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Wall Street was the real winner of the GameStop saga
- spupe 5y agoThis review was rather short and uninformative. There is a slightly longer one here: https://www.latimes.com/entertainment-arts/books/story/2022-02-02/gamestop-book-review-hed-tk https://www.latimes.com/entertainment-arts/books/story/2022-...
- andrewclunn 5y agoSo because people traded (sometimes) using services that had associated fees... Wall Street won? There's nothing in this article that supports the click bait title.
- rossmohax 5y agoBecause what linked is just a promo for the book by Spencer Jakab "The Revolution That Wasn't"
- serallak 5y agoActually it is the economist review of the book, it is in the Culture section.
- ChrisSD 5y agoIt's essentially the old adage about selling shovels during a gold rush.
- carnitine 5y agoSome small hedge funds no one had heard of had a bad year, while market makers like Citadel who thrive on volatility and high volume made a fortune.
- djtango 5y agoMelvin Capital definitely wasn't a HF "no one had heard of"
- djtango 5y agoI'm pretty sure market makers have made a killing off option premiums, especially once they realized the way to kill a gamma squeeze is to jack up premiums to the max to kill momentum (as observed during the despac squeezes)
- dchftcs 5y agoMarket making is a business that avoids taking sides over long time horizons. In this business, they need to be hedged in some way almost all the time, so what you said makes no sense.
- FabHK 5y agoThough, yes, if uncertainty rises, market makers will quote wider spreads, which results in huge implied vols when you try to buy options (particularly not at the money).
- xwolfi 5y agoWell for sure bagholders of worthless GME stocks aren't winning, but the high volume of transactions spread a lot of money everywhere. 1 or 2 hedge funds are still struggling, but that's their problem, "Wall St" is bigger than these 2.
- planetjones 5y agohttps://web.archive.org/web/20220205114640/https://www.economist.com/culture/2022/02/05/wall-street-was-the-real-winner-of-the-gamestop-saga https://web.archive.org/web/20220205114640/https://www.econo...
- dheera 5y agohttps://outline.com/hGfBNu https://outline.com/hGfBNu to read the full article without GDPR, paywall, or other annoyances.
- JumpCrisscross 5y agoHave we ever learned who is behind Outline?
- dheera 5y agoI hope we don't, I really love the idea of useful anonymous websites that grumpy digital rights idiots don't know who to send a court summons to.
- ggambetta 5y agoIt was a weird, fun ride. My writing partner Lutz and I work in tech, but have a real passion for filmmaking. We lost some money on $GME, so we had to tell the story from our point of view. The result is STONKS, a comedy/drama feature screenplay [0], fictional but inspired by the GME events, and a love letter of sorts to WSB. We queried Hollywood producers but were ignored; we shared on WSB itself but we were insta-banned and never told why (but given the founder sold the rights to his life story to Hollywood [1], we can make an informed guess). Anyway, here it is. Feedback welcome. [0] https://gabrielgambetta.com/files/STONKS-2022-02-02.pdf https://gabrielgambetta.com/files/STONKS-2022-02-02.pdf [1] https://www.wsj.com/articles/reddits-wallstreetbets-founder-sells-life-story-to-movie-producer-ratpac-entertainment-11612440001 https://www.wsj.com/articles/reddits-wallstreetbets-founder-...
- galcerte 5y agoMost discussion around $GME takes place on r/Superstonk these days anyways. Can't remember why it was banned from WSB. Something to do with the new mods I believe.
- swarnie 5y agoBecause it took over the entire subreddit for months on end and dominated all conversation. You can only read "Reporting in from Kazakhstan with 2 shares, stay strong apes HODL" so many times....
- voidfunc 5y agoHonestly it didnt just take over the sub it ruined the whole sub and community. Im not going to say WSB was civilized pre-pandemic but it was much smaller with a range of interesting takes on things plus funny memes. And also degenerate gamblers who at least knew what they were fucking with. The quality of poster is much much worse now.
- NoboruWataya 5y agoI followed WSB for a couple of years before the GME thing kicked off. When it did, it was great fun for about a week, then I unsubscribed. It got very repetitive and boring.
- rvanmil 5y agoThere are still many retail investors who think the saga is far from over, and are now betting on direct registration (DRS) of their GME shares with the goal of triggering another, much bigger short squeeze than last year.
- phphphphp 5y agoAlso known as the Mother Of All Collective Delusions
- mixologic 5y agoYeah, yet not even cool enough to get its own phrase in the zeitgeist like "Drink the Kool-Aid"
- goldnugget92 5y agoIts easily dismissed as conspiracy but having read many of their supporting arguments and seeing the SI (Short Interest) being over 220% myself along with the SEC report suggesting that shorts never closed their position... I can't say I would dismiss the possibility of another short squeeze...
- mupuff1234 5y agoWhere do you see a short interest of 220%? Checking yahoo finance now it's listed at around 20%.
- goldnugget92 5y agoHere is a archine from Jan 14, 2020 showing 101% of float SI. https://web.archive.org/web/20200114081942/https://www.marketwatch.com/investing/stock/gme https://web.archive.org/web/20200114081942/https://www.marke... The 220% was in Feb.
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- SideburnsOfDoom 5y ago"the house always wins"
- d--b 5y agoWell in these zero-sum games there is always someone who wins. And clearly many small investors got out with insane returns for a day of trading. But more importantly I think that for many small investors the point was not making money. The point was the story. It was worth losing some cash so that they can be a part of these things. Luckily winning is not always defined by money…
- paulhodge 5y agoSmall nitpick but this is a pet peeve of mine :) . The stock market is not zero sum. It grows over time, and there are many situations where people all succeed together. GME specifically is now hanging out at $100 compared to a very flat $5 two years ago.
- kklisura 5y agoTangentially: I learned a lot while watching Keiths (Roaring Kitty, DFV) streams, even before GameStop took off. It gave me insight in what kind of research and analysis is done for investment and it served almost as a demo for me. It's really a shame that he's not streaming anymore, but I kind of get it.
- mcv 5y agoProbably enjoying his early retirement as a stock market millionaire.
- netcan 5y ago$GME was always going to be a "Revolution That Wasn’t." Almost everyone playing knew it. IMO, it was kind of an exemplifier of postmodernism, used colloquially. All the "beat down hedgies" stuff was just part of the game, just like "fuck the fundamentals" was part of the game. IMO it has had an influence. A neurotic, dramatic lens through which we can look at financial institutions, more abstract economics. What is capital? What is money? Etc. Obviously, it all happens within a context with crypto, a long term bull market, and such. I think one of the features of being a basket case, meme-ish phenomenon is a sort of openness to ideas. Mentality-wise it allows exploring concepts with the vigour of a believer, but without really being bought into the position long term. Meme trading, and maybe trading generally, kind of lends to this. You can believe a "case" a hold the position with caveat. As is typical of "movements" today, there is no expectation of winning... just as there is no expectation that market rationality "wins." Everything, in our times, is a "just so story," in economic rhetoric terms.
- raxxorrax 5y agoI think it should started a discussion about some excesses of the stock market. Rich people can look for battered companies and severely profit from their accelerated demise which some people wanted to fight against for once. Out of their own motives for profit or just for fun to be able to at least once stick it to speculators looking for easy profit. That trading was halted and "corrected" proved they had an impact. I don't think the stock market serves a public function with these mechanisms in place and needs further regulation.
- JumpCrisscross 5y ago> Rich people can look for battered companies and severely profit from their accelerated demise which some people wanted to fight against for once You’re describing accelerating creative destruction. It’s painful but good. Prevent it entirely and you cause stagnation. We can make the human impact more compassionate. But trying to stop it is folly.
- raxxorrax 5y ago
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- 1_player 5y agoIt's just a matter of time before some company insider is paid to manipulate their employers' stock through the power of the /r/WallStreetBets self-defined autists. Companies use social media for astroturfing and viral marketing, why not market manipulation?
- mccorrinall 5y agoHappened a lot when Shkreli was still mod
- dfxm12 5y agoJohn Mackey himself used a burner account on Yahoo finance message boards to talk trash on Wild Oats to try and lower their stock price before Whole Foods acquired them in the mid 00s. chron.com/business/article/Whole-Foods-CEO-used-fake-name-to-knock-rival-1830788.php
- gorjusborg 5y agoIn hindsight, that didn't get nearly as much publicity as it should have.
- afterburner 5y agoMatter of time? It's definitely been happening since the beginning of this thing. GME isn't the only stock talked about on WSB.
- goldnugget92 5y agoIts easily dismissed as conspiracy but having read many of their supporting arguments and seeing the SI (Short Interest) being over 220% myself along with the SEC report suggesting that shorts never closed their position... I can't say I would dismiss the possibility of another short squeeze...
- goldnugget92 5y ago[dead]
- shlant 5y agowow I had no idea how much time has been dumped into propping up this conspiracy theory. People have a lot of time on their hands (but I guess rationalizing ones own investments is good motivation)
- carnitine 5y agoWhy do you think not a single institutional investor has rallied behind this cause? Hedge funds love fucking each other over and would embrace popularity with the public. Why hasn’t some firm with a few billion under management taken up this cause if there’s really anything there?
- goldnugget92 5y agoThey have? Blackrock just added 10% to their stake recently. Not to mention the former-Amazon staff that GameStop is hiring along with the header of BlockChain at Microsoft mentioning working with GameStop on their new NFT Market Place. Don't just get your news from Bloomberg or CNN.
- kasey_junk 5y agoBlackrock and Vanguard own GME because they operate the biggest S&P ETFs and mutual funds. GME has increased its percentage of the S&P because retail investors have bought the position. Blackrock is not taking a position that a short squeeze is possible they are just reacting to the index.
- codeptualize 5y agoWall Street always wins.
- just-tom 5y agoI suggest we start putting [PAYWALL] in titles of links that have paywalls. This way, my time and others' will be spent better.
- moffkalast 5y ago12 ft ladder works on the Economist: https://12ft.io/proxy?q=https%3A%2F%2Fwww.economist.com%2Fculture%2F2022%2F02%2F05%2Fwall-street-was-the-real-winner-of-the-gamestop-saga https://12ft.io/proxy?q=https%3A%2F%2Fwww.economist.com%2Fcu... It's pretty funny that the entire article is only like 3x the length of the preview.
- kwertyoowiyop 5y agoSeconded
- deepdmistry 5y agoThirded
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- ashurov 5y agoI have seen so much fuckery with the stock price and ridiculous headlines in het media about GME that can't really believe that we have seen the actual squeeze. Furthermore, the SEC report said that the price run-up was because retail bought in, not because the hedge funds closed their positions. So when did they do this and went from 200% to 20%? Besides all of that, the fundamentals for GME are great. They are hiring great people and seem to be working behind the scenes with some of the biggest companies to, what seems to be, create a NFT marketplace linked to gaming, that will be 'carbon neutral'. all-in-all a good investment on that end I think. time will tell.
- a254613e 5y agoThis reads exactly like the comments on conspiracy theory subreddits like Superstonk.
- deleted 5y ago[deleted]
- shlant 5y agoyep. "time will tell" meaning GME ideologues will continue to move the goalpost for when the MOASS will happen in perpetuity.
- ashurov 5y agoI don't necessarily believe in MOASS happening anymore, but I do have a strong believe that introducing an NFT marketplace and what else GME has in store will make sure the long term view for this company is optimistic. Wallstreet might have "won", but it seems that SEC is introducing new bills to prevent some of the stuff that was going on.. Hopefully they will start enforcing it as well.
- odonnellryan 5y agoWhy will an NFT marketplace do any of those things?
- jeffrallen 5y agoThe house always wins.
- wolverine876 5y agoHow do we recognize such madness in the future, before we get caught up in it? After it's metastasized?
- jsemrau 5y agoThat's the problem I am trying to solve with finclout. A lot of investors not only retail lost a bunch of money over the last 18 months. Personally, I think there is a space for the retail guy in investing. But it shouldn't be based on FOMO and/or hype. Not stonks and hodling. I think that's very dumb.
- MomoXenosaga 5y agoOur society does not learn from the past. And the nature of man doesn't change.
- wolverine876 5y ago> Our society does not learn from the past. And the nature of man doesn't change. Now that is current madness, IMHO, as insane as Gamestop. Look how society and humanity have changed over history, over the last 10 years, over the last century. The changes are dramatic! And the nature of humans includes those changes; it includes the good as well as the bad, the bad as well as the good (people act like they just discovered the bad part a few years ago!). You and I and all the rest each have the free will to choose between them, decide what we are going to do and what we will make our society. We got here by people choosing good, choosing optimism, almost always in much worse situations than we are. Shame on us if, standing on their shoulders, living on their accomplishments, we choose to quit and throw it all away. (Also, what a miserable way to live, drowning yourself in despair!)
- reducesuffering 5y agoEasy. If it's a unanimous echo chamber on Reddit, (see QAnon and WSB/GME), it's likely wrong and I'd bet on the opposite.
- andris9 5y agoOn the last day of the spike I saw in the pre-market the GME price to go over $500. Figured that this is good enough for me and as everything related to order processing was very slow I set a limit sell order for $490, figuring that it probably hits $500, but wanted to be sure it goes through. Once the price spiked at 483 and started rapidly dropping I was f-ed. Cancelling the sell-order took like an hour (couldn’t add a new sell order without releasing shares from the old one). By that time the price was in the dust.
- jasonwatkinspdx 5y agoThanks for sharing an honest story about your loss. If more people did this people would have a more balanced understanding of how risky these bets truly are.
- olladecarne 5y agoWhy is the financial media so obsessed with Gamestop? It's a relatively tiny company and if it truly was the case that it is over they would have stopped talking about it. Instead they publish fear-mongering articles and hit pieces on people like Keith Gill who was just a normal person seeing a value investment and got lucky. hint: http://www.paulgraham.com/submarine.html http://www.paulgraham.com/submarine.html
- kwertyoowiyop 5y agoYou’re expecting far too much objectivity and rational action from the financial media, my sweet summer child. They’ve always been obsessed by trivia and gimmicks. Much more interesting to write about than “buy a few good index funds and hold forever.”
- carnitine 5y agoIt’s an incredibly interesting story, symbolic of the mass influx of retail investors into the market, and also a fascinating example of cultish mass delusion. The short squeeze is blatantly over in the eyes of basically every investment professional, the incredibly weird price action driven by devotees is not.
- marcosdumay 5y agoThe financial media is media before anything else, and likes an interesting story.
- dfxm12 5y agoI can't speak for financial media at large, but I think this particular article makes it obvious that it is a review of the new book The Revolution That Wasn't by Spencer Jakab.
- malloryerik 5y agoIt's the kind of thing that screams that you're nearing the top of a bull market, or of a bubble. In 2007 it was waiters and the unemployed buying million dollar homes. In 1720 it was people ploughing their life savings into the South Sea Company though they freely admitted they had no clue what it was (understandable, since it was not much of anything). But many HODLed until it all came crashing down. https://en.wikipedia.org/wiki/South_Sea_Company#Top_reached https://en.wikipedia.org/wiki/South_Sea_Company#Top_reached
- dfxm12 5y agoWall street always wins, especially when congress gets involved.
- FuriouslyAdrift 5y agoBecause of my GameStop stock play, I am finally debt free for the first time in my life (after 35 years of paying). No car loan, no college loans, no mortgage. It actually felt good to pay over $10k in taxes for short term gains.
- brink 5y agoAnd others lost their life savings. Some win, some loose. Congrats on paying off all your debts though, that's amazing.
- FabHK 5y agoYes. Insofar as trading helps reveal the "true" value of a stock and thereby helps solving the allocation problem, it creates public benefit. And the companies financed by the equity markets create huge value, of course (parts of which they distribute by dividends or stock buy backs). But if you look narrowly at the gains and losses of trading, it's strictly a zero-sum game (well, negative sum, as the exchanges and market makers take their cut - though that cut in the good old equity markets is minuscule and far, far smaller than in the fancy new crypto exchanges which charge outrageous fees.)
- deleted 5y ago[deleted]
- throwthere 5y agoThat’s a really interesting mix of questionable prudence with total responsibility. Obviously things didn’t work out so well for the people in the other side of your trades.
- MomoXenosaga 5y agoI play videogames and I haven't been inside a game store in 5 years. Absolutely noone was shocked GameStop business is dying. Don't get me wrong I'm as nostalgic of browsing walls of videogames as the next 30+ year old gamer but nostalgia rarely makes money.
- potassiumwreath 5y agoThis seems to be a particularly polarizing topic and I may have some insight into why. There's a supreme value to the widely-held belief that 'the market' just 'works' and is 'fair' or 'free' or something. The only way features like liquidity were possible to offer in the early days of the emerging globalized financial markets was by appointing Market Makers, Authorized Participants, and other privileged positions that could self-regulate and influence the market. There were all kinds of (legitimate) limits to creating a truly 'free' or 'fair' system during the bootstrapping phase. So the system was justified, once upon a time at least... So that's how we got here: What now? Well... many of us still expecting a GME squeeze believe that Market Makers got greedy and instead of contenting themselves with the profit channels they were conceived to capture they used their central position to extract revenue from some less scrupulous places than the bid-ask spread. Once MMs realized the haul they could extract by selling shorts throughout the deaths of certain 'surely dead' companies, it doesn't take a stroke of genius to think about inciting these kinds of events themselves. Here's where the rub comes in: Because of the way things were bootstrapped, most of these Market Makers are self-regulating bodies that self-report a lot of critical positions if they even have to report it _at all_. Regardless of how we got here, the reality is that many privileged positions such as Market Makers do NOT need to report their short positions. Even if they were 'required' there are so many ways to 'hide' the position on a balance sheet that I honestly cannot imagine paperwork exists that would conclusively DISPROVE the possibility of a MOASS. Many others hold the belief that 'the market' is 'working' just 'fine' whatever those words mean to the individual espousing that belief. Their belief is, in general, that the rules of the game are to be trusted. They don't just quote the SEC report citing Self-Regulating Organization short interested coming in at 0% right after Jan 2021, they actually BELIEVE it. They don't even question that these self reporting organizations may be lying. I mean, with their immaculate records how could you not believe them? So there you have it: One group believes mostly on principle that markets are 'good' or 'functioning correctly' thus MOASS couldn't happen and anyone still awaiting MOASS is doing so because of ideological reasons more than a single piece of evidence. Disclaimer: I hold some GME
- rnd0 5y agoWhy is anyone surprised? The house always wins. Always.