Castanza Posted January 27, 2021 Share Posted January 27, 2021 NOK halted now. Maybe a basket of WSB names and let it ride? lol who am I I bought 1k shares...I mean, it's not trading that far off fair value so if I'm going to engage in any shenanigans this seems the least risky... Link to comment Share on other sites More sharing options...
Nomad Posted January 27, 2021 Share Posted January 27, 2021 I'm certainly no libertarian, but I fail to see why any regulation is necessary here. If you're a sophisticated institution and you decide to be short on a position where the aggregate short interest is 100%+ of the float, then you're the proverbial pig that deserves to be slaughtered. It's the classic greed described by Buffett: Risking what you have and need in a vain effort to gain what you don't have and don't need. Short squeezes have been happening for decades. What's different now is that it's retail orchestrating the short squeeze and thus the "wrong kind" of person is making money from the trade. The calls for regulation are being driven by envy, pure and simple. Link to comment Share on other sites More sharing options...
Jurgis Posted January 27, 2021 Share Posted January 27, 2021 I'm certainly no libertarian, but I fail to see why any regulation is necessary here. If you're a sophisticated institution and you decide to be short on a position where the aggregate short interest is 100%+ of the float, then you're the proverbial pig that deserves to be slaughtered. It's the classic greed described by Buffett: Risking what you have and need in a vain effort to gain what you don't have and don't need. Short squeezes have been happening for decades. What's different now is that it's retail orchestrating the short squeeze and thus the "wrong kind" of person is making money from the trade. The calls for regulation are being driven by envy, pure and simple. +1 Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted January 27, 2021 Share Posted January 27, 2021 I'm certainly no libertarian, but I fail to see why any regulation is necessary here. If you're a sophisticated institution and you decide to be short on a position where the aggregate short interest is 100%+ of the float, then you're the proverbial pig that deserves to be slaughtered. It's the classic greed described by Buffett: Risking what you have and need in a vain effort to gain what you don't have and don't need. Short squeezes have been happening for decades. What's different now is that it's retail orchestrating the short squeeze and thus the "wrong kind" of person is making money from the trade. The calls for regulation are being driven by envy, pure and simple. +1 It's not just short-squeezes though, right? I mean that exacerbated this, but short squeeze lifted the shares from $140 to $300. It was redditors and Gamma that lifted it from $4 to $140. The idea that a board of 2+ million members can be mobilized/weaponized to lever the F up and distort the trading of ANY asset/market IS problematic - for businesses, for pensions, for markets in general. What if Pepsi makes a political donation reddit decides it doesn't like and they short its shares into oblivion taking down pensioners assets with it? Is that ok? What if these guys get into FX futures/future options and all simultaneously enter longs into the EUR/USD pairing and blow the EUR USD pair to 3-4 USD temporarily? You don't think that could be problematic for businesses all over the world? What if they decide that they all think the Fed is exploding the dollar and decide to drive oil into the stratosphere by all loading into the front-month contract (the exact opposite of negative prices in April)? These things matter. Yes - those are all bigger markets. But it's a growing community now (1+ million recent member adds). More on the way. And HFT/trend follower/momo strategies that will ride their coattails. This is a HUGE pile of liquidity that can really slosh anywhere it wants that that is NOT healthy. Link to comment Share on other sites More sharing options...
compoundinglife Posted January 27, 2021 Share Posted January 27, 2021 I'm certainly no libertarian, but I fail to see why any regulation is necessary here. If you're a sophisticated institution and you decide to be short on a position where the aggregate short interest is 100%+ of the float, then you're the proverbial pig that deserves to be slaughtered. It's the classic greed described by Buffett: Risking what you have and need in a vain effort to gain what you don't have and don't need. Short squeezes have been happening for decades. What's different now is that it's retail orchestrating the short squeeze and thus the "wrong kind" of person is making money from the trade. The calls for regulation are being driven by envy, pure and simple. +1 It's not just short-squeezes though, right? I mean that exacerbated this, but short squeeze lifted the shares from $140 to $300. It was redditors and Gamma that lifted it from $4 to $140. The idea that a board of 2+ million members can be mobilized/weaponized to lever the F up and distort the trading of ANY asset/market IS problematic - for businesses, for pensions, for markets in general. What if Pepsi makes a political donation reddit decides it doesn't like and they short its shares into oblivion taking down pensioners assets with it? Is that ok? What if these guys get into FX futures/future options and all simultaneously enter longs into the EUR/USD pairing and blow the EUR USD pair to 3-4 USD temporarily? You don't think that could be problematic for businesses all over the world? What if they decide that they all think the Fed is exploding the dollar and decide to drive oil into the stratosphere by all loading into the front-month contract (the exact opposite of negative prices in April)? These things matter. Yes - those are all bigger markets. But it's a growing community now (1+ million recent member adds). More on the way. And HFT/trend follower/momo strategies that will ride their coattails. This is a HUGE pile of liquidity that can really slosh anywhere it wants that that is NOT healthy. Everything I have seen so far (GME, BB, AMC) has been low float or free float. I don't think there is as much capital sloshing around as people think. Also I imagine there is a decent amount of leverage involved for many larger participants and we all know how that eventually plays out. A bunch of people jump on the wagon most of them unfortunately will get burned and this too shall pass IMO. Link to comment Share on other sites More sharing options...
Guest cherzeca Posted January 27, 2021 Share Posted January 27, 2021 this is a fascinating question. there is a market manipulation prohibition in the 34 Act, directed to for example boiler room activity where such shops would build a position and engage in activities to induce a market (calling widows) to unload the position. is this reddit site tantamount to that? doesn't seem so to me. lots of "professional investors" use technical factors to make a buck. here these guys took on a stupid name that was >100% of float short and created a short squeeze...seems to be legit, and they have a 1st A right (commercial speech) to talk to each other about the idea. I just think shorting has moved into a new era where the squeeze risk has increased...caveat emptor Link to comment Share on other sites More sharing options...
Jurgis Posted January 27, 2021 Share Posted January 27, 2021 I'm certainly no libertarian, but I fail to see why any regulation is necessary here. If you're a sophisticated institution and you decide to be short on a position where the aggregate short interest is 100%+ of the float, then you're the proverbial pig that deserves to be slaughtered. It's the classic greed described by Buffett: Risking what you have and need in a vain effort to gain what you don't have and don't need. Short squeezes have been happening for decades. What's different now is that it's retail orchestrating the short squeeze and thus the "wrong kind" of person is making money from the trade. The calls for regulation are being driven by envy, pure and simple. +1 It's not just short-squeezes though, right? I mean that exacerbated this, but short squeeze lifted the shares from $140 to $300. It was redditors and Gamma that lifted it from $4 to $140. The idea that a board of 2+ million members can be mobilized/weaponized to lever the F up and distort the trading of ANY asset/market IS problematic - for businesses, for pensions, for markets in general. What if Pepsi makes a political donation reddit decides it doesn't like and they short its shares into oblivion taking down pensioners assets with it? Is that ok? What if these guys get into FX futures/future options and all simultaneously enter longs into the EUR/USD pairing and blow the EUR USD pair to 3-4 USD temporarily? You don't think that could be problematic for businesses all over the world? What if they decide that they all think the Fed is exploding the dollar and decide to drive oil into the stratosphere by all loading into the front-month contract (the exact opposite of negative prices in April)? These things matter. Yes - those are all bigger markets. But it's a growing community now (1+ million recent member adds). More on the way. And HFT/trend follower/momo strategies that will ride their coattails. This is a HUGE pile of liquidity that can really slosh anywhere it wants that that is NOT healthy. I wonder how you propose to regulate this. Forget concerted shorting. How do you propose to regulate people going long because they read something somewhere? Are you proposing to ban social networks? Are you proposing to ban/moderate posts about stocks? Based on what metrics? If Jim Cramer or Chamath or Elon posts to use Signal and people buy unrelated stock to stratosphere how are you going to regulate that? Ban every post that mentions a stock that reaches more than 1M people? How? Just FYI, there is no cartel or monopoly here. There is no agreement that WSB bros will actually buy anything. There is no central authority that makes people buy GME. There is no single person who "did it". And even if there was - as is the case with Chamath or Elon - what exactly is their crime in saying "buy GME"? You might be able to persuade regulators to ban options (not a big loss IMO), although I'm sure there's gonna be yuge pushback on this. Or maybe change some rules to make gamma squeeze unlikely. But I don't see how you expect to prevent millions of people from deciding that they want to buy some crappy stonk at the same time. @Sanjeev: if this crosses no-politics line, please delete and let me know. Link to comment Share on other sites More sharing options...
Santayana Posted January 27, 2021 Share Posted January 27, 2021 this is a fascinating question. there is a market manipulation prohibition in the 34 Act, directed to for example boiler room activity where such shops would build a position and engage in activities to induce a market (calling widows) to unload the position. is this reddit site tantamount to that? doesn't seem so to me. lots of "professional investors" use technical factors to make a buck. here these guys took on a stupid name that was >100% of float short and created a short squeeze...seems to be legit, and they have a 1st A right (commercial speech) to talk to each other about the idea. I just think shorting has moved into a new era where the squeeze risk has increased...caveat emptor This is more a case of caveat venditor, Link to comment Share on other sites More sharing options...
clutch Posted January 27, 2021 Share Posted January 27, 2021 If I was a veteran fund manager I'd feel like Tommy Lee Jones in No Country for Old Men. Link to comment Share on other sites More sharing options...
Guest cherzeca Posted January 27, 2021 Share Posted January 27, 2021 this is a fascinating question. there is a market manipulation prohibition in the 34 Act, directed to for example boiler room activity where such shops would build a position and engage in activities to induce a market (calling widows) to unload the position. is this reddit site tantamount to that? doesn't seem so to me. lots of "professional investors" use technical factors to make a buck. here these guys took on a stupid name that was >100% of float short and created a short squeeze...seems to be legit, and they have a 1st A right (commercial speech) to talk to each other about the idea. I just think shorting has moved into a new era where the squeeze risk has increased...caveat emptor This is more a case of caveat venditor, yes, thanks. I am not a latin maven Link to comment Share on other sites More sharing options...
bizaro86 Posted January 27, 2021 Share Posted January 27, 2021 You might be able to persuade regulators to ban options (not a big loss IMO), although I'm sure there's gonna be yuge pushback on this. Or maybe change some rules to make gamma squeeze unlikely. But I don't see how you expect to prevent millions of people from deciding that they want to buy some crappy stonk at the same time. CBOE would have hard feelings about that. I think options are a slight net positive. GME will work itself out, probably with the company doing a big issuance, and I think it would be a shame to neuter markets as a result. Link to comment Share on other sites More sharing options...
james22 Posted January 27, 2021 Share Posted January 27, 2021 Maybe a basket of WSB names and let it ride? WSB ETF! Link to comment Share on other sites More sharing options...
fareastwarriors Posted January 28, 2021 Share Posted January 28, 2021 The sub is invite-only now. I should've joined while I was scanning earlier! Link to comment Share on other sites More sharing options...
collegeinvestor Posted January 28, 2021 Share Posted January 28, 2021 They close it down and reopen WSB all the time to guests. I don't think its permanent unless they are trying to not get publicity right now. Link to comment Share on other sites More sharing options...
Nomad Posted January 28, 2021 Share Posted January 28, 2021 Apparently Discord just banned WallStreetBets for "hate speech" (whatever the hell that is). Curious timing, to say the least. Link to comment Share on other sites More sharing options...
clutch Posted January 28, 2021 Share Posted January 28, 2021 YOLO!! Well lived. Link to comment Share on other sites More sharing options...
Read the Footnotes Posted January 28, 2021 Share Posted January 28, 2021 I think retail investors are underestimating the number of different legal theories that could be an issue for them. Just because there has not been much appetite for pursuing bad behavior for the past 4+ years, does not mean there won't be in the future. The SEC tends to be reactive, not proactive, and I am sure they know they have a problem now. I am guessing that reddit realizes it has a problem too. From what I have read, several early instigators probably have multiple risks that they should be worried about. Some people involved will face little to no risk even if what they did technically broke the law, but my guess is that some people will be made an example of. Even more participants just amplified the message or joined the mob and in no way broke the law in the way they did it. What is interesting is that in the past it was more organized crime, rogue professionals, conflicts of interest, corrupted journalist and corrupted analysts that the SEC needed to worry about. Social media has just democratized the ability for the average Joe to commit a crime and amplify that message in a way that can move markets. That really would not have been possible to this extent 20 years ago, but we shouldn't forget that the TMT bubble had it's own version of market manipulations scandals that resulted in firings, prosecutions and reforms. Link to comment Share on other sites More sharing options...
Castanza Posted January 28, 2021 Share Posted January 28, 2021 The sub is invite-only now. I should've joined while I was scanning earlier! There must have been a karma requirement or something because it kicked me and everyone I know out. Link to comment Share on other sites More sharing options...
Spekulatius Posted January 28, 2021 Share Posted January 28, 2021 What if Pepsi makes a political donation reddit decides it doesn't like and they short its shares into oblivion taking down pensioners assets with it? Is that ok? What if these guys get into FX futures/future options and all simultaneously enter longs into the EUR/USD pairing and blow the EUR USD pair to 3-4 USD temporarily? You don't think that could be problematic for businesses all over the world? What if they decide that they all think the Fed is exploding the dollar and decide to drive oil into the stratosphere by all loading into the front-month contract (the exact opposite of negative prices in April)? These things matter. Yes - those are all bigger markets. But it's a growing community now (1+ million recent member adds). More on the way. And HFT/trend follower/momo strategies that will ride their coattails. This is a HUGE pile of liquidity that can really slosh anywhere it wants that that is NOT healthy. I don’t agree. If short sellers drive down PEP, it doesn’t matter, the company is self financing. In fact, the company could compound value and buy back tons of shares cheaply and the pensioners would benefit from this in the long run , even if they did nothing. More likely though. At least some folks would buy the discounted shares and benefit even more. the simple fact is that PEP share price doesn’t really matter for its operations. As for GME, everyone who has been and is involved in this from either side is just a greedy SOB, so why should be care if they make a ton of money or blow up. Personally, I think it is great that the little guys can form a Piranha swarm and gang up on the big fish, it usually is the other way around. Link to comment Share on other sites More sharing options...
Castanza Posted January 28, 2021 Share Posted January 28, 2021 I think retail investors are underestimating the number of different legal theories that could be an issue for them. Just because there has not been much appetite for pursuing bad behavior for the past 4+ years, does not mean there won't be in the future. The SEC tends to be reactive, not proactive, and I am sure they know they have a problem now. I am guessing that reddit realizes it has a problem too. From what I have read, several early instigators probably have multiple risks that they should be worried about. Some people involved will face little to no risk even if what they did technically broke the law, but my guess is that some people will be made an example of. Even more participants just amplified the message or joined the mob and in no way broke the law in the way they did it. What is interesting is that in the past it was more organized crime, rogue professionals, conflicts of interest, corrupted journalist and corrupted analysts that the SEC needed to worry about. Social media has just democratized the ability for the average Joe to commit a crime and amplify that message in a way that can move markets. That really would not have been possible to this extent 20 years ago, but we shouldn't forget that the TMT bubble had it's own version of market manipulations scandals that resulted in firings, prosecutions and reforms. What crime? What crime is the average Joe committing? How can a participant in an idea with no central or governing body be committing a crime? Link to comment Share on other sites More sharing options...
compoundinglife Posted January 28, 2021 Share Posted January 28, 2021 The sub is invite-only now. I should've joined while I was scanning earlier! There must have been a karma requirement or something because it kicked me and everyone I know out. I have been subbed for 4 years with 1.5K karma and got locked out as well. Link to comment Share on other sites More sharing options...
Spekulatius Posted January 28, 2021 Share Posted January 28, 2021 I think retail investors are underestimating the number of different legal theories that could be an issue for them. Just because there has not been much appetite for pursuing bad behavior for the past 4+ years, does not mean there won't be in the future. The SEC tends to be reactive, not proactive, and I am sure they know they have a problem now. I am guessing that reddit realizes it has a problem too. From what I have read, several early instigators probably have multiple risks that they should be worried about. Some people involved will face little to no risk even if what they did technically broke the law, but my guess is that some people will be made an example of. Even more participants just amplified the message or joined the mob and in no way broke the law in the way they did it. What is interesting is that in the past it was more organized crime, rogue professionals, conflicts of interest, corrupted journalist and corrupted analysts that the SEC needed to worry about. Social media has just democratized the ability for the average Joe to commit a crime and amplify that message in a way that can move markets. That really would not have been possible to this extent 20 years ago, but we shouldn't forget that the TMT bubble had it's own version of market manipulations scandals that resulted in firings, prosecutions and reforms. What crime? What crime is the average Joe committing? How can a participant in an idea with no central or governing body be committing a crime? I see it the same way. someone posts GME , another one says it’s going to $1000, another one says “Hold the line “ , what the crime here? Who, what why? In the meantime Ackman goes on TV and says “hell is coming” and pockets $2B in genius trade short trade! Give me a break. Link to comment Share on other sites More sharing options...
lessthaniv Posted January 28, 2021 Share Posted January 28, 2021 The sub is invite-only now. I should've joined while I was scanning earlier! There must have been a karma requirement or something because it kicked me and everyone I know out. It's back up and running Link to comment Share on other sites More sharing options...
Spekulatius Posted January 28, 2021 Share Posted January 28, 2021 Link to comment Share on other sites More sharing options...
fareastwarriors Posted January 28, 2021 Share Posted January 28, 2021 The sub is invite-only now. I should've joined while I was scanning earlier! There must have been a karma requirement or something because it kicked me and everyone I know out. I have been subbed for 4 years with 1.5K karma and got locked out as well. :o 4 years Hello DeepFukingValue ;) Link to comment Share on other sites More sharing options...
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