Business, Economics, and Taxes: Capitalism. Yay? >=(

[BassAle]

like when I heard Fitbit was likely selling to Google and bought despite the dropping price...went up another $10 after the original $40 a share so I am doing a happy dance right now

Fitbit $40 a share? The sale closed at just under $7 a share.
I owned a bunch at $4/share but got out a couple years ago because it wasn't doing shit.

 

[dxmnkd316]

When I saw a story online about that reddit thread and GME, a couple of things came to mind.

1. Is there anyone in the world happier right now than those GME corporate types who have been saddled with a stock in a dead company in a deadend industry, as they call their broker each morning and sell a little more?

2. Might be a great time to short GME stock.

3. All those people buying shares in this company where it's share price is up 700% or something are going to learn an interesting lessen when the drive to buy on that forum ends. Now, they're not going to take a bath like some of the hedge funds they're trying to bankrupt, because it's more of a crowd sourcing deal, but I wouldn't even want to buy 10 shares of a stock at $150/share, knowing that within the last year it traded at $3/share or something, and knowing it will probably end up back there very quickly.

4. Hedge fund guys are smart. The gamers may have gotten the hedgies this time, but next time, look out. They will figure out a way to manipulate this and we haven't seen the last of these crowd sourced share price explosions, and the hedgies will figure out a way to be on the winning end.

This is an excellent post and summarizes my feelings exactly. Especially #4. That’s been rattling around my head since I posted earlier. They don’t get burned twice. They already figured an out for this GME debacle. I just know they have. Now I wouldn’t be surprised if they’re actually flanking these Reddit morons because they’re pissed and because they can.

 

[dxmnkd316]

The more I think of this...

If the Reddit users who organized this GME rally had already owned shares of GME, they could be facing issues regarding illegally influencing the market just to turn a buck. That could theoretically land these people in jail should they sell out their positions that they hypothetically owned, or purchased after the start of this run as part of this ploy before the price really soared.

Excellent point.I’ve wondered about the legality of such schemes. I’m guessing not a single one of these morons has ever talked to someone in the SEC. Hedge funds probably have them in their (figurative) Rolodex. That might be what happens here. Hedge funds take their loss, to which they’ve probably already found an out, and the next call is to their buddies in the SEC. Not one of these Reddit chumps knows a lawyer who specializes in securities law. Hedge funds have depts of them. The SEC will make sure this never happens again.

 

[Handyman]

Fitbit $40 a share? The sale closed at just under $7 a share.
I owned a bunch at $4/share but got out a couple years ago because it wasn't doing ****.

Its at $60 today. I bought it under $7.

 

[dxmnkd316]

I think the story that I saw suggested that it actually started as sort of an internal argument within the gaming world over online gaming versus the old GME method, and was a way for the GME supporters to sort of put their money where their mouth is. They then discovered the side benefit of screwing some hedge funds, and everyone in the gaming world got on board.

I think it has more to do with what happened to Doge Coin (yeah, I know, me neither). Someone probably asked if they could do this to a stock and the two worlds merged.

it’s worth noting this is exactly what’s happening with Tesla but on a slower moving scale. Lots of people with big bucks shorting TSLA and the cult found a way to screw them. TSLA, like GME, will come back to earth and it’s going to put a lot of people in serious financial trouble.

 

[dxmnkd316]

It seems like it should still be illegal to "pump" a stock that you don't own with the intention of buying it on its way up and "dumping" before it hits the peak.

Has this happened before? It’s like there should be a term to describe this kind of scheme. Imagine if the mob got a hold of this technique. You could make a movie or HBO series spend an entire season on it.

 

[Handyman]

Excellent point.I’ve wondered about the legality of such schemes. I’m guessing not a single one of these morons has ever talked to someone in the SEC. Hedge funds probably have them in their (figurative) Rolodex. That might be what happens here. Hedge funds take their loss, to which they’ve probably already found an out, and the next call is to their buddies in the SEC. Not one of these Reddit chumps knows a lawyer who specializes in securities law. Hedge funds have depts of them. The SEC will make sure this never happens again.

Actually you underestimate how many people in the financial industry probably are gamers. If this was some other venture I would agree but in this case I would bet they have their ducks in a row.

And you give the SEC WAY too much credit.

This will likely not work very much in the future but if they pick and choose their spots I wouldn't be surprised to see it again. Things like this have been run for hundreds of years they just find better ways to hide it. There will always be ways to (pardon the pun) game the system in ways like this. This is just the first time it was crowdsourced. Usually they do it to each other ;^)

Man some students and I in my MBA classes discussed stuff like this in the hypothetical but never thought I would see it in practice. It is an expensive and risky venture...which is why crowdsourcing is smart. Again though it will end up co-opted.

 

[mookie1995]

Stocks are legalized, taxed casinos. Both rhyme and reason are checked at the door

 

[BassAle]

Its at $60 today. I bought it under $7.

FIT is no longer trading, and it never hit $60. Google closed the deal on the 14th, and if you still held FIT shares you would get $6.93 per share deposited into your brokerage account.

Open	-
High	-
Low	-

Mkt cap	1.89B
P/E ratio	-
Div yield	-

Prev close	6.93
52-wk high	7.34
52-wk low	5.85

 

[Handyman]

it’s worth noting this is exactly what’s happening with Tesla but on a slower moving scale. Lots of people with big bucks shorting TSLA and the cult found a way to screw them. TSLA, like GME, will come back to earth and it’s going to put a lot of people in serious financial trouble.

Yeah Tesla is a very good example. The Elon Cult has overinflated the price of Tesla. (I plan to buy a Tesla when I go back to my normal tax bracket...but not the stock ;^) ) It is hilarious actually.

And of course Elon talked up GME yesterday which tells me he knows what is going on.

 

[Handyman]

Holy crap Bass, you are right. I havent looked too deeply into my account in a while. My Fitbit got cashed out at $7.35. My big gain is from some car charging company I bought on a lark for $2.69!

 

[BassAle]

Holy crap Bass, you are right. I havent looked too deeply into my account in a while. My Fitbit got cashed out at $7.35. My big gain is from some car charging company I bought on a lark!

Oh yeah Google bought for $7.35 not the $6.93 which is the last closing price.

 

[Handyman]

Has this happened before? It’s like there should be a term to describe this kind of scheme. Imagine if the mob got a hold of this technique. You could make a movie or HBO series spend an entire season on it.

Yes it is called a "Pump and Dump".

https://en.wikipedia.org/wiki/Pump_and_dump

 

[Handyman]

Oh yeah Google bought for $7.35 not the $6.93 which is the last closing price.

I still made a profit...and now I dont owe my buddy a finders fee on the money I made on my car charging stock.

 

[BassAle]

I think it has more to do with what happened to Doge Coin (yeah, I know, me neither). Someone probably asked if they could do this to a stock and the two worlds merged.

it’s worth noting this is exactly what’s happening with Tesla but on a slower moving scale. Lots of people with big bucks shorting TSLA and the cult found a way to screw them. TSLA, like GME, will come back to earth and it’s going to put a lot of people in serious financial trouble.

every time I look at Tesla I think it would be dumb to get in at that price. and then it goes up more.

i almost got in when it was down while there was talk of them potentially going bankrupt. It was like $200 then. Then the crazy run up to > $2000 happened, the 5:1 split and then the run back up to almost $900

 

[BassAle]

I’m pretty happy with CRSP as a long term hold. I got in a couple years ago at $45 (and wished I bought more when it dropped down into the 30s). Took some profits at $100. Still holding after a recent run up to $200, but it’s pulled back to $164.

 

[Handyman]

every time I look at Tesla I think it would be dumb to get in at that price. and then it goes up more.

i almost got in when it was down while there was talk of them potentially going bankrupt. It was like $200 then. Then the crazy run up to > $2000 happened, the 5:1 split and then the run back up to almost $900

If I had my second job I would consider Tesla because it won't crap out for a while but I can't at these prices and my current salary. That was I bought stock in battery charging figured it would be a nice secondary investment. Biden winning definitely helped especially with his intentions of turning the fleet electric.

 

[Kepler]

CNBC talking about the SEC getting involved. "A fair market for institutional and retail investors" is fine as long as the institutional investors always win.

I'm under no illusions that the reddit GME tactic is a Good Thing or healthy or even that it will end without catastrophe for some (many? most?) of the day traders. And judging by their posts I'd say a large percentage of those traders are the type of sad sack Incel who posts Pepe memes and votes for Dump. And again, going by the reddit thread, the drumbeat of a pump and dump con is clearly discernable underneath the political talk.

But we are also going to get another lesson how rigged everything is for the 1%, or more exactly the .01%. The business channels are reacting like a cross between Marie Antoinette and Pinochet.

 

[BassAle]

CNBC talking about the SEC getting involved. "A fair market for institutional and retail investors" is fine as long as the institutional investors always win.

I'm under no illusions that the reddit GME tactic is a Good Thing or healthy or even that it will end without catastrophe for some (many? most?) of the day traders. And judging by their posts I'd say a large percentage of those traders are the type of sad sack Incel who posts Pepe memes and votes for Dump. And again, going by the reddit thread, the drumbeat of a pump and dump con is clearly discernable underneath the political talk.

But we are also going to get another lesson how rigged everything is for the 1%, or more exactly the .01%. The business channels are reacting like a cross between Marie Antoinette and Pinochet.

Some at least seem to be aware there will be an investigation:

It isn't a pump so don't call it that. It's a short squeeze. This distinction matters because there will be an SEC investigation over this, and if you want WSB to exist afterwards you won't use language that suggests it's intentionally manipulating the market in a coordinated manner.

Edit: WE LOVE THE STOCK

 

[dxmnkd316]

yes it is called a "pump and dump".

https://en.wikipedia.org/wiki/pump_and_dump

wooooooooooooooooooooooooooooooooooooooooooooooooooosh. :-d