Merged Wall Street Bets subreddit / Too late to buy Gamestop stock?

[Beelzebuddy]

Even beyond this one, specific incident I wonder how many companies really could function without any low level employees at all but keep them around for, as you say, "human shield" purposes.

None, I think. If that's all they need them for, they just wave their arms around and say "jobs!" For example, that imaginary Foxconn factory in Wisconsin.

 

[lobosrul5]

"Rooting for Gamestop" is an interesting position to take.

I'm still thinking about the ethics of short-selling, but I'm pretty sure Gamestop isn't worth rooting for. Could you tell us a little bit more about what that position means to you?

TBF Gamestop was, and still is, probably heading for bankruptcy. The shorters are just hastening their demise. That said, they are making money off other peoples misfortune. If GME could at least make it to the end of the pandemic they'd have a better chance of finding a buyer to keep their stores open. That means, people have jobs, the holder of the mortgage is still getting rent. Its better than stores sitting empty which is probably what would've happened in the next few weeks if not for the degens on reddit. More than that are the shorts on AMC. These are vultures closing in during a pandemic, that may cause the closure of a viable business. If they can hold out until the world returns to normal, I could see them turning a profit again.

 

[JoeMorgue]

Having your stock shorted seems like all the fun of going through a leveraged buyout without the pesky "I have a say in this matter" and "I'll get anything out of it in the rare chance this does turn my business around" parts.

 

[Squeegee Beckenheim]

I'm seeing a lot of both. Especially for late buyers, the risk is super high. The price will crash eventually, and if these later buyers are too slow on the selloff, they're going to lose basically everything.

Some are, like you say, buying it as a form of activism. A suicide bombing of the short-sellers, knowing that the shorted hedge funds will lose a lot more. They seem willing to lose whatever they put in.

But I'm definitely seeing a lot of people jumping on the bandwagon because it appears to be a money-printing machine. I'm seeing tons of people bragging about paper gains and getting ecstatic, but not seeing much evidence of anyone actually cashing out and securing those gains. It's not real money until it's out of the market, but I'm seeing a lot of bragging about numbers on screens.

I think we're going to see a lot of stories about people that were up tens of thousands of dollars that missed their opportunity to cash out and are now negative.

I saw a guy who had reportedly put in $53,000 and was, at the time of reporting, worth $48,000,000. If I were him, I'd probably go "yep, that's enough" and cash out regardless. And if it later turned out that I could have doubled that amount, well, who cares? Once you get above a certain threshold then the actual amount is pretty meaningless.

There was one guy who said he got out before a potential crash. He says he got a single share free with a game purchase, when it was worth $4. He says he sold it today for around about $250.

 

[JoeMorgue]

I get there's probably deep psychological reasons why this isn't the case, but yeah it does seem like, mathematically, a lot more people really could "get rich quick" (for certain values of rich and certain values of quick) if they went in with a firm number in their head just got out when they reached it.

 

[TragicMonkey]

I get there's probably deep psychological reasons why this isn't the case, but yeah it does seem like, mathematically, a lot more people really could "get rich quick" (for certain values of rich and certain values of quick) if they went in with a firm number in their head just got out when they reached it.

I always wonder when people win at casinos why they don't remove their original stake and put that back into their pocket, then continue playing with the winnings. That way even if they lose after that they'll end the day no worse off than they were before they started.

But then I realized that someone who thought that practically would probably not be gambling in a casino in the first place, so that's why it doesn't happen much.

 

[lomiller]

The SEC will (near as I can tell. Financial law is stupidly massively complex obvious caveat here) have to prove that r/wallstreetbets intentionally spread false information with the intent to get people to buy/sell stocks in order to really get firm traction on any direct legal reprisals.

All they need to do is prove that they traded with the intent of changing the market price in order to get others to buy/sell the stock, which is of course exactly what's happening.

PROHIBITION AGAINST MANIPULATION OF SECURITY PRICES
SEC. 9. ø78i¿ (a) It shall be unlawful for any person, directly or indirectly, by the use of the mails or any means or instrumentality of interstate commerce, or of any facility of any national securities exchange, or for any member of a national securities exchange—

(1) For the purpose of creating a false or misleading appearance of active trading in any security other than a government security, or a false or misleading appearance with respect to the market for any such security, (A) to effect any transaction in such security which involves no change in the beneficial ownership thereof,or (B) to enter an order or orders for the purchase of such security with the knowledge that an order or orders of substantially the same size, at substantially the same time, and at substantially the same price, for the sale of any such security, has been or will be entered by or for the same or different parties, or (C) to enter any order or orders for the sale of any such security with the knowledge that an order or orders of substantially the same size, at substantially the same time, and at substantially the same price, for the purchase of such security, has been or will be entered by or for the same or different parties.

(2) To effect, alone or with 1 or more other persons, a series of transactions in any security registered on a national securities exchange, any security not so registered, or in connection with any security-based swap or security-based swap agreement with respect to such security creating actual or apparent active trading in such security, or raising or depressing the price of such security, for the purpose of inducing the purchase or sale of such security by others.

 

[BobTheCoward]

All they need to do is prove that they traded with the intent of changing the market price in order to get others to buy/sell the stock, which is of course exactly what's happening.

That doesn't seem right. They are using their words, not the trading of the security, to induce purchases.

 

[Modified]

I always wonder when people win at casinos why they don't remove their original stake and put that back into their pocket, then continue playing with the winnings. That way even if they lose after that they'll end the day no worse off than they were before they started.

But then I realized that someone who thought that practically would probably not be gambling in a casino in the first place, so that's why it doesn't happen much.

You do hear it a lot on stock message boards. Someone doubles up, sells half, then says they are "playing with free money". I guess it's psychologically helpful and allows them to feel comfortable staying in on a high-risk-high-reward stock.

 

[JoeMorgue]

All they need to do is prove that they traded with the intent of changing the market price in order to get others to buy/sell the stock, which is of course exactly what's happening.

Yeah but isn't the whole point of this stunt largely "This is what Wall Street does all the time, it shouldn't be different because it's a bunch of Reddit bros."

The "Oh my God how dare poor people game the system. That's only for rich people to do!" reaction does seem to sort of prove the point.

 

[Gord_in_Toronto]

All they need to do is prove that they traded with the intent of changing the market price in order to get others to buy/sell the stock, which is of course exactly what's happening.

Exactly. As soon as I saw this thread I thought of the once mighty Vancouver Stock Exchange: https://www.vancouverisawesome.com/...own-defunct-vse-had-colourful-history-2927226 There money was to be made from the gullible by trading penny mining stocks.

What is being done here is a slight variation of Pump and Dump. See: https://www.investopedia.com/terms/p/pumpanddump.asp

People found guilty of running pump-and-dump schemes are subject to heavy fines.

Trusting Influences, Faceboob^*, et al for financial advice is akin to trusting them for all the silly **** conspiracy theories promoted therein.

------------
^* Originally a typo but it was too good not to leave in.

 

[JoeMorgue]

"This is different because the advice is coming from Reddit and not brokers" is

- Massively arbitrary in the age of democratization of knowledge.
- Massively self-serving if you've spend your entire life turning investment economics into a complicated wizards duel of a shadow theater version of a shell game that only you and a handful of others actually fully understand.
- Again seems to be the point of what is being done.

Again all that is happening is a bunch of rich old farts got really good at reading the tea leaves because they specifically built the system so they could do it and learned to swoop in at the last minute and suck the last drops of economic moisture dry from dying stocks via shenanigans are now mad that a bunch of internet trolls are upsetting their apple cart.

It's a blustering "Bad form! Bad form I say!" at best, many other much worst things at worst. "How dare you steal the money I'm as close to literally conjuring out of thin air as possible!" at worst worst.

 

[JoeMorgue]

Wall Street: I know we agreed to play by these terrible rules and I was doing really well with them but now regular folks are beating me this way so we should change the rules.

 

[Babbylonian]

[ETA] Actually, it may be too late for that as well. I'm starting to see stories of brokerages and trading apps disabling further buys of Gamestop.

For individual investors. You can bet your ass that as long as NASDAQ allows GME to be traded, the big firms will have no trouble doing so. I have no desire to see Internet trolls win at anything, but this is clearly a class war and the upper class is deploying their nukes.

 

[JoeMorgue]

Also just out of pure morbid curiosity has Gamestop as a corporation responded to or reacted to this at all?

 

[BobTheCoward]

As an aside, we don't know if the people buying the stock are the same people advocating doing it. We don't know how many people running their mouth to buy it bothered to buy it (even if they said they did).

 

[Gord_in_Toronto]

As an aside, we don't know if the people buying the stock are the same people advocating doing it. We don't know how many people running their mouth to buy it bothered to buy it (even if they said they did).

If some authority (like the SEC) wants to investigate, all the transactions are recorded.

 

[lobosrul5]

If some authority (like the SEC) wants to investigate, all the transactions are recorded.

Yes. But tying the transaction to a reddit user account may prove rather difficult. You can sign up for a reddit account with an anonymous email, and a VPN.

 

[Meadmaker]

I just got off the phone with my son, who is not taking classes this semester and so is basically an idle bum, but was following WallStreadBets on reddit before this thing took off.

It's pretty amazing stuff going on. It will take some time to figure it out, but there are at least thousands, and possibly hundreds of thousands, just like him, how are buying one and two shares at a time, making, or losing, thousands of dollars individually.

Meanwhile, the "big players", who are trading millions and billions of dollars in this stock at the same time, are going nuts as they are tossed around on the ocean of hundreds of thousands of penny ante investors.

 

[Mader Levap]

All this reinforces my view that justice is about people's need for retribution.

History shows that "rich, tree, rope, some assembly required" equation is popular. Wonder why?

Fun update, apparently a number of trading apps are not allowing users to buy GME.

So much for "free" market, eh? Only 1%s are allowed to do shenanigans like that.

Life spoiler for ya all: capitalism is way to funnel money from poor to rich. Rest is just incidental bonus.