5 ms·

I don’t think so... if WSB is being criticised for market manipulation, then so should be hedge fund managers. Everyday we see institutional investors setting n

I don’t think so... if WSB is being criticised for market manipulation, then so should be hedge fund managers. Everyday we see institutional investors setting new price targets for certain stocks—which definitely drives up the price. People are just criticising WSB since newbie investors backed dumb stocks.

grepthisab 6y ago
Someone else committing a crime isn't really a defense to one's own crime though.
- b3kart 6y ago
  No, but if a law is applied inconsistently it raises questions about whether 1) the law is sensible 2) the regulatory system is unbiased. Pointing to such inconsistencies is a perfectly reasonable thing to do.
  - VWWHFSfQ 6y ago
    Resolving those inconsistencies in the law because of uneven enforcement would come quite a long time after the fact. But as the law stands now, this is probably illegal. I doubt anyone will be prosecuted for it, though.
anonuser123456 6y ago
This seems to be the sentiment of a lot of people, but the SEC has in fact prosecuted hedge fund managers for just this tactic in the past. It is generally hard to prosecute because smart hedge fund managers don't leave a paper trail and leave a trail of plausible deniability. But in this case, people are literally admitting "Yes, I would like to engage in your proposed felony." Even manipulation aside... conspiracy itself is a crime. I don't think conspiracies suddenly become legal just because they were very large.
- whomst 6y ago
  The key distinction AFAICT is that r/WSB isn't commanding people to buy, nor does it have any assets of its own. This is just a stochastic result of mania and individual investors doing what they believe to be in their best interest.
  - snet0 6y ago
    > r/WSB isn't commanding people to buy ehhhhhh... I've seen plenty of BUY BUY BUY posts. Unless I'm missing your point. I understand what WSB isn't a corporation or entity in and of itself, but it is still a (somewhat) organised group of uh... "investors".
    - anupamchugh 6y ago
      True... except they don’t call themselves investors. They relish using terms like autists, degenerates. Basically they enjoy sending across a message more than making a fortune today.. it’s like a cult
    - sircastor 6y ago
      But aren’t there plenty of “BUY BUY BUY” posts that result in nothing? My understanding prior to this was that r/WSB was typically a lot of hot air being blown around trying to drum up enthusiasm. No different than your uncle saying at the table “I’ve invested in... and it’s going sky high!” The bar to qualify this random association of people as organized seems pretty high.
      - snet0 6y ago
        Yeah absolutely, this is one of the few shots that landed, but it was still a very obvious shot. I qualified "organised" with "somewhat", because nothing in this kind of place is ever really organised, but I mean just look at what they've done. You couldn't do this with a fully disorganised group.
    - Uw7yTcf36gTc 6y ago
      Cramer says buy buy buy almost every day on his show during lighting round. Is that manipulation too?
cm2187 6y ago
I am not white washing hedge fund managers, but any hedge fund manager that would put in writing in an auditable system that he is considering manufacturing a short squeeze to hurt specific investors and went ahead and did it would have a tough time in court. No one with half a brain would do that (not that in recent history there hasn't been a handful of sub-half-brain bankers who documented their misdeeds in writing).
- fma 6y ago
  Yeah, but if you're Bill Ackman you can do it on front of millions of people on CNBC. "During the epic verbal battle between Icahn and Ackman that was televised on CNBC in January, Icahn predicted that Ackman’s Herbalife investment could produce the “mother of all short squeezes.” Shortly after that incident, it became clear that Icahn had taken a big position in Herbalife’s stock. He has since expanded that position, bought 16.5% of the outstanding shares and gotten two representatives on Herbalife’s board." https://www.forbes.com/sites/nathanvardi/2013/07/22/carl-icahn-is-squeezing-bill-ackman-to-death-with-herbalife-trade/ https://www.forbes.com/sites/nathanvardi/2013/07/22/carl-ica...

grepthisab 6y ago

Someone else committing a crime isn't really a defense to one's own crime though.

b3kart 6y ago
No, but if a law is applied inconsistently it raises questions about whether 1) the law is sensible 2) the regulatory system is unbiased. Pointing to such inconsistencies is a perfectly reasonable thing to do.
- VWWHFSfQ 6y ago
  Resolving those inconsistencies in the law because of uneven enforcement would come quite a long time after the fact. But as the law stands now, this is probably illegal. I doubt anyone will be prosecuted for it, though.

anonuser123456 6y ago

This seems to be the sentiment of a lot of people, but the SEC has in fact prosecuted hedge fund managers for just this tactic in the past. It is generally hard to prosecute because smart hedge fund managers don't leave a paper trail and leave a trail of plausible deniability. But in this case, people are literally admitting "Yes, I would like to engage in your proposed felony." Even manipulation aside... conspiracy itself is a crime. I don't think conspiracies suddenly become legal just because they were very large.

whomst 6y ago
The key distinction AFAICT is that r/WSB isn't commanding people to buy, nor does it have any assets of its own. This is just a stochastic result of mania and individual investors doing what they believe to be in their best interest.
- snet0 6y ago
  > r/WSB isn't commanding people to buy ehhhhhh... I've seen plenty of BUY BUY BUY posts. Unless I'm missing your point. I understand what WSB isn't a corporation or entity in and of itself, but it is still a (somewhat) organised group of uh... "investors".
  - anupamchugh 6y ago
    True... except they don’t call themselves investors. They relish using terms like autists, degenerates. Basically they enjoy sending across a message more than making a fortune today.. it’s like a cult
  - sircastor 6y ago
    But aren’t there plenty of “BUY BUY BUY” posts that result in nothing? My understanding prior to this was that r/WSB was typically a lot of hot air being blown around trying to drum up enthusiasm. No different than your uncle saying at the table “I’ve invested in... and it’s going sky high!” The bar to qualify this random association of people as organized seems pretty high.
    - snet0 6y ago
      Yeah absolutely, this is one of the few shots that landed, but it was still a very obvious shot. I qualified "organised" with "somewhat", because nothing in this kind of place is ever really organised, but I mean just look at what they've done. You couldn't do this with a fully disorganised group.
  - Uw7yTcf36gTc 6y ago
    Cramer says buy buy buy almost every day on his show during lighting round. Is that manipulation too?

cm2187 6y ago

I am not white washing hedge fund managers, but any hedge fund manager that would put in writing in an auditable system that he is considering manufacturing a short squeeze to hurt specific investors and went ahead and did it would have a tough time in court. No one with half a brain would do that (not that in recent history there hasn't been a handful of sub-half-brain bankers who documented their misdeeds in writing).

fma 6y ago
Yeah, but if you're Bill Ackman you can do it on front of millions of people on CNBC. "During the epic verbal battle between Icahn and Ackman that was televised on CNBC in January, Icahn predicted that Ackman’s Herbalife investment could produce the “mother of all short squeezes.” Shortly after that incident, it became clear that Icahn had taken a big position in Herbalife’s stock. He has since expanded that position, bought 16.5% of the outstanding shares and gotten two representatives on Herbalife’s board." https://www.forbes.com/sites/nathanvardi/2013/07/22/carl-icahn-is-squeezing-bill-ackman-to-death-with-herbalife-trade/ https://www.forbes.com/sites/nathanvardi/2013/07/22/carl-ica...