Gamestop fiasco

[robj144]

Have you guys been following the Gamestop stock pump the last few days?

Basically, Gamestop is about to go out of business so a bunch of hedge funds invested heavily in a short position. But, a bunch of people on reddit wanted to manipulate the market in the other direction because they feel the hedge funds do the same thing all the time. So, they drove the price way up causing a short squeeze with the hedge funds closing their positions and losing billions.

The whole thing is quite interesting and strange at the same time.

[Methos1979]

Yes, I'm watching the markets tank right before closing. Which is good so I can buy more and make a ton of money!

[1neeto]

And one of the guys heavily invested is the guy Christian Bale played as in the movie The Big Short.

[fazool]

I think , fundamentally, something is wrong with society where the people who create material wealth make dramatically less money than someone who just invested but didn't actually contribute to the creation.


Big guys were outsmarted by kids who'd had enough.

[Mandobart]

Yet another example of how the US stock market is NOT the same as the US economy. I believe we'll see more of this kind of grassroots/amateur market manipulation.

Then the hedge fund managers/oligarchs will change the rules.....

No one really cares if you steal from the poor. But steal from the rich? Better beware.

[Simon Fay]

Originally Posted by Mandobart

No one really cares if you steal from the poor. But steal from the rich? Better beware.

Ain't that the truth !!!

Any economic system can be exploited and then, in turn, become a system of exploitation. We aren't there yet but we are moving in that direction. The wage disparity in America is absolutely ridiculous. Basic necessities of life -- food, a home, transportation -- all of these things should be affordable with any full-time job.

Wallstreet is upset at the manipulation -- something they do all the time -- it's just this time the poor profited off the rich instead of the other way around.

[M19]

Diving up the price means that someone is paying that price. If (when) the price plummets, all those who bought at the high price will get killed. "Wall Street" and "retail" investors alike. Its a game of financial "Chicken" that I wouldn't play. Index funds and ETFs are the way to go, IMO. You won't get rich quick, but you won't get poor quick either. YMMV.

[woodbox]

I liked fazools comments.

[Dirk Hofman]

Originally Posted by woodbox

I liked fazools comments.

+1. Not the first incident in the past year of gen z getting fed up and gaming the pants off some folks. Love it.

[rokdog49]

Real money is fiction anyway.

[Mr. Jelly]

The people with the most money and power will win in the end. If they haven't won it's not the end.

[Cypress Knee]

I went over to the Reddit Wall Street Bets forum and scrolled through it. Most comments would be banned here. In short, here is what is happening:
A) Gamestop as a company has very dim prospects going forward. Hedge funds as a group borrowed then sold over 220% of the existing float.
B) The people on the Reddit began buying shares and are refusing to sell them.
C) The lenders now want their stock back so they can sell it at market prices. The borrowers (hedge fund short-sellers) have to pay whatever the current market price is, but nobody is selling yet.
D) The Reddit crowd also bought a shipping container boatload's worth of call options that expire tomorrow. Whoever sold those calls is going to be forced to pay market price on Friday January 29th to deliver the stock.

In mid-January you could have bought all you wanted for less than $20 a share. As I write it is trading at around $400. At some point this is going to come crashing back to Earth.

This is one speculation that I don't want to touch with a ten-foot pole!

[Slothead56]

I’m a capitalist and believe in a free market economy. I also believe that once “the little guy” gets wind of some thing fabulous it’s generally too late and too risky.

[robj144]

Nearly every brokerage is not allowing customers to buy any of these pumped stocks any more. That is ridiculous.

[AX17609]

This story sounds like an updated version of "Trading Places".