pineknollshoresking said:

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FlossyDFlynt said:

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Good Twitter thread explaining whats going on

TLDR version - hedge funds shorted the stock (borrowed shares banking that the stock will tank, they can sell at a cheaper price and pocket the difference) and the Reddit crowd bought all the shares and refused to sell, jacking up the price. Well, the options expired and the hedge funds owe the difference, thus creating a huge loss for the hedge funds. And now some hedges are doubling down with the prices skyrocketing on the stock.

Its basically one gigantic game of chicken. Someone is going to get stuck with the bill at some point

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Agree, at some point the Reddit guys are holding stock that is over valued. What I like is that they "kind of stuck it to the man" and caused harm.

The CNBC's of the world are all raising hell over this. One guy said: these people (Reddit people) are using this like a casino. I'm sorry, but that's all a Hedge Fund group does is use the market as a casino.

None of us have the access to the markets the same way investment houses have. This, in my opinion, was a populist movement and the Elite's don't like it! I say GOOD!

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A lot of people who helped to drive up the price will end up losing money. As the selloff begins, the pipe will not be big enough to get many of them out fast enough. Also, even though the main target was the hedge fund, there were some smaller investors who will likely lose their homes and much of their entire portfolio, if they were also shorting the stock.

Shorting stock can be high risk and the chances of losing everything is real. If you are not prepared to lose large sums of money, you should not short stock.

This dude gets it...kinda like the tweet below

cowboypack02 said:

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This dude gets it...kinda like the tweet below

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For every ~ $11 rise in the stock, the margin call was ~$2.5B for Melvin Capital. This is why other hedge funds had to step in and help them out. They saw most of their net worth wiped out and could not pay the margin calls as the stock continued to rise in price. I do not feel sorry at all for Melvin Capital, but I do for some of the smaller consumer investors who may have been following Melvin's lead and were also shorting the stock.

I think the hedge funds will figure out a way to deal with what happened today, before they take large short positions again. Today was a big warning shot across the bow of the hedge funds and they are going to react.

You should also realize that while Melvin was in a bad position and lost a lot of money, there are other hedge funds that saw what was happening, bought into the stock to ride the price up and they will be in a position to dump it quickly and make a ton of money. So, while the Reddit guys stuck it to Melvin as a way to get back at the big bad hedge fund, there were other hedge funds that capitalized and made a very healthy return on their money today. If you are someone who bought Gamestop on its way up, you need to think about getting out now and taking your profits. Also, realize that there are other funds that are shorting the stock as we speak, knowing the price is definitely going to fall as investors take profits.

griff17matt said:

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FlossyDFlynt said:

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Reddit nuked r/WallStreetBets and Discord deleted the WSB server. As we saw leading up to the election, big tech censorship is a big, big problem.

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They didn't nuke the subreddit. They closed it to get moderation in place to monitor the 1mm new subs they've had in the past 3 days. I think I saw where the subreddit is back up now.

ETA: Discord definitely deleted their server though for some bull**** TOS violation. Discord doesn't want that reddit smoke though. That place will put discord out of business.

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You are correct. It was down when I looked, so I assumed Reddit had done it.

I think the point may be missed in what happened to the GameStop stock...

What we saw is a group of people manipulate a stock just like an investment house is able to do. They worked together and showed the system (one of the country's Oligarchs) they are tired of being on the outside.

This move, in my opinion, is no different than a group of people unifying against the system (Tea Party, MAGA movement, etc...). What we are now seeing are the Elite Oligarchs trying to shut them down. Sound familiar?

Somehow, these guys are not worried about their investment (Elon Musk backed?); rather, I think this was done to show up the system...

BTW, I could be wrong on my opinion...

Saw yesterday that someone bought $187mm worth of shares in GameStop while all those retail investment trading apps were down. So, either someone (Elon?) is legit throwing money away to take down a hedge fund, or these hedge funds killed those apps so they could buy up as much stock as they could to help cover some of their losses.

Apparently Elon hates Hedge Funds bc of all the times they shorted and tried to kill off Tesla. Wouldn't surprise me at all if a guy with a few billion to burn decided to roast some hedge funds for fun. Didn't think I could be more of a fan of his alien ass as I was but here we are.

Good explained thread too:

Also appears you can only sell GameStop, AMC, and a few other stocks rumored to be targeted by the subreddit. How shady is that. I hope all these damn apps in bed with the hedge funds are put out of business too. God this stuff is so disgusting.

griff17matt said:

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Saw yesterday that someone bought $187mm worth of shares in GameStop while all those retail investment trading apps were down. So, either someone (Elon?) is legit throwing money away to take down a hedge fund, or these hedge funds killed those apps so they could buy up as much stock as they could to help cover some of their losses.

Apparently Elon hates Hedge Funds bc of all the times they shorted and tried to kill off Tesla. Wouldn't surprise me at all if a guy with a few billion to burn decided to roast some hedge funds for fun. Didn't think I could be more of a fan of his alien ass as I was but here we are.

Good explained thread too:

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Welcome to the "Populist Movement"!!! You folks may not get this; however, this is what Trump is all about. As he said, in his 2017 inauguration (I paraphrase):

"for too long congress has been getting rich while you (his constituents) have been taking it on the cheek"

Now, every Government agency, hedge fund manager, Big Tech, is getting involved or complaining to protect the system! I am a conservative/Libertarian; however, the systems are protected for a few and not for you!

That is eff'ed up!!!

FlossyDFlynt said:

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The plebs are doing what Wall Street does every day. Wall Street is pissed because they are being beaten at their own game

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Agree! This does have bigger consequences than this one stock!

griff17matt said:

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Saw yesterday that someone bought $187mm worth of shares in GameStop while all those retail investment trading apps were down. So, either someone (Elon?) is legit throwing money away to take down a hedge fund, or these hedge funds killed those apps so they could buy up as much stock as they could to help cover some of their losses.

Apparently Elon hates Hedge Funds bc of all the times they shorted and tried to kill off Tesla. Wouldn't surprise me at all if a guy with a few billion to burn decided to roast some hedge funds for fun. Didn't think I could be more of a fan of his alien ass as I was but here we are.

Good explained thread too:

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If Elon found a way to profit off of the Gamestop episode, the SEC will definitely come looking. For example, if he bought stock at $50/share and then urged the raid on the stock publicly, only to sell the stock at $200/share, the SEC will take action. Elon is not just an average guy on the street and he can actually move markets, due to his public standing.

If youre curious as to why RobinHood is restricting trades...well...

FlossyDFlynt said:

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If youre curious as to why RobinHood is restricting trades...well...

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Our economy is so incestuous it's surprising we don't all see the birth defects. Absolutely disgusting.

griff17matt said:

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Our economy is so incestuous it's surprising we don't all see the birth defects. Absolutely disgusting.

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That statement is exactly what made Trump so popular! Was he perfect? Not at all! Biden, on the other hand, is aligning with China via his EO's. If you don't see the same incestuous issue, then I'm at a loss...

I had some cash in my brokerage account (Schwab) and was trying to take a flyer on AMC just for the ride, and I keep getting glitches every time I try to confirm the order. Weirdest thing, that usually doesnt happen....

griff17matt said:

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pineknollshoresking said:

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griff17matt said:

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Our economy is so incestuous it's surprising we don't all see the birth defects. Absolutely disgusting.

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That statement is exactly what made Trump so popular! Was he perfect? Not at all! Biden, on the other hand, is aligning with China via his EO's. If you don't see the same incestuous issue, then I'm at a loss...

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Please shut the **** up with the constant Trump crap. It's so damn old.

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Griff, you are so adult... You are flagged for that post! This is exactly why I quit looking at this forum. Should have stayed out!

I'll bet you want say "Please shut the **** up" to my face...

Can someone explain the Gamestop / AMC / stock stuff because I have no idea what's going on, but have seen that apps are limiting ability to trade those which seems like serious market manipulation?

Robinhood is supposed to be for the "small investor." They are owned by a big hedge fund group. i.e. Wall Street. Reddit guys got together and formed a group that inflated undervalued stocks. i.e. Gamestop.

Drove the price up and will dump it.

The owners, Wall Street hedgers wanted to drive the price down and sell it off to make big money. They got out duped by nerds.

That's it in a nutshell. There are four or five more potential Gamestops that Robinhood and another supposed "small investor" site that have blocked the purchases of the stocks.

Problem is all these brokerage firms that charge percentages to buy/sell/trade for you are getting hosed by this and people are finally seeing what a scam this is.

I myself was able to pick up 50 shares of NOK this morning. It's tanking now because of the sites blocking purchases.

It's all a bunch of BS and God forbid President Trump been re-elected. Hell, they may impeach him for this as well!!!!

statefan91 said:

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Can someone explain the Gamestop / AMC / stock stuff because I have no idea what's going on, but have seen that apps are limiting ability to trade those which seems like serious market manipulation?

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I saw something similar to the following, so here it goes:

1. Ape has 5 bananas and they cost $25 each and these are being held by Mr. Top Hat.
2. Chimp borrows the bananas from Ape (through Mr. Top Hat), since he is not using them and sells them for $25 each. Chimp believes the price of bananas will fall before Ape needs them back. When the price falls, Chimp will buy 5 bananas for $15 and give Ape back 5 bananas, making him whole. Chimp will make $50 off this transaction.
3. Wolf sees what Chimp is up to (short selling bananas) and begins to buy up the supply of bananas. Wolf tells his friends and they also begin to buy as many bananas as they can. Pretty soon, the price of bananas begins to go up, instead of going down.
4. Mr. Top Hat (these are the banks) begin to get worried that Chimp will not be able to buy the bananas and return them to Ape, so he requires Chimp to give him money to buy bananas at the higher price (this is the margin call). The amount Chimp needs to provide is based on a previously agreed to amount when Chimp borrowed Ape's bananas from Mr. Top Hat.
5. As Wolf and his friends continue to buy up the banana supply and drive the price even higher, Mr. Top Hat demands more money from Chimp. Eventually, Chimp begins to run out of money and he has to turn to his friends (other hedge funds) to help him pay Mr. Top Hat. This cycle will continue until Wolf and his friends stop buying up the banana supply.
6. The apps are now limiting Wolf and his friends ability to buy bananas, thus stabilizing the price of bananas.
The price of bananas will eventually start to fall as Wolf and his friends begin to take profits - opening up the opportunity for Chimp and others to short sell bananas.

I hope this helps. I also think Robinhood's days are limited. They are not a serious company and a place I or others would ever try to execute trades in the future, if they are actively working to manipulate the market. I suspect the SEC will be contacting them shortly.

Thanks - that does help. But is it legal to limit someone buying bananas (gamestop), while others are still able to access the bananas?

I actually saw on Twitter they've already been hit with a Class Action lawsuit, but not sure if it'll go anywhere.

statefan91 said:

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Thanks - that does help. But is it legal to limit someone buying bananas (gamestop), while others are still able to access the bananas?

I actually saw on Twitter they've already been hit with a Class Action lawsuit, but not sure if it'll go anywhere.

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No, it likely violates not only their terms of service with the people who signed up with them, it also has serious implications that will involve the SEC. The SEC does have the power to halt trading and at some point, I do expect them to get involved when they believe what is happening is making markets less efficient (something limiting trading can do) and if it disadvantages traders.

Thanks - good information and appreciate the layman's term analogy you provided.

statefan91 said:

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Thanks - that does help. But is it legal to limit someone buying bananas (gamestop), while others are still able to access the bananas?

I actually saw on Twitter they've already been hit with a Class Action lawsuit, but not sure if it'll go anywhere.

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No...they basically just signed their own death certificate. Not to mention that Dave Portnoy, Barstool President, has been crucifying them along with Donald Trump Jr and hang onto your hats...AOC.... they are on the SAME PAGE with this.

If those two agree on anything you basically are ****ed if you are on the receiving end.

griff17matt said:

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pineknollshoresking said:

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griff17matt said:

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pineknollshoresking said:

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griff17matt said:

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Our economy is so incestuous it's surprising we don't all see the birth defects. Absolutely disgusting.

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That statement is exactly what made Trump so popular! Was he perfect? Not at all! Biden, on the other hand, is aligning with China via his EO's. If you don't see the same incestuous issue, then I'm at a loss...

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Please shut the **** up with the constant Trump crap. It's so damn old.

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Griff, you are so adult... You are flagged for that post! This is exactly why I quit looking at this forum. Should have stayed out!

I'll bet you want say "Please shut the **** up" to my face...

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Lmmfao thanks. I'm scared of you flagging my post. I'll try to find a **** to give about it. And yes, I would absolutely tell you to shut the **** up to your face.

I'd maybe just block me if I were you, which is exactly what I plan to do with you. Good day, populist libertarian guy. Whatever the hell that is....

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And yes, I would absolutely tell you to shut the **** up to your face.


That's a threat!

Considering the position Robin Hood took in this, it's a bit perplexing they chose that company name.

I know E-trade halted trades on Gamespot and AMC yesterday as well. Maybe Robinhood is less worried since they didn't act first in halting trades? Maybe they consulted with the SEC first?

BBW12OG said:

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statefan91 said:

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Thanks - that does help. But is it legal to limit someone buying bananas (gamestop), while others are still able to access the bananas?

I actually saw on Twitter they've already been hit with a Class Action lawsuit, but not sure if it'll go anywhere.

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No...they basically just signed their own death certificate. Not to mention that Dave Portnoy, Barstool President, has been crucifying them along with Donald Trump Jr and hang onto your hats...AOC.... they are on the SAME PAGE with this.

If those two agree on anything you basically are ****ed if you are on the receiving end.

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Yes, it is legal to limit someone from buying bananas. Just like the banana seller of a shop can decide that it no longer wants to sell bananas. Robinhood, banana seller in this case, is a broker. Just like Schwab or whoever else is still offering GME is a broker and is choosing to continue to offer GME.

Brokers provide a service that arranges transactions between buyers and sellers. They can choose what services to provide. RH doesn't provide it's users with tons of available services for similar reasons. They make it more difficult to do options trading and don't offer other derivatives like forward and swaps. They also don't offer penny stocks or mutual funds or foreign exchange stocks but could one day decide to.

Now, are the optics good? Certainly not as it's clear who RH is choosing lay with. Will more class actions suits come? Probably. Will RH have to settle or pay up? I doubt it. Will more regulation come into the market to prevent these sorts of bubbles in the future? It should, but probably won't.

I read that one of Robinhoods biggest customers is a hedge fund that has significant Short options on GameStop. Could it be proven that they were colluding to help their customer avoid massive losses by manipulating the market?

Yep, they could potentially. Need evidence though. As RH can just sit behind the defense that they are trying to protect their consumer base from volatile stock, which on its own, is a valid reason.

They caught all kinds of flack when they opened up options trading and a high school kid that thought he messed up options trading and owed a boat load of cash ended up killing himself. In reality, he didn't lose, he just didn't understand how options trading operates and how balances post to your account. So RH decided to change its offerings and accessibility to options trading in order to protect its consumer base.

Obviously not the same thing but you can see how easily they can defend their position of acting in order to protect its consumer base.

griff17matt said:

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lmao wasn't there some loser on packpride that was always DMing people to try to fight them or some ***** What is it with you dip****s taking everything on a message board so damn personal.

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I don't need to fight anybody, especially somebody as weak as you mentally! Not trying to fight you; rather giving you an opportunity to not be a dumb **** punk!

As I thought, you just run your ****ing trap and act like you're some kind of smart person. You're probably still living with your parents!

What's with you being so damn stupid? You are a disgrace to our society and would be better off in Cuba! Get out!!!

See, if can act like an idiot also. It's beneath me; however, we can all have a smart ass mouth!

pineknollshoresking said:

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griff17matt said:

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lmao wasn't there some loser on packpride that was always DMing people to try to fight them or some ***** What is it with you dip****s taking everything on a message board so damn personal.

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I don't need to fight anybody, especially somebody as weak as you mentally! Not trying to fight you; rather giving you an opportunity to not be a dumb **** punk!

As I thought, you just run your ****ing trap and act like you're some kind of smart person. You're probably still living with your parents!

What's with you being so damn stupid? You are a disgrace to our society and would be better off in Cuba! Get out!!!

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Whew, the olds are getting cranky. I am responsible for 7 kids and step kids. I have a job and a house and some common sense which you seem to lack, my friend. Please don't act like you know a single *********thing about me or my life.

You're going back on ignore now. Just wanted to show everyone how absolutely unhinged you are. Have a wonderful day.