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Politics Wall St - Above the Law
- Thread starter colin traveller
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Treasury Secretary got paid millions by Citadel LLC (thus conflict of interests).
Jeffrey Psaki, brother of Press Secretary Jen Psaki, is a portfolio manager at Citadel LLC.
Citadel LLC owns Robinhood.
Jeffrey Psaki, brother of Press Secretary Jen Psaki, is a portfolio manager at Citadel LLC.
Citadel LLC owns Robinhood.
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One comment in this rag sums it up:
“To quote the late George Carlin about what has been happening in this whole saga: "It's a big club, and you ain't in it." By the way he said that over 15 years ago.”
“To quote the late George Carlin about what has been happening in this whole saga: "It's a big club, and you ain't in it." By the way he said that over 15 years ago.”
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I joined the "Mother-of-all-stock-market-battles" yesterday.
And to say the truth, Man, I dont know if I will gain a single cent, but I have been laughing my ass off for 24h non stop.
If you think about joining for the LOLs, remember use only your pocket change or cuantities that wont hurt your bank account.
"We will build a Nokia that will last a thousand years"
? ? ?
And to say the truth, Man, I dont know if I will gain a single cent, but I have been laughing my ass off for 24h non stop.
If you think about joining for the LOLs, remember use only your pocket change or cuantities that wont hurt your bank account.
"We will build a Nokia that will last a thousand years"
? ? ?
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Joined in today hahaha! To the moon!I joined the "Mother-of-all-stock-market-battles" yesterday.
And to say the truth, Man, I dont know if I will gain a single cent, but I have been laughing my ass off for 24h non stop.
If you think about joining for the LOLs, remember use only your pocket change or cuantities that wont hurt your bank account.
"We will build a Nokia that will last a thousand years"
? ? ?
- Joined
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- 14,004
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I joined the "Mother-of-all-stock-market-battles" yesterday.
And to say the truth, Man, I dont know if I will gain a single cent, but I have been laughing my ass off for 24h non stop.
If you think about joining for the LOLs, remember use only your pocket change or cuantities that wont hurt your bank account.
"We will build a Nokia that will last a thousand years"
? ? ?
The fire rises!
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Lots of conspiracy talk. But not necessarily accurate.
These brokerages like Robinhood are in some ways very similar to an internet business using cloud services.
Internet traffic spikes, your cloud services bill explodes(that’s where Amazon makes all their money with AWS by the way).
Now with a brokerage, if they see a sharp spike in trades they need a sharp increase in their collateral for clearing trades with DTCC(of which Robinhood and every other brokerage is a member).
Collateral requirements don’t just increase with volume, but also with volatility.
Hello...super duper increase in both volume and volatility with equities like Gamestop.
1Volume x 1volatility = 1 collateral
10Volume x 10Volatility = 100 collateral(oops we’re instantly insolvent!)
So Robinhood was dealing with a huge cash crunch requiring them to draw down on new credit lines.
And it’s why they temporarily halted buy trades in certain equities.
The CEO fcuked up and should have fronted up about the cash crunch that would make them technically, and from a financial regulatory perspective, insolvent.
Instead he didn’t answer anything and he is a sh!tty CEO way out of his depth.
And also instead, we get conspiracy theories because we live in a record low trust environment where trust in Wall Street is battling with Congress and conventional news media for least trusted institutions ever.
There’s a lot of legit badness going on with Wall Street malevolent influence and moral hazard, but the Robinhood story is likely one about a sh!tty rookie brokerage with a nice user interface that naive folks thought was actually as good as it looked.
StartUps, including very successful ones, are built only good enough to get initial users.
Then as they scale and money is raised the battle shifts to trying to transform a duct tape experiment into slick professional processes and platform.
Robinhood reported has over 14 million users with the majority, yes the majority, holding GameStop long.
This story got the liquidity crunch correct, but they completely failed to dig beneath the surface on 2 things specially:
1) brokerage clearing collateral impacted by volume and exponentially magnified by volatility
2) Robinhood is just an amateur hour brokerage with a fancy user interface
Instead they went with the populist oligarch conspiracy to keep the little guy down.
But the Reddit pirate story is legit cool.
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What will comes of this .. remains to be seen . When shorts selling/ insider dealing has been happening for years and will they pass a law barring Politicians making any financial gains from there insider knowledge of up n coming Laws /regulations regarding Green energy etc
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Grab yer popcorn ... And Enjoy
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Its all well and good until the bubble bursts. Isn't hedging suppose to be an insurance rather than a wild bet.
Any punter buying at those prices is gambling and the other end of it sits these business wrecking hedge funds. Non of that is good free market by any standard.
Any punter buying at those prices is gambling and the other end of it sits these business wrecking hedge funds. Non of that is good free market by any standard.
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You are absolutely correct that hedging is supposed to be an insurance policy, not a wild bet. Unfortunately, there seems to be a lot of naked shorting in the case of Gamestop, in this case something to the tune of 140% of available shares or so if I remember correctly. At this point, it appears that we've left the realm of insurance and entered the realm of illegal market activity, and very possibly market manipulation by the Hedge Funds.
The most interesting part about this is the behavior of the small investment community. While there are certainly some people who are hoping to get rich of this in this group, there are a lot of people who are doing this just to stick it to the hedge funds and Wall Street. Wall Street and the government are going to have to be very careful about how they handle this. If they do it wrong, it will absolutely destroy retail investing along with any tiny shred of credibility that they have left. Just as an aside, Wall Street and the banks have been almost universally disliked after the Bush Bank Bailout of 2008, of which disapproval ranged from 2-1 to 20-1, depending upon who's numbers you believe.
Another interesting aside, this has done a wonderful job of uniting all of the little people on both sides, as all have (temporarily) stopped or at least slowed down going after each other and are focused with a laser like intensity on the brokerages and government regulatory agencies.
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I am a combo of both types. If I can make a bit of money while helping to F*** some of the biggest C****s in the business well and good. If MC had gotten away with it there was a chance of 15k people losing jobs. Let that sink in.
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It's beautiful to watch, a bunch of internet autists bankrupting billion dollar hedge funds. ?
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On the one hand it's kind of funny seeing some Wall St. types being up to lose a decent chunk of change.
But on the other hand, it's GameStop that's being propped up here. They are a particularly scummy company with a awful record in their employee relations and a terrible set of business practices. And this is enabling them to continue when they should be headed for bankruptcy. Not to mention that almost certainly their scumbag management get some of their pay in the form of shares. So this has enriched some very nasty people.
All in all I can't see this as a good thing when weighed up.
But on the other hand, it's GameStop that's being propped up here. They are a particularly scummy company with a awful record in their employee relations and a terrible set of business practices. And this is enabling them to continue when they should be headed for bankruptcy. Not to mention that almost certainly their scumbag management get some of their pay in the form of shares. So this has enriched some very nasty people.
All in all I can't see this as a good thing when weighed up.
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It is an interesting situation. I can't say that I know much about the company's business practices or general behavior so I will defer to those who do in that regard. I can definitely see that their business model is most likely obsolescent, if not obsolete, and therefore likely to be on a fatal downhill spiral sooner rather than later.
In my mind however, GameStop isn't the main issue but is the main focal point of the bigger issue. It appears that naked short selling, on the part of the hedge funds, was taking place on at a fairly high level and they got caught, not by the regulatory agencies that were supposed to catch it but by a bunch of Reddit users. The Reddit users decided to band together and slap the hedge fund users around, giving them a bit of punishment that they have well and truly earned based upon their history of bad behavior.
Now here's where the quote from the Three Witches in Macbeth about wicked crap heading our way comes into play. The hedge funds more than likely have some sort of counter party risk mitigation, possibly in the form of some sort of derivatives. As the hedge funds collapse, it's very likely that they set off a chain reaction with serious negative effects that blow throughout the entire economy. A lot of people are going to get hurt simply because a large group of criminals were allowed to get away with often unethical and sometimes illegal behavior with complete impunity for decades.
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