OT - r/wallstreetbets and GameStop (GME)

CTMike

Anyone else paying attention to this drama playing out? Anyone have any skin in the game?

HeavyG

There were a couple posts about it on a different thread a couple days ago.

Funny stuff.

Not participating personally tho.

Gulfcoastguy

Not participating but I don’t mind seeing shorters be a bit inconvenienced.

lkapigian

Totally laughing and the hedge fund idiots ..beauty troll of the stock market 

CTMike

This dude is certainly making out on the deal, assuming he sells before the bubble bursts. He is basically the reason this whole madness started. 

JohnInCarolina

A classic pump and dump type deal.  Some folks will invariably lose their shirts.

CTMike

JohnInCarolina said:

A classic pump and dump type deal.  Some folks will invariably lose their shirts.

I’m not so sure about that John. This guy identified that 140% of the available GME float was shorted, and realized the potential of a short squeeze, similar to VW back in 2008 I believe it was. Then Ryan Cohen (founder of Chewy.com) was brought on to the board to turn things around. 

Will be interesting to see how it plays out, especially if it causes several hedge funds (Melvin and Citadel) to go bankrupt, and lead to new regulations that would prevent the hedge funds from manipulating the market. Funny that Wall Street/SEC are ok with retail investors losing their shirts, but heaven forbid it happens to the whales. 

JohnInCarolina

CTMike said:

JohnInCarolina said:

A classic pump and dump type deal.  Some folks will invariably lose their shirts.

I’m not so sure about that John. This guy identified that 140% of the available GME float was shorted, and realized the potential of a short squeeze, similar to VW back in 2008 I believe it was. Then Ryan Cohen (founder of Chewy.com) was brought on to the board to turn things around. 

Will be interesting to see how it plays out, especially if it causes several hedge funds (Melvin and Citadel) to go bankrupt, and lead to new regulations that would prevent the hedge funds from manipulating the market. Funny that Wall Street/SEC are ok with retail investors losing their shirts, but heaven forbid it happens to the whales. 

I've yet to see anything that indicates the current stock price is actually representative of a fair valuation of the company, but if you have seen something that indicates otherwise, by all means pass it on.   I would be more than happy to be wrong about this.  

dbCooper

CTMike said:

JohnInCarolina said:

A classic pump and dump type deal.  Some folks will invariably lose their shirts.

I’m not so sure about that John. This guy identified that 140% of the available GME float was shorted, and realized the potential of a short squeeze, similar to VW back in 2008 I believe it was. Then Ryan Cohen (founder of Chewy.com) was brought on to the board to turn things around. 

Will be interesting to see how it plays out, especially if it causes several hedge funds (Melvin and Citadel) to go bankrupt, and lead to new regulations that would prevent the hedge funds from manipulating the market. Funny that Wall Street/SEC are ok with retail investors losing their shirts, but heaven forbid it happens to the whales. 

Correct @CTMike That 140% figure (I've seen others figures, as high as 150%) is pure Naked Shorting*, which is illegal but largely unenforced.  Those Reddit folks found another type of justice to impose.

New regulations will not help if they too would go unenforced.  When the dust settles from all this, my hope is that at minimum laws currently on the books are paid attention to.

*https://www.investopedia.com/terms/n/nakedshorting.asp

CTMike

This just keeps getting better, dude behind “The Social Network” has already sold book/movie rights for the GameStop - r/wsb drama:

https://deadline.com/2021/01/mgm-ben-mezrichs-the-antisocial-network-wall-street-1234684378/

JohnInCarolina

And... GME is getting killed in after hours trading.  I think the game is about to end.

CTMike

JohnInCarolina said:

And... GME is getting killed in after hours trading.  I think the game is about to end.

I wouldn’t bet on that John, I won’t be surprised to see a short squeeze happen in the next day or so. Of course I could be full of sh!t also.

JohnInCarolina

CTMike said:

JohnInCarolina said:

And... GME is getting killed in after hours trading.  I think the game is about to end.

I wouldn’t bet on that John, I won’t be surprised to see a short squeeze happen in the next day or so. Of course I could be full of sh!t also.

Mike, I just keep coming back to what is a reasonable valuation of the company.  There's a basic disconnect at the moment that suggests the music has to stop at some point.

CTMike

JohnInCarolina said:

CTMike said:

JohnInCarolina said:

And... GME is getting killed in after hours trading.  I think the game is about to end.

I wouldn’t bet on that John, I won’t be surprised to see a short squeeze happen in the next day or so. Of course I could be full of sh!t also.

Mike, I just keep coming back to what is a reasonable valuation of the company.  There's a basic disconnect at the moment that suggests the music has to stop at some point.

I agree wholeheartedly John, but if you look at the VW short squeeze back in 2008, you see that there was a 5x spike in the price of VW as Porsche took control and shorts had to close out their positions. This was followed shortly thereafter by a return to more sane pricing. 

A similar situation is expected to occur on GME, but at a larger scale because of the percent of float that is shorted. Also, if you look at a price volume chart for the last couple days compared to a couple weeks ago, you will see the price getting hammered down on very little volume - caused by a short ladder attack where are couple of HFs trade shares back and forth to each other and at increasingly lower prices, trying to trick the algorithms and induce panic/fear based selling of retail shares, thereby making them available to buy at now lower prices so the HFs can close out their positions.

The problem is the self-described autistic retards who inhabit r/wsb aren’t selling, and they are buying even more on the dips caused by these short ladder attacks. This in-turn puts even more upward pressures on the shorts, causing them to be closed at higher and higher price points, leading to a meteoric rise in price ala VW, albeit at a much higher delta between high and low, in my opionion.

Of course one has to follow this closely and have an exit strategy preplanned.

I am not a financial advisor, so take the advice at your own peril. This is just my $0.03 (adjusted for inflation) after doing some reading at Investopedia, spending some time among the autists on r/wsb, and staying in a Holiday Inn Express recently.

YMMV

HeavyG

CTMike said:

JohnInCarolina said:

CTMike said:

JohnInCarolina said:

And... GME is getting killed in after hours trading.  I think the game is about to end.

I wouldn’t bet on that John, I won’t be surprised to see a short squeeze happen in the next day or so. Of course I could be full of sh!t also.

Mike, I just keep coming back to what is a reasonable valuation of the company.  There's a basic disconnect at the moment that suggests the music has to stop at some point.

I agree wholeheartedly John, but if you look at the VW short squeeze back in 2008, you see that there was a 5x spike in the price of VW as Porsche took control and shorts had to close out their positions. This was followed shortly thereafter by a return to more sane pricing. 

A similar situation is expected to occur on GME, but at a larger scale because of the percent of float that is shorted. Also, if you look at a price volume chart for the last couple days compared to a couple weeks ago, you will see the price getting hammered down on very little volume - caused by a short ladder attack where are couple of HFs trade shares back and forth to each other and at increasingly lower prices, trying to trick the algorithms and induce panic/fear based selling of retail shares, thereby making them available to buy at now lower prices so the HFs can close out their positions.

The problem is the self-described autistic retards who inhabit r/wsb aren’t selling, and they are buying even more on the dips caused by these short ladder attacks. This in-turn puts even more upward pressures on the shorts, causing them to be closed at higher and higher price points, leading to a meteoric rise in price ala VW, albeit at a much higher delta between high and low, in my opionion.

Of course one has to follow this closely and have an exit strategy preplanned.

I am not a financial advisor, so take the advice at your own peril. This is just my $0.03 (adjusted for inflation) after doing some reading at Investopedia, spending some time among the autists on r/wsb, and staying in a Holiday Inn Express recently.

YMMV

"...autistic retards..."

Geeez...really dude?

HeavyG

https://twitter.com/jbarro/status/1356627493000798212

Somebody get this guy a bandaid for his boo-boo.

JohnInCarolina

CTMike said:

JohnInCarolina said:

CTMike said:

JohnInCarolina said:

And... GME is getting killed in after hours trading.  I think the game is about to end.

I wouldn’t bet on that John, I won’t be surprised to see a short squeeze happen in the next day or so. Of course I could be full of sh!t also.

Mike, I just keep coming back to what is a reasonable valuation of the company.  There's a basic disconnect at the moment that suggests the music has to stop at some point.

I agree wholeheartedly John, but if you look at the VW short squeeze back in 2008, you see that there was a 5x spike in the price of VW as Porsche took control and shorts had to close out their positions. This was followed shortly thereafter by a return to more sane pricing. 

A similar situation is expected to occur on GME, but at a larger scale because of the percent of float that is shorted. Also, if you look at a price volume chart for the last couple days compared to a couple weeks ago, you will see the price getting hammered down on very little volume - caused by a short ladder attack where are couple of HFs trade shares back and forth to each other and at increasingly lower prices, trying to trick the algorithms and induce panic/fear based selling of retail shares, thereby making them available to buy at now lower prices so the HFs can close out their positions.

The problem is the self-described autistic retards who inhabit r/wsb aren’t selling, and they are buying even more on the dips caused by these short ladder attacks. This in-turn puts even more upward pressures on the shorts, causing them to be closed at higher and higher price points, leading to a meteoric rise in price ala VW, albeit at a much higher delta between high and low, in my opionion.

Of course one has to follow this closely and have an exit strategy preplanned.

I am not a financial advisor, so take the advice at your own peril. This is just my $0.03 (adjusted for inflation) after doing some reading at Investopedia, spending some time among the autists on r/wsb, and staying in a Holiday Inn Express recently.

YMMV

It's currently trading at $77 a share.  I'm just sorry that so many people got swept up in it and dumped their savings into a stock that was clearly overpriced. 

JohnInCarolina

http://twitter.com/MadScientistPhD/status/1356684829312475136?s=20

JohnInCarolina

As I was saying:

https://www.washingtonpost.com/technology/2021/02/02/gamestop-stock-plunge-losers/

Hate to be right about this, but it was largely predictable.

JohnInCarolina

https://www.cnn.com/2021/02/04/investing/gamestop-wallstreetbets-reddit/index.html

Don't know whether to laugh or cry at this.  

HeavyG

JohnInCarolina said:

https://www.cnn.com/2021/02/04/investing/gamestop-wallstreetbets-reddit/index.html

Don't know whether to laugh or cry at this.  

I'm pretty firmly in "the whole thing is hilarious" camp.

JohnInCarolina

http://www.youtube.com/watch?v=i4M4T15YzL0

CTMike

Congressional hearings coming up soon:

https://www.ft.com/content/975b0ae2-a5a0-42da-b503-4f47660d0bcd

JohnEggGio

It was never about underlying value - that's the whole point.

CTMike

Round 2 of this crazy train in progress - opened around $43 today, closed at $91.71 or so, and almost doubled again in after hours trading:

Moleman

over 200 for GME as I type

JohnInCarolina

Moleman said:

over 200 for GME as I type

But why though?