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It certainly has that reputation but it is largely unearned in my experience. There is no explicit coordination happening to create pump and dumps. There has,

by smcn 3y ago

It certainly has that reputation but it is largely unearned in my experience. There is no explicit coordination happening to create pump and dumps. There has, on occasion, been some level of coordination when attempting to trigger a short squeeze but that is mechanically different than a pump and dump. What it does do, though, is spur memetic investment, which can create a short term frenzy for some stocks but it is not a planned event. Thousands of people post stocks each day and every so often a stock will perform well enough to where the community will take hold of it and push it to pretty incredible heights. The most recent one would be TRKA. If you're switched on enough, you can make some pretty massive gains. However don't take this as me defending their crypto scam. That's just downright not okay.

dragontamer 3y ago
> What it does do, though, is spur memetic investment, which can create a short term frenzy for some stocks but it is not a planned event Erm... investing in a security, then trying to create a meme is a pump-and-dump scheme by any other name. You've just changed the name "pump" to "meme", rather than using old-school behaviors like boiler rooms. Its even "meming" the same information: too the moon, or whatever. In the 90s, it was all cold calls over telephone, but today you can use online forums to do this.
- smcn 3y ago
  I'd argue that is a very simplistic way of looking at it. There is always a narrative as to why a stock will go "to the moon". You say it's explicitly a pump and dump and it's not really, no. Look at GME, the idea was to restrict the float so that when the shorts got exercised, they would be trying to buy shares that didn't exist, creating exponential demand which would increase the price significantly. Not an impossible feat[0]. The "memetic" part of it is purely information exchange. That's all. If that's the barrier for entry for being considered a pump and dump, then I'd say anything which reports on a companys action could be a pump and dump. From Financial Times, to Bloomberg, to Mad Money, to StockTwits, to whomever else. 0: https://internationalbanker.com/history-of-financial-crises/the-volkswagen-short-squeeze-2008/ https://internationalbanker.com/history-of-financial-crises/...
  - xsmasher 3y ago
    In what way is this different than a pump and dump? You tout the stock and say it's going to 5x, 10x, whatever because of X. Then the suckers buy. Then you sell.
    - smcn 3y ago
      Well, it's different because of whatever X is. X is the reason why the idea can spread through the community. It needs to make sense on some fundamental level in order to get past the onslaught of ridicule that every stock and member is subjected to. If you say "ABC is going to increase 10x because it has a funny name" that obviously won't fly, but if you give a detailed account of why it is possible (this is called DD - due diligence), this has much more potential to excite people. I wouldn't classify open source intelligence as a pump and dump.
      - dragontamer 3y ago
        You mean like 'Save the stock market from big banks by buying GME?' It was the biggest crock of $$$$ I've ever heard, no element of truth to it. But it meme'd really well.
        smcn 3y ago
        I don't think anyone was trying to save the stock market. The general vibe was more fire and brimstone.
        dragontamer 3y ago
        They made up a story about how short sellers were ruining the stock market and then tried to say that punishing them would save the stock market. Or am I wrong in my assessment? Then the crowds ate it up and GME mooned. The pumpers then dumped and RoaringKitty became a millionaire.
        smcn 3y ago
lupire 3y ago
2.5 years after the "MOASS", even after Ryan Cohen rugpulled WSB with BBBY, GME is still 6x the price it was before. Maybe it's all bagholders who are down 75% from Jan 2021, but that's still amazing.
- smcn 3y ago
  The thing is, the GME situation is still developing. The new thing is that they're buying and directly registering their shares (DRS). This prevents brokers from lending shares out. As a result of this, they own almost 25% of the company by themselves[0], which is absolutely incredible when you think about it. I know that they're expecting MOASS as a result of this and I'm a bit iffy on whether that can happen but I am eagerly watching to see what happens. Nothing like this has been attempted and it's just fascinating to me. https://www.thestreet.com/memestocks/gme/76-million-gamestop-shares-are-directly-registered-and-nobody-on-wall-street-is-talking-about-it https://www.thestreet.com/memestocks/gme/76-million-gamestop...

by smcn 3y ago

dragontamer 3y ago

> What it does do, though, is spur memetic investment, which can create a short term frenzy for some stocks but it is not a planned event Erm... investing in a security, then trying to create a meme is a pump-and-dump scheme by any other name. You've just changed the name "pump" to "meme", rather than using old-school behaviors like boiler rooms. Its even "meming" the same information: too the moon, or whatever. In the 90s, it was all cold calls over telephone, but today you can use online forums to do this.

smcn 3y ago
I'd argue that is a very simplistic way of looking at it. There is always a narrative as to why a stock will go "to the moon". You say it's explicitly a pump and dump and it's not really, no. Look at GME, the idea was to restrict the float so that when the shorts got exercised, they would be trying to buy shares that didn't exist, creating exponential demand which would increase the price significantly. Not an impossible feat[0]. The "memetic" part of it is purely information exchange. That's all. If that's the barrier for entry for being considered a pump and dump, then I'd say anything which reports on a companys action could be a pump and dump. From Financial Times, to Bloomberg, to Mad Money, to StockTwits, to whomever else. 0: https://internationalbanker.com/history-of-financial-crises/the-volkswagen-short-squeeze-2008/ https://internationalbanker.com/history-of-financial-crises/...
- xsmasher 3y ago
  In what way is this different than a pump and dump? You tout the stock and say it's going to 5x, 10x, whatever because of X. Then the suckers buy. Then you sell.
  - smcn 3y ago
    Well, it's different because of whatever X is. X is the reason why the idea can spread through the community. It needs to make sense on some fundamental level in order to get past the onslaught of ridicule that every stock and member is subjected to. If you say "ABC is going to increase 10x because it has a funny name" that obviously won't fly, but if you give a detailed account of why it is possible (this is called DD - due diligence), this has much more potential to excite people. I wouldn't classify open source intelligence as a pump and dump.
    - dragontamer 3y ago
      You mean like 'Save the stock market from big banks by buying GME?' It was the biggest crock of $$$$ I've ever heard, no element of truth to it. But it meme'd really well.
      - smcn 3y ago
        I don't think anyone was trying to save the stock market. The general vibe was more fire and brimstone.
        dragontamer 3y ago
        They made up a story about how short sellers were ruining the stock market and then tried to say that punishing them would save the stock market. Or am I wrong in my assessment? Then the crowds ate it up and GME mooned. The pumpers then dumped and RoaringKitty became a millionaire.
        smcn 3y ago

lupire 3y ago

2.5 years after the "MOASS", even after Ryan Cohen rugpulled WSB with BBBY, GME is still 6x the price it was before. Maybe it's all bagholders who are down 75% from Jan 2021, but that's still amazing.

smcn 3y ago
The thing is, the GME situation is still developing. The new thing is that they're buying and directly registering their shares (DRS). This prevents brokers from lending shares out. As a result of this, they own almost 25% of the company by themselves[0], which is absolutely incredible when you think about it. I know that they're expecting MOASS as a result of this and I'm a bit iffy on whether that can happen but I am eagerly watching to see what happens. Nothing like this has been attempted and it's just fascinating to me. https://www.thestreet.com/memestocks/gme/76-million-gamestop-shares-are-directly-registered-and-nobody-on-wall-street-is-talking-about-it https://www.thestreet.com/memestocks/gme/76-million-gamestop...