(https://static.seekingalpha.com/uploads/2013/3/30/683356-13646381593349972-Dan-Naumov_origin.jpg)
https://www.cnbc.com/2021/01/27/amc-shares-triple-as-retail-investor-raid-of-hedge-fund-short-targets-spreads-from-gamestop.html (https://www.cnbc.com/2021/01/27/amc-shares-triple-as-retail-investor-raid-of-hedge-fund-short-targets-spreads-from-gamestop.html)
Shares of embattled movie theater giant AMC Entertainment more than quadrupled on Wednesday amid a flurry of trading activity in some of Wall Street’s most shorted stocks.
The frenzy started right out of the gate. About 10 minutes into the session, trading in the stock was halted for the first time due to volatility. Shares were halted several additional times during the first hour of trading amid heavy activity.
The stock finished the day with a 301.21% gain to close at $19.90. That was slightly below the stock’s high of the day — $20.36 — from just after the opening bell. During premarket trading shares had been up as much as 360%.
Roughly one hour into trading more than 500 million shares had already changed hands — significantly above the stock’s 30-day average volume of 86.8 million shares a day. By 4pmET more than 1.1 billion shares had been traded.
Individual investors are creating short squeezes by piling into these names, while hedge funds that are short on the other side are rushing to cover their losses. They are promoting their activity on the wallstreetbets Reddit board, which has 2.8 million members. AMC appeared to be a growing topic of interest on the board.
===================================================================================
Rather that discuss this actual event (social media manipulation of equity price, in a war of shorts vs. reddit nuts), I would rather talk about the symptoms of what appears to be a hurricane of a market in the not too distant future. 10,000 flashing red lights should be blinding investors when there is a 31K DJIA in the shadow of a Biden presidency, where business will be facing those head winds of that hurricane. There will be a tipping point when speculation finally collapses under the weight of consitent poor EPS reporting,
There is a legend that either Joe Kennedy or J.D Rockerfeller got out of the market in the summer of 1929, when he started getting stop tips from shoe shine boys who were shining their shoes for a penny a pop. I see these fun and games at Reddit, as a similar event. And honestly, IMO ..... ANY speculative play right now is risky as hell.
OTOH, I do see one bit of brightness in this mess. I have always abhored Shortys, who amount to be the vultures of the business world. Seeing these buzzards getting their wings clipped a bit, does give me a few chuckles.
I think the Reddit baby boys are trying to hurt the hedge funds but bidding up short sales. While I hate reddit with all of my being, I bid them good luck on this endeavor.
Look who Biden chose to run the SEC's Enforcement Division:
Melissa Hodgman Named Acting Director of Division of Enforcement
FOR IMMEDIATE RELEASE | 2021-15
Washington D.C., Jan. 22, 2021 —
The Securities and Exchange Commission today announced Melissa R. Hodgman, currently an Associate Director in the Commission's Division of Enforcement, has been named Acting Director of the Division of Enforcement.
https://www.sec.gov/news/press-release/2021-15 (https://www.sec.gov/news/press-release/2021-15)
Melissa Hodgman is the wife of Peter Strzok.
The swamp is incestuous to the max!
This appointment is akin to allowing this outfit running an animal shelter.....
(http://thumbs.media.smithsonianmag.com/filer/2f/df/2fdf811a-36d0-4de1-a695-476be549112c/istock-503692580.jpg__800x600_q85_crop.jpg)
Wall Street can't stand it because they didn't get their cut.
Especially with this administration, watch them now regulate the heck out non-licensed brokers, day traders, etc.
The outsiders can't be allowed in, in their eyes.
It is a lot like what the swamp is trying to do to Trump and his supporters.
Discourage any person who is not from the swamp from trying to crash their party.
As usual, with the RL, it's all about control of the 'little people' (the people whose sweat and hard work pays their salaries) re: every aspect of their/our lives. Only the elitist leftists are allowed to become rich, after all.
There are a lot of new little startups like Robinhood, Webull, and MooMoo that are allowing a lot of flexibility for young small investers. They are scaring the hell out of the institutional goons. I've dealt with enough of them and their eliteism is starting to crash around their deminishing brokerage fees and commissions. The "That's too bad" Seinfeld meme couldn't be more apt.
Robinhood Halts Trading Of GameStop, AMC As Wall Street Backlash Continues (https://dailycaller.com/2021/01/28/robinhood-stops-trading-gamestop-amc-wallstreetbets-reddit-nokia-amc/)
Popular investing app Robinhood blocked users from purchasing shares of GameStop, AMC, and several other companies Thursday morning due to “volatility.â€
Shares of GameStop rose to over $500 in pre-market trading Thursday morning as retail investors continued to drive the price up against the wishes of many hedge funds and other institutional investors. The full list of stocks Robinhood halted purchasing of includes GameStop, AMC, Blackberry, Nokia, Bed Bath & Beyond, Express Inc., KOSS Corp, and Naked Brand, according to CNBC.
Excerpted, more at the link: https://dailycaller.com/2021/01/28/robinhood-stops-trading-gamestop-amc-wallstreetbets-reddit-nokia-amc/ (https://dailycaller.com/2021/01/28/robinhood-stops-trading-gamestop-amc-wallstreetbets-reddit-nokia-amc/)
My comment: they've really kicked the hornet's nest now. This ain't over by a long shot.
Robinhood Halts Trading Of GameStop, AMC As Wall Street Backlash Continues (https://dailycaller.com/2021/01/28/robinhood-stops-trading-gamestop-amc-wallstreetbets-reddit-nokia-amc/)
Popular investing app Robinhood blocked users from purchasing shares of GameStop, AMC, and several other companies Thursday morning due to “volatility.â€
Shares of GameStop rose to over $500 in pre-market trading Thursday morning as retail investors continued to drive the price up against the wishes of many hedge funds and other institutional investors. The full list of stocks Robinhood halted purchasing of includes GameStop, AMC, Blackberry, Nokia, Bed Bath & Beyond, Express Inc., KOSS Corp, and Naked Brand, according to CNBC.
Excerpted, more at the link: https://dailycaller.com/2021/01/28/robinhood-stops-trading-gamestop-amc-wallstreetbets-reddit-nokia-amc/ (https://dailycaller.com/2021/01/28/robinhood-stops-trading-gamestop-amc-wallstreetbets-reddit-nokia-amc/)
My comment: they've really kicked the hornet's nest now. This ain't over by a long shot.
Fascinating. I have been a serious investor my entire adult life, and have never heard of a brokerage firm imposing their own "circuit breakers"
You are an investor. Those involved here are gamblers. Short-selling stock is no different than betting the 'Don'ts' are rge Craps table.
I don't condone either side's tactics, but what is happening right now gives me kind of the same feeling I get when I hear an Antifa member has been shot dead.
I share your sentiments wholeheartedly. It's why I root against Tom Brady.
I really feel sorry for the serious investor who is seeing his investment vehicle being used as a battlefield.I do, too. Just keep this nonsense away from the particular stocks in which I invest!
Fascinating. I have been a serious investor my entire adult life, and have never heard of a brokerage firm imposing their own "circuit breakers" This stinks to high heaven, and needs to be fully investigated. I don't have proof, but I would bet good money that there are some panicking Hedge Fund Shorters calling in some favors.
IF I didn't have any ethics this would be me yesterday with Gamestop at $450/sh on a short play.
(https://i.makeagif.com/media/10-07-2015/dHLoEh.gif)
Based on the past few days of trading GME's market capitalzation has changed hands 4 TIMES!!!!! I really feel sorry for the serious investor who is seeing his investment vehicle being used as a battlefield.
I am no investment guru. I don't even have a good concept of "shorting". But from what I have read and kind of understand....it sounds border line illegal. Allowed, but should it be?
]
I am no investment guru. I don't even have a good concept of "shorting". But from what I have read and kind of understand....it sounds border line illegal. Allowed, but should it be?
Today, Robin Hood suspended the purchase of these stocks, but not the selling. Someone has already filed a lawsuit against them for violating their own EULA. The effect of their purchase suspension was to drive down the price. As @catfish1957 called it, someone called in some favors.
But this violates equal protection. The pajama investors should have the same access to the market as the hedge fund folks. The hedge funders are the ones who have driven up the price through their demand to cover their short sells. They wanted less competition for those shares, hence they limited other peoples' ability to buy. Yet it is the pajama investors who are being accused of manipulating the market? Please.
Another item that made this all possible is that the quantity of stocks that these hedge funds shorted exceeded the total number of outstanding shares. Let's say there are 12 million shares outstanding and there are three hedge funds. The first hedge fund goes to Brokerage House A and borrows 5 million shares to be paid back in two weeks. That hedge fund then sells those shares at $5/share to Brokerage House B. The second hedge fund then goes to Brokerage House B and borrows those same 5 million shares to be paid back in 2 weeks and sells them to Brokerage House C at $5/share. The third hedge fund approaches Brokerage House C and borrows the same 5 million shares, and sells them to Brokerage House A. As far as the brokerage houses go, the actual stock is back where it started. Each brokerage house has paid out $25 million a piece. And each is owed 5 million shares of stock two weeks from now. That's 15 million shares total. But there are only 12 million shares outstanding. See why these guys are panicking?
They gambled. They lost. They each need to face the bookie.
Today, Robin Hood suspended the purchase of these stocks, but not the selling. Someone has already filed a lawsuit against them for violating their own EULA. The effect of their purchase suspension was to drive down the price. As @catfish1957 called it, someone called in some favors.
But this violates equal protection. The pajama investors should have the same access to the market as the hedge fund folks. The hedge funders are the ones who have driven up the price through their demand to cover their short sells. They wanted less competition for those shares, hence they limited other peoples' ability to buy. Yet it is the pajama investors who are being accused of manipulating the market? Please.
Another item that made this all possible is that the quantity of stocks that these hedge funds shorted exceeded the total number of outstanding shares. Let's say there are 12 million shares outstanding and there are three hedge funds. The first hedge fund goes to Brokerage House A and borrows 5 million shares to be paid back in two weeks. That hedge fund then sells those shares at $5/share to Brokerage House B. The second hedge fund then goes to Brokerage House B and borrows those same 5 million shares to be paid back in 2 weeks and sells them to Brokerage House C at $5/share. The third hedge fund approaches Brokerage House C and borrows the same 5 million shares, and sells them to Brokerage House A. As far as the brokerage houses go, the actual stock is back where it started. Each brokerage house has paid out $25 million a piece. And each is owed 5 million shares of stock two weeks from now. That's 15 million shares total. But there are only 12 million shares outstanding. See why these guys are panicking?
They gambled. They lost. They each need to face the bookie.
Very well stated. We have just witnessed a beautiful example of the masters of "gaming" the system, getting gamed. Ironic the equity is known as Gamestop.A little joke I saw on Facebook from one of my friends following this:
Just as an fyi, here are few of the Hedge Fund players in this drama.....Melvin Capital is also allegedly the owner of Robinhood, or at least a major investor.
https://www.cnbc.com/2021/01/27/hedge-fund-targeted-by-reddit-board-melvin-capital-closed-out-of-gamestop-short-position-tuesday.html (https://www.cnbc.com/2021/01/27/hedge-fund-targeted-by-reddit-board-melvin-capital-closed-out-of-gamestop-short-position-tuesday.html)
1. Gebe Plotkin's Melvin Captial- Citadel, it's parent company has sank $3B to cover options, and by the way, their short position has been closed.
2 Andrew Left of Citron, has covered his short position, and commented that the (sic. Reddit) stock owners were an angry mob.
3. Michael Burry's comments really took the cake. Here is his subsequently deleted Twitter comment... "trading in GameStop is “unnatural, insane, and dangerous†and there should be “legal and regulatory repercussions.†Burry shot to fame by betting against the housing bubble and was featured in Michael Lewis’ book “The Big Short.â€". LMAO....Mikey? Investigate? Do you really want to do that?
Guess what... no comment from the SEC .... Imagine that.
Melvin Capital is also allegedly the owner of Robinhood, or at least a major investor.
Inside employee at Robinhood posted this today:
(https://www.rightjournalism.com/wp-content/uploads/2021/01/robinhood.jpg)
If the White House was involved in making these firms cease trading, then we have a scandal that could bring this administration down.
Dunno about that but it might shatter the illusion of a few people out there.
FINRA is the most evil agency in all of government. Their job is to shake down every financial and investment firm operating in the US. They already did that to Robinhood, receiving a payout of close to $2 million. But they never address actual corruption and wrongdoing.
So let me get this straight, please?
The few core-owners of AMC, the movie theater chain that was essentially bankrupt due to the 'Pandemic'... earned BILLIONS of $$$ yesterday??
So let me get this straight, please?
The few core-owners of AMC, the movie theater chain that was essentially bankrupt due to the 'Pandemic'... earned BILLIONS of $$$ yesterday??
And all because a bunch of autists on Reddit decided to screw with hedge funds that were short-selling the stock. What a country indeed.
You really think the Reddit bunch are the villians in this saga? We'll have to disagree on that one.
I'd make a call that Short Trading be eliminated from the markets, but then I realize these low lifes would figure out a different way to game the system.
Sorry, but where did I say they are villains? For what it's worth, I've been cheering them on (in my home, if not making that clear in my posts.) I think this whole thing is hilarious and very telling, in how the system is stacked against ordinary people.
So let me get this straight, please?
The few core-owners of AMC, the movie theater chain that was essentially bankrupt due to the 'Pandemic'... earned BILLIONS of $$$ yesterday??
Sorry, I mis-infered. I figured the term "autist" was an insult.
Agree, on the balance, In a good real world, these Reddit boys might permanently function as the "Short Police". Complict SEC will have none of that, I am sure.
One of their memes (which had me laughing out loud) :
https://www.reddit.com/r/wallstreetbets/comments/l7tlyw/wsb_vs_ws/?utm_source=share&utm_medium=web2x&context=3 (https://www.reddit.com/r/wallstreetbets/comments/l7tlyw/wsb_vs_ws/?utm_source=share&utm_medium=web2x&context=3)
The GameStop phenomenon has gone global
https://www.cnn.com/2021/01/29/investing/premarket-stocks-trading/index.html (https://www.cnn.com/2021/01/29/investing/premarket-stocks-trading/index.html)
January 29, 2021
The GameStop (GME) mania that's hijacked US markets is grabbing the attention of investors all over the world, as traders from London to Mumbai try to get in on the action.
What's happening: Shares of companies that are heavily shorted — indicating that institutional investors are betting theywillcan make them fall — have been scooped up on a number of global exchanges....
Fixed it!
https://www.reddit.com/r/wallstreetbets/comments/l7tlyw/wsb_vs_ws/?utm_source=share&utm_medium=web2x&context=3 (https://www.reddit.com/r/wallstreetbets/comments/l7tlyw/wsb_vs_ws/?utm_source=share&utm_medium=web2x&context=3)
(sorry, I'm not able to embed it.)
That was a hoot. Bloomberg TV just came up short of calling the Reddit brigade econ-terrorist. The financial swamp is shitting in their pants.
Remember these lines from Trading Places?
Candace Owens @RealCandaceO
15m
Wow. They actually did it. CNN is already beginning to call Redditors anti-Semitic white supremacists.
They are setting the stage to give the wealthy, hedge fund elites their billions back.
This is sick stuff but they’ve been doing it for years to Trump supporters.
(https://pbs.twimg.com/media/Es7E_-IXYAQd4sG?format=jpg&name=small)
Wow, they really are panicking, and going all Alinsky on 'em.
Candace Owens @RealCandaceO
15m
Wow. They actually did it. CNN is already beginning to call Redditors anti-Semitic white supremacists.
They are setting the stage to give the wealthy, hedge fund elites their billions back.
This is sick stuff but they’ve been doing it for years to Trump supporters.
(https://pbs.twimg.com/media/Es7E_-IXYAQd4sG?format=jpg&name=small)
An Open Letter to Melvin Capital (https://www.reddit.com/r/wallstreetbets/comments/l6omry/an_open_letter_to_melvin_capital_cnbc_boomers_and/?ref_source=embed&ref=share)
This is personal.
Now THAT pisses me off. It makes me want to buy some GME shares.
According to WallStreetBets (https://www.reddit.com/r/wallstreetbets/comments/l7wmkf/why_this_weekend_is_so_crucial/), 113% of total stock is still shorted. Some of the stock has been recovered by the original hedge funders and paid out to satisfy the short, but more funders have jumped in since then and shorted again.
If there is really 113% still outstanding, then these funders are in deep doodoo. If the call dates are ever published, it would up the ante considerably.
BTW, you all know that WH Press Secretary Jen Psaki's brother Jeffrey Psaki is a portfolio manager at hedge fund Citadel LLC -- one of the main short sellers getting crushed by WSB in the GameStop thing?
Meanwhile, the DOW dropped 2% after the Biden Administration tipped its hand in support of the hedge fund managers.Just checked our investment account: down 0.9%. Supposedly strong, conservative stocks like Walmart, Microsoft, Home Depot were way down. 9999hair out0000
Just checked our investment account: down 0.9%. Supposedly strong, conservative stocks like Walmart, Microsoft, Home Depot were way down. 9999hair out0000
Reflecting a developing lack of confidence in Wall Street in general, especially now with Pedo Joe backing the bad guys.I have to agree.
I have to agree.
Candace Owens @RealCandaceO
15m
Wow. They actually did it. CNN is already beginning to call Redditors anti-Semitic white supremacists.
They are setting the stage to give the wealthy, hedge fund elites their billions back.
This is sick stuff but they’ve been doing it for years to Trump supporters.
(https://pbs.twimg.com/media/Es7E_-IXYAQd4sG?format=jpg&name=small)
Wow, bold move for a web site with 50 million users a day.
Even though it is from the enemy CNN, this is not a bad article describing the Reddit WSB Army. Fascinating David/Goliath story of where the common folk have fought back and screwed over those who have screwed society for decades. I wish them the best.....
https://www.cnn.com/2021/01/29/investing/wallstreetbets-reddit-culture/index.html (https://www.cnn.com/2021/01/29/investing/wallstreetbets-reddit-culture/index.html)
They do not paint WSB in a favorable light at all. But the underlying message here is the cynicism and fatalistic outlook of our millennial generation. They are already convinced that they will be handed a world that is far worse off than their parents' generation. With national debt exceeding the GDP and a social security 'safety net' that is in real terms bankrupt now and on paper bankrupt a decade from now, they feel powerless over their circumstances and have lost hope for the future. That is why so many are willing to forgo that future and risk everything now just to squeeze some enjoyment out of life.
The other takeaway is that this isn't about investment. It is gambling, pure and simple. It is no different from picking horses at the track, except that this track stays open 24/7, thanks to the wonderful internet.
Looking at the forest instead of just the trees, this all suggests the time to exit positions is here.
Looking at the forest instead of just the trees, this all suggests the time to exit positions is here.
Underlying asset value is not reflected in the stock market.
I intend to significantly scale back as such.
Television screens in airports that cannot be turned to any other channel should not be counted as 'users'.
@Hoodat
I was talking about Reddit. That web site has a massive, world-wide following and active user base.
GME down 10%, and 3.2M share volume in the first minute at opening. Hope this isn't a sign of some defectors in the WSB Army.....
I suspect the attention span on reddit will be the main reason this eventually fails.
OTOH, have they even looked this far ahead?
AMC is up 14%. Something's up.
AMC is up 14%. Something's up.
They better not damage AMC with all these shenanigans (which I don't really understand), is all I know...dammit!
Looks like a stampede exit at GME. After hours trading has the stock down 42% overnight, after losing 31% yesterday.
Some really hilarious comments at Reddit WSB
[–]mcuban
Final thought. First thanks for the great questions. Thanks for changing the game. Thanks for taking on Wall Street. Thanks for making kids around the country if not the world, including my son, want to learn about stocks and try trading them (Including my son and daughter). WSB changed the game far more than everyone on this board will ever get credit for.
That said, you will do all this again. You will go after WS and the next time you will be smarter. There was only one thing that messed you all up: RobinHood and the other zero commission brokers that everyone used didnt have enough capital to fund the fight. They let you down in a big way.
When you load back up, fight a broker with TRILLIONS OF DOLLARS in assets on their balance sheet. Someone that can be there when the fight starts and wont blink an eye.
No disruption is easy or happens in a straight line. Stay with it. I am a believer
Gamestop has approached the pre-WSB run up price. On the surface, it may seem like a strategic loss for these guys, but IMO they are stronger and have more core resolve than ever. And don't let anyone tell you that the Hedge Fund Managers are now sleeping better. I think this event supposedly cost the sector $10B the past few weeks in margin calls. It'll likely happen again.
Go Retards.. go!!!!
:yowsa: Excellent analysis @catfish1957 and I agree 100%! Those hedgefund @$$holes have been put on notice now!
My favorite post today from the retards was them calling out Robinhood. Couldn't afford the capitalization for managing heavy trades (trade stops), while buying Superbowl Ad time?
Which part? The hedge fund investors shorting more stock shares than there were in existence? Or some 23-year-old (who spends his time playing video games in his basement) figuring it out?
Looks like this saga is going into the next phase... legal proceedings against Robin Hood for market manipuation.
This is going to be a groundbreaking case, as it will have long lasting ramifications of how shorts can game the brokerage houses for their own gain. Hopefully, it will bring some changes to what has been an abused system that has "winked winked" at what is basically insider trading for some time.
https://www.marketwatch.com/story/lawsuits-against-robinhood-in-the-gamestop-saga-are-getting-their-day-in-court-but-theres-one-big-snag-11618806321?cx_testId=22&cx_testVariant=cx_1&cx_artPos=8&mod=home-page-cx#cxrecs_s (https://www.marketwatch.com/story/lawsuits-against-robinhood-in-the-gamestop-saga-are-getting-their-day-in-court-but-theres-one-big-snag-11618806321?cx_testId=22&cx_testVariant=cx_1&cx_artPos=8&mod=home-page-cx#cxrecs_s)
I hope Robinhood loses.