GameStop/Reddit vs. Big Financial

[BugI02]

So, I have to wonder ... how many of those Robinhood investors, that the SEC just broke down like a shotgun, voted Biden and believed that he was going to fix the rigged system?

 

[muncie21]

GME is down over $125.00 today (2-2-21). So, people who went long on GME early and got out early made out like bandits. Where it goes from here is anyone's guess. I think the Reddit guys are still trying to encourage buyers to buy because of the still huge short positions in the stock.
Who will make out? Maybe some of those Reddit guys just want to unload their long positions. Most of the people who are short still probably think this company is in a decline that will end with the stock at or near zero. It is hard for me to see how GME survives without a new/different business model.

Many of the Reddit folks that are a part of this activity (WSB) aren't necessarily doing this for the money (although that's important) they are really wanting to put the screws to the big money hedgefunds that make a living out of squeezing the life from vulnerable businesses.

If you've followed the WSB discussions, you'll see that Mark Cuban (yest the Dallas Mavericks Mark) joined the discussion yesterday and shared his thoughts on the movement; interesting to read.

 

[Rookie]

Hedgefunds are still shorting game stop. People are still buying stock. I don't think it's over yet.

 

[muncie21]

Hedgefunds are still shorting game stop. People are still buying stock. I don't think it's over yet.

Agree on all accounts, it's definitely not over but folks that had naked shorts are scrambling as margin requirements are increasing

 

[RedDot]

I think it is surprising this made news. Every day some random stock gets pumped to extreme levels and many traders are looking for that opportunity. Everyday people have started to play more aggressively in that stock market. Besides WSB there are many reddit, StickTwit, Twitter, Discord, Facebook groups and so on discussing their speculation on companies trying to strike it big. Shame on wall street, the press and trading platforms for restricting trading and demonizing regular people participating in capitalism.

 

[kickbacked]

Gamestop is skyrocketing again.

 

[muncie21]

Gamestop is skyrocketing again.

Holly smokes, where the hell did that come from....that's crazy. Next options expire this Friday.

 

[Ingomike]

This is awesome to watch...

 

[BroodXI]

gamestop bought me an AK

 

[zer0day]

Someone may have mentioned this already but combing through 14 pages after having nearly a pint of bourbon was a task. So here we go.

The hedges got beat at their own game and cried about it. DFV and WSB made a lot of money and the retail investor came out on top.

The politicians gave them all a light grilling. Except for Vlad, the ceo of Robinhood. Whom is a giant pos for halting trading. He tries(poorly) to shift blame and avoid the bloodshed but thats far from possible.

BTW Robinhood was supposed to IPO this year but highly doubt that will happen.

So here we are today with $GME running again. Why? Charlie Munger(Warren Buffets bestie) slammed the actions of the WSB community by saying something to the effect of "it's gonna come to a bad ending" and WSB wasn't about to take it. Plus DFV posted that he just so happened to double his stake in $GME. And the CFO was "forced" out of $GME and was announced today. Some are speculating that Ryan Cohen had something to do with it by posting a tweet of a McDonalds ice cream cone. Which could mean that he fixed the machine.

That being said, other companies benefited from the rally by making offerings of stock and selling corp held shares to create liquidity to help themselves and help pay their employees they havent yet been able to bring back to work. Gamestop had not done that for some strange reason.

A couple viable reasons to justify the price of $GME is to say they are going to revamp their business plan by a) introducing a "netflix" style format for renting games and having them streamed to the subs. Creating exclusivity with game devs, Sony and Microsoft. b) Revamping all the stores by shifting all the toys/clothes/etc to online sales. Creating a place for e-sports leagues to compete. They can offer rewards for teams and players by paying out winnings in BTC, RTH, LTC. Sort of a gold, silver, bronze medals. c) They can work out partnership deals with companies like Skillz(who just got a contract with the NFL) and someone like DraftKings to further push e-sports betting.
This plus other synergies could propel them into a new era where they will need to be to survive and actually show some profit.

WSB will fade after time. Right now there is a shift coming on where the companies that showed strong fundamentals and had solid assets pre-covid will begin to rise again and regain their value. The popularity contests, "hot spacs", reddit rallies, etc will be gone. It will return to being based on fundamentals and partnerships and M&A.

Time for another drink

 

[HoughMade]

Oopsie

Not 100% Gamestop, but I'm sure it's part of it.

Robinhood Trader May Face $800,000 Tax Bill

A Robinhood newbie is facing a potential tax bill of $800,000 despite only making $45,000 in net trading profits. The case should serve as a loud warning for the new crop of do-it-yourself investors.

www.forbes.com

 

[jason867]

Ignorance can hurt!

 

[Ark]

Oopsie

Not 100% Gamestop, but I'm sure it's part of it.

Robinhood Trader May Face $800,000 Tax Bill

A Robinhood newbie is facing a potential tax bill of $800,000 despite only making $45,000 in net trading profits. The case should serve as a loud warning for the new crop of do-it-yourself investors.

www.forbes.com

Wowser. Definitely a major oversight on his part, but also highlights how our tax system is clearly not designed to favor retail investors on these more modern platforms.

 

[Cameramonkey]

Wowser. Definitely a major oversight on his part, but also highlights how our tax system is clearly not designed to favor retail investors on these more modern platforms.

THIS. Obviously something is broken in the tax code.

 

[HoughMade]

"All he had to do", and I put that in quotes because it's not obvious, was hold stock for over 30 days before buying it again and he could have deducted his losses.

 

[jason867]

Not trying to defend the IRS, but isn't the Wash Sale rule meant to discourage this type of trading behavior, by penalizing those who cross that 30-day line-in-the-sand?

 

[printcraft]

Wowser. Definitely a major oversight on his part, but also highlights how our tax system is clearly not designed to favor retail investors on these more modern platforms.

Gee Whiz, I wonder who put those rules in place...

 

[BigRed]

Oopsie

Not 100% Gamestop, but I'm sure it's part of it.

Robinhood Trader May Face $800,000 Tax Bill

A Robinhood newbie is facing a potential tax bill of $800,000 despite only making $45,000 in net trading profits. The case should serve as a loud warning for the new crop of do-it-yourself investors.

www.forbes.com

Maybe the guy should consider classifying himself as a trader in lieu of an investor.

Come on... think, McFly. It's not that difficult.

 

[Ark]

THIS. Obviously something is broken in the tax code.

His trade volume was pretty insane, though. Like he was just sitting there tapping on the app like it's Candy Crush all day long, no idea he's getting a tax penalty every time he buys or sells the same stock trying to work those minute price differences multiple times a day.

I get that the rule is there to try to stop people from creating losses to claim on their taxes, but that's not what he's doing. He's just tapping away like it's a video game, oblivious. Which is exactly the kind of behavior an app like RobinHood is designed around.

Market always outruns regulation and unintended consequences are rife.

 

[singlestacksig]

Wash sale tax rules do not hurt the small investor, just the clueless ones.. Trading in the million $ range requires some reading & understanding the rules.. A good broker account will track & show you your wash sale values as you go along..
Decent financial record keeping software will do it also..
Doing that volume of trades may have also required him to mark to market the value at end of year..