Economy
Related: About this forumBig Short Investor Warns Of 'Dangerous' GameStop Stock ("Insane")
Investors Business Daily
MICHAEL LARKIN
12:11 PM ET 01/27/2021
This is a short blurb from a longer story entitled: Dow Dives As Bears Attack; Apple Slips As Tesla Reverses; 'Big Short' Star Warns Of 'Insane' Trade
But star investor Michael Burry, whose story was featured in "The Big Short," took to Twitter to warn about the stock.
"What is going on now there should be legal and regulatory repercussions," he said in a now-deleted tweet. "This is unnatural, insane, and dangerous."
Burry's investment firm Scion Asset Management reported held a 2.4% stake in GameStop as of Sept. 30. It has been cited by some traders as a reason to own the stock.
https://www.investors.com/market-trend/stock-market-today/dow-jones-dives-bears-attack-apple-stock-up-tesla-stock-reverses-big-short-insane-trade/
If you want to check out the GameStop stock chart, take a look. Move it back to the 5 Day and 1 Month view to see what it has done.
Google Charts:
https://www.google.com/search?q=gme+stock+chart&oq=GME+stock+chart&aqs=chrome.0.0i324l2j0i3j0i22i30.3340j0j7&sourceid=chrome&ie=UTF-8
Budi
(15,325 posts)Movers & shakers all right!
Yikes.
Introduction Video game retailer GameStop is up nearly 800% in the last two weeks. The story of how this happened makes for both an entertaining soap opera and an educational
https://www.tradingview.com/chart/GME/aRahmXqq-Short-squeezes-gamma-squeezes-and-the-GameStop-drama/
Check out this chart as of right now.
3:49 ET
NYSE:GME
341.62 193.64 130.86%
GAMESTOP CORPORATION
underpants
(182,769 posts)Asking for myself
sweetloukillbot
(11,008 posts)Babette
(818 posts)While I'm sure there are people in this for the money, if you read the threads on the subreddit there are a lot of people who just want to screw the hedge funds. There are stories from kids who watched their families lose everything in 2008 while Wall Street got bailed out. Stories from people who saw hedge funds get PPP loans while their businesses went under. There is a lot of simmering anger that these funds can do whatever they want and destroy lives with no consequences. These guys want revenge. Since the government has not shown any willingness to rein in Wall Street the little guy is starting to take matters into their own hands. Many people have only purchased one share, and are holding it until the hedge funds bleed. They have stated that they don't care if they lose their investment. The redditors can only lose the money they put in for the stock, but the hedge funds can lose billions. If they get a chance to pay off student loans or get needed medical care from the profit that's just a plus.
Mike 03
(16,616 posts)I have only a vague understanding and lack the expertise to explain it knowledgeably. I think other DUers will do a better job.
How GameStop found itself at the center of a groundbreaking battle between Wall Street and small investors
The companys share price began to soar as small investors snapped up a cheap stock using the trading app Robinhood and other services, seizing on what they saw as an ideal buying opportunity. Wall Street saw something else a chance to short an ambitious bet against Amazon they believed was bound to fail.
Shorting a stock is risky. It involves borrowing a companys shares and selling them with the intention of buying them back cheaper when the share price falls. Many Wall Street fortunes have been made this way, but if the price doesnt fall, the losses can be huge.
About 71.66m GameStop shares are currently shorted worth about $4.66bn. Year-to-date, those bets have cost investors about $6.12bn, which includes a loss of $2.79bn on Monday.
https://www.theguardian.com/business/2021/jan/27/gamestop-stock-market-retail-wall-street
underpants
(182,769 posts)soothsayer
(38,601 posts)Link to tweet
?s=21
Snip
You have been sent here because your child, partner, or friend suggested that you invest your life savings into GameStop stock and you are curious what the fuck is going on. This post is long and thorough and mostly does not discuss memes and "the internet" until the end, but if you read it you will hopefully understand What Is Happening.
What is going on is that GameStop, a company that sells physical copies of video games next to Auntie Annes pretzel shops in dying malls, is the most highly traded asset in the United States, a meme stock, and currently the primary front in a micro class war. GameStops stock price jumped from $4 last summer to $20 at the end of 2020, to $40 two weeks ago. It was worth $100-ish at times on Monday and Tuesday, and as I write this it is worth close to $300. Essentially, many normal-ish people have made a huge bet against gigantic financial institutions and are currently winning. In practice this means we are seeing one of the largest wealth transfers from the financial ruling class to the middle and middle-upper classes in recent memory, so it is, understandably, the only thing anyone is talking about. ...
The financial press is trying to explain what this means for them, hedge funds, capitalism, the economy, and the stock market moving forward. Internet culture reporters are trying to explain if this is GOOD or BAD, if this is the Donald Trump-ification of the stock market, where a meme or troll gets out of control and causes unprecedented havoc on the real world. Anthony Scaramucci, of all people, is calling this the "French Revolution of finance."
It is true that this means something and that this is likely a big moment. We are seeing, I think, the democratization of financial information, at least to some extent. While we've seen technology like deepfakes and facial recognition filter down from research firms and big companies into the hands of ordinary people and amateur technologists who then use them for whatever purposes they want, we are seeing financial technologies, information, and analysis becoming available not just to hedge fund managers, financial institutions, and the very rich, but to the masses.
underpants
(182,769 posts)SWBTATTReg
(22,112 posts)upper and lower income classes, w/ the lower income winning thus far, if true, even if not 100% true, good. All of benefits over last 30 years or so give or take has gone to the upper income tiers, that is, over 83% of income went to upper 5%, rest of us shared the rest and still look at what our bills have done in the meantime, spiraled out of control almost.
soothsayer
(38,601 posts)Turnabout is fairplay, as the bard said.
jimfields33
(15,769 posts)I like the idea of a teacher, nurse, electrician doing well on this stock. Or those that can only afford 10 dollars a month and due to loving gaming has the 10 dollars going to Gamestop. Thats sorta how I buy stocks. Put money towards businesses you enjoy. Id rather the hedge fund people not only make out on this.
liberalmuse
(18,672 posts)I have very little understanding of stocks, but it's been interesting. Amazing how some little guys can mess things up bigtime for short sellers/hedge fund managers. I am not disappointed.
awesomerwb1
(4,267 posts)Could you PM me the name of the Reddit sub if it's not too much of a bother?
Thanks
soothsayer
(38,601 posts)Budi
(15,325 posts)Ever see Wolf of Wall Street?
Yup.
He's been in trouble for doing this same thing before.
Wasn't it with Tesla?
FTC & DOJ will have a look at Elon if the Redditt thing proves his manipulation.
At that point FINRA steps back & says C-Ya to Mr Musk.
Hoo Boy!!
awesomerwb1
(4,267 posts)liberalmuse
(18,672 posts)no message
jmbar2
(4,874 posts)When everyone starts unloading the shorts AND the shares - the hedgies and the kids who have ramped them up--it's gonna trigger a big sell-off in the market. A BIG selloff.
I think it has already started. As a daytrader, I like it. But it is a scary development for the stock market. Shows how easily it can be manipulated by a large group of small investors. Think of the possibilities for disinformation guiding their decisions. Like QAnon messing with your 401ks.
A lot of the kid investors are gonna get their asses handed to them on a platter. SEC needs to devise strategies for managing stock market warfare immediately.
Budi
(15,325 posts)😬
jmbar2
(4,874 posts)I made that mistake in my early years of trading. And mine was small. These babies gonna learn hard.