Gamestop?

What is being missed is that shorting stock leads to inability of these companies to get access to capital, as it creates fear over the companies. Now they can sell stock directly into these rallies and get $300 a share in capital to fund their companies for years to come. It is estimated that Gamestop raised 100 million last week alone. This is exactly how Tesla has become a force and is now unstoppable as they sold as much in stock that they did cars.
 
Running_Man said:
What is being missed is that shorting stock leads to inability of these companies to get access to capital, as it creates fear over the companies. Now they can sell stock directly into these rallies and get $300 a share in capital to fund their companies for years to come. It is estimated that Gamestop raised 100 million last week alone. This is exactly how Tesla has become a force and is now unstoppable as they sold as much in stock that they did cars.
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You are saying two opposite things together. First you say shorting is bad, then you say it is good because they can sell shares at higher prices. High short interest is always good because those shares will need to be bought back.
 
These Masters of the Universe trumpet the “creative destruction” of capitalism, until, of course, they are destroyed creatively by Reddit users. LOL.

I saw Andrew Ross Sorkin on The Newshour last night complaining that pension funds will lose money. My view is, maybe this will be a lesson to those responsible for pensions not to invest in hedge funds. Warren Buffett already proved these things underperform the indices due with lousy long-term records and massive fees. The mutual fund world knows well that active management and high fees lead to sub par results. It’s no different for hedge funds.

Let them burn.
 
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IMO the solution is to prohibit short sales of stocks... which is betting rather than investing. If you want to bet on a company's success then by all means do so by going long but let's prohibit creating situations where investors root for companies to fail. Better for capitalism.

Besides, where other than the financial markets can you sell something that you don't own? Doesn't make sense.
 
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pb4uski said:
IMO the solution is to prohibit short sales of stocks... which is betting rather than investing. If you want to bet on a company's success then by all means do so by going long but let's prohibit creating situations where investors root for companies to fail. Better for capitalism.

Besides, where other than the financial markets can you sell something that you don't own? Doesn't make sense.
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They would need to get rid of options and futures as well since synthetic shorts can be created. A terrible idea for the capital markets since these are basic risk management tools.
 
Jusst let it run its course. It'll work itself out.
 
Just checked out that sub reddit. "interesting" to say the least.

I can't help but think some big players are quietly participating and making use of this fog of war between the Reddit bros and Big Hedge. Some people are gonna make a lot of money.
 
According to the folks on Reddit robinhood is not accepting any GME orders this morning? I don't have a RH account to verify.
This is a portion of their statement.

"We continuously monitor the markets and make changes where necessary. In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AMC, $BB, $BBBY, $EXPR, $GME, $KOSS, $NAKD and $NOK. We also raised margin requirements for certain securities."
 
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This is all really just legalized pyramid, sanctioned by the government.

You might as well just do the "send a letter with a dollar in it to 5 people on this list"

GME is not worth $22B

They could have just picked any stock and pushed it to the moon. It isn't investing at all.

Tesla at least has a path toward big growth and has always had a path toward growth, plus Elon has proved he can do amazing things like build up a company that can land two apartment buildings side by side after flying them around a bit.
 
I hope the Koss family benefits from the run-up of their stock. Milwaukeean John Koss invented stereo headphones in the 1950s so he could better appreciate the jazz he loved.

Koss was brilliant, but like so many other "little guys" he got squeezed by bigger players in his sector with better marketing strategies. The company is currently suing Apple for patent infringement. In 2010, a former executive was sentenced to prison for stealing $34 million from the company. So they've had a rough go. I'm sure the family is watching their stock price with wonderment.

That said, the company's performance made it a likely target for short sellers. Here's the details from the Milwaukee Journal Sentinel:

Koss last reported a 3.7% decrease in sales in the three months ending Sept. 30 in its most recent filings with the Securities and Exchange Commission. It was the sixth consecutive quarter that the company reported a decline in sales.

In the last five years, the stock has never traded above $5 a share. For most of the last year, the stock traded around $2 a share. The 52-week low is 80 cents a share.
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jim584672 said:
They would need to get rid of options and futures as well since synthetic shorts can be created. A terrible idea for the capital markets since these are basic risk management tools.
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Just get rid of futures.... another odd instance where else can one benefit from the ownership of an asset without owning it.

Options would be fine... while with a call you can benefit from the ownership without owning you have to pay for that privilege.
 
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Markola said:
These Masters of the Universe trumpet the “creative destruction” of capitalism, until, of course, they are destroyed creatively by Reddit users. LOL.

I saw Andrew Ross Sorkin on The Newshour last night complaining that pension funds will lose money. My view is, maybe this will be a lesson to those responsible for pensions not to invest in hedge funds. Warren Buffett already proved these things underperform the indices due with lousy long-term records and massive fees. The mutual fund world knows well that active management and high fees lead to sub par results. It’s no different for hedge funds.

Let them burn.
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Yes, all the gnashing of teeth is a bit amusing. Elites losing money speculating in stocks is some kind of "crisis".

Truth is, there will be a lot of money made AND lost on these stocks.

They will come back to earth. And the kids who stayed long will be routed. And new shorts will make more than ever.

And the fear of this reality will plant the seeds of its end...for now.

But short squeezes are not new and are not going away. What goes around comes around, and that should give pause to the shorts AND the longs.
 
I kind of want to pump some of my own stocks on wsb if it is legal.

Like Vanda...holy crap if they can get behind GME, imagine the value in a biotech that has a third of its market cap in cash and is profitable. It was a super deal at $9 but even at $14 it is a hell of a lot better company than GME or AMC.
 
P.S. said:
This will be my only post, promise.
Yes, although there are big players like deepf^ckingvalue, much of the army of wsb-ers are small accounts putting their entire savings towards this GME movement, sometimes just hundreds of dollars.
It is not fun. It is not games.
It’s the small fry, the guy that this economy has left behind taking a stand.
When many on the ER community were slapping each other on the back about their ever glorious higher balances, these guys were figuring how to pay their bills. Many of them lost jobs. They lived through 2008 and saw their parents lose jobs, houses. They would prob love to exchange their student loans, medical bills, etc. for the few percent “loss” that the average ER member experienced today. And when your balances do go up? That money didn’t come from a vacuum.
There is a lot of due diligence amongst the many threads on WSB re: GME. To understand that and buy GME is as much gambling, as buying VTI or VWELX is.
Who of you analyzes all the companies in each fund you buy?
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Well said.
 
NW-Bound said:
Not the buyers I saw above.
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Of course. A lot of people are gonna lose.

Reading the redditbros, there are a core group that believe they are revolutionaries, and are promising to hold GME and others no matter what loss they make. Others are all-in talking about paying their rent with credit cards just so they can put their cash to the revolution.

OK, so are these real? Yes, some of them are. But I'm sure there are some bad actors gaming others.

Whether the gamers are manipulating behind the scenes or not is one thing. There have to be third parties reading these tea leaves and taking advantage of the situation. There always are third party winners during war.
 
Montecfo said:
Yes, all the gnashing of teeth is a bit amusing. Elites losing money speculating in stocks is some kind of "crisis".

Truth is, there will be a lot of money made AND lost on these stocks.

They will come back to earth. And the kids who stayed long will be routed. And new shorts will make more than ever...
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And who are the new shorts? And who will be the new longs who lose more than ever?

I don't imagine that some hedge funds will be these new longs, and a bunch of Redditors will be the new shorts.
 
I am going to guess their next pump target will be something like CCL. I am tempted to buy a couple hundred shares just in case they push it to a $100B cruise company in a week or something.
 
JoeWras said:
Of course. A lot of people are gonna lose.

Reading the redditbros, there are a core group that believe they are revolutionaries, and are promising to hold GME and others no matter what loss they make. Others are all-in talking about paying their rent with credit cards just so they can put their cash to the revolution.

OK, so are these real? Yes, some of them are. But I'm sure there are some bad actors gaming others.

Whether the gamers are manipulating behind the scenes or not is one thing. There have to be third parties reading these tea leaves and taking advantage of the situation. There always are third party winners during war.
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Of course the big winners are the instigators. Same as riot inciters making out, but rioters go to jail.
 
NW-Bound said:
And who are the new shorts? And who will be the new longs who lose more than ever?

I don't imagine that some hedge funds will be these new longs, and a bunch of Redditors will be the new shorts.
Click to expand...

The shorts will be hedge funds mostly. "Smart money" who recognized that these stocks are now fundamentally grossly overvalued.

The longs will be the kids (and others) who think they are winning.
 
Fermion said:
I kind of want to pump some of my own stocks on wsb if it is legal.
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Ha ha. One of the rules posted on wsb is "No Market Manipulation". And then every thread is about manipulation.

Rules are one thing. Legality is another. You have to look deep, but reddit publishes an aggregate count of all the requests from the authorities regarding legal actions. I presume a lot of those are for minor exploitation and the like. Don't know if they ever go for users for stuff like SEC actions.
 
Montecfo said:
The shorts will be hedge funds mostly. "Smart money" who recognized that these stocks are now fundamentally grossly overvalued.

The longs will be the kids (and others) who think they are winning.
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Mine were rhetorical questions. ;)

Again, the kids will lose, but their instigating leaders are getting rich.
 
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