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Re:The Battle of GameStop by pxue on Monday January 25, 2021 @10:24PM (#25912114)
this is exactly it. people say the market is a melt up.. another bubble. but i think that's wrong.

It's like the show Billions, actual wallstreet does what wsb is doing ALL THE TIME. You make money when someone else loses money, it's simple.

Except this time, the money isn't staying in the fraternity, it's being distributed out to the common folks.

Can't have that it seems.

Re:The Battle of GameStop by in3d on Monday January 25, 2021 @10:38PM (#25912221)
Common folks who get in late in the bubble will be the ones who will suffer. This populist mindset that you’re somehow sticking it to big banks or something by paying for trading is funny.
Re:The Battle of GameStop by djeiasbsbo on Tuesday January 26, 2021 @12:27PM (#25918619)
In this case they have actually a pretty interesting goal and motivation. They chose GME because it had a short ratio of 138%. Basically, big hedge funds were betting on the downfall and demise of this stock excessively.

What WSB daytraders are trying to do is to bleed out these hedge funds by buying in and holding. The stock doesn't even have to increase and the damage to the big hedge funds is already happening, see the situation that Melvin Capital is in. To those who participate it is a david vs. goliath situation.

The thing is, what they are trying to do is not that dumb and actually quite interesting, but they won't get anywhere by remaining "civil". They need this to spread and be on the frontpage of Reddit constantly. Negative or positive press helps, because more regular people want to participate if they hear about it.

I think that this will go down in history. Constant timeouts, organised selling at certain intervals, unnatural spikes, we've yet to hear about the shady stuff that keeps this stock from surging even faster considering the current "virality".

Re:The Battle of GameStop by pas on Tuesday January 26, 2021 @11:02AM (#25917323)
It's not zero-sum. Central banks are printing money. People put their gov checks into ETFs. Sure, eventually there'll be a reckoning.
Re:The Battle of GameStop by kyawzazaw on Tuesday January 26, 2021 @07:53PM (#25922909)
Melvin Capital just got bailed out.
Re:The Battle of GameStop by phil_e_delphian on Tuesday January 26, 2021 @08:17PM (#25923090)
And anyone who bought shares at peak yesterday is up 50% today - those who bought _any_ Call option are up much, much more
Re:The Battle of GameStop by gvhst on Tuesday January 26, 2021 @09:21AM (#25916013)
I can assure you that most folks on wall street (speaking about most of the multi-manager hedge funds specifically) have significantly tighter risk limits than anyone on WSB. Frequently drawdowns of even 5-10% can get your sized reduce or get you fired. The YOLO attitude that WSB has is closer to the film "the wolf of wall street" than what actually happens.

While Billions is one of the more realistic shows about finance, it is far from accurate enough to be compared to real life.

Re:The Battle of GameStop by greatpatton on Tuesday January 26, 2021 @12:06PM (#25918290)
So if everyone in Wall Street have significantly tighter risk can you explain the risk linked to the short position taken by Melvin Capital on GME? How many "Wall Street" were burned by taking high bet that went wrong going around their internal audit?
Re:The Battle of GameStop by delaaxe on Tuesday January 26, 2021 @07:12PM (#25922605)
Oh yeah? Risk limits so tight that one of largest hedge funds needed a 2.75 billion bailout to cover their losses on a single short position? https://www.wsj.com/articles/citadel-point72-to-invest-2-75-...
Re:The Battle of GameStop by koheripbal on Tuesday January 26, 2021 @08:55AM (#25915756)
There's a significant difference in the willingness to enact change between the Legislative branch and the Executive branch.

Where Congress (legislative branch) has been unwilling to pass any new regulations upon social media, the SEC (executive branch) is going to shut down these sorts of forums when they become disruptive.

Having worked in this field, while the SEC can sometimes be slow to act, the fact that it made the front page of the WSJ, it is only a matter of time before that hammer comes down.

...and Reddit isn't going to fight for this form (or any form) of Free Speech.

Re:The Battle of GameStop by nico_h on Tuesday January 26, 2021 @10:14AM (#25916632)
I mean it's just a small forum, can they really have the same amount of influence on the market than a hedge fund or a market maker? What does the SEC care about a bunch of trolls on the internet?
Re:The Battle of GameStop by pas on Tuesday January 26, 2021 @11:05AM (#25917370)
Coordinating with the goal of market manipulation (basically buy/sell/short/pump-and-dump/etc cartels or other) is illegal as far as I know. Hence why the guys who made a lot of money on the negative oil trades are staying very quiet.
Re:The Battle of GameStop by tootie on Tuesday January 26, 2021 @10:16AM (#25916651)
That's not really true. So long as stock indexes generally move up, everyone can make money. The battle is over who makes more and more quickly. I'm a passive investor just plowing savings in index funds and making like 12% a year. All the mechanics of day trading vs working for a bank are pretty similar, but the difference is scale. And the ability to hedge bets.
Re:The Battle of GameStop by pas on Tuesday January 26, 2021 @11:14AM (#25917499)
Indices are going up because people are putting money into the market(s), and governments (legislatures and central banks) are printing money in order to prevent market collapse, because that'd mean liquidation events, meaning every mark-to-market asset will suddenly worth nothing, every company will become toxic overnight, banks will (have to) stop funding companies, companies will cut costs (fire everybody, stop every kind of project/investment/capex), and everyone will try to sell things to make cash to pay back debt, which can start a deflation spiral.

The asset bubble is an unintended consequence, it's the "lesser evil". But it's again the rich get richer.

Re:The Battle of GameStop by chasd00 on Tuesday January 26, 2021 @08:56AM (#25915773)
Exactly right. It’s all fun and games until the wrong firm loses big enough then the SEC hammer will come down.
Re:The Battle of GameStop by throwaway0a5e on Tuesday January 26, 2021 @09:01AM (#25915811)
>until the wrong firm loses big enough

Revolving door doing what it does best.