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Forum moderators are not on the hook for what their users say. The SEC or other law enforcement will do as they see fit. I just don't like the suggestion that n

Forum moderators are not on the hook for what their users say. The SEC or other law enforcement will do as they see fit. I just don't like the suggestion that nothing should be done. We're all essentially bystanders to young people being lured into losing a lot of money. This isn't just the Darwinian free market taking its course (which you could object to anyways on ideological grounds); it's a lot of people acting illegally and victimizing some vulnerable people.

DennisP 6y ago
In this case it appears young people got lured into making a lot of money, and the vulnerable people were professional short sellers who should have known better.
- mike00632 6y ago
  I can't tell if you're actually this naïve. GameStop stock is not a success story because it is up at the current moment. Also, vulnerable people are exactly who will be left holding GameStop stock when it inevitably goes down. The narrative that a Robinhood proletariat is making a bunch of money at the expense of evil hedgefund managers is a fairy tale.
  - DennisP 6y ago
    It's generally the short sellers who lose money in a short squeeze. All this paternalism about poor naive retail traders is frankly getting a bit tiresome. They've done quite well for themselves and it won't take much risk management to stay in profit.
    - mike00632 6y ago
      The short sellers? Who exactly? It's not Melvin. How much are these shorts? Where are you getting your information? Are you really taking financial advice from Reddit trolls and unsourced Tweets? I really want to emphasize how naïve this is.
      - DennisP 6y ago
        No, I'm not a participant. Maybe rein in the condescension and learn something about what happened here. It's been all over the nightly news and the financial press. I'll get you started with an article from Fortune: > And while the traders on r/wallstreetbets—the Reddit forum that kicked off the unlikely rally for GameStop stock—may be racking up profits, the damage is accumulating for short-sellers, the investors and hedge funds who bet against, or "short," the stock. By Friday, short-sellers had lost $19.75 billion on GameStop so far this month alone, according to S3 Partners, a New York–based firm that tracks short positions on U.S. stocks. > The losses have hit hedge funds shorting GameStop including Steve Cohen's Point72, as well as other high-profile short-sellers like Andrew Left, who runs Citron Research, a firm that built a reputation for publishing reports on stocks he believed were destined to fall. > After announcing last week that he was shorting GameStop when the stock was trading around $40, Left said Wednesday that he had largely abandoned the trade "at a loss 100%," covering the short—or buying back the stock—when it reached the $90 range. https://fortune.com/2021/01/29/gamestop-stock-how-much-hedge-funds-have-lost-sellers-losses-gme-steve-cohen-point72-andrew-left-citron-research-short-squeeze/ https://fortune.com/2021/01/29/gamestop-stock-how-much-hedge...
        mike00632 6y ago
        Hey, it's some days later and GameStop is down, hedgefunds made money and tons of ignorant, new traders lost money. You couldn't have been more wrong. "Winners of the GameStop rally included wealthy Wall Street hedge funds - The Washington Post" https://www-washingtonpost-com.cdn.ampproject.org/v/s/www.washingtonpost.com/business/2021/02/08/gamestop-wallstreet-wealth/ https://www-washingtonpost-com.cdn.ampproject.org/v/s/www.wa...
mancerayder 6y ago
I'm not for a laissez-faire society, don't get me wrong. But a blanket restriction on risk taking as you're hinting at here to 'protect the vulnerable' is a red flag because who decides how wide this net is and the terms of the net. Concretely, what are we allowed to say and not say (the Reddit forum question at stake here), how much are we allowed to have and not have as demonstrable assets to qualify for a trade (Accredited Investor and Qualified Purchaser already exist in the private equity world), etc. If you take a step back and put a magnifying glass on the principle, protect vulnerable people, you have to ask, what about: smoking, drugs, unhealthy foods in an obesity epidemic, extreme sports, combat sports, driving under the age of 18, and many other questions. What about poor people buying lottery tickets? If I go to a local bodega, I'll stand in line behind people buying lottery tickets, and you can see they are not upper income people. The world is dangerous and we're all vulnerable, and yes, some more than others. Various societies have to decide on the scale of 0 to 100, how much we allow individual to hurt themselves. The answer will be different in China, Sweden, the United States, and so forth, owing to the values of the societies. How about protecting vulnerable investors by regulating entities like short selling hedge funds?
- mike00632 6y ago
  It's not a restriction on taking risk. It's a restriction on spreading misinformation to pump and dump a stock. You could say that the perpetrators were meming, or they didn't know the illegality, or they got caught up in the moment but that defense 1) gives too much benefit of doubt to these people. WSB types know very well that what they're doing is unethical and illegal. It's exactly what they accuse hedgefund boogeymen of doing to stir up their victims. 2) This situation isn't as novel as it seems. There are already deliberations and legal mechanisms in place to determine the culpability of someone who only took a small part in a crime, is a first-time offender or whatever other excuse there is. 3) To carry this point home, I think HackerNews already censors (thankfully) links that try to pump random penny stocks. This type of internet scheme is not new, and most of us have already decided it is something we won't tolerate. This behavior is outrageous and it's not made any better because it's happening in broad daylight or on a large scale. We shouldn't be in such awe of the 'revolution' that we are blinded to its impact.

DennisP 6y ago

In this case it appears young people got lured into making a lot of money, and the vulnerable people were professional short sellers who should have known better.

mike00632 6y ago
I can't tell if you're actually this naïve. GameStop stock is not a success story because it is up at the current moment. Also, vulnerable people are exactly who will be left holding GameStop stock when it inevitably goes down. The narrative that a Robinhood proletariat is making a bunch of money at the expense of evil hedgefund managers is a fairy tale.
- DennisP 6y ago
  It's generally the short sellers who lose money in a short squeeze. All this paternalism about poor naive retail traders is frankly getting a bit tiresome. They've done quite well for themselves and it won't take much risk management to stay in profit.
  - mike00632 6y ago
    The short sellers? Who exactly? It's not Melvin. How much are these shorts? Where are you getting your information? Are you really taking financial advice from Reddit trolls and unsourced Tweets? I really want to emphasize how naïve this is.
    - DennisP 6y ago
      No, I'm not a participant. Maybe rein in the condescension and learn something about what happened here. It's been all over the nightly news and the financial press. I'll get you started with an article from Fortune: > And while the traders on r/wallstreetbets—the Reddit forum that kicked off the unlikely rally for GameStop stock—may be racking up profits, the damage is accumulating for short-sellers, the investors and hedge funds who bet against, or "short," the stock. By Friday, short-sellers had lost $19.75 billion on GameStop so far this month alone, according to S3 Partners, a New York–based firm that tracks short positions on U.S. stocks. > The losses have hit hedge funds shorting GameStop including Steve Cohen's Point72, as well as other high-profile short-sellers like Andrew Left, who runs Citron Research, a firm that built a reputation for publishing reports on stocks he believed were destined to fall. > After announcing last week that he was shorting GameStop when the stock was trading around $40, Left said Wednesday that he had largely abandoned the trade "at a loss 100%," covering the short—or buying back the stock—when it reached the $90 range. https://fortune.com/2021/01/29/gamestop-stock-how-much-hedge-funds-have-lost-sellers-losses-gme-steve-cohen-point72-andrew-left-citron-research-short-squeeze/ https://fortune.com/2021/01/29/gamestop-stock-how-much-hedge...
      - mike00632 6y ago
        Hey, it's some days later and GameStop is down, hedgefunds made money and tons of ignorant, new traders lost money. You couldn't have been more wrong. "Winners of the GameStop rally included wealthy Wall Street hedge funds - The Washington Post" https://www-washingtonpost-com.cdn.ampproject.org/v/s/www.washingtonpost.com/business/2021/02/08/gamestop-wallstreet-wealth/ https://www-washingtonpost-com.cdn.ampproject.org/v/s/www.wa...

mancerayder 6y ago

I'm not for a laissez-faire society, don't get me wrong. But a blanket restriction on risk taking as you're hinting at here to 'protect the vulnerable' is a red flag because who decides how wide this net is and the terms of the net. Concretely, what are we allowed to say and not say (the Reddit forum question at stake here), how much are we allowed to have and not have as demonstrable assets to qualify for a trade (Accredited Investor and Qualified Purchaser already exist in the private equity world), etc. If you take a step back and put a magnifying glass on the principle, protect vulnerable people, you have to ask, what about: smoking, drugs, unhealthy foods in an obesity epidemic, extreme sports, combat sports, driving under the age of 18, and many other questions. What about poor people buying lottery tickets? If I go to a local bodega, I'll stand in line behind people buying lottery tickets, and you can see they are not upper income people. The world is dangerous and we're all vulnerable, and yes, some more than others. Various societies have to decide on the scale of 0 to 100, how much we allow individual to hurt themselves. The answer will be different in China, Sweden, the United States, and so forth, owing to the values of the societies. How about protecting vulnerable investors by regulating entities like short selling hedge funds?

mike00632 6y ago
It's not a restriction on taking risk. It's a restriction on spreading misinformation to pump and dump a stock. You could say that the perpetrators were meming, or they didn't know the illegality, or they got caught up in the moment but that defense 1) gives too much benefit of doubt to these people. WSB types know very well that what they're doing is unethical and illegal. It's exactly what they accuse hedgefund boogeymen of doing to stir up their victims. 2) This situation isn't as novel as it seems. There are already deliberations and legal mechanisms in place to determine the culpability of someone who only took a small part in a crime, is a first-time offender or whatever other excuse there is. 3) To carry this point home, I think HackerNews already censors (thankfully) links that try to pump random penny stocks. This type of internet scheme is not new, and most of us have already decided it is something we won't tolerate. This behavior is outrageous and it's not made any better because it's happening in broad daylight or on a large scale. We shouldn't be in such awe of the 'revolution' that we are blinded to its impact.