their own clients. They kept selling them shit. Goldman made billions and their clients lost billions. The money always finds a way to go up the ladder to the giants.
I don’t see a problem with shorting per se. I see a problem with a system than can allow 140% of the float to be shorted. Somewhere in that is a regulatory failure.
Posted by: ReductiMat
Imagine borrowing the same car from two different people and having the Government take your side when the two ask for it back.
Now that's naked shorting, which is not the same as plain vanilla shorting. And naked shorting is actually illegal (though poorly enforced).
Posted by: Couch_Surfer
I don’t see a problem with shorting per se. I see a problem with a system than can allow 140% of the float to be shorted. Somewhere in that is a regulatory failure.
Yah, this should be low hanging fruit for the SEC. If 140% of float is short (easy to know because the exchange publishes a short report weekly), then at least 40% of float is naked shorts. Not hard to follow the money to the naked shorters.
Posted by: chupacabra
OK, I can see that there is a potential positive in that case, but I would think potential for harm is greater. Take Goldman when they realized the housing market was screwed but instead of taking the hit they kept quiet and screwed their own clients. They kept selling them shit. Goldman made billions and their clients lost billions. The money always finds a way to go up the ladder to the giants.
My view is that it isn't the ability to sell short that causes that situation, but the lack of regulation and/or enforcement of regs. And part of that problem is that US in particular has left the banks to regulate themselves, which is pretty much asking for that kind of chicanery.
I'm completely fascinated by watching this Gamestop battle play out. My question that I'm trying to puzzle out is this.
If the price stays at it's current (inflated) levels of 200-400 range as it bounces all over the place. What happens when the Call options hit tomorrow (friday)? I don't know the volume, but if there is a significant number of contracts that people exercise at 60$, doesn't the seller of the contract have to go buy a share in order to be able to sell it? Seems like this has the potential to kick in a positive feedback loop.
Which is nuts.
Posted by: Couch_Surfer
I'm completely fascinated by watching this Gamestop battle play out. My question that I'm trying to puzzle out is this.
If the price stays at it's current (inflated) levels of 200-400 range as it bounces all over the place. What happens when the Call options hit tomorrow (friday)? I don't know the volume, but if there is a significant number of contracts that people exercise at 60$, doesn't the seller of the contract have to go buy a share in order to be able to sell it? Seems like this has the potential to kick in a positive feedback loop.
Which is nuts.
Hard to tell for sure, but a lot of sellers of call contracts will already hold the shares. My trading accounts only allow me to sell calls against shares that I hold (covered calls). So if the shares are in the money on expiry date, I just lose shares already held. But if there are a lot of naked calls floating around, then yes, the seller would have to source the shares at market price.
https://kotaku.com/robinhood-blocks-users-from-buying-gamestop-stock-1846149536
I guess free market Capitalism is valid until the hedge fund guys feel the sharp end of a bad trade.
Posted by: KenN
Posted by: chupacabra
OK, I can see that there is a potential positive in that case, but I would think potential for harm is greater. Take Goldman when they realized the housing market was screwed but instead of taking the hit they kept quiet and screwed their own clients. They kept selling them shit. Goldman made billions and their clients lost billions. The money always finds a way to go up the ladder to the giants.
My view is that it isn't the ability to sell short that causes that situation, but the lack of regulation and/or enforcement of regs. And part of that problem is that US in particular has left the banks to regulate themselves, which is pretty much asking for that kind of chicanery.
Fair enough, you clearly know this stuff far better than I do, but it is obvious this is one more aspect of our lives that is ruled by the most powerful. Regulations don't de-regulate themselves.
I have never done any real investing. For someone with not a lot of disposable cash but willing to sacrifice say 2000$ to 5000$ what is the most affordable option these days? Basically I want to buy and sell stocks, but only with money I can afford to lose... although 5000$ would buy a nice new post pandemic bike.
Posted by: chupacabra
I have never done any real investing. For someone with not a lot of disposable cash but willing to sacrifice say 2000$ to 5000$ what is the most affordable option these days? Basically I want to buy and sell stocks, but only with money I can afford to lose... although 5000$ would buy a nice new post pandemic bike.
Buying a handful of decent stocks really isn't going to get you anywhere and investing in lesser know players may pay off, but it takes time and effort to find good bets or some money to pay someone else to do that for you. Of course there's also the risk of losing your investment too. If you're really interested in creating more wealth beyond having a few grand to play with each year then find a way to create more income by using the skills that you have in a capacity that gives you a decent return. If your labour is worth say $50/hr, then an extra 20hrs per month will give you $10g a year to play with. Be conservative with your initial investments and after a few years you'll have acquired enough capital to really be able to put your money to work for you. Depending on how old you are, early retirement at 55 or younger becomes a strong possibility. If you're tungsten old and trying to get the wealth ball rolling, well, I've got bad bad news for you.
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