WSB Dedicated Thread

#101
#101
MurphyVol said:
It's a good thing it isn't because most of them will lose their shirts.

And shorting a stock is perfectly legal and not manipulation.

Hopefully you held on to that 401k and reaped the bounty of the previous decade.

As far as bailouts go, there really weren't any. The government took ownership in many companies and made loans to others. I haven't seen recent data, but back in 2017 the taxpayers had made a profit of $30 billion on the TARP program. The "bailouts" was a rare instance where the government did something they made sense.
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First, the bailouts were a disaster for anybody that believes in free markets. The bailouts literally sent the worst message you could possibly send to those vultures. Instead of holding anyone accountable, we essentially reinforced their idea that they were above the law. The message should have been If an entity is too big to fail, it’s too big to exist.

Second, TARP wasn’t the only bailout Wall Street received. They’ve been getting trillions of dollars every year over the last decade in the form of ”stimulus” programs like quantitative easing.
 
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#102
#102
red butler said:
First, the bailouts were a disaster for anybody that believes in free markets. The bailouts literally sent the worst message you could possibly send to those vultures. Instead of holding anyone accountable, we essentially reinforced their idea that they were above the law. The message should have been If an entity is too big to fail, it’s too big to exist.

Second, TARP wasn’t the only bailout Wall Street received. They’ve been getting trillions of dollars every year over the last decade in the form of ”stimulus” programs like quantitative easing.
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Quantitative easing and bailouts have nothing to do with each other. If the treasury creates new money where would it go besides banks? I guess we could print it and risk deforestation on a global scale.

The government is trying to inflate their way out of debt by debasing the currency and has nothing to do with "wall street hand-outs"

The "vultures" paid the government back a handsome profit. It's not their fault that the government squandered it on studies about llama farming.
 
#104
#104
Thunder Good-Oil said:
Who will run such a computer program? Government regulators? Putting the criminals in jail if they’re caught would be a substantial deterrent. The risk/reward with cheating, stealing from the retail investor versus being punished for it is not balanced. It’s up to the legislators to hold Wall Street accountable. When congress people are voted out, they often go to work for Wall Street firms.

The infrastructure is in place to identify the crooks. But they are not being punished when they are exposed.
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Good question.
 
#106
#106
MurphyVol said:
Quantitative easing and bailouts have nothing to do with each other. If the treasury creates new money where would it go besides banks? I guess we could print it and risk deforestation on a global scale.

The government is trying to inflate their way out of debt by debasing the currency and has nothing to do with "wall street hand-outs"

The "vultures" paid the government back a handsome profit. It's not their fault that the government squandered it on studies about llama farming.
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I agree with much of your post, just a few caveats. If the government is going to go into massive debt to stimulated the economy, it might as well provide regular people stimulus checks instead of making rich Wall Street people richer.

Also, it’s not a big deal that banks paid the gov a little bit of money. They have the advantage of literally creating money out of thin air and investing it. If they make a mistake they get bailed out. It takes a black swan event for them to not make obscene profits.
 
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#107
#107
ajvol01 said:
Thanks.

Why would a hedge fund expose themself to potentially unlimited risk the way Melvin Capital did with GME?

Seems like professional malpractice if such a thing exists in that line of business.
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"Unlimited risk" hits the nail on the head, many people don't get that shorting is so much more risky than buying.

My only guess as to why is conviction. GME "feels" like Kmart a decade ago or Blockbuster or camera film 20 years ago. It's just something that looks like it's not only no longer necessary but it's inferior to it's replacement.

He's a different perspective. Pension funds are in trouble. People are living too long and interest rates are zero. Back in the day, you could invest half your pension fund in bonds and have a good, safe return. Now bonds pay nothing. And your retirees are living to 90. It's a timebomb.

So you invest a chunk of your pension with a hedge fund. The hedge fund is under pressure to keep the pension afloat and sees Kmart and Amazon and goes short Kmart. It's a no brainer. Then imagine (had it existed) a chat board army gets together and leads a crusade to stop the wall street fat cats from shorting this (horrible, poorly mismanaged) store. They succeed and the hedge fund has to cover the short and loses their shirt. Hooray, victory! We took down the big hedge fund.....and also the firefighters pension.....

Yes there are greedy, well paid people on Wall St, no doubt about it. But they're are a lot of pieces to every story.
 
#108
#108
MurphyVol said:
"Unlimited risk" hits the nail on the head, many people don't get that shorting is so much more risky than buying.

My only guess as to why is conviction. GME "feels" like Kmart a decade ago or Blockbuster or camera film 20 years ago. It's just something that looks like it's not only no longer necessary but it's inferior to it's replacement.

He's a different perspective. Pension funds are in trouble. People are living too long and interest rates are zero. Back in the day, you could invest half your pension fund in bonds and have a good, safe return. Now bonds pay nothing. And your retirees are living to 90. It's a timebomb.

So you invest a chunk of your pension with a hedge fund. The hedge fund is under pressure to keep the pension afloat and sees Kmart and Amazon and goes short Kmart. It's a no brainer. Then imagine (had it existed) a chat board army gets together and leads a crusade to stop the wall street fat cats from shorting this (horrible, poorly mismanaged) store. They succeed and the hedge fund has to cover the short and loses their shirt. Hooray, victory! We took down the big hedge fund.....and also the firefighters pension.....

Yes there are greedy, well paid people on Wall St, no doubt about it. But they're are a lot of pieces to every story.
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Take 10 minutes and watch the Jim Cramer video clip if you haven’t already - that attitude is what I believe most involved with GME are angry about

He basically said he knew a lot of it was illegal but nobody cares so why not

2006 advising people to short Apple? And this guy is on TV giving investment advice for the past 15 years. Sickening IMO
 
#109
#109
ajvol01 said:
Take 10 minutes and watch the Jim Cramer video clip if you haven’t already - that attitude is what I believe most involved with GME are angry about

He basically said he knew a lot of it was illegal but nobody cares so why not

2006 advising people to short Apple? And this guy is on TV giving investment advice for the past 15 years. Sickening IMO
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Listening to Cramer makes people instantly dumber. People need to realize CNBC is an entertainment network.
 
#110
#110
sk013121dAPC20210129104506.jpg
 
#112
#112
Thunder Good-Oil said:
SLV
ISHARES SILVER TRUST ETF

$24.99
Friday 1/29/2021 close

$27.40 9:15am pre-open Monday 2/1/2021
27.5 million of 600 million shares traded

70 million shares
$27.8

75 million
Almost $28

80 million
Hasn’t broken through $28 yet

90 million
$27.6

100 million
$27.4

185 million
$26.80

261 million
$27

275 million at 4pm
$26.76 (+7.08%)

$27.98 Intraday high; highest level since 2013
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So explain that. Shares go up. Price goes down/sideways.
 
#113
#113
MurphyVol said:
Quantitative easing and bailouts have nothing to do with each other. If the treasury creates new money where would it go besides banks? I guess we could print it and risk deforestation on a global scale.
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The money goes to the banks first before it trickles down to Main Street. They are the first ones in line to get the money and the first ones able to bid up equities.

MurphyVol said:
The government is trying to inflate their way out of debt by debasing the currency and has nothing to do with "wall street hand-outs"
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So you're perfectly fine with our government eroding away our purchasing power?
 
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#114
#114
MurphyVol said:
"Unlimited risk" hits the nail on the head, many people don't get that shorting is so much more risky than buying.

My only guess as to why is conviction. GME "feels" like Kmart a decade ago or Blockbuster or camera film 20 years ago. It's just something that looks like it's not only no longer necessary but it's inferior to it's replacement.

He's a different perspective. Pension funds are in trouble. People are living too long and interest rates are zero. Back in the day, you could invest half your pension fund in bonds and have a good, safe return. Now bonds pay nothing. And your retirees are living to 90. It's a timebomb.

So you invest a chunk of your pension with a hedge fund. The hedge fund is under pressure to keep the pension afloat and sees Kmart and Amazon and goes short Kmart. It's a no brainer. Then imagine (had it existed) a chat board army gets together and leads a crusade to stop the wall street fat cats from shorting this (horrible, poorly mismanaged) store. They succeed and the hedge fund has to cover the short and loses their shirt. Hooray, victory! We took down the big hedge fund.....and also the firefighters pension.....

Yes there are greedy, well paid people on Wall St, no doubt about it. But they're are a lot of pieces to every story.
Click to expand...


I have zero problems with anyone trying to make money. I also don't have a problem with one competitor trying to beat another competitor for market share.

What I do have a problem with is someone trying to put another business completely out of business simply to make a buck.

When you short something 140 percent you arent saying hey this stock is about to go down....you are literally trying to kill it.

Maybe I am wrong but it appears they were literally trying to crash Gamestop. That is what sickens me with hedgefunds.


Artificially increasing or decreasing a stock price simply to make a buck with no regard for the company or other investors.
 
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#115
#115
NEO said:
I have zero problems with anyone trying to make money. I also don't have a problem with one competitor trying to beat another competitor for market share.

What I do have a problem with is someone trying to put another business completely out of business simply to make a buck.

When you short something 140 percent you arent saying hey this stock is about to go down....you are literally trying to kill it.

Maybe I am wrong but it appears they were literally trying to crash Gamestop. That is what sickens me with hedgefunds.


Artificially increasing or decreasing a stock price simply to make a buck with no regard for the company or other investors.
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Yes, it’s the naked shorting that is illegal and troublesome. If a stock is simply overvalued then the shorts should actually be contributing to an orderly market. When they are able to borrow and sell more shares than are in the market they are manipulating and destroying a company’s ability to raise capital fairly. The PR campaigns to destroy them are troublesome as well. Explaining the reasoning behind believing a short position is taken is one thing. Employing the media along with a well capitalized effort to bring down a company should be criminal. In many cases it could be a civil matter, but a beaten down entity is at a huge disadvantage to push back in the legal system.
 
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#116
#116
Rasputin_Vol said:
So explain that. Shares go up. Price goes down/sideways.
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That was the shares traded over the entire day. The technical minded guys, the high frequency traders, or the market maker/fund managers in The Pub’s stock thread can provide better insight than I am able. In this case the security soared in the light, after hours and pre-open trading sessions. Then the profit taking after that early surge depressed the stock price throughout the day. If there are more orders initiated and accepted from the sell side traders than the buy side then the price will fall, even if the volume of shares traded is higher than usual. The early price surge was met with selling pressure all the way until the 4pm regular session close by profit taking (sellers were initiating the orders). As far as the laws of supply/demand, with stock equities it should be perfectly balanced. Every share traded has a buyer and a seller. Except when the hedge funds and brokers break the rules and allow naked short transactions to occur and shares are sold that were never borrowed or existed. The artificial, illegal imbalance of missing share supply backfired on the GameStop shorts. The Reddit bros saw it and destroyed the hedge funds with their buy side orders. Wall Street money came to the rescue of the side that was caught cheating.

The supply of shares does not run out in a fair system. Other factors affect the market price, primarily a company’s ability to generate revenue and earnings (silver is a commodity though and the supply-demand of the actual metal should determine the prices of the various, related securities).
 
#117
#117
Rasputin_Vol said:
The money goes to the banks first before it trickles down to Main Street. They are the first ones in line to get the money and the first ones able to bid up equities.

So you're perfectly fine with our government eroding away our purchasing power?
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Not at all. It was an explanation. Banks don't control government spending and QE.
 
#120
#120
#122
#122
MurphyVol said:
Not at all. It was an explanation. Banks don't control government spending and QE.
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Banks (specifically one private bank owned by its member banks) facilitates government overspending by manipulating interest rates and buying treasuries when there are no buyers. The same private bank (owned by its member banks) developed QE to save its member banks from the toxic assets on their balance sheets. The only government involvement I remember with QE was the congressional hearings that were held to determine the legality. Bernanke reminded congress they were his b!t*h and they didn't do squat about it.
 
#123
#123
So AMC raised $300 million dollars by issuing stock during this to add to their war chest. Game Stop raised zero. WTF was their leadership team thinking?
 
#124
#124
red butler said:
Banks (specifically one private bank owned by its member banks) facilitates government overspending by manipulating interest rates and buying treasuries when there are no buyers. The same private bank (owned by its member banks) developed QE to save its member banks from the toxic assets on their balance sheets. The only government involvement I remember with QE was the congressional hearings that were held to determine the legality. Bernanke reminded congress they were his b!t*h and they didn't do squat about it.
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Dr. Ben S. Bernanke - Citadel
 
#125
#125
red butler said:
Banks (specifically one private bank owned by its member banks) facilitates government overspending by manipulating interest rates and buying treasuries when there are no buyers. The same private bank (owned by its member banks) developed QE to save its member banks from the toxic assets on their balance sheets. The only government involvement I remember with QE was the congressional hearings that were held to determine the legality. Bernanke reminded congress they were his b!t*h and they didn't do squat about it.
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And the President appoints that Fed chair and has great influence over their actions. Trump had Powell cutting rates before the pandemic even hit
 
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