Skip to whatever section you need clarification in:
- Stocks:
A stock is just an entitlement to a small share of profit or revenue from a company. Businesses are after all, a collaboration of labor and capital (you're the capital) nd both are entitled to some share of the gains. These gains are paid as dividends.
- Dividends:
The dividend you may receive is set in reality. What they bring in is what they pay out, basically. The company can't pay out more than they make, but they can't afford to pay less than a certain amount because they rely on capital investment to run the business and no one is buying in if you 'aint paying out. But what should a "stock" be worth? Well, what share of a profit actually worth? Depends on how much profit a share will pay out right?
- Share Price:
It's easy to understand that if a "share" is paying out $1 per quarter, then it should be worth twice as much as a "share" paying out 0.50c per quarter, right? Well it's a little more complicated because there's no certainty what the pay out will be ahead of time. Did the company do good this quarter? Did it meet it's "projections" or did it fall short? Did something unexpected happen, like a pandemic, or a ill tempered tweet causing a boycott?
- Speculation:
Because of these risks, some known, some unknown, different people have different opinions on what the stock is worth because they have different views of what the dividend will be and how likely or risky it is to rise or fall. Some risks are commonly "factored in" to the price, (such as price of rice) since flooding and drought may not come this year but they'll come some year. Other risks aren't easy to predict, or even inevitable. But if you believe a war is coming, or a new product will be a success, you may decide that a given stock is over valued, or undervalued. By purchasing an undervalued stock, you don't just reap a higher return through a larger dividend than if you invested elsewhere, but if you later sell that stock you accrue the price difference after it's price "corrects" to reflect what becomes common knowledge. Similarly, "shorting" is how you make a profit off a stock you believe to be overvalued.
- Shorting:
Let's say a stock is selling for $20, and you think it's only worth $15. You believe this because you think the dividend paid out will be lower than what most people buying/selling think it will be. Well what you can do is make an arrangement to 'temporarily' hold onto someone's stock for them. You'll totally give it back at the end of the contract, say a week, so the original holder will still hold it when the dividends pay out. You offer to pay a small fee for the privledge and both parties are happy. The original holder is happy because they just got paid free money for doing nothing - they were going to hold the stock anyways. And you can now short the stock. Because all that stock you're temporarily holding? You sell it. You sell it at $20. It's only temporarily yours, but you sell it. Because remember, you think the price is going to drop and you don't have to give the stock back until next Friday. Well Friday rolls around and lo and behold the stock dropped to $15. You buy some of that stock at $15, and give it back to the person you borrowed from. You bought low, and sold high, you just did it in the opposite order.
- Hedgefunds
Now let's say you're a hedgefund and you think Gamestop is overvalued. So you 'short sell it'. Now you're sitting on some cash from your sale... hmm, what to do, what to do... well it was a good move with a few shares, so why don't we do it again with more shares? Like, a lot. Like, as much as we can get our hands on. So you borrow and sell, borrow and sell. Eventually you've borrowed and sold the same stock multiple times. That's how you get to 130% of all available shares being in this state. When Friday comes around and the price has dropped, you're going to make a killing. You'll just buy the shares to give back at the lower price and pocket the difference. Just like you've done before. And this time will be no different. The stock price will definitely be lower on Friday... right?
- INTERLUDE
Wait...
What's that...
A board of Chaotic Neutral autists with stimulus checks see what you're doing to their nostalgic brick and mortar from childhood? Well what could a few unwashed millennials do?
- Enter Stonky Bois:
Hey guys, what if we buy Gamestop, but like, keep buying it. We buy and buy and buy and never sell. We drive the price up well beyond anything the dividend is worth, but who cares, come friday all these short sells get called and they have to pay them back at literally whatever the stock price is then. We'll make a ton of money. So they did. They drove the price up and guaranteed a profit for them, and a loss for the hedgefunds.
But wait, what's that, these prices are getting ridiculous. $100? $200? We're not going to just bankrupt these hedgefunds, we're going to break the fucking market. We're going to break it so hard it exposes the shell game for all to see. What happens if the stock is worth $1k? Or a million? Guys the emperor has no clothes.
- It's not about the money, it's about the message.png (you are here)
To hell with profits, To hell with selling, or bankrupting a hedgefund, or even about just making our own money back. Let it all burn to the ground, I don't care if I see a cent of return, I want to drive this price so high that it costs so much to repay that the entire system grinds to an explosive hault. What will happen? Can it be ALLOWED to happen? Will the SEC (Securities and Exchange Commission) put a halt to trading? Reverse trades? If they do they expose the fraud for what it is - it's ok to rig the game when the rich profit, but not ok when the rich are fleeced? Would such moves herald the end of old money and the old financial systems? Centralized fiat relies on the appearance of fairness, and when you remove that you remove the foundation it relies on. Can they afford to step in? Can they afford not to? Is this the moment centralized fiat dies to be replaced by decentralized crypto? No one knows. But does it matter at this point? Buy and hold. Fuck 'em
Great explanation. Let's see how my American airlines, bed bath and beyond, and AMC do..
If you are buying anything other than GME you are falling for the damage control shills trying to redirect your money. Any dollar going anywhere other than GME reduces the damage. $300 GME destroys the hedge, but there's some unknown threshold that destroys the whole centralized fiat financial system as we know it.
Because at a certain point the SEC steps in and does shit only a centralized player can do, which will be draconian and entirely unfair. It will expose the rigged game for all to see. Centralized fiat relies entirely on faith that it is fair, so exposure of cheating in the open (it's usually hidden) would be the beginning of the end of a financial system used to keep people in chains.
It's one thing if a hedge is on the line for tens of billions, but what if they're on the line for a trillion? Get it? Somewhere between the two the SEC has to step in to prevent people realizing the emperor has no clothes... which in and of itself will prove the same.
If you're only in it for quick returns, there are always other options, but if you're in it to fuck the system, for luls, or for financial revolution there is only ONE stock, GME.
$100 of your money has never had the power to do more for the future of humanity than today, and it's not in AMC.
"Guys we're storming Versailles!"
"Actually, I'm just gonna break some shop windows and loot my local jeweler"
uh... well... ok then, you do you I guess
It's not rigged. Most of the stonky boys will lose their asses when the stock returns to a price that reflects the true value of the company. They are kidding themselves if they think they have the smarts or the deep pockets to go head to head with the hedge funds.
This isn't a bubble, this is a short squeeze.
In a bubble people can look at the price and decide "fuck that, I 'aint buying at that price it's over valued" so the strop price drops as more people sell than buy
In a short squeeze people holding shorts are required to buy them at market price. They can't not buy, they have to. And we aren't talking a few shares they have to buy and then it's over gee I hope you sold when you could later bois.
No, they short sold 140% of available stocks. Maybe close to a hundred million shares they are REQUIRED to buy at market price, whatever that market price is. And to buy, someone has to be willing to sell. It will tkae them literal days to purchase all the stock they are required to, and as they do so the price of the stock will explode. Not 10x, maybe not even 100x depending on how much of a dick the holders are in refusing to sell.
And we're pissed.
If the hedge can't afford to buy the stocks, the brokerage is required to, and if the brokerage can't, their bank must. The game is rigged so the rich always win and get their money... only this time it's the people playing the role of the rich.
Get it now?
And yes it is rigged, they are literally pulling out illegal shenanigans to try and stop this. The hedge is sending out disinfo to manipulate the market, tRobinhood and their broker Citadel (who bailed out the hedges to the tune of $3b) just delisted GME, made it so you could sell but not buy, and were selling people's positions without consent)
This is real, you're in a happening.
The stonky Bois either are not going to lose their asses because they didn’t individually put that much in, and/or they just don’t care (how many people do you know who wouldn’t set three hundred dollars of their own money on fire to watch a hedgefunder lose everything)? They are a bunch of little jokers setting small piles of cash on fire to watch a hedge cheater’s house burn to the ground with him inside.
‘Melvin closed’ reported by who? Their friends in the media? Bwahahahahah...
That’s just damage control.
Get fucked, it’s still 139% Short.
This hasn’t even started yet. Fasten your seatbelt hombre.
MAKE SPACE GREAT AGAIN!
TO THE MOMALA-LOVING MOON!
2021 LUNAR LANDING CONFIRMED
MISSION TO MARS IS A GO!!!
^^^^THIS^^^^
Mathematically impossible.
They are lying to the press to that effect, which is also illegal attempted market manipulation.
Look up what happened to Volkswagen in 2008. Same scenario playing out today. Short sellers and hedge fund types lost over $30 billion then. Could have been spectacularly worse too, but Porsche spared them. Do a little research and stop trusting lying MSM for investment advice.
In fact they have likely gone even SHORTER. Doubling down. They are going down. Watch and see. Enjoy the show.
Bless all the pedes that are decapitating these evil satanic snakes.
u/Imransgarage has a point in that REPORTEDLY the short position was closed out Tuesday afternoon.
Melvin Capital, hedge fund targeted by Reddit board, closes out of GameStop short position GameStop Short-Sellers Start Crying Uncle, Close Out Positions
Some $3 Billion has been loaned to the fund by Citadel and Point72.
The amount of the loss cannot be confirmed, although in the Motley Fool link, one of the hedgies reported a 100 percent loss.
So while the big hedgies cited closed their positions Tuesday afternoon, $GME continued to rocket upward during market hours on Wednesday and Thursday based upon the buying pressure exerted by "neckbeards" who gotta have their single shares or even slices of a "stonk?"
Meantime, the Fool notes other short-sellers are stepping in because there's an old Wall Street adage: "Trees do not grow to the sky."
It's all good here, as long as everyone playing this game on the buy side is prepared to hold on no matter what.
The Capitalist in me hopes they do, and $GME uses that capital to grow their business into its current valuation.
So gamers, find your friendly neighborhood GameStop and spend a buck or two today, tomorrow and forever more and don't reward the online mercenaries who've been "creatively destroying" vast swaths of the American Main Street economy.
Blackberry? Wanna have some Blackberry too?