*doublepromote

Double-Promoting this video and sending it back into the queue for one more try; last queued Thursday, January 28th, 2021 8:20pm PST - doublepromote requested by Mordhaus.

Rich people do shit to stay rich.

Regular people FTW!

This is what is fundimentally wrong with being able to "vote with dollars" - some people have more dollars than me. That doesn't make me any less of a person. But just try asking conservative supreme court justices about that.

Finally. Someone I can relate to. Thanks babe.



*isitstilloktosaybabe*

It's the neverending story.

*quality
Shorting over 100% should be 100% illegal. By itself that’s market manipulation.
Any company that halted trading should lose their license to trade and be fined into oblivion, along with any employees that made those decisions. They didn’t halt trading when the hedge funds bet on failure so much they caused it.

Boosting this quality contribution up in the Hot Listing - declared quality by newtboy.

THANK GOD THIS IS HAPPENING! PEOPLE WHO HAVE NO MONEY DON'T NEED TO WORRY ABOUT LOSING MILLIONS!!!!!111!!!!111one!!!

Sorry to be the little grey raincloud on this Hate The Hedges party, but you might want to understand the implications of what just happened

Y'know that fund that's getting all attention, Melvin Capital? Yeah, fuck them, right? Fuckin' shorters all shortin' and shit -- they played, they paid!

There's a reason they were bailed out and with all due haste.

Here's the issue: they were VERY good at the shorting game. So good that they actually had to turn away business. They made money like horses makes shit. When clients couldn't get in at Melvin, they went elsewhere. That opened the door to a lot of other firms basically mirroring exactly what MC was doing, which included shorting the fuck outta GME.

Fuck those guys too, right? It's their money, so why should I care?

Let's go back a few year, shall we, to the glorious chapter in finance and economics that was the 2008 Crash. Remember when Paulson lost his shit because he realized that in about 36 hours, the basic system called Western Capitalism was going to shit the bed; the bedroom; the whole house and pretty much every surface above the ocean within a planetary radius? This is sorta like that. Only worse.

The thing about short squeezes is that the losses can be infinite, and that's exactly why WallStreetBets did what they did. They knew if they bought and held -- diamond hands -- the stock would have to rise as the shorters had to cover their bets. Melvin Capital and a shit-ton of other, smaller firms had to do that and ran out of liquidity long before GME was even at $50. For every share of stock they shorted, they need to cough up another share at a higher value -- and they HAD to actually have the higher-priced share.

And here's where things get VERY ugly.

Shorting GME was such a sure thing that a huge number of shorts were placed. In fact, more shares of GME were shorted than actually existed. Oops. But hey, SURE THING, BABY and what's the worst that can happen?

Yeeeah, y'see where this is going now?

So these firms, not only are they broke, they don't have the shares, either. They need to come up with shares, pronto, at any price, because contractual obligations are a motherfucker in the finance world. But again, more shorts than there are shares and the people who have the shares, WSB and 4chan's /biz/, aren't letting them go. The longer they hold, the higher the price will go as short after short faces having to cough up the shares they borrowed.

A lot of people are about to lose a LOT of money -- the kinda losses that have so many zeros attached that looking at the number bores the eyes.

Back to 2008: the reason the whole world almost started Mad Max LARPing back then is that a narrow number of highly-important financial institutions were a wee bit thin on liquidity because they were having to pay it out by the boatload. That's bad. What would be better is if risk were more distributed, and how could that little plan POSSIBLY go wrong? Maybe a Black Swan event involving a huge amount of money that needs to be paid out by all of them due to this annoying bird.

That's where we are now, but no one even remotely knows what that figure is going to be. Again, (potentially) infinite losses multiplied by 150% times the number of shares actually available, multiplied by the dogshit risk factor on the loans and the leveraged payouts -- your best case scenario might be a loss of about $500 billion. Someone has to come up with that money, be it the Fed or other banks/investors, but that latter group has to come up with the money themselves, which is generally accomplished by selling profitable holdings. We all know what happens when a lot of people have to sell, right?

I always wanted to live in interesting times, thus proving what an utter fuckwit I am.

How many brokers shorted GME? Will the world crash if they burn and the whole market learns not to sell short other than as a hedge and/or in a quantity that is unlikely to not be available?

For me it is the shorting brokers that are doing something that is not acceptable. The kids are taking advantage and probably colluding, but that would not happen without the prior excessive shorting.

Obviously it had to stop at some point. Possibly regulation is needed for the shorts.

The funny part is that some of the liability is probably in the direction of people who have a stake in Robin Hood, and that was what got it stopped.

Louis summary and changed/updated views of all the things wallstreetbets, Gamestop, Robinhood. Makes situation much more understandable for someone like me with very little knowledge of how all these things work. https://youtu.be/jQDHWu32W7o

Ultimate wallstreetbets, Gamestop, Robinhood summary/update has been added as a related post - related requested by eric3579.

Stock Broker Robinhood CEO explains why they had to limit GameStop buys
https://videosift.com/video/Elon-Musk-grills-Robinhood-CEO-about-trade-restriction