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> Actually the fact that they were letting people exit trades was a big clue to me that this was risk mitigation while this collusion with citadel narrative was

> Actually the fact that they were letting people exit trades was a big clue to me that this was risk mitigation while this collusion with citadel narrative was making the rounds. Ok let's say I'm a retail investor using RH. Why should I need to divine what my brokerage is doing from Twitter posts and Reddit? My should I need to wait hours for their explanation that comes in the form of a handwavey blog post?

dkrich 6y ago
You shouldn’t, and I’m not defending RH’s handling of a PR crisis, which is never easy and one that every successful company eventually encounters at some point. I don’t use RH personally. My guess is they had problems with collateral obligations but didn’t have their arms around the problem so the immediate solution was to pull the plug until they could get their affairs in order. This by the way isn’t the first time they’ve had these problems. A lesser known story in wsb lore was ironyman who a few years ago opened so many box spreads before RH knew what was happening that he turned an initial $500 account into a $50,000 loss. That should never be able to happen obviously but RH was ill prepared. It’s clear in hindsight that something like what’s happening now or worse was almost inevitable. They seem to take move fast and break things to another level. The problem is that when you don’t dot your i’s in the stock market you can be fine for years and then one day get carried out in a casket. I surely would never consider using RH at any point. My point was that a mob formed instantly with false narratives about what was happening. It’s clear now that these moves are entirely due to risk mitigation and that it had nothing to do with collusion with Citadel to cheat people. So the conversation has shifted from outright collusion to cheat retail investors to one of terrible communications.

dkrich 6y ago

You shouldn’t, and I’m not defending RH’s handling of a PR crisis, which is never easy and one that every successful company eventually encounters at some point. I don’t use RH personally. My guess is they had problems with collateral obligations but didn’t have their arms around the problem so the immediate solution was to pull the plug until they could get their affairs in order. This by the way isn’t the first time they’ve had these problems. A lesser known story in wsb lore was ironyman who a few years ago opened so many box spreads before RH knew what was happening that he turned an initial $500 account into a $50,000 loss. That should never be able to happen obviously but RH was ill prepared. It’s clear in hindsight that something like what’s happening now or worse was almost inevitable. They seem to take move fast and break things to another level. The problem is that when you don’t dot your i’s in the stock market you can be fine for years and then one day get carried out in a casket. I surely would never consider using RH at any point. My point was that a mob formed instantly with false narratives about what was happening. It’s clear now that these moves are entirely due to risk mitigation and that it had nothing to do with collusion with Citadel to cheat people. So the conversation has shifted from outright collusion to cheat retail investors to one of terrible communications.