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Trading stocks is not the 1st amendment where we basically say we don’t really care about the outcome of your speech (as an individual). Say what you want even

Trading stocks is not the 1st amendment where we basically say we don’t really care about the outcome of your speech (as an individual). Say what you want even if its dumb and hurts you. With capital markets...there absolutely is a goal, and it’s not speculation/gambling. The goal is to have a place where corporations can raise capital and investors can hold them accountable for how they return value to them...and then a billion rules to make that as fair and functional (not equitable) as possible. I don’t get the argument that what these guys are doing is somehow noble, or to be encouraged. Completely unregulated non-purposeful markets are not helpful....we did that 100 years ago...thats why we have all the rules we do to make markets function to the end.

layoutIfNeeded 6y ago
>it’s not speculation/gambling What is short selling if not speculation? It's speculating that an asset will be worth less than it is now.
- drewcon 6y ago
  There is a world of difference between playing a game of chance, and playing a game where you happen to believe you have real better/different information about how the future unfolds. Speculators tend to act mostly on emotion and inertia from the game, not any real understanding of any underlying fundamentals. Short sales can be good. Downward pressure can be healthy. If you think a company is overvalued because its fundamentals are misjudged, the short is a corrective force in an overly optimistic market
dixego 6y ago
Perhaps this is proof regulations on the market should be stricter, then. After all, if a bunch of barely coordinated randos on the internet can do this through the power of 'meme magic', imagine what people with real resources and power and influence could do.
- Dirlewanger 6y ago
  >imagine what people with real resources and power and influence could do. You mean what they already have been doing for decades? Are you seriously in favor of clamping down on retail investors??
  - drewcon 6y ago
    Who has been doing this for decades? When has "Wall st." coordinated a random attack to squeeze cash out of an entity just for the hell of it? You may disagree with the outcomes of short pressure, or private equity actions etc., thats fine, but I think there is an important distinction between actors in the market doing something profitable because they actually believe it, and the hysteria of a mob just randomly committing financial mayham because they can. I don't think we want to live in a world where markets are increasingly led by irrational forces simply amplified by media and misinformation...its not good in media right now, I shudder to think what happens if that behavior gets a foothold in markets.
MrMan 6y ago
to the extent that the market needs speculators, I think it is part of the "goal" of capital markets. a market of only long-term risk-averse allocators wont have the liquidity necessary to create fair prices nor is it likely to attract as much capital when companies issue shares, as a market that has a "healthy" amount of speculation.
- drewcon 6y ago
  I have no problem with individuals or fiduciaries investing on short time horizons because they believe they understand something fundamental the next guy doesn't. But mass coordinated speculation isn't that; it's using a mob to affect the underlying system for profit -underlying equity be damned. And for all those that say "well Wall St has been doing that for years"...fine, let's address that too. Financial regulations are essentially a history lesson of past failure we've tried to correct. Let's be consistent.

layoutIfNeeded 6y ago

>it’s not speculation/gambling What is short selling if not speculation? It's speculating that an asset will be worth less than it is now.

drewcon 6y ago
There is a world of difference between playing a game of chance, and playing a game where you happen to believe you have real better/different information about how the future unfolds. Speculators tend to act mostly on emotion and inertia from the game, not any real understanding of any underlying fundamentals. Short sales can be good. Downward pressure can be healthy. If you think a company is overvalued because its fundamentals are misjudged, the short is a corrective force in an overly optimistic market

dixego 6y ago

Perhaps this is proof regulations on the market should be stricter, then. After all, if a bunch of barely coordinated randos on the internet can do this through the power of 'meme magic', imagine what people with real resources and power and influence could do.

Dirlewanger 6y ago
>imagine what people with real resources and power and influence could do. You mean what they already have been doing for decades? Are you seriously in favor of clamping down on retail investors??
- drewcon 6y ago
  Who has been doing this for decades? When has "Wall st." coordinated a random attack to squeeze cash out of an entity just for the hell of it? You may disagree with the outcomes of short pressure, or private equity actions etc., thats fine, but I think there is an important distinction between actors in the market doing something profitable because they actually believe it, and the hysteria of a mob just randomly committing financial mayham because they can. I don't think we want to live in a world where markets are increasingly led by irrational forces simply amplified by media and misinformation...its not good in media right now, I shudder to think what happens if that behavior gets a foothold in markets.

MrMan 6y ago

to the extent that the market needs speculators, I think it is part of the "goal" of capital markets. a market of only long-term risk-averse allocators wont have the liquidity necessary to create fair prices nor is it likely to attract as much capital when companies issue shares, as a market that has a "healthy" amount of speculation.

drewcon 6y ago
I have no problem with individuals or fiduciaries investing on short time horizons because they believe they understand something fundamental the next guy doesn't. But mass coordinated speculation isn't that; it's using a mob to affect the underlying system for profit -underlying equity be damned. And for all those that say "well Wall St has been doing that for years"...fine, let's address that too. Financial regulations are essentially a history lesson of past failure we've tried to correct. Let's be consistent.