Even if that fabled squeeze was to take place I'm sure many of them would still be left holding the bags because they wouldn't know when to sell. And again, at this point I'm really not sold on that squeeze theory at all, it seems very plausible that it ended last week and now we're just seeing a good old pump-and-dump taking place.
In the end some people are going to be very lucky and some others are going to learn a very expensive lesson about the dangers of gambling.
Can you provide a single case of someone losing their entire life savings by YOLOing it on GME at the top?
> The Reddit poster Volkswagens1, who declined to give his name but said he lives in the Pacific Northwest, showed The Washington Post an image indicating roughly $400,000 in potential GameStop losses from the day but insisted he would not sell.
> He said he’s poured most of his saving and checking accounts into the stocks and spent the last week “doing as much research as possible,” including sacrificing sleep and calling in sick to work, to make sure he was staying on top of the market’s moves.
(There's also a quote about him doing this because he's been poor for too long, but my take is that if you have enough assets to face a $400k loss, you weren't poor before you entered that position, even if you may now be).
It’s not clear to me this has sunk in w ‘Volkswagens1 nor the loss has really been faced. I’d bet the sober second thought will come after this article was published
Still not a great move to dump your entire worth into meme stocks.
That could be a lot of money to him, but it is not a lot of money compared to what an average worker earns in a year. A probably-young guy losing $6k on a risky stock bet is not life-destroying.
Also, depending on when he bought he could actually be up. And even if he bought at the top, it would still be worth something like 40% of that.
[0]: https://www.reddit.com/r/PersonalFinanceCanada/comments/lavx...
A 21-year-old soon-to-be software engineer losing $25k is not a life-changing tragedy.
That's kind of worse than YOLOing your life savings, because if this prevents them from continuing their education, it just fucked their life.
Most of "average people" entered at or near the top. The ones that did not were so engaged in gambling that they did not sell when it did 20x return. Call it what it is: fear of missing out.
Even DeepFuckingValue, who sold at least some of this position and netted a lot of money after taxes was not smart enough to say that 20x return in a few months is a time to pack the toys and go home so he could fight another day, leaving millions on a table in a futile hope that it would do much, much better.
Better to take $15M of profit than to gamble $35M on the SEC deciding not to prosecute.
Especially when the newspapers decided to plaster his real identity all over the place.
Let's hope that Congress doesn't try to bail these people out!
I think the point being made here is that the whole narrative of "average people beating wall street" is pretty naive and quite bullshit. All in on, maybe a few handful of people got 10x or even 100x their money, but most of the gains were most likely made by hedge funds and with the exception of one or two hedge funds who were squeezed, the majority of losses will probably be by average people.