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That's not how brokers should work though, speaking in code, they are a wrapper around the market to make an interface that regular people can use. Price disco

That's not how brokers should work though, speaking in code, they are a wrapper around the market to make an interface that regular people can use. Price discovery means that buy/ask spread changes based on supply and demand, were this the case, and there was no collusion, then there would have been no need to shut down trading. The problem is the supply was inflated due to naked shorts, and Robin Hood's clearing house/business partner (Citadel) was caught with their pants down facilitating this naked shorting. Under normal market mechanics, there would be no panic. The price would have increased, early adopters would have gotten profit, late adopters would have missed out and lost as the correct price was found. The January blocking of trades was a desperate 'Hail Mary' to prevent an actual squeeze, and it *worked*. Calculations based on married put/calls shows that 190% of GME has, and still is shorted. There is no way to close the short position without increasing demand. https://www.reddit.com/r/Superstonk/comments/oc4f79/well_there_it_is_more_mathevidence_pointing_to/ https://www.reddit.com/r/Superstonk/comments/oc4f79/well_the... Yes, this is conjecture, but the author is well respected, and if you can disprove any of it, reddit is very happy to help you strengthen/disprove it's case. It's all seems quite cultish over in superstonk, but no-one believed Michael Burry back in 2008.

paulgb 5y ago
> The problem is the supply was inflated due to naked shorts, and Robin Hood's clearing house/business partner (Citadel) was caught with their pants down facilitating this naked shorting. What is the “caught with their pants down” referring to? I’ve seen dubious speculation but this is the first I’ve heard of them being caught on anything.
- real-dino 5y ago
  They had a naked short position, one that could not be covered, and when the price rose too high, they would be margin called. When all the shares on the market are synthetic (fake), and retail and investors own more shares than are issued, then there is a serious problem that can either be brushed under the rug, or untangled by force (liquidation) Citadel itself is a hedge fund AND a market maker, it has two arms both ran by Ken Griffin. The path they were going down pre January was to short Gamestop into bankruptcy with no means to raise capital, much like Toys R us was. When Gamestop got a new CEO, and changed direction, they had already gone 'all-in' with their shorting with no way out. Main thing about shorting, it's an infinite risk position, but hedgefunds have historically been able to short into oblivion.
  - paulgb 5y ago
    That’s aligned with what I’ve heard speculated, but what’s the part where they were caught? The reddit post doesn’t point to a Citadel link, unless I’m missing something.
    - real-dino 5y ago
      Not literally caught, they are stuck in a position of covering and liquidating or seeing how far they can kick the can down the road.
gruez 5y ago
>Price discovery means that buy/ask spread changes based on supply and demand, were this the case, and there was no collusion, then there would have been no need to shut down trading. 1. they didn't shut down trading, only forced positions to go into close-only 2. they absolutely needed to do that, given that they were at risk of not being able to meet deposit requirements, which would mean they would have to suspend trading for all stocks >Calculations based on married put/calls shows that 190% of GME has, and still is shorted. There is no way to close the short position without increasing demand. 1. shorts in excess of 100% doesn't indicate anything nefarious, due to synthetic longs created by shorts 2. I'm very skeptical of these "calculations", when official numbers put short interest at far lower than that, eg https://fintel.io/ss/us/gme https://fintel.io/ss/us/gme. >Yes, this is conjecture, but the author is well respected, Is he? Respected by whom? The superstonk community? The financial community? If it's just the latter it doesn't mean much. >It's all seems quite cultish over in superstonk, but no-one believed Michael Burry back in 2008. “But the fact that some geniuses were laughed at does not imply that all who are laughed at are geniuses. They laughed at Columbus, they laughed at Fulton, they laughed at the Wright brothers. But they also laughed at Bozo the Clown.” -- Carl Sagan
- real-dino 5y ago
  1. They shut it down enough to prevent retail from FOMOing in more. At that point, the rules of the game were changed, and the price dropped. 2. I'm skeptical too, but there is no way the reported figures are accurate. Finra itself lists RC Ventures/Blackrock twice, and adds up to more than 100% for institutional investors. Information on Bloomberg terminals is completely wrong, and information on short positions is self reported. I'm tempted to believe criand's latest DD, as it's yet to be disproven. Older DD has not stood the test of time so well. In regards to qualifications, yes, the superstonk members are self policing, but also they don't accept that credentials mean you are automatically right, and people who are wrong are called out almost immediately. There's not going to be a place where it says 'This stock is owned 290%', but then again, that's the nature of Russell's teapot. Given what I've seen with news coverage, the promotion of AMC as an alternative, and the passing of so many SEC rule changes, it's hard to imagine zero fuckery behind the scenes.

paulgb 5y ago

> The problem is the supply was inflated due to naked shorts, and Robin Hood's clearing house/business partner (Citadel) was caught with their pants down facilitating this naked shorting. What is the “caught with their pants down” referring to? I’ve seen dubious speculation but this is the first I’ve heard of them being caught on anything.

real-dino 5y ago
They had a naked short position, one that could not be covered, and when the price rose too high, they would be margin called. When all the shares on the market are synthetic (fake), and retail and investors own more shares than are issued, then there is a serious problem that can either be brushed under the rug, or untangled by force (liquidation) Citadel itself is a hedge fund AND a market maker, it has two arms both ran by Ken Griffin. The path they were going down pre January was to short Gamestop into bankruptcy with no means to raise capital, much like Toys R us was. When Gamestop got a new CEO, and changed direction, they had already gone 'all-in' with their shorting with no way out. Main thing about shorting, it's an infinite risk position, but hedgefunds have historically been able to short into oblivion.
- paulgb 5y ago
  That’s aligned with what I’ve heard speculated, but what’s the part where they were caught? The reddit post doesn’t point to a Citadel link, unless I’m missing something.
  - real-dino 5y ago
    Not literally caught, they are stuck in a position of covering and liquidating or seeing how far they can kick the can down the road.

gruez 5y ago

>Price discovery means that buy/ask spread changes based on supply and demand, were this the case, and there was no collusion, then there would have been no need to shut down trading. 1. they didn't shut down trading, only forced positions to go into close-only 2. they absolutely needed to do that, given that they were at risk of not being able to meet deposit requirements, which would mean they would have to suspend trading for all stocks >Calculations based on married put/calls shows that 190% of GME has, and still is shorted. There is no way to close the short position without increasing demand. 1. shorts in excess of 100% doesn't indicate anything nefarious, due to synthetic longs created by shorts 2. I'm very skeptical of these "calculations", when official numbers put short interest at far lower than that, eg https://fintel.io/ss/us/gme https://fintel.io/ss/us/gme. >Yes, this is conjecture, but the author is well respected, Is he? Respected by whom? The superstonk community? The financial community? If it's just the latter it doesn't mean much. >It's all seems quite cultish over in superstonk, but no-one believed Michael Burry back in 2008. “But the fact that some geniuses were laughed at does not imply that all who are laughed at are geniuses. They laughed at Columbus, they laughed at Fulton, they laughed at the Wright brothers. But they also laughed at Bozo the Clown.” -- Carl Sagan

real-dino 5y ago
1. They shut it down enough to prevent retail from FOMOing in more. At that point, the rules of the game were changed, and the price dropped. 2. I'm skeptical too, but there is no way the reported figures are accurate. Finra itself lists RC Ventures/Blackrock twice, and adds up to more than 100% for institutional investors. Information on Bloomberg terminals is completely wrong, and information on short positions is self reported. I'm tempted to believe criand's latest DD, as it's yet to be disproven. Older DD has not stood the test of time so well. In regards to qualifications, yes, the superstonk members are self policing, but also they don't accept that credentials mean you are automatically right, and people who are wrong are called out almost immediately. There's not going to be a place where it says 'This stock is owned 290%', but then again, that's the nature of Russell's teapot. Given what I've seen with news coverage, the promotion of AMC as an alternative, and the passing of so many SEC rule changes, it's hard to imagine zero fuckery behind the scenes.