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> These players don't care about losses because Their losses are the price of admission to watch your curated hedge fund burn. I'm seeing stories of people put

> These players don't care about losses because Their losses are the price of admission to watch your curated hedge fund burn. I'm seeing stories of people putting their modest life savings into GameStop stock. When the bubble invariably bursts, they will be left penniless. We will see people making actual, huge losses that they very much care about. Sure, there are also the people to whom this is a game/collective action, and who can afford to lose a few hundred bucks to make a statement or have fun. But let's not pretend that that's the case for everyone. There will be painful outcomes here, with lots of people spending more than they can afford on stocks that they will only be able to sell at a tiny fraction of the current price. Stock price manipulation can be enjoyable, but it shouldn't be confused with prices going up because the business behind the stocks actually does better. This is such a weird situation: On Twitter I see several of the same people who are usually like "Bitcoin is a scam, it's pure speculation without fundamentals" now applauding the GameStop situation just because this time the speculation without fundamentals also hurts hedge funds (but ignoring that it will hurt lots of individual investors as well). > a repeatable strategy that will work over and over. As long as the people playing along have the real money to put into real stocks that are not worth that real money. It would be more sustainable/repeatable if people had stopped driving up the price once a reasonable ceiling was reached.

ASalazarMX 6y ago
> I'm seeing stories of people putting their modest life savings into GameStop stock These people were too naive to speculate in the stock market, and had they not bought stocks, they would likely waste those savings in another naive investment.
- tom_mellior 6y ago
  Some naïve investments are sold more convincingly than others. Many people would go on saving until some huge, once-in-a-lifetime opportunity (like this one is made out to be) came along. Otherwise, if "they" collectively jumped on every opportunity, they wouldn't even have any life savings to waste on this one. Either way, the OP's point was that everyone is only playing with money they can afford to lose, and that point is false.
  - scruple 6y ago
    Should we shut down casinos, as well, then? How about state operated lotteries, are those still okay? I genuinely do not understand this "won't someone, please, think of the children?!" line of reasoning. This isn't the first short squeeze in history that led to retail winners and losers. Retail investors had a hand in the dotcom crash and the 1929 crash. Why is it only applicable to this specific short squeeze?
    - tom_mellior 6y ago
      Nobody said anything about shutting anything down.
throw0101a 6y ago
> I'm seeing stories of people putting their modest life savings into GameStop stock. When the bubble invariably bursts, they will be left penniless. We will see people making actual, huge losses that they very much care about. You're not wrong, but how is GME different that any other stock someone could have gone all-in on? Nick Maggiulli posted this on a somewhat unrelated matter (some TikToker's strategy to fund their lifestyle): > If it wasn’t obvious before, it bears repeating now—some people are going to beat you at investing. Some of them will be dumber than you. Some will be less knowledgable. Some will even be completely wrong about the future. But they will beat you just the same. There is no great arbiter of justice in the investment world. There is no cosmic force that ensures that only the knowledgable make money. If there were, then I would be a far richer man today. > But what does exist in the investment world is the inevitable pull of fundamentals. The inescapable attraction between prices and reality. Like a moth drawn to a flame. Yes, markets will go through periods where some people make lots of money very quickly with little effort. We are seeing such a market today. But, eventually, these same markets find their way back. As the legendary Benjamin Graham once said: >> In the short run, the market is a voting machine but in the long run, it is a weighing machine. > So let them vote. Let them vote on which stock will be the next to double in a day. Let them vote on which non-profit will make them rich. Let them vote on what to buy and what to sell. Let them vote I say. Because gravity will eventually set in. Maybe not today. Maybe not tomorrow. Maybe not next week or even next year. But eventually it will set in. > So there is no point in making fun of other investors because they happen to be doing better than you, even if they are using a seemingly foolish strategy. If they are truly fools, they will learn their lesson. Maybe not in this market, but maybe in the next one. * https://ofdollarsanddata.com/let-them-vote/ https://ofdollarsanddata.com/let-them-vote/
- tom_mellior 6y ago
  > You're not wrong, but how is GME different that any other stock someone could have gone all-in on? It's different for the very reason that we are discussing it: Because people got together to deliberately (and quite possibly illegally) manipulate it into a bubble.
  - 6y ago

ASalazarMX 6y ago

> I'm seeing stories of people putting their modest life savings into GameStop stock These people were too naive to speculate in the stock market, and had they not bought stocks, they would likely waste those savings in another naive investment.

tom_mellior 6y ago
Some naïve investments are sold more convincingly than others. Many people would go on saving until some huge, once-in-a-lifetime opportunity (like this one is made out to be) came along. Otherwise, if "they" collectively jumped on every opportunity, they wouldn't even have any life savings to waste on this one. Either way, the OP's point was that everyone is only playing with money they can afford to lose, and that point is false.
- scruple 6y ago
  Should we shut down casinos, as well, then? How about state operated lotteries, are those still okay? I genuinely do not understand this "won't someone, please, think of the children?!" line of reasoning. This isn't the first short squeeze in history that led to retail winners and losers. Retail investors had a hand in the dotcom crash and the 1929 crash. Why is it only applicable to this specific short squeeze?
  - tom_mellior 6y ago
    Nobody said anything about shutting anything down.

throw0101a 6y ago

> I'm seeing stories of people putting their modest life savings into GameStop stock. When the bubble invariably bursts, they will be left penniless. We will see people making actual, huge losses that they very much care about. You're not wrong, but how is GME different that any other stock someone could have gone all-in on? Nick Maggiulli posted this on a somewhat unrelated matter (some TikToker's strategy to fund their lifestyle): > If it wasn’t obvious before, it bears repeating now—some people are going to beat you at investing. Some of them will be dumber than you. Some will be less knowledgable. Some will even be completely wrong about the future. But they will beat you just the same. There is no great arbiter of justice in the investment world. There is no cosmic force that ensures that only the knowledgable make money. If there were, then I would be a far richer man today. > But what does exist in the investment world is the inevitable pull of fundamentals. The inescapable attraction between prices and reality. Like a moth drawn to a flame. Yes, markets will go through periods where some people make lots of money very quickly with little effort. We are seeing such a market today. But, eventually, these same markets find their way back. As the legendary Benjamin Graham once said: >> In the short run, the market is a voting machine but in the long run, it is a weighing machine. > So let them vote. Let them vote on which stock will be the next to double in a day. Let them vote on which non-profit will make them rich. Let them vote on what to buy and what to sell. Let them vote I say. Because gravity will eventually set in. Maybe not today. Maybe not tomorrow. Maybe not next week or even next year. But eventually it will set in. > So there is no point in making fun of other investors because they happen to be doing better than you, even if they are using a seemingly foolish strategy. If they are truly fools, they will learn their lesson. Maybe not in this market, but maybe in the next one. * https://ofdollarsanddata.com/let-them-vote/ https://ofdollarsanddata.com/let-them-vote/

tom_mellior 6y ago
> You're not wrong, but how is GME different that any other stock someone could have gone all-in on? It's different for the very reason that we are discussing it: Because people got together to deliberately (and quite possibly illegally) manipulate it into a bubble.
- 6y ago