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Comment by drited | Hacker News Reader

The company could issue new stock (to get a lifeline of cash from inflated price)

I know someone who tried to convince VW management to do that during the Porche/VW squeeze. They didn't but I see no reason why another management team wouldn't act differently.

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This would be the most hilarious resolution to the madness. However, the cynic in me sees management spending their time selling their entire portfolio to buy back when it hits $20 again.

It takes time to put a secondary stock offering together. Unless they already had it primed and ready to go the bubble will probably pop first.

Yes true but a green shoe (to the hedge funds who need to exit) could be done more quickly.

The SEC spiked Hertz's attempt to sell stocks into a similar rally, so even if they try it's unlikely IMO that they would succeed.

Htz had declared bankruptcy at the time they tried. Gamestop hasn't and that is a very big diference.

Bankruptcy makes it a bit different, I guess, but Gamestop executives can't possibly make a good faith argument that +1000% price in the middle of a short squeeze is a correct valuation of their stock. The SEC has a lot of discretion here (both by law and in practice), and they're just not going to let a company bilk its investors like that.

Discretion

* The U.S. Securities and Exchange Commission (SEC) had previously conducted multiple investigations into his business practices but had not uncovered the massive fraud.*

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

"bilking investors?" Gamestop is a mature company in a mature industry w/ 20 years of annual reports, earnings releases, investor calls, SEC filings, etc. There's far more information upon which to make a decision about Gamestop than virtually any IPO, or tons of low-float, low-volume stocks out there. Could easily say you know way more about Gamestop future prospects than Uber, Airbnb, Beyond Meat, plenty more.

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