GameStop: Anger as trading in GameStop shares is restricted

The submitted title was &quot;GameStop: Amateur investors continue to outwit Wall Street&quot; but the BBC changed theirs.<p>For pointers into the massive graph of submissions on this topic, see <a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=25933543" rel="nofollow">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=25933543</a>.

&gt; &quot;This isn&#x27;t investing, this is gambling&quot;<p>Yep. Agreed. Spot-on. That&#x27;s what Wall St does. If you don&#x27;t like it, try and stop it. But for everyone, including the hedge funds.<p>Treating the derivatives markets like a casino (and taxing appropriately) sounds like a great idea.

While the title might be true for the &quot;amateur investors&quot; that got in early, I strongly believe that most of them are not outwitting anyone and will be bagholders. As of this post basically everyone who bought yesterday are underwater by 50%.

Not being in the US I don&#x27;t know this but can Robinhood be sued, like a lot of people seem to be calling for, just for refusing to handle trades on a stock?

OK, we&#x27;ve got this. Can we now stop sharing this every 5 minutes? Amateur investors lose money in the end.

Outwit certain <i>parts</i> of wall street, maybe. Any hedge fund making money off of deal flow is gonna make a huge profit when there&#x27;s a big spread between buy&#x2F;sell prices.

The high&#x2F;low so far today is $514.50&#x2F;$112.25. As I write this it&#x27;s down 65%. What a surprise.

More than 10 Trading Halts in just a couple of hours. <a href="https:&#x2F;&#x2F;www.nyse.com&#x2F;trade-halt-current" rel="nofollow">https:&#x2F;&#x2F;www.nyse.com&#x2F;trade-halt-current</a>

Nobody is “outwitting” Wall Street here. That will become particularly apparent in the coming days.<p>I’ve read posts on &#x2F;r&#x2F;WSB where people talk about having put all of their savings into this.<p>I only hope that they’re just teenagers with little savings.

How sure are we that this is really being driven by &quot;amateurs&quot; and not by scammers running a pump and dump scheme under cover of a grassroots phenomenon?

A stock actually has a calculable estimate of value, you know. It&#x27;s the sum of future cash flows. Gamestop has been losing money for years and their outlook as a brick and mortar retailer for items that are now sold online is poor. The short sellers are correct. The business of Gamestop is bad and it&#x27;s equity will be worth nothing. A short squeeze isn&#x27;t going to change that in the long term.

The problem with GME starts with the funds that managed to accumulate a 140% short interest in the stock.<p>Send those people to jail for illegally issuing unregistered shares of a security, or counterfeiting shares of a security, because everything that happened after that point is entirely their fault.<p>Alternatively, fine them $10B and issue it as a dividend to the shareholders that bought and held after Jan 1.

I liked Ars Technica&#x27;s analysis of what happened. The TL,DR is that if a company&#x27;s stock is so heavily shorted, so much so that the number of &quot;borrowed&quot; shares exceeds the number of liquid shared available, and it is not on the verge of going bankrupt, this kind of short squeeze is possible and you can get a feedback mechanism going to make the price soar, at least in the short term.<p>If Wall Street wants to address this, they could put limits on the number of shares that can be shorted.<p><a href="https:&#x2F;&#x2F;arstechnica.com&#x2F;gaming&#x2F;2021&#x2F;01&#x2F;the-complete-morons-guide-to-gamestops-stock-roller-coaster&#x2F;" rel="nofollow">https:&#x2F;&#x2F;arstechnica.com&#x2F;gaming&#x2F;2021&#x2F;01&#x2F;the-complete-morons-g...</a>