Stock market drama llama: GameStop shares dramatically rise in price from some Reddit users' trading in it

[Axulus]

I've been amused about this for about 2 weeks. In addition to Robinhood putting limits on these trades, yesterday, TDAmeritrade announced that they wouldn't even allow trades of Gamestock. I don't know if that's still going on today. But, all of these stocks are currently tanking. but they are way above what they were at the beginning of the year.

MSNBC interviewed an evangelical pastor this morning, who had invested 35 dollars on Gamestock. His investment was worth about 4K early this morning. He gave an excellent analogy, using a Biblical parable, where Jesus condemned the rich who had too much grain to store in their barns, but instead of sharing it with the poor, they built larger barns to store it. The guy was obviously not a conservative.

It's not the little investors who are hurting due to this behavior, as they were only investing tiny amounts of money in order to pump up these stocks. Their goal was always to hurt hedge funds etc. while making a little extra for themselves. I think it's pretty funny when small inexperienced investors are able to make a mockery of some of the biggest investors in the market.

The restrictions apparently have to do with the clearing houses charging much higher fees to clear the transactions in these stocks as there is more involved when there is this much volatility and volume. Anyone else know more about this?

No, they don't. It's pretty transparent manipulation given that they only blocked BUY and not SELL options. There is even some discussion of the possibility that RobinHood is illegally selling people's shares and illegally cancelling their already-approved transactions this morning before open.

And why wouldn't they? Fines for illegal activity, even prison time for some, probably seems better to them than covering the infinite losses they risked taking.

A number of markets have done this, limiting buy but not sell.

Reddit is holding the line, though. The goal is to close on Friday above 600 and bankrupt Citadel.

While I find it unethical to bet against people, it will be hilarious when Reddit goes after Citadel's long positions when they cash them to cover their shorts.

Yes, it did have to do with the clearing houses, at least for some of the firms. The green light has been given again:

https://finance.yahoo.com/news/webull-public-remove-restrictions-memestocks-195711214.html

 

[Trausti]

 

[Loren Pechtel]

Yeah fake news is not even funny. A professional hedge fund frim lost around 2 billion because a couple of reddit users outsmarted them. Now that's funny.

In the long run we will see who lost.

 

[Jarhyn]

The sentiment is clearly "punishment". What else would it be? Why would someone be fine risking losses to "destroy" a hedge fund if not as some sort of punishment?

Yeah it's definitely punishment. No question about it. If the government would have done their job and punished folks for this sort of bullshit trading the last time, we most likely wouldn't see the halfcocked retribution being witnessed today.

No, they don't. It's pretty transparent manipulation given that they only blocked BUY and not SELL options. There is even some discussion of the possibility that RobinHood is illegally selling people's shares and illegally cancelling their already-approved transactions this morning before open.

And why wouldn't they? Fines for illegal activity, even prison time for some, probably seems better to them than covering the infinite losses they risked taking.

A number of markets have done this, limiting buy but not sell.

Reddit is holding the line, though. The goal is to close on Friday above 600 and bankrupt Citadel.

While I find it unethical to bet against people, it will be hilarious when Reddit goes after Citadel's long positions when they cash them to cover their shorts.

Yes, it did have to do with the clearing houses, at least for some of the firms. The green light has been given again:

https://finance.yahoo.com/news/webull-public-remove-restrictions-memestocks-195711214.html

That is the story. The reality is that it was collusion between Citadel an RH, and shortly followed up by demands from Apex putting pressure on.

The fact is, this was a one-sided event. As it is, RH has forcibly closed many users' positions on GME while they are being blocked from reacquiring their positions. This was apparently done on margin accounts, which it says in their ToS, buried, that they reserved the right to sell the contents of any marginal account. It may, however, still be illegal as a ToS still can't authorize illegal behavior.

It didn't have jack shit to do with the clearing houses unless the clearing houses were in on it too.

 

[Angry Floof]

 

[RVonse]

If the elite deep state and wall streeters don't want the unsophisticated Trumpster's and Bernie crowd to ruin their scam.....they will have to stop their stimulus checks that were used to buy Gamestop. Shutting down Robinhood wont be good enough.

 

[Gospel]

Yeah fake news is not even funny. A professional hedge fund frim lost around 2 billion because a couple of reddit users outsmarted them. Now that's funny.

In the long run we will see who lost.

Why wait when I can tell you now. The short sellers.

 

[Angry Floof]

If the elite deep state and wall streeters don't want the unsophisticated Trumpster's and Bernie crowd to ruin their scam.....they will have to stop their stimulus checks that were used to buy Gamestop. Shutting down Robinhood wont be good enough.

At first I thought this was sarcasm but then I saw "RVonse."

And don't talk shit about the unsophisticated crowd. They're just trying their best to save babies from being eaten by Lizard-Dems. Oh, wait, that's the other unsophistiQated crowd.

 

[Jarhyn]

If the elite deep state and wall streeters don't want the unsophisticated Trumpster's and Bernie crowd to ruin their scam.....they will have to stop their stimulus checks that were used to buy Gamestop. Shutting down Robinhood wont be good enough.

At first I thought this was sarcasm but then I saw "RVonse."

And don't talk shit about the unsophisticated crowd. They're just trying their best to save babies from being eaten by Lizard-Dems. Oh, wait, that's the other unsophistiQated crowd.

God, seriously though, reading wallstreetbets tonight is fucking choice.

We have folks whose loss today was 10m, and they're perfectly content riding it all the way to 0.

The market models these hedge funds bet it all on never accounted for people who care more about what happens for society as a result of their actions than they care about their own well-being.

Every last one of those fuckers is "holding the line".

They have called and spotted various market manipulation scams by Citadel et al, ladder scams, pump/dumps... They just can't figure out, it seems, why people aren't selling out when it peaks, or selling off when it is in fall when they dump.

It feels really good to see the system getting fucked, finally.

 

[Axulus]

If the elite deep state and wall streeters don't want the unsophisticated Trumpster's and Bernie crowd to ruin their scam.....they will have to stop their stimulus checks that were used to buy Gamestop. Shutting down Robinhood wont be good enough.

At first I thought this was sarcasm but then I saw "RVonse."

And don't talk shit about the unsophisticated crowd. They're just trying their best to save babies from being eaten by Lizard-Dems. Oh, wait, that's the other unsophistiQated crowd.

God, seriously though, reading wallstreetbets tonight is fucking choice.

We have folks whose loss today was 10m, and they're perfectly content riding it all the way to 0.

The market models these hedge funds bet it all on never accounted for people who care more about what happens for society as a result of their actions than they care about their own well-being.

Every last one of those fuckers is "holding the line".

They have called and spotted various market manipulation scams by Citadel et al, ladder scams, pump/dumps... They just can't figure out, it seems, why people aren't selling out when it peaks, or selling off when it is in fall when they dump.

It feels really good to see the system getting fucked, finally.

You are a fool to believe all that. Hedge funds are rivals. Seeing one burn enriches the others as rich investors flee and flood their cash with rivals. High volatility benefits wall street traders and insiders as it increases their profit potential (trading profits increase with volatility for smart traders). The vast majority of hedge funds don't even get involved with large short positions on individual securities, let alone small/micro cap securities. No one is scared. The largest short position already closed out. I'm looking to profit off the stupidity myself by finding the best way to bet against the stock associated with a company that is going the way of blockbuster.

The only ones who will be laughing all the way to the bank are the wall street trading firms as the sheeple are parted from their cash.

 

[ZiprHead]

Robinhood Sued by Furious GameStop Stockholders

 

[Jarhyn]

God, seriously though, reading wallstreetbets tonight is fucking choice.

We have folks whose loss today was 10m, and they're perfectly content riding it all the way to 0.

The market models these hedge funds bet it all on never accounted for people who care more about what happens for society as a result of their actions than they care about their own well-being.

Every last one of those fuckers is "holding the line".

They have called and spotted various market manipulation scams by Citadel et al, ladder scams, pump/dumps... They just can't figure out, it seems, why people aren't selling out when it peaks, or selling off when it is in fall when they dump.

It feels really good to see the system getting fucked, finally.

You are a fool to believe all that. Hedge funds are rivals. Seeing one burn enriches the others as rich investors flee and flood their cash with rivals. High volatility benefits wall street traders and insiders as it increases their profit potential (trading profits increase with volatility for smart traders). The vast majority of hedge funds don't even get involved with large short positions on individual securities, let alone small/micro cap securities. No one is scared. The largest short position already closed out. I'm looking to profit off the stupidity myself by finding the best way to bet against the stock associated with a company that is going the way of blockbuster.

The only ones who will be laughing all the way to the bank are the wall street trading firms as the sheeple are parted from their cash.

Woot, I get to mark off "sheeple" on my bullshit bingo card!

 

[Gospel]

God, seriously though, reading wallstreetbets tonight is fucking choice.

We have folks whose loss today was 10m, and they're perfectly content riding it all the way to 0.

The market models these hedge funds bet it all on never accounted for people who care more about what happens for society as a result of their actions than they care about their own well-being.

Every last one of those fuckers is "holding the line".

They have called and spotted various market manipulation scams by Citadel et al, ladder scams, pump/dumps... They just can't figure out, it seems, why people aren't selling out when it peaks, or selling off when it is in fall when they dump.

It feels really good to see the system getting fucked, finally.

You are a fool to believe all that. Hedge funds are rivals. Seeing one burn enriches the others as rich investors flee and flood their cash with rivals. High volatility benefits wall street traders and insiders as it increases their profit potential (trading profits increase with volatility for smart traders). The vast majority of hedge funds don't even get involved with large short positions on individual securities, let alone small/micro cap securities. No one is scared. The largest short position already closed out. I'm looking to profit off the stupidity myself by finding the best way to bet against the stock associated with a company that is going the way of blockbuster.

The only ones who will be laughing all the way to the bank are the wall street trading firms as the sheeple are parted from their cash.

I think you're missing something though. The antics of wallstreetbet's drew a lot of attention to short sellers and unless MIB is real and memories can be wiped people aren't just gonna forget. I predict one of two outcomes, politicians ruin it for everyone or a group more organized and with more buying power will make situations like this the norm.

 

[Jarhyn]

God, seriously though, reading wallstreetbets tonight is fucking choice.

We have folks whose loss today was 10m, and they're perfectly content riding it all the way to 0.

The market models these hedge funds bet it all on never accounted for people who care more about what happens for society as a result of their actions than they care about their own well-being.

Every last one of those fuckers is "holding the line".

They have called and spotted various market manipulation scams by Citadel et al, ladder scams, pump/dumps... They just can't figure out, it seems, why people aren't selling out when it peaks, or selling off when it is in fall when they dump.

It feels really good to see the system getting fucked, finally.

You are a fool to believe all that. Hedge funds are rivals. Seeing one burn enriches the others as rich investors flee and flood their cash with rivals. High volatility benefits wall street traders and insiders as it increases their profit potential (trading profits increase with volatility for smart traders). The vast majority of hedge funds don't even get involved with large short positions on individual securities, let alone small/micro cap securities. No one is scared. The largest short position already closed out. I'm looking to profit off the stupidity myself by finding the best way to bet against the stock associated with a company that is going the way of blockbuster.

The only ones who will be laughing all the way to the bank are the wall street trading firms as the sheeple are parted from their cash.

I think you're missing something though. The antics of wallstreetbet's drew a lot of attention to short sellers and unless MIB is real and memories can be wiped people aren't just gonna forget. I predict one of two outcomes, politicians ruin it for everyone or a group more organized and with more buying power will make situations like this the norm.

There is a response possible: to simply watch the open flow of information and act on it in equal proportion to the holders. Then pay them off with their own stocks to dump the position when they make something ridiculous happen. It'll be a game of chicken next time. Who the fuck knows. This is goddamn dangerous and it's because of unbridled capitalism.

 

[Swammerdami]

Is fake news allowed to be spread here?

1. The losses did not surpass (or even approach) 13.1 billion
2. The hedge fund did not go bankrupt
3. Not all of wall street is saying it should be illegal. In fact, only a very few are saying that.

The market cap of GME rose by $14 Billion in a single day. If the short interest was 150%, the shorts suffered a $21 Billion paper loss that day. But I supposed you're correct: No actual bankruptcy. And many of the shorts liquidated before the big price surge.

I do see that Melvin Capital "received more than $2 billion in emergency cash [Monday] ... to allow it to close the shorted position." Where did they get the "emergency cash"?

 

[Gospel]

I guess this was fake news huh.

[TWEET]<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Just got off the phone with <a href="https://twitter.com/S3Partners?ref_src=twsrc%5Etfw">@S3Partners</a> who say that as of the market close, short-sellers lost $14.3 billion TODAY on <a href="https://twitter.com/search?q=%24GME&src=ctag&ref_src=twsrc%5Etfw">$GME</a> stock. On the year, short-sellers are down almost 900%, $23.6 billion.</p>— Ezra Kaplan (@EzraNBC) <a href="https://twitter.com/EzraNBC/status/1354546109054595078?ref_src=twsrc%5Etfw">January 27, 2021</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>[/TWEET]

 

[Jarhyn]

Is fake news allowed to be spread here?

1. The losses did not surpass (or even approach) 13.1 billion
2. The hedge fund did not go bankrupt
3. Not all of wall street is saying it should be illegal. In fact, only a very few are saying that.

The market cap of GME rose by $14 Billion in a single day. If the short interest was 150%, the shorts suffered a $21 Billion paper loss that day. But I supposed you're correct: No actual bankruptcy. And many of the shorts liquidated before the big price surge.

I do see that Melvin Capital "received more than $2 billion in emergency cash [Monday] ... to allow it to close the shorted position." Where did they get the "emergency cash"?

Given the fact of the ladder scam yesterday, wherein there was a 500 share spread between 100's and 300's, I would say they didn't get out from their short position at all.

 

[Elixir]

Short sellers are basically parasitic, providing no benefit to anyone but themselves.
Sure, hedge funds compete with each other, which makes this situation even more comedic. Point 92 and Citadel actually bailed out Melvin Capital to the tune of almost 3 billion. They're circling the wagons and wishing they could cry foul.
The fact is, there's nothing they can do about it if a lot of people are willing to each lose a little to make sure the big short sellers lose a lot. My guess is that once Came Stop, AMC etc. crash back to realistic valuations, this will blow over and hedge funds will not be looking for regulations to protect them against this kind of dynamic, because that would be killing their golden goose.
But it is a good lesson in general - if you leverage your assets, the lever can bounce up and clock you in the head.

 

[ZiprHead]

 

[TV and credit cards]

Interesting all the stories I'm reading and listening to on CNBC putting the spotlight on the Redditors in this Retail Investor versus Hedge Fund saga.

Reuters outs individual who drove the surge in GME This is beneath Reuters. This is a story I would expect from CNN not Reuters.

Facebook takes down Robinhood Stock Traders discussion group. Oh, now Facebook springs into action. Where were you the last four years, you moneygrubbing POS?

The notification, seen by Reuters, said without detail that the group violated policies on “adult sexual exploitation”.

Seriously? Were the terms "red hot poker" or "sideways" your concern?