I am not sure about this idea I was hoping someone could inform me of its potential flaws / Morality.
I just found out about this sub reddit called Wallstreetbets. You might have heard about it. The idea is simple find a hedge fund that is shorting a stock and get a bunch of investor to buy that stock. The stock goes up and you may or may not make some money but for me that is not the point the hedge fund losses big time. I just have rudimentary knowledge of how this work so maybe someone here can explain it better. Not sure if there are any legal issues with it ether. First we could all setup trade accounts with small amount of money just waiting to invest. We start looking for a funds that Nancy, Chuck or someone similar are invested in. We find a stock that the hedge fund is shorting and we all buy that stock. If there are not enough of us to make a difference then we also post it on wallstreetbets or some place similar.
Maybe when wallstreetbets targets a fund that is on our list we contribute.
Guerilla Economics! — Edit — Tim Farley you are right. I am not exactly the sharpest tool in the shed. Thank you.
12 replies on “Could we some how use the Wallstreetbets idea?”
Guys and Gals! Think bigger! That’s what my dad would say. Let’s turn the GAMESTOP idea into a strategy that we can apply across the board. I think the subreddit group have the Wall Street arena in hand. If you want to use your stimulus check and jump in and support them, please do. BUT MORE IMPORTANTLY is, how do you apply this eye opening philosophy to your area of expertise? Can you find a way to play the game outside of the conventional rules? Gamestop’s motto is “Power to the people.” Let’s brainstorm ways to turn over all the applecarts and put the power back in the hands of the people where it belongs…. Education… Banking… Food supply… Local bureaucracies… real estate…. I think we should start forum groups for brainstorming each area that needs action.
First off, Bill put out and posted a video on this topic, today. I’m going to try to get this thread combined/merged with that one so everybody is in on the same conversation.
That said, here’s the skinny of what’s going on, or at least what I’ve gathered so far, and I’m no stock expert. A hedge fund guy sees a company floundering and their stocks are low. He borrows “x” number of shares of said stock, then using buddies in the business and the media, he purposely drives the stock into the dirt, gives back the devalued share keeping the difference as profit. It would be something like this: I borrow ten shares of stock form Joe Blows Stuff, the stock is worth say $10 per share, that’s $100 in total value. Now I drive those shares down to say $1, now I buy the shares. I then give the ten shares back at a buck each and keep the 90 bucks I made as the difference in profit. I borrowed the shares, not their values. When I borrowed them they were worth $10, and when giving them back they’re worth $1. A $9 dollar difference. If I bought enough shares at $1, then the value of the stock starts to climb again, because as other investors see another buying, they want in on it. Pretty cold-blooded, right?
What the good folks buying shares in Game Stop at wallstreetbet’s dot com did by buying the shares is drive the value per share up, and not down as the hedge managers wanted, or expected, and now they have to give back the shares at their present value which is near $17 billion I think. Also let me mention that they’ve shorted the stock to 140%, which means they had to borrow many shares twice. How that’s legal is beyond me, but it’s like the banks loaning the same money on paper over and over again, betting the owners of said money don’t all want it at the same time. This is why banks are terrified of a run, they don’t actually have all the money they say they do at any given time. As to how we can weaponize this is a good question, but it’s already been done by wallstreetbet’s dot com so I say follow their lead. I will say this. The same kind of financial tactics can be used in other ways. All we have to do is think about how.
I messed up my explanation, it’s a hard concept to explain, and I go ahead of myself in a couple of spots making things confusing.
A related idea that I’ve been kicking around is to get lots of regular people to buy stock in some of these companies to the point where they, as a group, can effect the leadership. Of course that will only work where the CEO position is actually up for grab, and the owner/creator doesn’t still have a controlling share. I was originally thinking about things like Disney. Sick of the fact that they are crazy woke, make junk, and are less family friendly than they used to be? Kick the bums out, rather than just flee.
The problem is that as you buy the shares, the value goes up, giving said company and CEO more capital as it does.
Yep. We have to accept that in this plan. Individuals will only be out a little bit, and these characters were still making a killing anyway. It is about wresting control the woke-sillies.
The individuals making small buys are who is driving this, not big investors, they’re the opposition. Never invest more than you can lose is the golden rule, but this is about having an effect, and as a retired old man on a fixed income and small savings, which inflation is fixing to eat anyway, I would spend a thousand to slap Wall Street one time before I die.
While this is true for the wallstreetbets thing, I don’t think it takes a lot of money for a normal person to buy say 1 share of Disney. Though, your point is still true; you should be willing to accept such an expense as a loss. You wouldn’t be doing it for the profit of the share, but to influence the company.
I would think guerilla economics. Like guerilla marketing.
Louis Rossmann has some videos on it. I recommend checking them out:
https://youtu.be/XX6-jPy98YA
It’s mostly about being willing to lose that cash if necessary; but ideally what you want is to take a heavily shorted stock and boost its value to the point where the shorts then have to buy back at higher prices than they paid.
This is when you sell and make money, while taking that money from the shorts. They lose big time at this point; which is the opposite of how they’re usually stealing your money.
Well from what I have been reading I like what they are doing with GameStop. I was reading an article that stated Trumpism has hit wall street.I do not understand anything about stock trading other than the bare minimum and was hoping Bill Whittle would take it on as something we can do to fight back.