Buy the dip! Never sell! Get tendies!
For those who has been living in a cave and don't know what its all about. Check out: https://www.reddit.com/r/wallstreetbets/
A brief recap:
The hedge funds have been manipulating the markets for ages. For those who don't know. Short selling is when you borrow something you don't own and sell it because you think the price of that item will drop in the near future so you can buy it back at a lower price then return it and pocket the difference. Now in their blind greed, the hedge funds have short sold more shares of GameStop(GME) than actually exists. A group of Redditors noticed this and realized that if they buy up a significant amount of GME shares, then the hedge funds will be fucked because they have the contractual obligation to buy those shares back no matter how high the price goes. This is known as a short squeeze.
Last week, the hedge funds were squeezed so bad that they had to resort to every trick in the book, both legal and illegal, to try to save their asses. They even went so far as to invent new tricks that goes way beyond anything that was ever attempted.
This is how things went down last week.
- When the hedge funds first noticed that they were getting squeezed, their analysts and experts tried bluffing and scare tactics. They began by ridiculing retail investors as stupid and not knowing how to invest, and warned the retail investors to sell or else they will lose it all. It didn't work.
- Next the hedge funds got the media to help and predict that the GME is a worthless stock whose prices are on the verge of crashing, so everybody better sell RIGHT NOW. But that didn't work either. The prices kept going up, because Redditors knew they had the hedge funds by the balls. If you own something that you know someone must buy from you, then you can dictate any price you want.
- By now the hedge funds are getting desperate, and their tone changed. They suddenly began making announcements on various channels that they concede defeat. That they lost billions of dollars, but now they have settled all their positions, and have no more interests in GME. The not so implicit message being that the Redditors have won and its time for them to sell. But the Redditors looked at the numbers and realized the hedge funds are lying through their teeth. Besides, why would they even botther trying to convince people to sell if they no longer have any interests and incentive in the matter. It just doesn't make sense.
- With the Redditors not budging, the hedge funds resort to a new tactic, and that is "if you can't beat the enemy then join the enemy". Over the course of 1-2 days, we saw the membership count of the Wall Street Bets group of Redditors soar up from about 2 million to 4 million. And interestingly all these new accounts all start spamming the board with a similar message. The message is simple, using the insider lingo of the Redditors to blend in and pretend to be part of the crowd, they repeated harped the message, "good job", "we won", and tried to convince others that its time to sell GME and move on other stocks. Redditors quickly realized most of these new accounts were bots controlled by the hedge funds. Nobody was fooled.
- By now, its Thursday, the price of GME has gone from around $40 dollars at the beginning of the week to almost $500. At the rate that GME was soaring, more than one of the hedge funds were going to be bankrupt within 1-2 more days. So it was time to use the nuclear option. On mid-morning of Thursday, the bomb was dropped. Retail investors on numerous trading platforms were informed that they could only sell GME (and a few other stocks like AMC and BB), nobody was allowed to buy. The complicit media helped the financial elites to push their narrative in order to spook the markets. This time it did the trick. Some of the retail investors panicked and started selling. The share price of Gamestop went from nearly $500 to barely above $100 in about 2 hours. Luckily, most of the retail investors held firm and didn't sell, and the public outry was immense (understandably so), that even politicians, both Democrats and Republicans, stepped in and voiced their concerns.
- By Friday, with major damage done the to retail investors holding GME, trading platforms started partially easing restrictions on buying. At the same time they maxed out their PR to push the narrative that all this was done to "protect" the retail investors from potentially getting burned if when their investments plummetted in a market crash (the irony being that it was them who tried to engineer this crash).
- Having kneecapped the opposition on Thursday, the hedge funds managed to partially recover from a totally hopeless situation of annihilation, to a weak but somewhat defensible position. On Friday, GME share price recovered to above $300, and for the rest of the day the share price fluctuated between low to high 300's. Meanwhile, the financial institutions continue to handicap the retail investors by restricting trading to very limited shares. Despite playing with significant disadvantage, retail investors managed to hold a steady defense line.
Next week will be interesting. No matter what happens, this will go down in history as an epic battle between the wealthy elites and the common man. It'll be one of the extremely rare instances in human history, where against all odds, the little guy came within an inch of beating the big guy to death.
I urge everyone to support the cause. APE TOGETHER STRONG!
I further pledge that if GME goes above $1000 next week, I will treat 10 random bros from the list of everyone that replies to this tread to a session with the MM of their choice (capped at $200), including one for the mod.
** This is not financial advice. I'm just a retard from Toronto supporting the cause with our brothers down south.
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