6 ms·

The people who probably would have lost their money anyways (because they were waiting for more suckers to push the price higher) now have an excuse (other reta

by sidibe 6y ago

The people who probably would have lost their money anyways (because they were waiting for more suckers to push the price higher) now have an excuse (other retail buyers couldn't open new positions). People who realized those were the suckers stomached selling while it wasn't as high as yesterday but still astronomical. The anger at Robinhood reminds me of when the government in Nigeria cracked down on MMM ponzi scheme. People were furious because they all assumrd they wouldn't be the bag holders at the end. But here there's been a full day to close positions so I'm fairly sure the people who aren't doing it now wouldn't have done it whenever the stock starting going down in other circumstances

beagle3 6y ago
Except, as SI/Float was at 139%, there was a guaranteed sucker to buy it off them at basically any price - unlike in a Ponzi scheme where you never know if there’s going to be another sucker.
- egwor 6y ago
  Hasn't SI/Float been around there for more than a year? I'm not an expert on this. Source: https://www.ortex.com/symbol/nyse/gme/short_interest https://www.ortex.com/symbol/nyse/gme/short_interest
  - beagle3 6y ago
    Seems like the 100% line was crossed in Jun 2019 - and it does indeed mean that going long since that point, at almost any price was fundamentally sound investment and not ponzi; It is a pyramid, but the base layer of “suckers”, those that end up taking the losses in a standard ponzi/pyramid are already determined ; they are the most finance literate people in the market, and they did it willingly. WSB is just adding layers in the middle which is rational. The short sellers knew their risks perfectly well and did it willingly. They just didn’t expect anyone will figure out how to take advantage of the setup they created.
    - MrMan 6y ago
      Investment ? Not sure about that
      - beagle3 6y ago
        As much as that term can apply to buying stocks, it does. Whether buying stocks should be considered investment or gambling - is an entirely different distinction.
- sidibe 6y ago
  Well the original shorts claim to have already closed their position and as it went up I think people are probably jumping on that side of the bet as well. Short interest doesn't mean it's going to go up forever this thing is just moving up on ponzi energy not short math
  - beagle3 6y ago
    CNBC reported Melvin Capital closed the shorts, and then it turned out they didn’t. This is very likely criminal market manipulation, but I’d be surprised if it ends up with more than a slap on the wrist to anyone. And ... at the time I wrote that, si/float was still more than 100%, so - no, they most definitely not. (Am on phone now, will check later)
    - sidibe 6y ago
      The idea that the shorts are for sure going to pay a higher price is super misleading and is the fuel for this ponzi. Everyone already knows the value of Gamestop is a tiny fraction of its price, so even if some shorts have to close, others will open short positions. To the people who believe they won't be the bag holders because of high short interest, this basically means the stock will always go up, and when enough people realize that's not true, the party is over and the ones opening short positions or closing long positions recently will be the only ones walking away with actual money.
      - beagle3 6y ago
        Yes, but that’s not more ponzi than e.g. Snapchat which expected to never make money in its filing. When you buy it, you expect to sell it to a bigger fool, or for a miracle. GameStop is the same; they are both doomed, and will be worth 0 sooner or later unless a miracle happens. The only reasonable valuation for either is (assets-liabilities), or liquidation value. All other value is based on a belief something will happen. In GameStop, it’s the belief that there are buyers of last resort who would pay almost any price - which is likely true for some of the shorts. Whether it is 1% or 10% or 100% is what these people are betting on. And the call from industry to pause trading to regroup against Reddit indicates it’s likely a lot more than 1%

by sidibe 6y ago

beagle3 6y ago

Except, as SI/Float was at 139%, there was a guaranteed sucker to buy it off them at basically any price - unlike in a Ponzi scheme where you never know if there’s going to be another sucker.

egwor 6y ago
Hasn't SI/Float been around there for more than a year? I'm not an expert on this. Source: https://www.ortex.com/symbol/nyse/gme/short_interest https://www.ortex.com/symbol/nyse/gme/short_interest
- beagle3 6y ago
  Seems like the 100% line was crossed in Jun 2019 - and it does indeed mean that going long since that point, at almost any price was fundamentally sound investment and not ponzi; It is a pyramid, but the base layer of “suckers”, those that end up taking the losses in a standard ponzi/pyramid are already determined ; they are the most finance literate people in the market, and they did it willingly. WSB is just adding layers in the middle which is rational. The short sellers knew their risks perfectly well and did it willingly. They just didn’t expect anyone will figure out how to take advantage of the setup they created.
  - MrMan 6y ago
    Investment ? Not sure about that
    - beagle3 6y ago
      As much as that term can apply to buying stocks, it does. Whether buying stocks should be considered investment or gambling - is an entirely different distinction.
sidibe 6y ago
Well the original shorts claim to have already closed their position and as it went up I think people are probably jumping on that side of the bet as well. Short interest doesn't mean it's going to go up forever this thing is just moving up on ponzi energy not short math
- beagle3 6y ago
  CNBC reported Melvin Capital closed the shorts, and then it turned out they didn’t. This is very likely criminal market manipulation, but I’d be surprised if it ends up with more than a slap on the wrist to anyone. And ... at the time I wrote that, si/float was still more than 100%, so - no, they most definitely not. (Am on phone now, will check later)
  - sidibe 6y ago
    The idea that the shorts are for sure going to pay a higher price is super misleading and is the fuel for this ponzi. Everyone already knows the value of Gamestop is a tiny fraction of its price, so even if some shorts have to close, others will open short positions. To the people who believe they won't be the bag holders because of high short interest, this basically means the stock will always go up, and when enough people realize that's not true, the party is over and the ones opening short positions or closing long positions recently will be the only ones walking away with actual money.
    - beagle3 6y ago
      Yes, but that’s not more ponzi than e.g. Snapchat which expected to never make money in its filing. When you buy it, you expect to sell it to a bigger fool, or for a miracle. GameStop is the same; they are both doomed, and will be worth 0 sooner or later unless a miracle happens. The only reasonable valuation for either is (assets-liabilities), or liquidation value. All other value is based on a belief something will happen. In GameStop, it’s the belief that there are buyers of last resort who would pay almost any price - which is likely true for some of the shorts. Whether it is 1% or 10% or 100% is what these people are betting on. And the call from industry to pause trading to regroup against Reddit indicates it’s likely a lot more than 1%