I picked one, EHOS.

The price has been a solid $0.00 for over six years. 100% worthless

Then a few days ago it suddenly jumps to $0.0013

Sounds like the SEC have found a bunch of social media accounts in the early stage of doing a classic Pump & Dump on worthless penny stocks. Nothing at all to do with WSB

Sounds more like the SEC have found a bunch of worthless penny stocks they can use to justify some new rules and regulations that will also conveniently affect the stocks that have been all over the news without directly citing those stocks since that would surely cause an uproar.

They aren't new rules or new regulations.

U naive.

Sure, because what has been going on forever is the thing that just happened in the last month and not the age old scam.

Hey, saying that out loud, it sounds like maybe you’d be interested in a random penny stock I heard good things about!

This is an obnoxious answer to a valid point.

There aren't any new rules or regulations. It's a valid answer to an obnoxious "point"

you are referencing a sibling comment, not the parent.

Lammy claimed new rules and regulations, that's directly up thread, not a sibling comment.

Ding ding.

Yeah, it's like "yes we stopped GME being traded but also all these others, we aren't focussing on one stock here"

the sec didnt stop gme trading.

Yet, is my point. If they do then they can say "Gme is not a special case"

What an insane pivot from the factual inaccuracy of “the SEC stopped GME trading.” Just admit you had no idea what you were spewing and move on.

I won't because I understand what I said. If your reading comprehension is so poor that is the fault of your education.

The self-delusion required to think that any form of regulation is somehow an affront to your personal freedom is the hallmark of our broken society.

Regulations go against personal freedom by definition

Don’t confuse freedom with anarchy

serious philosophical question that i'm uneducated about -- please don't mistake it as my arguing with your statement :

what is the difference between total freedom and total anarchy?

Regulation seems to hurt personal choice for the sake of personal security/well-being; anarchy being a state of total non-regulation then appears to be the state that is closest to the point where personal freedom has escalated to the highest level possible.

Is this balanced by the opportunity that is awarded to those in a governed state that no longer exists for the person in a state of anarchy?

In other words : does the freedom of choice that a structured government gives the individual PLUS the benefits of said society (roads, medicine, whatever) ensure greater freedom of personal choice compared to the person who lives in a state of non-regulated anarchy and isn't afforded opportunity by the infrastructure -- but is uninhibited by regulation?

Is there any meaningful philosophical consensus on this idea, or is it by-and-large unanswered? I'm not really in-touch with the philosophy world.

anarchy is just an unstable state preceding despotism. my rationale for that isn't philosophical, it's game theoretical.

in anarchy, there isn't anything that can stop others from enslaving or murdering me or people I care about. actually, it's likely a positive outcome for my captors or killers. regulation and enforcement give me more freedom in the sense that opportunists exploiting their absolute freedoms go from +EV to -EV. note that the first one to eliminate opponents who employ the same strategy becomes the despot.

OK, but who are we protecting here? Someone who reads a social media post and makes an investment without doing any due diligence?

That's 90% of WSB, seeing a ticker and rocket emoji and YOLOing into the latest stock because someone said it was going up. Why is this different?

And these are OTC, pink slip stocks. Most major brokerages don't carry them and people who trade them know they're investing in distressed companies with low liquidity.

Sure, go after the pump & dumpers, but it's not clear what the criteria is for halting trading on a stock.

Risk is inherent in any investment. Don't invest what you're not willing to lose because you could lose everything. Your investment can always go to 0, wether it's in stocks, bonds, real estate or a business. And don't invest in what you don't understand.

The goal of the SEC is to ensure confidence in the stock market, to protect the stock market and the whole economy in general.

They were primarily setup to avoid another great depression. They are operating under the assumption that the great depression was caused by a general loss of confidence in the stock market (and other types of investments) and that if they insure confidence, it will never happen again.

They don't really care if an individual investor loses money.

But pump&dump schemes prey on inexperienced noob investors and are very effective at pulling all their money away to experienced pump&dumpers. The SCE are worried that many noobs will experience such a scam and decide that investing isn't for them. This deprives the sock market of funds which the SEC considers bad.

As for GME and WSB... well the SEC are in a bit of a tough spot.

In general the SEC wants the stock price to match reality, and WSB's short-squeezes are clearly violating that. But if the SEC does anything to drive the share price back to normality then it looks like they are siding with big hedge funds and that really reduces the confidence of retail investors.

I suspect they might eventually enforce a technical solution which provides live updates to the current status short positions. Such updates will mean that short squeezes can operate on the actual intelligence of short positions, rather than the wild speculation they are currently operating on. On the flip side, shorters will use the live updates to know when they are at risk of a short squeese.

So is what they're doing some sick joke? I doubt people couldn't care less about the damage done by functionally worthless companies. People are pissed at the perception of manipulation by wall street. This is hilariously myopic. People aren't upset about losing money. They're upset that the game _looks_ (and ostensibly is) rigged. That is where all the lack of confidence stems.

> People aren't upset about losing money.

I’m sure this is true for a minority of participants in the stock market, and I’m sure this is true for a minority of retail investors.

I don’t believe for a second that this is true for a majority of retail money in the market. Most people care very much about losing money.

Just because there’s a bunch of noisy people making news about YOLOing their savings away, doesn’t mean they’re the majority. They’re just noisy and newsworthy.

Nailed it. The people upset by minor regulatory intervention to ensure fair markets are as ruthless as anyone in this equation, but they play the victim. If you knowingly manipulate the price of garbage stock for personal gain, you're not a victim, you're an asshole.

But, but, but they're restricting their freedom to be assholes and their personal liberties to do asshole things to people!

> The goal of the SEC is to ensure confidence in the stock market, to protect the stock market and the whole economy in general.

Well, that's the official goal.

In practice, public choice theory suggests some additional motivations.

That make sense as a mission but that announcement alone will have the opposite effect. The last few weeks proved a lot of people that the game is rigged against retail investors. The is not what is needed to restore confidence, and stop the move to crypto.

In general I am with you - invest at your own risk.

That said, having read WSB for the last few weeks as someone who's actually versed in trading and finance, it was like reading a nutrition forum where people told each other how delicious and healthy lead is and how they couldn't wait to eat more of it (if only they weren't feeling so sick.)

So IF there's room in our society for the government prohibiting lead in the food because yes, plenty of people are that stupid, there's something here - though I think these people would find some other stupid thing to lose their last dollar on.

I'm not sure I'm on board with that lead analogy because everyone's investing goals are different.

I'd say WSB encourages highly volatile, short-term investments. For most people that's bad advice. For others, they'd much rather be broke or a millionaire than wait 40 years for their savings to steadily accumulate into a reasonable nest egg.

It's not just the goals, it's the reasoning. There are highly upvoted advice posts that are transparently illogical and/or based on factual errors.

I popped on at the height of the turn to see multiple posts about a "short ladder attack", a concept that exists nowhere except in the echo chamber of WSB.

The groupthink levels are enormous and frankly terrifying

lead is a great analogy here because its a sweetener.

Maybe if we let the speculators take the hit of losing it all when playing these games, they’d stop playing. But instead we stop it from happening and prevent the hard lesson from being learned.

I think you're severely misreading the history here. Most of the constraints on our modern financial system, including the SEC, were built after the Great Depression to try and prevent it from repeating.

Just in case the speculators here are the over leveraged hedge funds on the short side.

If they lose it all, they don't have anything left to play with and now society has some new destitutes to support. People losing everything imposes costs on everyone else, so it's in all of our interests to put up some guard rails.

Same reason we ban people going to Vegas

2008 agrees with you.

2008 is about people investing in AAA funds which contained subpar stocks, often fraudulently.

2008 is about mortgages given to people who didn’t even have the money to rent a house, with a variable interest based on market conditions.

GMS is about a hedge fund (a fund who uses market volatility to extract value, i.e. not producing value, just taking it from other investors), getting short-squeezed because they are immensely unpopular with the mass of the citizen, due to their shady business practices, and those citizen don’t care about taking money since it is about taking revenge. The desired outcome is that hedge funds cease business, and sticking it to perceived wealthy people, hoping to make the business of hedge funds unreliable and risky. One should wonder whether the SEC shouldn’t weigh on the consumer side and make stock markets atteactive to the lowly again. Otherwise stock markets are just an exclusive tools to make the rich richer again (not that I mind — I ended up in the rich side, but wealth is clearly not correctly distributed).

I’m not a fan of this practice but investing in an arbitrage fund or hedge fund is for wealthy companies/individuals who can afford to lose money or win big; It is an entirely separate market from index funds with long-term investors expecting AAA reliability.

> I’m not a fan of this practice but investing in an arbitrage fund or hedge fund is for wealthy companies/individuals who can afford to lose money or win big;

Or, you know, companies that want to hedge. This idea that hedge funds are pure evil is getting a bit old, should we all cancel all insurance?

> This idea that hedge funds are pure evil is getting a bit old

Why? Aren't they useless?

https://www.forbes.com/sites/mitchelltuchman/2013/07/18/hedg...

WSB has bets in the name and frequently points out that fact in various threads.

> That's 90% of WSB, seeing a ticker and rocket emoji and YOLOing into the latest stock because someone said it was going up. Why is this different?

WSB bans discussions, even mentions (by autobot) of pennystocks and crypto coins.

Exactly. You have to go out of your way to invest in the "pink sheets." And it's probably a good idea to make sure unsuspecting "investors" know the risks and common scams associated with these.

Question: if the price is literally zero, does that mean it can it be purchased for $0, that it's not for sale, or that there are literally no requests to buy it so the price can't be measured?

It's not actually zero.

There some sells at the minimum price of $0.0001. But nobody is actually buying them. There is no room in the order book for buys. No trading is taking place.

Some stock APIs report this as $0.00, others report it as $0.0001. Both views are correct, you could buy some shares shares at $0.0001, but you can't sell any.

Me too. If it's $0 can I "buy" a million shares of it?

No you can't. A bid/offer of 0x1/0.05x25 could be what you see (i.e. 25 shares available at the offer price of 0.05 and 0 shares available at 0 - no one wants this shit) on these garbage-quality companies. So there's no one bidding on it.

So you could come in, place a bid at 0.025 and the updated OB would be like 0.025x1/0.05x25. If there's any autoquoters from the adversaries, then ok immediately they might throw some more offers up at like 0.045x100, since the interpretation of some bids coming in means that they can fill the orders at the tighter spread

Your first example quote has an unfortunate typo. 0x1 should be 0x0

yeah, press F to pay respects. Hopefully most are able to overcome the complexity of reconciling 0x0 == 0x1

I have the same question, but think we can answer it by reasoning.

If it could be purchased for $0, only the first stock would cost $0, and the price would then rise, but how would we calculate the price increase for a stock purchased at $0 that is now worth $0.1? So that's not it.

If it were not for sale, why would it be listed?

I think it's the third, and I'd further guess that any bid for the stock will be accepted, thus setting the price.

I thought the price was what someone was a rough idea of what people are willing to pay for it. So if it’s $0.00, why would you ever pay more than that? And if no one buys it for a penny or more, it’s “price” won’t go up.

In case it’s not clear: I only know the price is what I pay for it. I don’t fully understand where it comes from.

My understanding is that for each tradable asset, there are two prices: Bids and asks; and trades will only happen when asks and bids exist at the same price point.

Most prices we see on tickers are the lowest asks, I believe.

Most commonly, price you see on ticker quotes is the price the stock last traded at; i.e., the last price at which a buyer and seller exchange money for equity.

Oh, right. That makes sense. Hence it's that magical point where an ask equals a bid, and thus: trade!

So doesn't that essentially mean that at the point of measurement—that is, a trade occurring—the price is both lowest ask and highest bid?

Yes, a trade represents an instant in time when a potential buyer and a potential seller agree on a price. The highest bid matches the lowest ask, and then the exchange "matching engine" generates a trade from them.

Instantaneously afterward, the highest remaining bid will be below the lowest ask.

When anyone talks about "the price" of a stock it is an approximation of some sort. Probably they mean the last traded price; maybe the midpoint (bid+ask)/2; maybe the symbol is in the middle of an auction and they mean the auction clearing price.

There's an order book listing buy and sell orders at a variety of prices clustered around big/ask, but the actual bid/ask numbers shown are a standardized summary view of the order book

Does that mean that there are automated trading accounts that just buy whatever people tweet about? Which in turn push the price higher?

Is it like making link farms to game Google but in this case they are gaming the stock market?

If so, the issue is the algorithm.

I suspect this was just one or more discord/telegram pump&dump groups. They have been popular in the crypto-world for ages.

It's a members only group, where a leader will pick a stock that the whole group will buy. Then at an agreed time, the whole group will hype the stock on (slightly more) public social media. If they hype it correctly, everyone sells at a profit after a fixed hold period.

These groups might have a secret (or semi-secret) inner circle who get to see the decision before the main group. These people are able to profit from the main group even if the pump phase fails.

It's possible the SEC has infiltrated one (or more) of these groups. Or they are are simply looking for trading patterns in dead penny stocks.

There are plenty people who invest in pump&dump schemes fully knowing that it's a pump and dump. Because it's still possible to profit if you can predict the length of the pump and sell before the main dump.

There are a few strategies that might be in play: sentiment analysis and technical analysis. Sentiment analysis does what you describe. Technical analysis is similar, but only looks at price movement and attempts to either follow or buck the trend. In these examples, a social media post could push the stock from $0.0001 to $0.0002. Maybe a sentiment algorithm sees the positive post and a technical analysis algorithm sees the positive price actions and confirms the upward momentum, triggering a purchase that moves the price to $0.0003. That 300% gain gets noticed by others and so on.

Algorithms are really just a digital manifestation of group psychology. The same thing happens in a run on a bank, or a Tulip bubble. Word spreads and others follow.

The Spiffing Britt on YouTube apparently has a bot that watches for anything musk tweets, buys some of it, then sells it again an hour or so

With the timing and everything, it looks a lot like SEC got a wake-up call, looked at it, and saw a bunch of clearly illegal things it should be acting on. So they are acting on them.

If that's the case, good.

Honestly kinda surprised the stock markets don't delist this stocks if they've been at ~$0.00 for 6 years.

They have been delisted. But just because they've been delisted they don't cease to exist, so you can buy them OTC ("over the counter").

They were on wsb.

https://redditsearch.io/?term=Ehos%20&dataviz=false&aggs=fal...

One person ignored

What exchange is that even on then? It was worthless as in zero cents or zero-rounded cents

Does not include GME. Obviously they didn't want to let that make the headline go to waste..

or naked, amc, sunw, blackberry, none of them.

Not only but if you search reddit for these stock tickers you'll see very little other than the suspension notice. Take HLXW for instance - 1 mention in the past year. (https://old.reddit.com/search?q=HLXW&restrict_sr=&sort=relev...)

The exceptions to this are PTTN & BLSP, which both have some low vote count posts - but there's always some brigade trying to pump something on reddit, why not the 100 or so other tickers as well?

PTTN and BLSP for instance, is listed amongst 'IGEN HPST GRNF IPNFF VMNT RNWF SHMN ZNOG COUV VISM CBBT BRTX ISWH TSNP ENZC PUGE ATVK BRLL NECA OPTI GMEV TTCM PMPG TSPG OZSC FORW BLSP GTLL PTTN VPER AGGI CTLE BLDV NWTT PVDG UATG MICT RSSV PPBT AKBA DSGT GRCV NAKD ACB ALPP BLSP GM TRUP' in 2 posts, what about the others? - feel free to cross-compare the list btw, I did. Those are the only 2 crossovers. A direct link to the hype post: https://old.reddit.com/user/pennystockguyz/comments/lf8zhg/h...

The claim of 'the latest in a string of temporary trading halts amid volatile trading in so-called “meme stocks.”' needs more information. Does the SEC have some criteria that doesn't include reddit (for instance, some scammer paying for facebook ads to unsavvy investors claiming "HLXW is the next gamestop")?

The SEC in https://www.sec.gov/litigation/suspensions/2021/34-91213.pdf uses the words "certain social media accounts may be engaged in a coordinated attempt to artificially influence their share prices." alright, let's take it on good faith. It's not happening on reddit. Somewhere else maybe?

The only thing I can find is on twitter. The political class likes to pretend people care about twitter wayy more than they actually do. If you look for say, HLXW and let's just pick PTTN https://twitter.com/search?q=HLXW%20PTTN&src=typed_query&f=l... and scroll scroll scroll you'll see a few mentions, is that it? Things like this? https://twitter.com/AlexDelarge6553/status/13605979641719808... ... there's our IPWG, MRIB, BBDA and EVTI, we have 6 matches in that post. If this was a source, what about the others 16 in that list? Even if it's some incompetent DC person impressed by 24 retweets, it's still only a 27% crossover.

Is it this And weird trading patterns? Do they have some undisclosed tripwire model with conditions (say, some X trading pattern followed by some Y "influence metric" followed by some Z pattern?). And if this exists, shouldn't there be some disclosure so that innocent investors know what to avoid and when to divest? I always check reddit before I invest to make sure there's not some hypetrain bubble behind the security.

Also there's real people behind all these companies who, I assume, are just trying to do an honest job of overseeing waste management facilities or whatever these companies do. I'm sure they don't appreciate scammers playing around with their stock and getting it suspended and thus probably scaring off their actual investors.

Whatever it is, this isn't the full story.

Fun fact: WSB bans discussion of penny/microcap stocks, which is why none of these tickers show up in that subreddit.

GME had a market cap below $1B between April and November 2020[0], and somehow DFV could still make his posts.

The rules didn't say that the limit was $1B in September,[2] that was only added later.[1]

[0]: https://www.macrotrends.net/stocks/charts/GME/gamestop/marke...

[1]: https://www.reddit.com/r/wallstreetbets/about/rules

[2]: https://web.archive.org/web/20200912192940/https://www.reddi...

This is a case of needing more explicit rules to enforce the intent of the ambiguous existing ones.

>any other worthless securities that are susceptible to scams or pump & dump schemes.

As for GME, Penny stock designation technically requires that the stock not trade on a major exchange. GME was never de-listed.

Penny stock designation has nothing to do with exchange listings, that’s OTC. Penny stock designation starts when the stock price is $5 or below.

GME however was a fallen titan.

Also, being a sub member since 2014 - pennystocks were always frowned upon.

I know for crypto back in 2015-2017 there were semi-private groups that would orchestrate P&D schemes for alt coins. I think "social media" is probably misused here as much if not more than "meme stock" - the internet just makes collusion that much easier.

No different nowadays. /biz/ runs endless P&D schemes.

They are still going strong. More of them even thanks to the wave of dumb money that flooded in recently.

Orchestrating in secrets, OK; but pumping in secret??

Not secret necessarily, just spamming only niche groups on telegram and discord, not publicly spamming. I believe they think this makes it less likely they get caught whilst still covering a lot of ground. For an analysis of these private telegram groups doing pumping, see the following paper. It has an index at the end listing all the private channels they used in their analysis

[0] https://www.doc.ic.ac.uk/~livshits/papers/tr/pump_and_dump_t...

Wow, really interesting, thanks for posting that.

In my Twitter feed a couple months ago, I saw a tweet (a promoted tweet? If they even have that and I’m remembering correctly) advertising a crypto “pumping group” on Discord. Yes, they actually referred to themselves as a “pumping group.”

Not so secret in terms of getting new members!

Did you check Tik Tok? Discord?

No. I spent enough time wearing the journalism hat today. I really have to get back to my actual job.

Tell me if you find anything

I was never going to bother because I don't have any conspiracy theories about this

If the SEC says there's strange social media activity, I'll take it at face value. They're the SEC and these are dead companies, not really unexpected they'd be halted at some point

I'm just pointing out that there are less discoverable places that are pumping stocks right now

Absolutely. I'm sure they aren't hiding anything. The results aren't what I expected so it's a learning opportunity for me

>Does not include GME. Obviously they didn't want to let that make the headline go to waste..

What in that headline implies anything about Gamestop?

"social media" obviously. With the heavy news coverage on WSB and GME the mind goes to that when reading the headline.

Nothing but the "suspicious social media activity" not being clearly defined would lead one to think that GME would be included in the list, GME being the focus of wsb for some time now.

The article had GameStop in it, although SEC was doing the good thing, and stopping trades where the companies were violating securities rules.

Why would it? You can't suspend stocks because outsiders have suspicious social media behavior lol. We are not in the medieval ages, even though it sometimes seems that way.

You can suspend them if insiders have suspicious social media behavior.

I do not think it should include GME. I was pointing out the misleading headline.

> You can't suspend stocks because outsiders have suspicious social media behavior lol

That is exactly what is happening right now, you realize? They are suspending them because of possible P&D schemes run by outsiders to those companies.

50 years too late...this has been going on forever...they never investigate penny stocks or their broker ilk...pump and dump

"Wolf of Wall Street" with Leonardo DiCaprio vividly shows wild west of pump and dump schemes in late 80s - early 90s. The movie is based on a true story of Jordan Belfort who finally went to jail. But today's SEC lost most of last teeth they have had in the 90s. I doubt anyone will go to prison for the modern day pump-and-dump and Ponzi schemes (Bernie Madoff was the last one).

The SEC didn't really lose its teeth, everyone else used all the prior court filings and outcomes as instruction manuals on how to accomplish the same things compliantly

Most of that time that just means a slightly longer disclaimer, or the timing of a transaction, or not talking about your awareness of a specific regulatory nuance

these are penny stocks, not surprised. actually most of them are sub-penny stocks. surprised they are still listed for public trading.

very easy to do a "pump and dump" scheme especially in the digital or social media age

They're on OTC (over the counter) markets, see https://en.m.wikipedia.org/wiki/OTC_Markets_Group

This isn't NYSE or NASDAQ. Not all retail brokerages support OTC markets although it's become much more common in the past year or two. Even then it's usually partial support. Here's the instrument list https://www.otcmarkets.com/corporate-services/company-direct...

They've been generally discouraged (and thus not supported) for retail investors due to their complexity and risks, similar to derivatives and futures, which are still quite exotic to find in retail brokerages

You can also get foreign stocks over the counter (select by country from the link above). There's an ADR 30 similar to the DJIA index. You've likely heard of many of them https://en.m.wikipedia.org/wiki/OTCM_QX_ADR_30_Index . You can say, invest in Lenovo or Fujitsu via OTC. It's not everything, but it's the ones people are generally interested in.

It's exotic because if Lenovo doesn't move but say the Yuan does, then your dollar value does too. Also there's different fee schedules often for foreign investors (that's you here), etc. The complexity tries to be smoothed out by the brokerages (firstrade has offered otc since 2010, recommended if you want to give OTC a try* ) but it's not as simple as buying a bit of General Motors

And lastly, some, like Taiwan Liposome Company (TLC), get traded on NASDAQ using ADR schemes (https://www.investopedia.com/terms/a/adr.asp)

* - shameless signup referral for a free stock: https://share.firstrade.com/CHRISTOPHVR08 ... If you were going to try it anyways, might as well

whew my jaw dropped at that headline but its ok