Investing Thread

[Hards Alumni]

https://www.youtube.com/watch?v=PmDYrMGKMQM

[TSmith34, Inc.]

Kara Swisher and Scott Galloway have been dragging Robinhood for months on their podcast. Hard to imagine there is a more clear cut case of collusion than RH only allowing retail invests to sell shares while the HF's could trade freely.

[buckchuckler]

Kara Swisher and Scott Galloway have been dragging Robinhood for months on their podcast. Hard to imagine there is a more clear cut case of collusion than RH only allowing retail invests to sell shares while the HF's could trade freely.

I have to wonder if there is some sort of volatility clause in their T&Cs.

[jesmu84]

Robinhood CEO looked like a clown on his CNBC interview.

W/r/t the youtube video posted above...

When the host talks about unity over protests, or murder or any other act where you have a liberal vs conservative slant, it's hard to unite and see justice done - I agree with him.

But he talks about this situation being different because it seems like the left/center/right all agree that there was a significant injustice - I disagree. In this situation, regardless of which part of the political spectrum agrees, you aren't going to punish the rich/elite/powerful. It just won't happen. It didn't happen in 2008. It won't happen now.

[Skatastrophy]

WSJ did a writeup on /u/DeepFxxkingValue (the reddit denizen and Twitch streamer that bought a bunch of GME 4/16/21 calls at around $5 in September of 2019 and drove this thing).

This is great watching old media try to make sense of the internet. Nice writing by the WSJ, as always.

https://www.wsj.com/articles/keith-gill-drove-the-gamestop-reddit-mania-he-talked-to-the-journal-11611931696

[skianth16]

Good article from Yahoo finance explaining some of the rationale by Robinhood and other brokerages for halting trading on the meme stocks this week. It seems pretty clear there's a lack of knowledge about the differences in the way retail brokerage firms typically operate and how they allow their customers to trade vs. the way hedge funds and other institutional investors trade. I can't imagine these retail firms had scenarios like this built into their business models. This seems to have taken everyone by surprise.

Hopefully this opens the eyes of the brokerage firms and the regulators and forces them to address these kinds of possibilities in the future. If this article is accurate, though, I'm guessing any investigations into the decisions made this week won't find anything to punish the brokerage firms for.

https://finance.yahoo.com/news/robinhood-dash-cash-traders-took-053007442.html

Edit - here's another story with the CEO of Webull explaining their decision to stop allowing trading yesterday. I doubt many people will end up reading through these kinds of articles because they're not nearly as flashy as most of the headlines, but sharing this information is important. There's a lot to be learned before people wind up on CNBC and demanding prison time for the heads of these brokerages.

https://finance.yahoo.com/news/we-bull-ceo-explains-why-trading-was-restricted-amid-the-game-stop-market-mania-172539318.html

[The Sultan]

So my son, who is less financially literate than I am and I only dabble in indexed funds because I know that I don't know enough, told me that he purchased GME through his Robinhood app a couple days ago.  $50 worth.  As did a bunch of his friends.

Why?  "To screw over the hedge fund guys."

I think there is A LOT of that thinking going around. 

[tower912]

This has got to Heisie's kind of chaos.

And looking back a couple of pages, I see that it is.

[MuggsyB]

So my son, who is less financially literate than I am and I only dabble in indexed funds because I know that I don't know enough, told me that he purchased GME through his Robinhood app a couple days ago.  $50 worth.  As did a bunch of his friends.

Why?  "To screw over the hedge fund guys."

I think there is A LOT of that thinking going around.

Props to your son FBM.  This is an amazing story. 

[The Sultan]

Props to your son FBM.  This is an amazing story. 

Thanks.  I love the kid, but I am going to spend a part of my day tomorrow helping him with his taxes because they are "hard for him to figure out."  Dude's 23 with one W2 form.  I don't think this is a guy who should be playing the market.

[MU Fan in Connecticut]

So my son, who is less financially literate than I am and I only dabble in indexed funds because I know that I don't know enough, told me that he purchased GME through his Robinhood app a couple days ago.  $50 worth.  As did a bunch of his friends.

Why?  "To screw over the hedge fund guys."

I think there is A LOT of that thinking going around.

Somewhat similar, my younger daughter was reading the story on this last night and was telling my wife she was happy because "the regular people are screwing over the capitalist's."
Something along those lines. My wife and I just looked at each other speechless wondering where that quote came from. 

[MuggsyB]

Thanks.  I love the kid, but I am going to spend a part of my day tomorrow helping him with his taxes because they are "hard for him to figure out."  Dude's 23 with one W2 form.  I don't think this is a guy who should be playing the market.

Ha....touche.  Or it could be that he has a massive portfolio, as well as an K-1 trust form, and needs your expert tutelage.  He may just want your accountant free of charge? 

[skianth16]

So my son, who is less financially literate than I am and I only dabble in indexed funds because I know that I don't know enough, told me that he purchased GME through his Robinhood app a couple days ago.  $50 worth.  As did a bunch of his friends.

Why?  "To screw over the hedge fund guys."

I think there is A LOT of that thinking going around.

Kind of funny when it's just $50 and it's no big deal if/when that goes up in smoke. But the energy online of people wanting to stick it to the hedge fund guys without even knowing why they might want to do that is a little concerning when it's real money. Scrolling through WSB is absolutely crazy. A ton of the stories and the values being touted have to be fake, but I'm sure they're encouraging some people to buy in with money they don't have to lose.

A great example of how quickly people are buying into all these fake stories is the NY Post reporter who got duped by some 22 year old on Twitter. If she bought into this story (she absolutely should have known better than to believe this) can you imagine what people with no background knowledge would do? There are going to be some really ugly stories that come out of this, and they're not going to be coming from the hedge funds.

https://www.mediaite.com/news/ny-post-deletes-story-after-getting-duped-by-random-twitter-user-who-pushed-absurd-story-about-buying-gamestop-stock/

[The Sultan]

Ha....touche.  Or it could be that he has a massive portfolio, as well as an K-1 trust form, and needs your expert tutelage.  He may just want your accountant free of charge? 

Schedule D is as complex as I get.  And if he has that, we are going to start charging rent.

[MuggsyB]

I'm confident FBM will get his son out once it goes up another 300%. 

[Hards Alumni]

Somewhat similar, my younger daughter was reading the story on this last night and was telling my wife she was happy because "the regular people are screwing over the capitalist's."
Something along those lines. My wife and I just looked at each other speechless wondering where that quote came from.

Good to hear that she sees the world for what it is.  Men in big buildings producing nothing robbing the average person blind on a daily basis.

[MuggsyB]

Schedule D is as complex as I get.  And if he has that, we are going to start charging rent.

You better have a talk with him about all of his assets!! 

[skianth16]

I spent a little more time scrolling through WSB the last day or two, and I'm amazed there hasn't been any talk about how awful these guys are. If I'm anyone with some credibility commenting on this situation, I'd make sure to distance myself from this group immediately. It's one thing to root for the little guy, but Im having a hard time seeing how people want to support these guys in particular.

[jesmu84]

I spent a little more time scrolling through WSB the last day or two, and I'm amazed there hasn't been any talk about how awful these guys are. If I'm anyone with some credibility commenting on this situation, I'd make sure to distance myself from this group immediately. It's one thing to root for the little guy, but Im having a hard time seeing how people want to support these guys in particular.

Why?

[skianth16]

Why?

You must not have spent much time on the subreddit if you're asking. Toxic is an understatement for most threads. Lots of mocking of intellectual disabilities,  a little mysoginy, and general praise of reckless behavior all on top of horribly ignorant financial commentary. It's a mess.

[jesmu84]

You must have spent much time on the subreddit if you're asking. Toxic is an understatement for most threads.

I have spent zero time. Thus why I'm asking someone who has spent time there.

What's toxic about it?

[JWags85]

You must have spent much time on the subreddit if you're asking. Toxic is an understatement for most threads.

That's why I've been bemused in this thread earlier about people fawning over them and their "crusade".  They are out to make money and screw those against them, in this case it's hedge funds which make them media darlings.  It's certainly not altruistic or with any greater sentiment of "good"

I have spent zero time. Thus why I'm asking someone who has spent time there.

What's toxic about it?

There is some good insight from some people, like DeepValue quoted earlier. But most threads and most members are like any gambling subreddit. They call any bearish investors or positions a "(rainbow emoji)(bear emoji)". It's exceptionally juvenile, crude, and antagonistic.

It's hilarious to see AOC jumping on board their "mission" cause ive seen that sub absolutely brutalize her repeatedly in a pretty harsh manner, and that's coming from someone who largely can't stand her

[rocket surgeon]

i understand shorting a stock is part of the process, but for someone who has the means to go very public, on t.v., online and chit all over a company, announce the company is going to hell, in my mind, criminal.  it's ok when the "big guys" do it?  but they pissed off the junk yard dogs-take your medicine   

[Hards Alumni]

That's why I've been bemused in this thread earlier about people fawning over them and their "crusade".  They are out to make money and screw those against them, in this case it's hedge funds which make them media darlings.  It's certainly not altruistic or with any greater sentiment of "good"

There is some good insight from some people, like DeepValue quoted earlier. But most threads and most members are like any gambling subreddit. They call any bearish investors or positions a "(rainbow emoji)(bear emoji)". It's exceptionally juvenile, crude, and antagonistic.

It's hilarious to see AOC jumping on board their "mission" cause ive seen that sub absolutely brutalize her repeatedly in a pretty harsh manner, and that's coming from someone who largely can't stand her

I'm not defending them, but I'm surely not going to lump them all into a group.  Quite a bit of money has been donated from people's gains.  Generally, their 'schtick' is awful.

I think it's okay to defend what they are doing and not condone their juvenile pathetic behavior.  They all think they're Jordan Belfour.  They have nothing in common.

[jesmu84]

I'm not defending them, but I'm surely not going to lump them all into a group.  Quite a bit of money has been donated from people's gains.  Generally, their 'schtick' is awful.

I think it's okay to defend what they are doing and not condone their juvenile pathetic behavior.  They all think they're Jordan Belfour.  They have nothing in common.

I'm sure everyone who works at a hedge fund is a saint