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$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

by 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 ago
I 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
    You propose certainty where there is none and I am not talking about preventing it outright. I also do believe that it a profitable endeavour with very little general advantages as it is right now. That is more parasitic than constructive, so in that regard it fails to justify itself and regulation is required. Little would stagnate if modern fintech would be scraped almost entirely. Human impact should be secondary here. Additionally creative destruction can also mean that I destroy the wealth of those that currently do profit from canceling companies prematurely. It is applicable to economies rebuilding after a war, not applicable to Gamestop. That is an excuse for exploitation.
    - gruez 5y ago
      >I also do believe that it a profitable endeavour with very little general advantages as it is right now. the "advantage" here is that the true value of the company is reflected in the market, so that capital is allocated to the best companies rather than the most hyped ones. >That is more parasitic than constructive Can you explain how it's "parasitic"? >Additionally creative destruction can also mean that I destroy the wealth of those that currently do profit from canceling companies prematurely Isn't that what happens if someone thinks a stock will go down, shorts it, and gets it wrong?
  - netcan 5y ago
    Perhaps, but honestly, I think Schumpeterian creative destruction is... at this point, more of an idealistic take. It exists, but it isn't a permanent feature of the big fish economy that stock markets represent. There are processes like online travel retail overtaking travel agenting. That's a sort of creative destruction. Mostly though, travel agents were an SME sector. Like the proverbial (and literal) restaurant trade, they're subject to market forces in this way and the theory often plays out in practice. Heavy price competition. Creative destruction. Etc. Banking OTOH, doesn't really have a creative destruction dynamic to speak of. Most auto manufacturers are what and who they were 20 or 50 years ago. Big tech, also, doesn't compete like restaurants do. It's more about holding control via network effects, platforms or whatnot. Avoiding head to head competition and market price dynamics entirely. GME fell somewhere in the middle. They're kind of restaurant like, but also relatively big and publicly traded. In any case, the financial meta game can often be more relevant and determinant of reality than market dynamics as per Schumpeter, JS Mill and the like.
- WJW 5y ago
  > people can look for battered companies and severely profit from their accelerated demise Gamestop is one of those companies where the demise has been severely delayed IMO; they could've seen the future years ago but chose to stay with their legacy business of selling games in physical stores. Online game stores do what they do but with much lower costs and a much better business model. There are two ways forward for Gamestop IMO but neither is very positive: - They try to compete with the giants in the online gaming market, like Steam. I can't see them bootstrap their way into that, Steam and the others have too much network effect going on and GME has not shown any real talent in the online/tech domain. - They try to revitalize their offline presence. I don't see this happening either. There has been a decades long trend of everything moving from off- to on-line and I don't see that changing anytime soon. For anyone who agrees with the above assessment, the conclusion would be that the future for Gamestop is not very bright. Depending on the timescale you think it is going to play out, being short is an entirely valid position to be in. Personally, I think the sentimental memories of the ~25-~45 years old generation will keep it alive for a decade or so more.
  - FractalParadigm 5y ago
    GameStop has pivoted to some extent. It's incredibly rare that I go into one of their stores, but the last time I did it was less of a games store and more of a gaming merchandise store. Their acquisition of ThinkGeek and subsequent selling of those products in stores is satisfying a niche that nobody else (apart from maybe the mom & pop comic book store) seems interested in.
    - j2bax 5y ago
      I’m always surprised how much random gaming merch Target displays.
    - gruez 5y ago
      >it was less of a games store and more of a gaming merchandise store. Their acquisition of ThinkGeek and subsequent selling of those products in stores is satisfying a niche that nobody else (apart from maybe the mom & pop comic book store) seems interested in. Maybe it's just my personal preferences, but I can't imagine myself or anyone I know buying enough "gaming merchandise" in significant numbers. If I need a game, it's either digital, or physical through amazon with same day delivery. It's the same with other gaming-related merchandise. I go for whatever's cheaper/on sale, which is usually bestbuy or amazon.
- this_user 5y ago
  The purpose of stock markets is to find the "correct" price for a stock. To that end, it needs to be possible to express both bullish and bearish views. However, doing the latter is already more difficult because in order to short the stock, you need to borrow it first, and you need to pay for those borrowed shares for as long as you keep holding them. Furthermore, those borrows can be pulled at any time, forcing you to cover at the most inopportune of times. There are also things like Reg SHO Rule 201(b) ("Uptick rule") that further complicate shorting a stock. Regulators have even been known to ban short sales in certain names outright like they they did for financial stocks during the 2008 financial crisis. If anything, selling short needs to be made easier as it represents an essential corrective. And this ultimately serves the greater good too as it ensures that the price of a stock is correct and investors don't overpay, which will inevitably lead to losses for them. A good recent example of what happens otherwise is Wirecard. In 2019 the German BaFin enacted a ban on short sales in the stock of the company after reports had been published that were essentially accusing them of fraud. In the end, those reports turned out to be true, and the company collapsed less than 18 months later. The stock fell from over EUR 150 to virtually zero and investors lost pretty much everything. They should have listened to the short sellers rather than fight them. There are also no "easy profits" in short selling. They only make money if they are right. There are people who have been calling for the immediate collapse of Tesla for the last decade or so. Others have been trying to short Amazon, Google, Apple, Microsoft, because they think that these companies are completely overvalues. Most of these people are probably bankrupt by now. But GME isn't any of those companies. They are a failing brick and mortar retailer that is boxed in by Steam on one side and Amazon on the other. They have repeatedly attempted to transform the company over the last decade without success. The fact that their plan is to launch some NFT market place, a field in which they have no experience and that is already crowded by established players like OpenSea, demonstrates how much their management is completely out of ideas. And if the shorts make money from the GME stock, it just means they were right.
  - netcan 5y ago
    >> The purpose of stock markets is to find the "correct" price for a stock. Is it? Who's purpose? The main purpose of an IPO is (was?) financing. IE, raising money for the company operations... like a bank loan, VC investment, etc. In practice, many of today's IPOs are companies that don't need to raise money (anymore). For those companies, their main purpose when doing an IPO is usually liquidity. IE, letting founders, investors and such cash their shares... or continue owning them with the added benefit of market prices to validate the value of their wealth. Your argument is quite mainstream, but I can't see how anyone would make it except to justify short selling. It seems to me there's a lot of "you sure about that?" in the whole thing. Are you sure "finding the correct price" is an actual need? Who needs this, and why? Are you sure short selling makes for better prices? Liquidity is a similar argument made in favour of derivative HFT and such. I also think its (probably/usually) quite bogus. Do stock markets even have liquidity problems? Stocks are insanely liquid. That's what they're for.
- FabHK 5y ago
  > I don't think the stock market serves a public function with these mechanisms in place The purpose is precisely to zoom in on the correct value of a stock (via crowdsourcing and putting your money where your mouth is), and thereby allow investment to flow to the most advantageous opportunities.
- jcranberry 5y ago
  Sufficient volatility will cause automatically triggered halts. It's required by regnms.
cirgue 5y ago
WSB started as a canard to get more drunk tourists to the small stakes poker tables, in this analogy the poker table is low volume options where you can get a handful of robinhood investors to move the price and make a quick thousand bucks. It’s still that today, but larger players with more money figured out that they could do that too, and potentially on a larger scale. That’s what this has always been about. There’s no movement, there’s no postmodern narrative, it’s just a bunch of people pumping and dumping and using the “movement” thing as a fig leaf.
- wsb_mod2 5y ago
  > WSB started as a canard to get more drunk tourists to the small stakes poker tables 1. WSB was created before Robinhood was released. 2. WSB started as a place for people to discuss more risky strategies than what was being discussed on r/investing 3. Yes. There is no movement. WSB is not your personal army.
  - cirgue 5y ago
    “Robinhood investors” is a synecdoche here. Substitute “etrade” if you prefer.
- spelunker 5y ago
  Just like crypto! Hey, wanna buy into ShibaInuElonIsTheBestCoin? I hear it's gonna pump soon.
  - Bombthecat 5y ago
    Shiba just pumped hard for no reason.. Really.. Market is still full of shit..

by netcan 5y ago

raxxorrax 5y ago

I 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
  You propose certainty where there is none and I am not talking about preventing it outright. I also do believe that it a profitable endeavour with very little general advantages as it is right now. That is more parasitic than constructive, so in that regard it fails to justify itself and regulation is required. Little would stagnate if modern fintech would be scraped almost entirely. Human impact should be secondary here. Additionally creative destruction can also mean that I destroy the wealth of those that currently do profit from canceling companies prematurely. It is applicable to economies rebuilding after a war, not applicable to Gamestop. That is an excuse for exploitation.
  - gruez 5y ago
    >I also do believe that it a profitable endeavour with very little general advantages as it is right now. the "advantage" here is that the true value of the company is reflected in the market, so that capital is allocated to the best companies rather than the most hyped ones. >That is more parasitic than constructive Can you explain how it's "parasitic"? >Additionally creative destruction can also mean that I destroy the wealth of those that currently do profit from canceling companies prematurely Isn't that what happens if someone thinks a stock will go down, shorts it, and gets it wrong?
- netcan 5y ago
  Perhaps, but honestly, I think Schumpeterian creative destruction is... at this point, more of an idealistic take. It exists, but it isn't a permanent feature of the big fish economy that stock markets represent. There are processes like online travel retail overtaking travel agenting. That's a sort of creative destruction. Mostly though, travel agents were an SME sector. Like the proverbial (and literal) restaurant trade, they're subject to market forces in this way and the theory often plays out in practice. Heavy price competition. Creative destruction. Etc. Banking OTOH, doesn't really have a creative destruction dynamic to speak of. Most auto manufacturers are what and who they were 20 or 50 years ago. Big tech, also, doesn't compete like restaurants do. It's more about holding control via network effects, platforms or whatnot. Avoiding head to head competition and market price dynamics entirely. GME fell somewhere in the middle. They're kind of restaurant like, but also relatively big and publicly traded. In any case, the financial meta game can often be more relevant and determinant of reality than market dynamics as per Schumpeter, JS Mill and the like.
WJW 5y ago
> people can look for battered companies and severely profit from their accelerated demise Gamestop is one of those companies where the demise has been severely delayed IMO; they could've seen the future years ago but chose to stay with their legacy business of selling games in physical stores. Online game stores do what they do but with much lower costs and a much better business model. There are two ways forward for Gamestop IMO but neither is very positive: - They try to compete with the giants in the online gaming market, like Steam. I can't see them bootstrap their way into that, Steam and the others have too much network effect going on and GME has not shown any real talent in the online/tech domain. - They try to revitalize their offline presence. I don't see this happening either. There has been a decades long trend of everything moving from off- to on-line and I don't see that changing anytime soon. For anyone who agrees with the above assessment, the conclusion would be that the future for Gamestop is not very bright. Depending on the timescale you think it is going to play out, being short is an entirely valid position to be in. Personally, I think the sentimental memories of the ~25-~45 years old generation will keep it alive for a decade or so more.
- FractalParadigm 5y ago
  GameStop has pivoted to some extent. It's incredibly rare that I go into one of their stores, but the last time I did it was less of a games store and more of a gaming merchandise store. Their acquisition of ThinkGeek and subsequent selling of those products in stores is satisfying a niche that nobody else (apart from maybe the mom & pop comic book store) seems interested in.
  - j2bax 5y ago
    I’m always surprised how much random gaming merch Target displays.
  - gruez 5y ago
    >it was less of a games store and more of a gaming merchandise store. Their acquisition of ThinkGeek and subsequent selling of those products in stores is satisfying a niche that nobody else (apart from maybe the mom & pop comic book store) seems interested in. Maybe it's just my personal preferences, but I can't imagine myself or anyone I know buying enough "gaming merchandise" in significant numbers. If I need a game, it's either digital, or physical through amazon with same day delivery. It's the same with other gaming-related merchandise. I go for whatever's cheaper/on sale, which is usually bestbuy or amazon.
this_user 5y ago
The purpose of stock markets is to find the "correct" price for a stock. To that end, it needs to be possible to express both bullish and bearish views. However, doing the latter is already more difficult because in order to short the stock, you need to borrow it first, and you need to pay for those borrowed shares for as long as you keep holding them. Furthermore, those borrows can be pulled at any time, forcing you to cover at the most inopportune of times. There are also things like Reg SHO Rule 201(b) ("Uptick rule") that further complicate shorting a stock. Regulators have even been known to ban short sales in certain names outright like they they did for financial stocks during the 2008 financial crisis. If anything, selling short needs to be made easier as it represents an essential corrective. And this ultimately serves the greater good too as it ensures that the price of a stock is correct and investors don't overpay, which will inevitably lead to losses for them. A good recent example of what happens otherwise is Wirecard. In 2019 the German BaFin enacted a ban on short sales in the stock of the company after reports had been published that were essentially accusing them of fraud. In the end, those reports turned out to be true, and the company collapsed less than 18 months later. The stock fell from over EUR 150 to virtually zero and investors lost pretty much everything. They should have listened to the short sellers rather than fight them. There are also no "easy profits" in short selling. They only make money if they are right. There are people who have been calling for the immediate collapse of Tesla for the last decade or so. Others have been trying to short Amazon, Google, Apple, Microsoft, because they think that these companies are completely overvalues. Most of these people are probably bankrupt by now. But GME isn't any of those companies. They are a failing brick and mortar retailer that is boxed in by Steam on one side and Amazon on the other. They have repeatedly attempted to transform the company over the last decade without success. The fact that their plan is to launch some NFT market place, a field in which they have no experience and that is already crowded by established players like OpenSea, demonstrates how much their management is completely out of ideas. And if the shorts make money from the GME stock, it just means they were right.
- netcan 5y ago
  >> The purpose of stock markets is to find the "correct" price for a stock. Is it? Who's purpose? The main purpose of an IPO is (was?) financing. IE, raising money for the company operations... like a bank loan, VC investment, etc. In practice, many of today's IPOs are companies that don't need to raise money (anymore). For those companies, their main purpose when doing an IPO is usually liquidity. IE, letting founders, investors and such cash their shares... or continue owning them with the added benefit of market prices to validate the value of their wealth. Your argument is quite mainstream, but I can't see how anyone would make it except to justify short selling. It seems to me there's a lot of "you sure about that?" in the whole thing. Are you sure "finding the correct price" is an actual need? Who needs this, and why? Are you sure short selling makes for better prices? Liquidity is a similar argument made in favour of derivative HFT and such. I also think its (probably/usually) quite bogus. Do stock markets even have liquidity problems? Stocks are insanely liquid. That's what they're for.
FabHK 5y ago
> I don't think the stock market serves a public function with these mechanisms in place The purpose is precisely to zoom in on the correct value of a stock (via crowdsourcing and putting your money where your mouth is), and thereby allow investment to flow to the most advantageous opportunities.
jcranberry 5y ago
Sufficient volatility will cause automatically triggered halts. It's required by regnms.

cirgue 5y ago

WSB started as a canard to get more drunk tourists to the small stakes poker tables, in this analogy the poker table is low volume options where you can get a handful of robinhood investors to move the price and make a quick thousand bucks. It’s still that today, but larger players with more money figured out that they could do that too, and potentially on a larger scale. That’s what this has always been about. There’s no movement, there’s no postmodern narrative, it’s just a bunch of people pumping and dumping and using the “movement” thing as a fig leaf.

wsb_mod2 5y ago
> WSB started as a canard to get more drunk tourists to the small stakes poker tables 1. WSB was created before Robinhood was released. 2. WSB started as a place for people to discuss more risky strategies than what was being discussed on r/investing 3. Yes. There is no movement. WSB is not your personal army.
- cirgue 5y ago
  “Robinhood investors” is a synecdoche here. Substitute “etrade” if you prefer.
spelunker 5y ago
Just like crypto! Hey, wanna buy into ShibaInuElonIsTheBestCoin? I hear it's gonna pump soon.
- Bombthecat 5y ago
  Shiba just pumped hard for no reason.. Really.. Market is still full of shit..