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

[JoeMorgue]

"Invisible hand of the market is looking pretty visible today" - Seen on the intertubes

 

[marting]

Well Betting on Zero is a documentary on a wallstreet mogul trying to destroy a company with a short position on it.

Of course the company is a pyramid scheme so it makes it even more questionable who is the bad guy there.

Shorts expect to make money betting that a company is overvalued. Often by publicizing what they believe is wrong with the company after taking a short position. Truthful facts about a company shouldn't be a problem for a company. If it is then what hurts/kills the company are the facts the short elucidates, not the mechanics and price of the stock which doesn't affect the company's balance sheet/income statements.

 

[JoeMorgue]

Shorts expect to make money betting that a company is overvalued. Often by publicizing what they believe is wrong with the company after taking a short position. Truthful facts about a company shouldn't be a problem for a company. If it is then what hurts/kills the company are the facts the short elucidates, not the mechanics and price of the stock which doesn't affect the company's balance sheet/income statements.

Reddit hasn't lied about Gamestop's business value.

You don't get to sue the team that won because you bet against them.

 

[theprestige]

"Why don't the poor invest their money"?
"OK"
"Wait stop, not like that"

"... How do you think I got to be poor in the first place?"

 

[marting]

Reddit hasn't lied about Gamestop's business value.

You don't get to sue the team that won because you bet against them.

Exactly. Watching Gamestop's action and the impact on hedge funds is quite entertaining. That's much of the thrill. And the upside from an overly shorted stock spiking is an opportunity. But in the long run value will out. Timing is everything and most likely there will be a lot of losers.

But none of this directly impacts Gamestop's viability as a company nor it's quarterly/annual financials in it's SEC filings.

 

[catsmate]

Hmm, as I said elsewhere I'm dubious about this supposed "grassroots" movement , especially given who is actually set to profit from the share price inflation.

 

[a_unique_person]

Are you going for short dogs or long dogs? My friends are telling me to buy dachshunds.

 

[eerok]

Are you going for short dogs or long dogs? My friends are telling me to buy dachshunds.

They say buy low and sell high, so go for dachshund and hope it gets legs.

 

[Andy_Ross]

A share of GameStop stock is currently valued at $344, which means they would buy it from you for $12.

 

[Checkmite]

Hmm, as I said elsewhere I'm dubious about this supposed "grassroots" movement , especially given who is actually set to profit from the share price inflation.

Exactly.

A pump-and-dump isn't going to save GameStop; it's business is no longer viable. That's why it was targeted by the short-sellers in the first place.

The pump-and-dump WILL give GameStop's execs a nice consolation prize, though.

 

[theprestige]

Maybe they deserve a nice consolation prize, though. They had a good run. In spite of the double whammy of global-scale mail order, and the rise of streaming/downloadable content, they managed to last a lot longer than Hollywood Video and Blockbuster.

 

[Checkmite]

That will be a matter of personal opinion. I have an ethics problem with GameStop on account of a certain abusive policy toward its employees, and for the company's COVID lockdown shenanigans in California.

 

[TragicMonkey]

That will be a matter of personal opinion. I have an ethics problem with GameStop on account of a certain abusive policy toward its employees, and for the company's COVID lockdown shenanigans in California.

They can die in fire for undervaluing upon trade-in my PS1 copy of Vandal Hearts in 1999.

 

[p0lka]

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.

buy the dips seems to be a recurring theme.
some citadel based brokers have stopped that though, dodgy.

 

[p0lka]

Short selling doesn't make the bankruptcy come any faster.

It does if the short sellers actively work to diss the company.

 

[Cain]

I'm trying to understand how this works. Here's an analogy I'm basing off something I saw on Twitter.

Jerry has an original painting from an artist named Roy that's valued at $1,000, but who is to say what's it's really worth?

Kramer-Newman believe Roy's work is wildly over-valued. They believe Roy turns out paintings like a factory, so his pieces are certain to go down in price. Kramer-Newman rent the painting from Jerry with the intention of selling it for $950. When the painting inevitably drops in value, they'll buy it back -- maybe for as little as $100 -- and return it to Jerry.

They find a sucker named George who plops down the $950 bucks. Later that day, Roy chokes to death on Junior Mints, and all of his paintings rocket up in value. George has the best luck! Now Kramer-Newman will have to spend hundreds of thousands of dollars in order to buy back the painting and return it to Jerry.

Accepting that unique works of art are not quite like fungible shares, are these cases analogous in important respects?

I'm curious about the relationship here between the original lender and the speculators. I understand the owner is happy to rent(?) out his shares to make money, but what are the typical terms in the contract? Are the shares borrowed for a specified period of time? Can Jerry demand his painting back at any time?

 

[ChrisBFRPKY]

Hilarious! Hedge funds losing billions on shorts!

Interesting that the Robinhood app stopped members from purchasing until the hedge funds got out of Gamestop. Something a wee bit disturbing there...I'm reading that Janet Yellen received over $800K in speaking fees from Citadel, owner of Robinhood.

Was a phone call made?

 

[Meadmaker]

buy the dips seems to be a recurring theme.
some citadel based brokers have stopped that though, dodgy.

From what I've read, and at this point I am treating even mainstream news sources as rumor because things are moving so fast, Robinhood was a major source of the buying activity, and the parent company (or at least a substantial investor?) had a big stake in the Melvin fund that had a huge short interest in GameStop. So, Robinhood shut down trading to try and help out the hedge fund.

That really does sound dodgy. "Hi. I'm just a stockbroker, and not the old style that gives advice, just an app that connects trades, but my important client will lose money if you keep buying this stock, so I'm not going to let you do that anymore."

Sounds dodgy. There will be plenty of room for investigations after the dust settles.

 

[psionl0]

Almost assuredly yes. Late comers to get rich schemes, historically speaking, are the ones most likely to get fleeced.

I'd have to agree. This isn't bitcoin.

 

[theprestige]

Hmm, as I said elsewhere I'm dubious about this supposed "grassroots" movement , especially given who is actually set to profit from the share price inflation.

You think they instigated the movement in that subreddit?