Comment by thaumaturgy | Hacker News Reader

Comment by thaumaturgy | Hacker News Reader

One thing I appreciate about Taibbi's article is that he's got the most important part right: this isn't a pump-and-dump, it's a protest.

The talking heads doing the pearl-clutching and the commentators around the internet keep talking about how none of this makes financial sense, the fundamentals of the company aren't sound, it can't last forever, someone will get hurt, and it's obvious that zero of those people have scrolled through a single WSB thread.

You can't scroll very far through any of the WSB threads without passing comments like this one:

"Listen to me. Hedge fund dicks. 1%. And who ever the wants to read this.

"I will sell every position I own tomorrow. Red, green... I will sell. I will use all my capital to buy gme tomorrow. Fuck you hedge funds and 1%.

"I have been hit by every single financial and economic in the last 25 years. That’s been my adult life. You have taken every fucking thing from me. And now I will spend every single grand I have buying GME.

"What do I have to lose? My money? Well you fuckers made damn sure over decades that I’d never be able to own a house or live the life that you’ve been able to enjoy. But blocked from us."

That sentiment is posted multiple times in every single major thread -- along with great helpings of jokes and memes and a party atmosphere.

So many people keep assuming that the retail traders in this scenario don't know what they're doing and they need to be protected from themselves. They know what they're doing. Some of them have $millions riding on this and they've had multiple opportunities to cash out.

But they aren't looking for a payday so much as an opportunity to hurt some Wall Street firms that got a bit arrogant and thought they could get away with shorting more shares of a particular company than existed on the market.

Folks can bash Taibbi for getting some details wrong or for writing articles without an editor, but at least he managed to get the basic shape of this whole situation right, which puts him way ahead of a lot of other folks.

I'm sorry but why should we take WSB posters at their word? Here's an alternate view (also from a reddit post):

"WSB's power users are younger finance bros. It's 30s investment bankers and portfolio managers memeing with each other and cosplaying as 'autists.' If you didn't know what a gamma squeeze was 48 hours ago, you are their exit strategy and the down payment on their next Porsche."

https://www.reddit.com/r/AskReddit/comments/l7bl3z/brokers_o...

> If you didn't know what a gamma squeeze was 48 hours ago, you are their exit strategy

Absolutely this.

I think a lot of the protest diatribes are really just pumping. That Chamath guy gave a long impassioned speech but then just bought options and immediately sold for a big windfall, which isn't exactly squeezing anyone in a principled stand, it is essentially just pumping and dumping (he donated to charity to avoid allegations of that, so it was really probably just PR for his populist political campaign that offers 0% taxes).

And the big hero to the little man stick it to the big man movement is.. the richest man in the United States? Who gave WSB lots of drama and laughter with the $420 stock fraud thing and is anti regulation and SEC enforcement to their newfound desire for enforcement on powerful players? Who ripped off NASA to buy bonds in SolarCity and then bailed that out with Tesla or would probably have gone bankrupt?

The WSB people are basically doing this for fun and most of the principle stuff is only on moves that have directly affected their position.

Even before some of the bad moves from brokerages today they had principled screeds to draw people in, but the only people who seem to be mad in principle are the crazy qanon people that have now joined in that are basically spreading blood libel against bankers and stuff and latching onto this and probably praying for violence to result or some kind of revolution like fell out of the Albanian MLM stuff.

https://en.wikipedia.org/wiki/Pyramid_schemes_in_Albania

Chamath Palihapitiya was celebrated not for his trades but for a series of interviews he gave to financial talking heads where he said the things that WSB wanted to say (example: https://old.reddit.com/r/wallstreetbets/comments/l69jz5/hono...)

The Musk worship is cringe-inducing, but he signal-boosted WSB shortly before the whole thing exploded out of Reddit and into Congress and every television set and living room in the country. I don't get the sense he's their big hero, the core WSB community is far too chaotic-neutral to agree on a hero.

edit: To the second half you added to your comment, we can take a quick trip through a few key WSB threads and see for ourselves how this evolved.

First, there's https://old.reddit.com/r/wallstreetbets/comments/kxw4hu/dont... from about two weeks ago, where the activity was pretty typical WSB stuff and GME was just starting to look like it might have some legs.

Then, there was the post that ignited WSB a week ago, https://www.reddit.com/r/wallstreetbets/comments/l2x7he/gme_... , which is still mostly WSB commentary but the first stick-it-to-the-hedge-fund comments are there. At this time GME was still in the $50 to $65 range and the party hadn't really started yet. I think this makes a good case against the pump-and-dump explanation.

Right around the same time there was the person that paid off their student loans, https://old.reddit.com/r/wallstreetbets/comments/l3aj4z/i_lo... , and the comments are still pretty typical WSB but with pepperings of diamond-hands &etc.

Within 24 hours, attention started to leak out of WSB and into places like CNBC, which started to accuse WSB of things like "market manipulation", and that led to posts like this: https://old.reddit.com/r/wallstreetbets/comments/l3z0n8/howd... , which is when things really started to turn into a proper protest.

Initially some WSB nutcases figured they could gamble their way into a little bit of money, but when Wall Street took them seriously and started fighting back, it became a protest.

WSB is just a fraction of the people buying GME but they are the irrational fraction, the one that will not sell and that is what is ultimately driving the profit incentive for people who are in it to make a lot of money.

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