Reddit and GameStop

[Musclepug]

 

[Mr2Bits]

 

[backstop13]

came here to post the same comment from Reddit. It lines up with the ceo of Webull (brokerage firm) confirming they were trying to avoid Lehman all over again

 

[wrpgator]

Jesse Livermore would be having a field day like a pig in slop.

A great read!

Read it years ago, truly was a great read. When Livermore committed suicide he was upside down financially. His son and grandson both committed suicide years later.
Livermore's favorite book was Extraordinary Popular Delusions and the Madness of Crowds
written in 1841.

 

[wrpgator]

Charles Payne Epic Rant: This if fun. If you want to avoid listening to Neil Cavuto croaking, jump to the 30 sec spot for Sir Charles.

 

[no1g8r]

Famed GameStop bull 'Roaring Kitty' is a Massachusetts financial advisor

Is also user known as deepf()ckingvalue, whose portfolio @Detroitgator keeps posting photos of.

 

[wrpgator]

 

[bradgator2]

I’d jump out of Robinhood if I used it.

Someone is going to take the fall. Right or wrong.... it might be them.

 

[URGatorBait]

Charles Payne Epic Rant: This if fun. If you want to avoid listening to Neil Cavuto croaking, jump to the 30 sec spot for Sir Charles.

I like this guy

 

[wrpgator]

I’d jump out of Robinhood if I used it.

Someone is going to take the fall. Right or wrong.... it might be them.

 

[Concrete Helmet]

Here is the most important part to me and million of other investors vs traders....Looks like like there is a false narrative from the retail side of things also so I'm a bit neutral on this topic at this point.
Skip to the 30.00 minute mark of this video. If you can get past the silly computer generated voice it makes a ton of sense....Dow got punished for this because of 2 opposing forces....or so we were led to believe...again skip to the 29-20 minute mark.
Markets in Crisis: The GameStop Short Squeeze Explained - YouTube

 

[Alumni Guy]

Seriously, ever seen a stock chart look anything like this before.

This is Bananas. Glad I’m not along for this ride.

 

[Pablos Tunnel]

Its a fascinating game being played out in real time. Fu(k the hedge funds. They have been dirty for decades.

 

[Concrete Helmet]

Its a fascinating game being played out in real time. Fu(k the hedge funds. They have been dirty for decades.

Yes but this isn't as simple as that....there's more than meets the eye here.

 

[Pablos Tunnel]

Yes but this isn't as simple as that....there's more than meets the eye here.

Not really. Its a classic short squeeze. Robinhood’s lawyers freaked because the orders were not going to get filled. So they blinked first and now the people are pissed. Stock shorted at 140%. There is big money on both sides of this trade. Nobody is going to jail.

 

[GatorCatsi]

In the same vein as @Detroitgator's last post:

The Invulnerable Hero Story

I know that we all want to believe that the story of GameStop is really about regular people sticking it to institutions that have done the same thing to others for years. That a revolution has taken place.

I could give you my suspicions that most of the volume and capital that have driven the short squeezes have come not from Reddit or other retail investors but from institutions (read: other hedge funds) who quickly devised strategies to predict where the energy produced by these groups would be directed next.

But they would be only suspicions. Pretty strong ones, mind, but still suspicions all the same.

I also think there’s a certain misguidedness to so much of what has taken place, driven by the belief that it’s short-sellers who are the ones who most aggressively manipulate the system and do harm to the average investor.

I can think of many cases where this is specifically true, and I can think of many cases where this is categorically false.

Cases in which this group of investors have been among the only truth-tellers left, opposed by the same financial media that patronizes retail investors today.

Lazy fund-of-fund diligence analysts, hubris-and-implicit-debt-laden macro funds and 2-and-20 long/short funds minting decamillionaires by delivering 30% net exposure to the S&P and the occasional branded Patagonia vest have each extracted far more real value from the average investor and citizen.

But leave both of those things aside. Because it’s still a good story. It’s a story I think people will remember. It’s a story that still matters, even if it isn’t 100% true and even if its target was maybe a bit off-the-mark.

But it also isn’t the real story. It isn’t the Invulnerable Hero* (Achilles, Superman, Siegfried) story.

The real story is the one that lies underneath: it is the story of the source of cascading events in markets, of short squeezes and events in which those squeezes lead to large de-grossing events in which funds rapidly reduce their exposure and cause the kind of broader market events that do have real-world effects. It is the story of the heel of Achilles, the shoulder of Siegfried, the kryptonite of Superman.

It is the story of leverage.

It is the story of the gross exposure which we have collectively decided is the birthright of these institutions.

As they have many times before, regulators, financial media and financial institutions are responding to make sure that this Achilles heel doesn’t lead to the kind of wildfire event that it very well could.

As they have many times before, they are doing so not by addressing the Achilles Heel of leverage and excessive gross exposure, but by seeking to prevent whatever proximate cause threatens to expose that weakness.

Last year it meant our government providing a bid for assets that had none.

In this case, that means our government and institutions doing what they can to prevent the establishment of new positions by retail investors.

When the dust settles in the next couple days, you’ll get the usual laughing “This time it’s different…not!” think-pieces from Very Respectable Investors, and they’ll be mostly right.

Short squeezes aren’t new.

De-grossing events aren’t new.

Goofy run-ups happen all the time.

But there is a new common knowledge that applies to a much broader audience.

The place where Achilles was held when he was dipped into the River Styx is now common knowledge. The spot covered by the linden leaf on Siegfried’s back is now common knowledge. Superman’s home planet is now common knowledge.

Soon, the fact that hedge funds have long been and are now even more actively scraping, watching, predicting and pouncing on public, pseudo-private and private social networks will become common knowledge.

Their realization that they can free-ride on asymmetric, illiquidity-driven trades that don’t create the same regulatory risk as their own public agitation and collusion might well become common knowledge.

That an entire industry is vulnerable to and will itself join in cannibalistically with this kind of coordinated attack will soon become common knowledge.

I suspect that the gatekeepers and regulators will have to face the choice:

Do they want free and fair markets for the pricing of capital in which everyone plays by the same rules, or do they want to protect the birthright of the hedge fund industry to run high levels of gross exposure and substantial explicit and implicit leverage that will continue to necessitate these impartial emergency restrictions and rescue packages?

We know what they’ve chosen before.

Maybe this isn’t the revolution some were hoping it would be. But it might be a policy inflection point. There might be an opportunity to build a movement around fairness, truly free markets and the rule of law.

Let’s tell those stories.

The Invulnerable Hero* | Epsilon Theory

 

[Detroitgator]

In the same vein as @Detroitgator's last post:

Yup.

People always talk about "bubbles," but they get it wrong. They say "market bubble" or "real estate bubble"... that's seeing the tree, not the forest.

If you watch a pot of water boil, it doesn't go from "still water" to "full boil," but it is a homogenous body in a pot. Rather, what you see is a bunch of small bubbles forming on the bottom of the pot, and they start popping, one by one, until the pot comes to full boil. This is because there is not a "pure" transfer of energy. There are all kinds of imperfections in the heating surface, in the pot, and in the water itself. This results in a "misallocation of energy" that causes little bubbles that pop one by one until the whole pot of water is popping.

"Misallocation of capital" does the same thing... it results in little bubbles all over the place in many markets that pop one by one and we try to address them individually, meanwhile, the whole pot is still coming to boil.

That's where we are... the proverbial dutch boy with his finger in the dike, but we also create our own holes, lots of them, through misallocation (there is actually another term i'm searching for in economics terms, but i can't think of it!).

As for what's going with GameStop, I have said since Monday, this isn't about the retail investors, there is HUGE fukkin institutional/hedge fund money driving this on the "little guy" side against Melvin/Citadel. DFV is the one who RECOGNIZED this opportunity, he's not (nor were any of the wsb members prior to the last week) the one driving this "let's stick it to the big guy!" narrative. That is without a shred of doubt, coming from a rival "big guy(s)".

 

[bradgator2]

Nerdy side note: the type of boiling where you see little bubbles forming off the bottom of the pot is called "nucleate boiling". The surface temp of the pot is above the saturation temperature of the water. Maximum heat transfer is happening at a super efficient rate and the temperate of the water is increasing at its fastest rate possible.

 

[Concrete Helmet]

As for what's going with GameStop, I have said since Monday, this isn't about the retail investors, there is HUGE fukkin institutional/hedge fund money driving this on the "little guy" side against Melvin/Citadel. DFV is the one who RECOGNIZED this opportunity, he's not (nor were any of the wsb members prior to the last week) the one driving this "let's stick it to the big guy!" narrative. That is without a shred of doubt, coming from a rival "big guy(s)".

So in summary there are a couple groups of rich f vckers who are having a pissing match and dragging Robinhoodiots into the puddle....

 

[Alumni Guy]

Nerdy side note: the type of boiling where you see little bubbles forming off the bottom of the pot is called "nucleate boiling". The surface temp of the pot is above the saturation temperature of the water. Maximum heat transfer is happening at a super efficient rate and the temperate of the water is increasing at its fastest rate possible.

When Marco threw the shoe, my blood began nucleate boiling.