Some smart person explain the GME (gamestop) thing

[skaredshtles]

I wish I bought 25 min ago at the $126 dip.....i was waiting for $120 lol. never got there.

You like trying to catch a falling knife? Be careful... it's REALLY fucking sharp.

[rod9301]

GME: Day's Range112.25 - 482.85

Woah. I thought bitcoin was volatile. This is some penny stock bullshit right here. Hopefully this triggers the SEC into making some better rules to prevent market fuckery due to shorts.

This is not due to shorts, it's due to the mob on reddit. Some of them will go to jail for manipulating the market.
Shorts discover fraudulent companies and overvalued.

Sent from my Redmi Note 8 Pro using Tapatalk

[Skidog]

This is not due to shorts, it's due to the mob on reddit. Some of them will go to jail for manipulating the market.
Shorts discover fraudulent companies and overvalued.

Sent from my Redmi Note 8 Pro using Tapatalk

Wall Street guy eh? Go after the little guy when it was the hedge trying to screw a company by driving its price down....all so they could make money....nobody on reddit is going to jail lol.

[jackstraw]

This is not due to shorts, it's due to the mob on reddit. Some of them will go to jail for manipulating the market.
Shorts discover fraudulent companies and overvalued.

Sent from my Redmi Note 8 Pro using Tapatalk

Huh? Mob? Same ones that stormed the Capitol?

[MultiVerse]

GME is receiving a lot more attention than it deserves. It's a noteworthy event worth discussing in the stock market thread but there’s nothing to worry about and nothing that needs fixing.

[tetzen]

This is not due to shorts, it's due to the mob on reddit. Some of them will go to jail for manipulating the market.
Shorts discover fraudulent companies and overvalued.

Sent from my Redmi Note 8 Pro using Tapatalk

If anyone deserves some criminal charges for this week, it's the trading platforms blocking users from buying or only partially selling their stonks. That looks like some concerted action between these brokerages to manipulate the market to me.

[rod9301]

Wall Street guy eh? Go after the little guy when it was the hedge trying to screw a company by driving its price down....all so they could make money....nobody on reddit is going to jail lol.

No, I'm not a wall street guy, i invest and make a living on it.

Sent from my Redmi Note 8 Pro using Tapatalk

[jono]

So just how short are you now, rod?

[BmillsSkier]

No, I'm not a wall street guy, i invest and make a living on it.

Sent from my Redmi Note 8 Pro using Tapatalk

Would you like to audition for our movie?

[From_the_NEK]

Would you like to audition for our movie?

I'll bring the camera...

[From_the_NEK]

That is for the more "raw" footage. Everything else should be 4K gopro first person.

[rod9301]

So just how short are you now, rod?

100 shares

Sent from my Redmi Note 8 Pro using Tapatalk

[jacob_dbu]

Apparently one of the largest shareholders in GME cashed out today or yesterday.

[cravenmorhead]

This is not due to shorts, it's due to the mob on reddit. Some of them will go to jail for manipulating the market.
Shorts discover fraudulent companies and overvalued.

Ok Melvin.

How is observing "these idiots shorted 140% of float, they're fucked if people buy and hold" market manipulating any more than "I like this stock because of the fundamentals"

[BmillsSkier]

I'll bring the camera...

That is for the more "raw" footage. Everything else should be 4K gopro first person.

I'm not positive Todd will even know how to run that videomovie machine.

Did you get that off the wall next the the antique skis and snowshoes at the Killington TGR outpost when they liquidated everything?

[couloirman]

So it's just like those crypto pump n dump groups on discord? A bunch of guys on reddit told everyone to buy gamestop so the price soared but only the common man got in on it, so Robinhood shut down selling so no little people could get rich quick cause the hedge funds got mad?

I don't understand ANYTHING about the stock market-- why was this bad for hedgefunds? What does it have to do with them? A dying companies stock soared, who cares? Why do hedgefunds lose money when that happens? Did they bet money on the companies bankruptcy or something?

[skaredshtles]

100 shares

Sent from my Redmi Note 8 Pro using Tapatalk

[DJSapp]

How is observing "these idiots shorted 140% of float, they're fucked if people buy and hold" market manipulating any more than "I like this stock because of the fundamentals"

Yup. Hedge fund played a stupid game and the internet let them win their stupid prize. It's a great shot over the bow for the rest of the hedge funds, and maybe this causes Wall St. to curb this behavior for a while. Or the SEC steps in and does something about shorts.

[Timberridge]

So it's just like those crypto pump n dump groups on discord? A bunch of guys on reddit told everyone to buy gamestop so the price soared but only the common man got in on it, so Robinhood shut down selling so no little people could get rich quick cause the hedge funds got mad?

I don't understand ANYTHING about the stock market-- why was this bad for hedgefunds? What does it have to do with them? A dying companies stock soared, who cares? Why do hedgefunds lose money when that happens? Did they bet money on the companies bankruptcy or something?

Lot's to unpack here. Puregravity are you around?

[jono]

100 shares

I can't keep track of all the terms--what's this called after the float exceeds outstanding shares? Naked? Skinless?

[MultiVerse]

So it's just like those crypto pump n dump groups on discord? A bunch of guys on reddit told everyone to buy gamestop so the price soared but only the common man got in on it, so Robinhood shut down selling so no little people could get rich quick cause the hedge funds got mad?

I don't understand ANYTHING about the stock market-- why was this bad for hedgefunds? What does it have to do with them? A dying companies stock soared, who cares? Why do hedgefunds lose money when that happens? Did they bet money on the companies bankruptcy or something?

In tech terms: It's a DDOS attack on short hedge funds by millions of small investors.

In finance terms: It's a short squeeze (a rapid increase in the price of a stock) taken one step further (a gamma squeeze) on hedge funds with a short interest (hoping to profit from a falling stock) at 140% of outstanding shares.

In meme terms:Attachment 360176


In Biblical terms: It's David 1 Goliath 1,000,000

[cravenmorhead]

Read a book for once. But okay, let's start with short sales.

Let's say apples are $1 at the market. A snake (hedge fund trader) thinks they're over-valued. So they borrow 10 apples, with a promise to return the apples on Friday. The snake can then sell the apples, or loan them out, or whatever. Let's say the snake then sells the apples for $1.

Friday rolls around. Market apple prices have dropped to $.50. The snake can now make money because they can buy apples for $.50 to "cover" their promise to return the Friday apples.

So far so good?

Now, if apples go up to $1.50, the snake loses money. The snake could have "hedged" the short by, early in the week, entering into a contract with someone who promises to sell their apples for $1.10 on Friday. Snake has now limited their downside risk. But that contract probably costs some money.

Or the snake could get greedy and hold a "naked" short, which means that Snake doesn't have any guaranteed source, or price, for the Friday apple delivery.

Now, if all the apes get together and buy EVERY APPLE, the apes can basically decide how much the Snake has to pay for his Friday apples. Snake has promised to get apples to the market by Friday. Apes could, individually, decide they aren't selling apples for less than $1,000 apiece. Snake is fucked if Apes hold the line.

Now, here's why the Gamestop deal is different from most other shorts. The Snakes were SO CONFIDENT that Gamestop apples were overvalued that they shorted 140% of the shares on the market. That is, in the aggregate, the snakes agreed to deliver ALL THE APPLES, and then would have to buy back 40% of the apples again just to bring them back to the market to fulfill their contracts.

That's fine if they can buy apples at $.51, sell them to the market for $.52, buy them back for $.53, and resell for $.54, to cover all of the apples they got on $1 loans. BUT if all of the Apes buy and hold apples, the Snakes are forced to buy them at whatever the Apes want to sell them for.

So the beautiful parts of the story are that it's the hedge fund snakes getting gouged by the retail (thousandare) investors. All because the snakes took out massively risky bets with nearly unlimited potential risk.

[paulster2626]

This is not due to shorts, it's due to the mob on reddit. Some of them will go to jail for manipulating the market.
Shorts discover fraudulent companies and overvalued.

Sent from my Redmi Note 8 Pro using Tapatalk

You obviously haven't actually read the research that went in to this on r/WSB.

"go to jail for manipulating the market" hahahhah ok boomer.

[kathleenturneroverdrive]

rod coming in from the top rope with the worst take of the day

[BmillsSkier]

rod coming in from the top rope with the worst take of the day

It's a hallmark of the Padded Room. We love a hot take.