What's funny is how the HN community tries to defend the firms they've whined about for years. Is what's going on irrational? Yup. But it pulls back the curtain of what the financial firms do to the economy and their own manipulation tactics.
Sorry, but hasn't the news spinning and generally misconstruing news stories to the benefit of their advertisers and financiers agendas been the issue the past few years?
The problem is that hedge funds constantly benefit from a much lower risk due to market structures designed to stabilize the market. Many of the WSB people are willing to risk a big large loss in order to reveal this flaw of the system. Many of them will not be fine, and, if they're successful, some hedge funds will be bankrupt and all of them will be scared moving forward.
This is in fact exactly who most people care about, in this situation. It may not be who the extremely-online people that this board is mostly comprised of care about, but they are not most people.
> Further, they shouldn't care about them because anyone who doesn't understand what's going on deserves to get whatever happens to them.
This is directly at odds with how markets are regulated, because there is a long history of this thinking leading to widespread scams and cons.
There is clearly no coordinated agenda among news agencies here. It is a compelling story and a bunch of people wrote their hot takes on the topic.
None of this could have happened if they weren't shorting GME at 143%+ of float. They were greedy, this is the consequence. In 2006-2008, they ALL were greedy and so the government had to bail them out. No lessons were learned. If the SEC wants to do something, remove these instruments that allow infinite leverage and collapses.
In general, shorting stocks is a beneficial action because it helps prevent shares from becoming overvalued.
So, yea, the fact that GME had 143% of its shares shorted is a function of greed. But, no, greed in this case was not a problem so long as GME's share price was fairly valued.
There's a problem with bailing out big companies again and again. While not bailing out small investors (directly).
The other problem is that there's no real defense against CNBC/Twitter amplified end-user stupidity: https://www.youtube.com/watch?v=lMUtU0tOmNE
Every stock trading app/site/service requires submitting tons of "risk declaration" forms. (Sure, all of it is next next finish. It's the EULA/TOS all again, but with money.) And that's the problem.
He has an entertainment component, but fundamentally encourages people to educate themselves and manage a portfolio of stocks who choose to do so.
The mob bullshit we’re seeing now is just the new normal - brigades of internet idiots, motivated by profit or ignorance to run around like a drunken monkey. It’s no different than the political drama we’ve seen fomented by irresponsible social media like Twitter, Facebook, Reddit, etc.
Besides the jokes and the memes, Chamath went on CNBC and argued that WSB provided very good due diligence in some instances. Yes a lot of it is utter garbage, no doubt, but when there are specialists there able to call each other out, you get to see good analysis.
I claimed that if you have your information about WSB from anyone but yourself, you have most likely been duped in some way or another and that is evident by how you talked about WSB, full of ignorance.
> Anyways, yeah, GameStop is a great company with a great stock and some evil hedgefund is going to lose billions for trying to manipulate the price!
Nobody said GME is a great company. What are the odds the proletariat on reddit throwing money into the fire pit in an attempt to hurt the rich is attempting to con you, and what are the odds somebody who stands to lose billions and already lost is?
gmedd.com, or you know, do your own DD.
Most of those people don't own stock and don't know how to buy stock.
And I would guess most of them tune out stories about stocks going up or down like they tune out commercial breaks or the business segment of news shows.
Most people do not tune out stories of the form "do this simple thing to get rich". It's the same reason endless coverage of the lottery gets good ratings.
Your mental model of how stock bubbles work is not accurate.
As another example, lots of people assume Elon Musk got mad at short sellers because he took it personally, when in fact they were fucking with his ability to raise money he needed to ramp up production and meet manufacturing goals.
These things don't happen in a vacuum. Large funds making public bets against a company have a material impact on that company's liquidity.
Obviously the person who owns stock, or is set to earn billions when the share price reaches a certain level is going to be adversarial to someone whose actions result in the share price being depressed - even if that is the fair value.
> Large funds making public bets against a company have a material impact on that company's liquidity.
There are always bigger fish - and if the public bet is wrong, someone can, and will earn money at the funds' cost.
Edit: shareholders dislike shorts the same way employers dislike employees sharing salary information; it's a losing proposition for them, but a fair one.
Not when they get to simply turn off the half of the market moving against them they aren't.
Aren't you over-generalizing just slightly? Even in a post with many comments, only a small number of community members (if this is a community at all) post anything. And not a huge number vote, either.