7 ms·

It's probably purely a math question -- what's cheaper impending lawsuit (we can settle) or losing our trade?

by 0x426577617265 6y ago

deleted 6y ago
[deleted]
Miner49er 6y ago
True, there needs to be an SEC investigation and jail time.
- HenryKissinger 6y ago
  Jail time. I'm laughing. No one will go to prison over RH temporarily prohibiting its users from placing buy orders on a few particular stocks due to collective market manipulation through social media. There is nothing illegal about RH's actions, despite the faux outrage.
  - sfennell 6y ago
    "Collective Market Manipulation" so ... that is what we are calling buying stocks now?
    - HenryKissinger 6y ago
      No... Collective market manipulation is what we are calling thousands of people reading the threads on wallstreetbets and hyping stocks with one another.
- speeder 6y ago
  If the claims of this guy: https://twitter.com/justinkan/status/1354853920762253315 https://twitter.com/justinkan/status/1354853920762253315 are true, I find this might be quite possible.
Someone1234 6y ago
Why are you contrasting those two things? Don't they BOTH get sued AND lose retail trade volume by restricting these tickets?
- kllrnohj 6y ago
  The parent company/investor/whatever has a major short position on GME. By preventing Robinhood users from buying, they are reducing pressure on the short squeeze. Since Robinhood doesn't collect commissions there's no loss of revenue on trade volume. But driving GME's stock price down is definitely saving Citadel billions, and the class action lawsuit is unlikely to cost them billions.
that_guy_iain 6y ago
I would like to think if they lost the lawsuit they would get fined by the SEC of a fine more than what they would have lost. But, it'll probably less so from a maths point of view it's best to break the law.
- CoolGuySteve 6y ago
  "If the penalty for a crime is a fine, then that law only exists for the lower class." - Final Fantasy Tactics
ipnon 6y ago
My theory is that no market makers want to buy the orders Robinhood is selling anymore.
- gruez 6y ago
  Yeah the whole point of selling your orders is that retail traders are mostly "uninformed" and likely won't move the market. WSB basically showed that's not always the case.
  - neom 6y ago
    Not that I agree with it, but one of the talking heads on Fox Business was blabbering on about how retails investors should not be allowed to move the market because they're are unlicensed and don't understand the implications of their actions, hah.
    - HenryKissinger 6y ago
      It would not be difficult, or unconstitutional, for Congress to pass a law restricting the trades that non-accredited investors are allowed to make.
      - zaroth 6y ago
        They do that already. The "public" markets are the stocks that non-accredited investors are allowed to trade.
    - jayd16 6y ago
      I think there's something to that though. Whats to stop big firms from posing as many retail investors if there's no regulation against that class of investor manipulating the market? I don't have the answer but its something to think about.
      - avereveard 6y ago
        many small coordinated investment to hide a large movement are already illegal
qwerty12345678 6y ago
I don't know if any of Wall St realizes it yet, but this is bigger than dollars and cents. It was the biggest news story in the world, and they made the decision to rub their power in the faces of the middle class. This started as a backyard wrestling match, but Wall St pulled out brass knuckles. Time to cash out of the 401k scam we've been sold and bring the whole fucking system down.
mlindner 6y ago
I mean if you have a bunch of really really angry retail shareholders that want literal blood (which many of them sound like they do) then it's not the person being sued that gets to decide to settle.
threatofrain 6y ago
https://www.warren.senate.gov/newsroom/press-releases/senator-warren-releases-statement-on-gamestop-trades https://www.warren.senate.gov/newsroom/press-releases/senato... https://twitter.com/AOC/status/1354830697459032066 https://twitter.com/AOC/status/1354830697459032066 What about regulations?
- hirundo 6y ago
  That statement calls for "the SEC and other financial regulators to wake up and do their jobs". If this were about solving the problem rather than scoring points she would have left a clue to what she thought their job was in this case. There isn't one. She can't be so oblivious as to think it's obvious.
  - nkingsy 6y ago
    I heard there was an existing regulation about selling > 100% of a float short?
ballenf 6y ago
If RH signaled to its hedge fund investors that it would be making this change in advance and those funds entered into new short positions with that information, would that open both parties up to additional liability?
- tobylane 6y ago
  I believe so, and someone says that’s what happened. https://twitter.com/justinkan/status/1354853920762253315 https://twitter.com/justinkan/status/1354853920762253315
  - reaperducer 6y ago
    someone says that’s what happened Well, if someone said something on the internet, then it must be true!

It's probably purely a math question -- what's cheaper impending lawsuit (we can settle) or losing our trade?

deleted 6y ago

[deleted]

Miner49er 6y ago

True, there needs to be an SEC investigation and jail time.

HenryKissinger 6y ago
Jail time. I'm laughing. No one will go to prison over RH temporarily prohibiting its users from placing buy orders on a few particular stocks due to collective market manipulation through social media. There is nothing illegal about RH's actions, despite the faux outrage.
- sfennell 6y ago
  "Collective Market Manipulation" so ... that is what we are calling buying stocks now?
  - HenryKissinger 6y ago
    No... Collective market manipulation is what we are calling thousands of people reading the threads on wallstreetbets and hyping stocks with one another.
speeder 6y ago
If the claims of this guy: https://twitter.com/justinkan/status/1354853920762253315 https://twitter.com/justinkan/status/1354853920762253315 are true, I find this might be quite possible.

Someone1234 6y ago

Why are you contrasting those two things? Don't they BOTH get sued AND lose retail trade volume by restricting these tickets?

kllrnohj 6y ago
The parent company/investor/whatever has a major short position on GME. By preventing Robinhood users from buying, they are reducing pressure on the short squeeze. Since Robinhood doesn't collect commissions there's no loss of revenue on trade volume. But driving GME's stock price down is definitely saving Citadel billions, and the class action lawsuit is unlikely to cost them billions.

that_guy_iain 6y ago

I would like to think if they lost the lawsuit they would get fined by the SEC of a fine more than what they would have lost. But, it'll probably less so from a maths point of view it's best to break the law.

CoolGuySteve 6y ago
"If the penalty for a crime is a fine, then that law only exists for the lower class." - Final Fantasy Tactics

ipnon 6y ago

My theory is that no market makers want to buy the orders Robinhood is selling anymore.

gruez 6y ago
Yeah the whole point of selling your orders is that retail traders are mostly "uninformed" and likely won't move the market. WSB basically showed that's not always the case.
- neom 6y ago
  Not that I agree with it, but one of the talking heads on Fox Business was blabbering on about how retails investors should not be allowed to move the market because they're are unlicensed and don't understand the implications of their actions, hah.
  - HenryKissinger 6y ago
    It would not be difficult, or unconstitutional, for Congress to pass a law restricting the trades that non-accredited investors are allowed to make.
    - zaroth 6y ago
      They do that already. The "public" markets are the stocks that non-accredited investors are allowed to trade.
  - jayd16 6y ago
    I think there's something to that though. Whats to stop big firms from posing as many retail investors if there's no regulation against that class of investor manipulating the market? I don't have the answer but its something to think about.
    - avereveard 6y ago
      many small coordinated investment to hide a large movement are already illegal

qwerty12345678 6y ago

I don't know if any of Wall St realizes it yet, but this is bigger than dollars and cents. It was the biggest news story in the world, and they made the decision to rub their power in the faces of the middle class. This started as a backyard wrestling match, but Wall St pulled out brass knuckles. Time to cash out of the 401k scam we've been sold and bring the whole fucking system down.

mlindner 6y ago

I mean if you have a bunch of really really angry retail shareholders that want literal blood (which many of them sound like they do) then it's not the person being sued that gets to decide to settle.

threatofrain 6y ago

https://www.warren.senate.gov/newsroom/press-releases/senator-warren-releases-statement-on-gamestop-trades https://www.warren.senate.gov/newsroom/press-releases/senato... https://twitter.com/AOC/status/1354830697459032066 https://twitter.com/AOC/status/1354830697459032066 What about regulations?

hirundo 6y ago
That statement calls for "the SEC and other financial regulators to wake up and do their jobs". If this were about solving the problem rather than scoring points she would have left a clue to what she thought their job was in this case. There isn't one. She can't be so oblivious as to think it's obvious.
- nkingsy 6y ago
  I heard there was an existing regulation about selling > 100% of a float short?

ballenf 6y ago

If RH signaled to its hedge fund investors that it would be making this change in advance and those funds entered into new short positions with that information, would that open both parties up to additional liability?

tobylane 6y ago
I believe so, and someone says that’s what happened. https://twitter.com/justinkan/status/1354853920762253315 https://twitter.com/justinkan/status/1354853920762253315
- reaperducer 6y ago
  someone says that’s what happened Well, if someone said something on the internet, then it must be true!