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> 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

> 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 4y 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 4y 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 4y 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 4y 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 4y ago
        I don't think anyone was trying to save the stock market. The general vibe was more fire and brimstone.
        dragontamer 4y 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 4y ago
        Yes I'd say that you're wrong with that. To start, it wasn't that short sellers were ruining the market. If you spent any time there, you'd see that they, too, short stocks. Second, it definitely wasn't made up. GME was tremendously shorted. And there were more shares shorted than existed. This is not a unique phenomenon and is possible due to a concept called "naked shorting". It also didn't stop going up because people pumping it stopped. They literally disabled the ability for people to buy more. That is what killed the momentum. https://www.cnbc.com/2021/01/28/robinhood-interactive-brokers-restrict-trading-in-gamestop-s.html https://www.cnbc.com/2021/01/28/robinhood-interactive-broker...
        dragontamer 4y ago
        Yeah, no one is going to change short selling rules any time soon because it's all jus t made up crap and rumors from WSB to pump GME. Hate to break it to ya, but you're getting played of you actually think the problem here was short selling. The problem is that skittery online retail can be so openly manipulated to believe such conspiracies and that this leads to the profits of the small leaders of the crowd.

smcn 4y 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 4y 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 4y 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 4y 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 4y ago
      I don't think anyone was trying to save the stock market. The general vibe was more fire and brimstone.
      - dragontamer 4y 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 4y ago
        Yes I'd say that you're wrong with that. To start, it wasn't that short sellers were ruining the market. If you spent any time there, you'd see that they, too, short stocks. Second, it definitely wasn't made up. GME was tremendously shorted. And there were more shares shorted than existed. This is not a unique phenomenon and is possible due to a concept called "naked shorting". It also didn't stop going up because people pumping it stopped. They literally disabled the ability for people to buy more. That is what killed the momentum. https://www.cnbc.com/2021/01/28/robinhood-interactive-brokers-restrict-trading-in-gamestop-s.html https://www.cnbc.com/2021/01/28/robinhood-interactive-broker...
        dragontamer 4y ago
        Yeah, no one is going to change short selling rules any time soon because it's all jus t made up crap and rumors from WSB to pump GME. Hate to break it to ya, but you're getting played of you actually think the problem here was short selling. The problem is that skittery online retail can be so openly manipulated to believe such conspiracies and that this leads to the profits of the small leaders of the crowd.