6 ms·

Yes, but retail is going to get destroyed in the end. The power elite always get what they want. Right now there appear to be curbs on GME and AMC buy orders f

by xorx 6y ago

Yes, but retail is going to get destroyed in the end. The power elite always get what they want. Right now there appear to be curbs on GME and AMC buy orders for TD Ameritrade and Schwab customers. If you have to pull strings with your drinking buddy from Dartmouth to blow up a bunch of propertyless zoomers in order to prevent a margin call on the account you've leveraged to buy your house in the Hamptons, then that's what you're going to do.

koheripbal 6y ago
Very likely is that the SEC is making phone calls to the big trading firms. Firms don't restrict transactions like this much voluntarily. They are going to call the Reddit CEO and have wsb shut down under the threat of SEC enforcement actions. Looks like the wsb discord is down.
- jimbob45 6y ago
  Same stuff goes down on 4chan and several other sites. Not to mention the fact that the SEC has neglected to investigate insider trading for years now. IMHO why the fuck is shorting legal to begin with. Short insurance should be mandatory for short trading.
  - koheripbal 6y ago
    > the fact that the SEC has neglected to investigate insider trading for years now. Obviously false: https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affiliate=secsearch&dc=654&query=insider+trading&commit=Search https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia... > 4chan and several other sites... Scale dictates enforcement priorities, obviously. Like a lot of people, they don't deal with issues until they are large and impact the market. They are ABSOLUTELY going to intervene here. First with some immediate action, and later they'll craft a new rule to guide social media on stock advice being not allowed on their platforms (IMO). > why the f** is shorting legal Short selling rewards investors who believe that certain stocks are overvalued or that the company is covering up fraud. They helped bring Lehman Brothers down, as well as Enron, Wirecard, etc... In those instances, the shorts were instrumental in reverting stocks down to correct (sometimes zero) prices. Without them, bubbles would rise higher and poop much bigger. That sort of volatility destroys liquidity and confidence in the market. > Short insurance should be mandatory for short trading. There are naked short limits already, but yeah, this issue with GameStop should have those rules re-evaluated, because they obviously didn't work in this case.
    - mrec 6y ago
      > bubbles would rise higher and poop much bigger Please don't fix this, it's perfect.
    - jcfrei 6y ago
      > They are ABSOLUTELY going to intervene here. I wouldn't be so certain about this at all. Matt Levine has a good take on it: https://www.bloomberg.com/news/newsletters/2021-01-26/will-wallstreetbets-face-sec-scrutiny-after-gamestop-rally-kke9fpzq https://www.bloomberg.com/news/newsletters/2021-01-26/will-w...
    - tony101 6y ago
      > "First with some immediate action, and later they'll craft a new rule to guide social media on stock advice being not allowed on their platforms (IMO)." What about Section 230?
  - bilegeek 6y ago
    Well, the IRS doesn't go after rich people because they don't have the funding[1]; they only go after the people they can afford to go after[2]. I know the IRS is different from the SEC, Apples to Oranges. But like you said, they've neglected insider trading; it's probably for very similar reasons, because those being investigated just have too much power to take down. I'm sure the SEC will hammer these easy targets on WSB well before they even dare touch the Big Boys. [1]https://www.nytimes.com/2019/05/03/sunday-review/tax-rich-irs.html https://www.nytimes.com/2019/05/03/sunday-review/tax-rich-ir... [2]https://www.propublica.org/article/earned-income-tax-credit-irs-audit-working-poor https://www.propublica.org/article/earned-income-tax-credit-...
    - boringg 6y ago
      SEC got neutered when the previous US administration got into power. The administration before that was actively pursuing cases.
      - koheripbal 6y ago
        False: https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affiliate=secsearch&dc=654&query=insider+trading&commit=Search https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia...
        boringg 6y ago
        True: https://wp.nyu.edu/compliance_enforcement/2017/10/09/trump-v-obama-u-s-sec-anti-corruption-enforcement-actions-scorecard/ https://wp.nyu.edu/compliance_enforcement/2017/10/09/trump-v...
        koheripbal 6y ago
        No - false. They cherry picked a data window... > January 2016 through the end of the SEC fiscal year on September 30, 2017 If you look at the followup data, you can see both administrations are similar... https://www.law.nyu.edu/sites/default/files/Fig3-SEEDNov2020safe.jpg https://www.law.nyu.edu/sites/default/files/Fig3-SEEDNov2020... ...and then if you actually read my above link, you'd see numerous Insider Trading prosecutions (which was the original false claim made above).
beervirus 6y ago
> Right now there appear to be curbs on GME and AMC buy orders for TD Ameritrade and Schwab customers. Yes indeed. Ameritrade won't even let me exercise the calls I already own. It's ridiculous.
- piva00 6y ago
  This is absolutely fucking ridiculous. Someone is getting fucked by their own leverage, they got caught, isn't that what the market is supposed to do? Kill the overleveraged non-sense to redistribute wealth to more efficient investments? It isn't a bank run to be blocked for the sake of society, this is just a bunch of rich people paying the price for risking too much... Boils my blood so deeply.
  - kqr 6y ago
    This is part of the game, though. The hardest part of gambling is not coming up with the big winning bet -- it's getting whatever counterparty to pay you once you've won. It's always been this way, in sports, in horses, and on Wall Street. People come up with all sorts of reasons to not pay you and you have to shape your strategy around this. Aaron Brown talks about how being a successful gambler is not about a few high-stakes wins, or a super-consistent record. It's about winning the right fraction of bets, so that nobody suspects you're a winner.
    - mikepurvis 6y ago
      The Big Short talks about this too— people trying to figure out how to bet against subprime mortgages in a way that the entity on the other side of it will actually be in a position to pay out (and be able to be compelled to do so). Perhaps ironically, one of the central characters of that story, Michael Burry, is none too pleased at the current situation: https://www.bnnbloomberg.ca/michael-burry-calls-gamestop-rally-unnatural-insane-and-dangerous-1.1554521 https://www.bnnbloomberg.ca/michael-burry-calls-gamestop-ral... EDIT: The Big Short, of course, not Moneyball.
      - 6y ago
balls187 6y ago
> Yes, but retail is going to get destroyed in the end. Mainly because they're playing with their own money, while the hedgefunds are playing with House's Money.
asdfman123 6y ago
You can still buy AMC on Robinhood. I just did.
HNfriend234 6y ago
Also they apparently have the "biden economic team" looking into the situation so it does go to show that lobbying dollars allows you to get your concerns addressed rather quickly.

by xorx 6y ago

koheripbal 6y ago

Very likely is that the SEC is making phone calls to the big trading firms. Firms don't restrict transactions like this much voluntarily. They are going to call the Reddit CEO and have wsb shut down under the threat of SEC enforcement actions. Looks like the wsb discord is down.

jimbob45 6y ago
Same stuff goes down on 4chan and several other sites. Not to mention the fact that the SEC has neglected to investigate insider trading for years now. IMHO why the fuck is shorting legal to begin with. Short insurance should be mandatory for short trading.
- koheripbal 6y ago
  > the fact that the SEC has neglected to investigate insider trading for years now. Obviously false: https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affiliate=secsearch&dc=654&query=insider+trading&commit=Search https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia... > 4chan and several other sites... Scale dictates enforcement priorities, obviously. Like a lot of people, they don't deal with issues until they are large and impact the market. They are ABSOLUTELY going to intervene here. First with some immediate action, and later they'll craft a new rule to guide social media on stock advice being not allowed on their platforms (IMO). > why the f** is shorting legal Short selling rewards investors who believe that certain stocks are overvalued or that the company is covering up fraud. They helped bring Lehman Brothers down, as well as Enron, Wirecard, etc... In those instances, the shorts were instrumental in reverting stocks down to correct (sometimes zero) prices. Without them, bubbles would rise higher and poop much bigger. That sort of volatility destroys liquidity and confidence in the market. > Short insurance should be mandatory for short trading. There are naked short limits already, but yeah, this issue with GameStop should have those rules re-evaluated, because they obviously didn't work in this case.
  - mrec 6y ago
    > bubbles would rise higher and poop much bigger Please don't fix this, it's perfect.
  - jcfrei 6y ago
    > They are ABSOLUTELY going to intervene here. I wouldn't be so certain about this at all. Matt Levine has a good take on it: https://www.bloomberg.com/news/newsletters/2021-01-26/will-wallstreetbets-face-sec-scrutiny-after-gamestop-rally-kke9fpzq https://www.bloomberg.com/news/newsletters/2021-01-26/will-w...
  - tony101 6y ago
    > "First with some immediate action, and later they'll craft a new rule to guide social media on stock advice being not allowed on their platforms (IMO)." What about Section 230?
- bilegeek 6y ago
  Well, the IRS doesn't go after rich people because they don't have the funding[1]; they only go after the people they can afford to go after[2]. I know the IRS is different from the SEC, Apples to Oranges. But like you said, they've neglected insider trading; it's probably for very similar reasons, because those being investigated just have too much power to take down. I'm sure the SEC will hammer these easy targets on WSB well before they even dare touch the Big Boys. [1]https://www.nytimes.com/2019/05/03/sunday-review/tax-rich-irs.html https://www.nytimes.com/2019/05/03/sunday-review/tax-rich-ir... [2]https://www.propublica.org/article/earned-income-tax-credit-irs-audit-working-poor https://www.propublica.org/article/earned-income-tax-credit-...
  - boringg 6y ago
    SEC got neutered when the previous US administration got into power. The administration before that was actively pursuing cases.
    - koheripbal 6y ago
      False: https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affiliate=secsearch&dc=654&query=insider+trading&commit=Search https://secsearch.sec.gov/search/docs?utf8=%E2%9C%93&affilia...
      - boringg 6y ago
        True: https://wp.nyu.edu/compliance_enforcement/2017/10/09/trump-v-obama-u-s-sec-anti-corruption-enforcement-actions-scorecard/ https://wp.nyu.edu/compliance_enforcement/2017/10/09/trump-v...
        koheripbal 6y ago
        No - false. They cherry picked a data window... > January 2016 through the end of the SEC fiscal year on September 30, 2017 If you look at the followup data, you can see both administrations are similar... https://www.law.nyu.edu/sites/default/files/Fig3-SEEDNov2020safe.jpg https://www.law.nyu.edu/sites/default/files/Fig3-SEEDNov2020... ...and then if you actually read my above link, you'd see numerous Insider Trading prosecutions (which was the original false claim made above).

beervirus 6y ago

> Right now there appear to be curbs on GME and AMC buy orders for TD Ameritrade and Schwab customers. Yes indeed. Ameritrade won't even let me exercise the calls I already own. It's ridiculous.

piva00 6y ago
This is absolutely fucking ridiculous. Someone is getting fucked by their own leverage, they got caught, isn't that what the market is supposed to do? Kill the overleveraged non-sense to redistribute wealth to more efficient investments? It isn't a bank run to be blocked for the sake of society, this is just a bunch of rich people paying the price for risking too much... Boils my blood so deeply.
- kqr 6y ago
  This is part of the game, though. The hardest part of gambling is not coming up with the big winning bet -- it's getting whatever counterparty to pay you once you've won. It's always been this way, in sports, in horses, and on Wall Street. People come up with all sorts of reasons to not pay you and you have to shape your strategy around this. Aaron Brown talks about how being a successful gambler is not about a few high-stakes wins, or a super-consistent record. It's about winning the right fraction of bets, so that nobody suspects you're a winner.
  - mikepurvis 6y ago
    The Big Short talks about this too— people trying to figure out how to bet against subprime mortgages in a way that the entity on the other side of it will actually be in a position to pay out (and be able to be compelled to do so). Perhaps ironically, one of the central characters of that story, Michael Burry, is none too pleased at the current situation: https://www.bnnbloomberg.ca/michael-burry-calls-gamestop-rally-unnatural-insane-and-dangerous-1.1554521 https://www.bnnbloomberg.ca/michael-burry-calls-gamestop-ral... EDIT: The Big Short, of course, not Moneyball.
    - 6y ago

balls187 6y ago

> Yes, but retail is going to get destroyed in the end. Mainly because they're playing with their own money, while the hedgefunds are playing with House's Money.

asdfman123 6y ago

You can still buy AMC on Robinhood. I just did.

HNfriend234 6y ago

Also they apparently have the "biden economic team" looking into the situation so it does go to show that lobbying dollars allows you to get your concerns addressed rather quickly.