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| Gamestop: Reddit vs. Wall St. |
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| DrG:
Not sure if there is much interest in this, but I find it fascinating. My summary is not going to do it justice, but, basically, "users" decided that there was too much shorting going on with Gamestop and, for lack of a better understanding on my part, felt that the price was being manipulated downward by very large entities that were shorting the stock. Collectively, a large number of small time "traders" decided to buy Gamestop but with instruction that the brokers not allow loaning the stock to cover shorts. This drove the price up to mammoth levels and caused a lot of the traditional financial community to balk and call for regulations to stop this activity - the hypocrisy being that similar activities are allowed by big Wall St. - IOW "reverse social justice warriors." Again, I am not doing it justice, but if you are interested, check out the video here, it is long but it is on point.. https://thehill.com/policy/finance/536212-reddit-traders-cause-wall-street-havoc-by-buying-gamestop or a shorter article here https://www.npr.org/2021/01/28/961349400/gamestop-how-reddit-traders-occupied-wall-streets-turf or just search on "Reddit Gamestop". Now, in my opinion (and this is only my opinion and I have no particular interest in Gamestop or the equity markets in general), someone is going to get burned. I say this because if you screw with people who have a lot of money, they don't just take it. Sticking it to the man is usually expensive, again, in my opinion. But, it sure is an interesting show to watch. I am always on the look out for these "shows", because behavior interests me. Earlier today, I posted a video in a thread on the RPI Pico... Take a look at ~7.05 - 9.05 where they talk about how they got together and kept a secret and without all of the usual Big Chip makers "inconveniences".....they did "what everyone says should be possible" - I think that is the quote. In the same vein as Reddit Users vs. Wall St. now, I am wondering what the Big Chip makers and the cloners will do in reaction. |
| ataradov:
I don't want to defend normal chip makers too much, I hate that kind of behaviour too. But "That's so great, let's not mess this up" only holds for some time and at a certain scale. A some point someone will mess up, may be inadvertently or because of the disgruntled employee. And then the same companies will put some agreements in place. And they will be softer at first, but then with the time they will turn into NDA. And once people start designing your stuff into real products, there are all sorts of legal ramifications that you are not in control of, unless you have strict policies. Regular vendors also did not start with a bunch of lawyers and NDAs. But everyone either folds or ends up there anyway. I don't see why that would be an exception. |
| pickle9000:
This is a great story, super interesting. With luck this will create a more robust / careful sock market. On the other hand every country with the cash may start manipulating the market. Then after some massive losses rules will come that should have been put in place years ago. |
| magic:
--- Quote from: DrG on January 28, 2021, 07:55:03 pm ---Not sure if there is much interest in this, but I find it fascinating. My summary is not going to do it justice, but, basically, "users" decided that there was too much shorting going on with Gamestop and, for lack of a better understanding on my part, felt that the price was being manipulated downward by very large entities that were shorting the stock. Collectively, a large number of small time "traders" decided to buy Gamestop but with instruction that the brokers not allow loaning the stock to cover shorts. --- End quote --- No expert either, but I have heard about it and I can't help but see a hole in their argument: there is bound to be reasonable shareholders who are in it for the long game. They know that this peak isn't going to last, so they will take the opportunity to milk the shorters by lending them shares instead. And the shorters will rather pay for that than buy shares for $1k from nerds, expecting the scheme to collapse in near future. Knowing plebbit's attention span, they may not even need to wait for long. Many of those investors are likely of the "buy peak, sell dip" variety >:D |
| Psi:
The big players are throwing their weight around trying all sort of tactics to get the price down. Some small home traders have got emails from their brokers saying they have blocked buying of Gamestop but still allows selling. Not sure how they are doing that legally :-// Louis Rossmann has some videos on gamestop |
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