While this GME/AMC run will not end well for many people, restricting people from buying those stocks - whether it is through actions of trading platforms or governing agencies - smacks not just of paternalism, but downright favoritism. Only certain parties benefit from this.
And governments often do restrict other forms of gambling associated with more problematic losses. There are those who would like them more restrictions on it, and those who would like fewer, but at least the latter group don't argue that without loosening gambling laws, the little guy doesn't stand a chance of wealth improvement.
That's demonstrably false. There are literal ads on TV that show how wealthy you can become if you just buy a lottery ticket.
> that they should borrow money to buy as many of them as possible because they will make a nice easy profit
You clearly haven't read any of the GME threads on WSB. Pretty much everyone is saying to only invest what you can afford to lose. Most people are buying small amounts just to f##k with the hedge funds, and they are outspoken about it.
> but at least people playing don't think they're doing arbitrage.
Buying a lottery ticket for a dollar, hoping they make much more? Isn't that the whole point of a lottery?
> And governments often do restrict other forms of gambling associated with more problematic losses.
That's the whole point of the criticism that you're missing. These restrictions are completely arbitrary and don't follow any rules.
You can go to a casino and lose your life savings.
You can buy 1 million lottery tickets and lose your life savings.
You can buy one of thousands of penny stocks and lose your life savings.
The government won't stop you. The brokers won't stop you.
But suddenly, when a big hedge fund is caught with their pants down, people like you come out and pretend like what's happening is a big problem, and we have to stop the trading "because some people can lose money".
Sorry, I'm not buying your narrative at all.
I think the funniest part about this is that it is rationally irrational.
It's irrational from a market perspective, Gamestop really isn't fundamentally worth this much, everyone who invests ought to lose the money. Short sellers ought to make bank on it.
And then comes WSB and offers a different reason: Buy a couple of shares and hold just to punish the short sellers. It's irrational in the market sense, but it's completely rational from an internet mob sense. They're not out to make money, which is the normal rational decision-making process that all the big players are accustomed to. This mob is out for blood, and they're doing it for shits and giggles. Of course the big market players are upset, because the mob has money and are wielding it "wrong"!
There were lines outside the ticket shops (semi social distanced and with masks). Street vendors of tickets were walking around asking people “don’t you want 200 million Euros?” Or whatever the number was, I didn’t win so I forget.
Point being, with the Christmas lottery all but personally endorsed by the Pope and the King, and with millions of poor and poorly educated people watching this spectacle, I’d be shocked if some people didn’t cause themselves real trouble as a result. Just one more ticket...
(My friends there treat it mostly as a joke but still do buy one ticket each, every year, on principle.)
That's because you truncated my sentence to pretend I made a claim I didn't make. What I did say is that nobody is marketing lottery tickets as an investment or (or posting screenshots of how much they've spent on lottery tickets to encourage others not to cash out). They're literally not allowed to in those ads you mention.
> You clearly haven't read any of the GME threads on WSB. Pretty much everyone is saying to only invest what you can afford to lose. Most people are buying small amounts just to f##k with the hedge funds, and they are outspoken about it.
All the top threads are people encouraging others not to take their money out because it'll hold its value, honest, and the specific stakes people are sharing range from thousands to [options on] millions. You don't see people make those kind of bets on lotteries, and people with financial upside from lottery ticket sales certainly aren't allowed to encourage them to.
I mean, the whole reason we're having this discussion about Wall St versus the common man is because people here are treating entering the market at this stage as an opportunity rather than a negative EV gamble for people looking to join the action. If a vendor stops selling tickets for a particular lottery, nobody acts like wannabe customers or ticket holders dreaming of bigger jackpots are victims.
> Buying a lottery ticket for a dollar, hoping they make much more? Isn't that the whole point of a lottery?
The point of buying a lottery ticket for a dollar for what even the dumbest lottery player knows is an tiny chance of winning isn't very similar to the point of buying what used to be $20 stocks starting at $200 after reading an "AT THIS RATE $5,000 IS GOING TO BE NOTHING FOR GME" post.
> But suddenly, when a big hedge fund is caught with their pants down, people like you come out and pretend like what's happening is a big problem, and we have to stop the trading "because some people can lose money".
Casinos block people from some gambles all the time (especially if something funny's going on or they think they might get sued). Nobody cares. Some brokers stop people from some gambles on their platform and people gnash their teeth with rage at how unfair it is, before flipping to arguing that it's just a game people are playing with what they can afford to lose. The double standard here isn't mine.
And yes, most people buying today would lose money (with or without broker intervention). That's not a reason to for Robinhood to stop the trading, it's a simple observation which is hard to square with arguments that stopping the trades is some monstrous imposition on the common man.
As for the hedge funds and investment pros, some of the longs would have loved to see more retail investor action today, and some of the shorts are already out.
There was a followup round of reach-out "hey, you might want to take this quiz again and maybe we'll let you play" (meaning go answer the questions and lie that you're an experienced investor) to try and get the disenfranchised back into the game.
We're not likely to see an economic crisis due to a Gamestop short squeeze, but it is a bit of a worrying sign.