Discussion ***Official*** 2024 Stock Market Thread 💰

[FelixDeCat]

GME now $77 premarket, up another $44 per share. 😱

 

[jpiniero]

GME now $77 premarket, up another $44 per share. 😱

Would that be considered insider trading if RK bought shares before tweeting, betting that the stock would surge based upon it?

 

[dullard]

Would that be considered insider trading if RK bought shares before tweeting, betting that the stock would surge based upon it?

No, not unless he had insider information about the company that is not available to others. It is much more of a pump and dump.

 

[AdamK47]

 

[biostud]

No, not unless he had insider information about the company that is not available to others. It is much more of a pump and dump.

I wonder how much of the stock market is gambling and how much is actual investments. (and also that someone else than me should define the differences )

 

[FelixDeCat]

View attachment 98954

No rate cuts for you...until 2029.

 

[jpiniero]

I wonder how much of the stock market is gambling and how much is actual investments. (and also that someone else than me should define the differences )

There's a reason legalized gambling was held back for so long... Wall Street didn't want the competition.

 

[dullard]

There's a reason legalized gambling was held back for so long... Wall Street didn't want the competition.

1) In gambling, the house wins in the long run and is a slow drain from the gamblers who trade money back and forth.
2) In stocks, the companies as a whole add money to the gamblers who trade money back and forth.

There is a subtle but important difference. As long as companies as a whole are profitable, I'd much rather gamble with stocks.

That said, I'll make a conservative lowball estimate. ~20% of stocks are institutionally held (companies, pensions, governments). Lets lowball estimate by assuming that the companies are not gambling. That leaves ~80% left for the individual investors. Then 93% of individual investors claim to be saving for retirement. So, another lowball estimate is that 93% isn't gambling if they really are trying to save for retirement. So, the lowball estimate is that 7% of 80% is ~5.6% of stocks are gambles.

 

[Charmonium]

Ideally, as an investor, you share in the success of the companies you buy. It can often FEEL like gambling though because there are so many both endogenous and exogenous factors that determine when, if and how much a company profits from its operations - skill of the management, degree of competition, level of economic activity - it's an endless list.

Gambling falls mainly under the rubric of the "nanny state." So things that are both addictive and harmful (however those terms get defined) are things that either the population as a whole or segments of the population need to be "protected" from.

There's no doubt that for quite a lot of people, gambling is addictive. It's also true that many people, along with their families, have been ruined by gambling. So as long as the state could limit access to it, it felt obliged to do so. But first you had gambling on Indian lands. That was fine because you mostly had to go out of your way to get to these places. But then came the internet where sidestepping or outright evading the prohibition was a fairly trivial matter.

So . . . faced with a choice between keeping something illegal that didn't in any way limit access and instead, making it legal but regulated (which of course would include massive amounts of income to the state), it wasn't much of a choice.

 

[Charmonium]

Roaring Kitty is baaack. AMC and GME have made some nice moves over the past 2 trading days.

So . . . do you feel lucky, punk!

 

[Charmonium]

It is much more of a pump and dump.

I think the legality depends on how you do the pumping. If there's actual fraud, so you not only own the stock but tell misleading lies about it (as opposed to truthful lies I suppose), that's what gets you in trouble.

edit - when brokers used to do this sort of thing I think they called it a "boiler room operation." I'll have to check the etymology on that.

 

[Charmonium]

Boiler room (business) - Wikipedia

en.wikipedia.org

 

[FelixDeCat]

There's a reason legalized gambling was held back for so long... Wall Street didn't want the competition.

That's not really it. The casino makes the odds and the rules which is what WS does too.

They let you foolishly overbid in the morning on headlines then pull the rug out in the afternoon. Bastards. Because fuck you for trying to make money.

And they will let not themselves get done in by their own rules, so they constantly pull shenanigans like dumping phantom shares to suppress a price or trade on information that is not widely known yet. "Dont blame us, its the algorithms bro."

Oh..and those off market trades no one gets to see and off market hedges.

So when ordinary people try start to rig the game the establishment creates new rules or takes draconian measures to take the power back despite their overwhelming power and influence they have already.

 

[Charmonium]

That's a good point about the private market. Entities can trade huge blocks of shares w/o any hint to the public market.

I have mixed feelings about that. It would be nice to have some transparency there but then, that sort of the defeats the purpose of private trades.

 

[FelixDeCat]

I've been meaning to rant about the overreach and privacy invading FINCEN rules. They recently expanded the rules (yet again). Nobody complains because many people are ignorant how privacy we have given up.

 

[FelixDeCat]

That's a good point about the private market. Entities can trade huge blocks of shares w/o any hint to the public market.

I have mixed feelings about that. It would be nice to have some transparency there but then, that sort of the defeats the purpose of private trades.

Real price discovery on the largest stocks in the market? No, we cannot have that.

 

[AdamK47]

Money from new retail investors going into meme stocks is being hoovered up at this moment.

Highly regarded smooth brains.

 

[KB]

I thought the reddit crowd didn't have any money since they stop giving out covid handouts? Where did this influx come from?

Oh well, time for the late-comers to lose money again.

 

[AdamK47]

I thought the reddit crowd didn't have any money since they stop giving out covid handouts? Where did this influx come from?

Oh well, time for the late-comers to lose money again.

There was a report yesterday that stated many Gen Z have maxed out credit cards. I'm going to assume they put GME and AMC stock buys on them.

 

[FelixDeCat]

I thought the reddit crowd didn't have any money since they stop giving out covid handouts? Where did this influx come from?

Oh well, time for the late-comers to lose money again.

Low taxes, excessive government spending and record national debt entered the chat.

 

[IronWing]

Low taxes, excessive government spending and record national debt entered the chat.

Raising taxes solves all three.

 

[dullard]

Raising taxes solves all three.

Slight clarification needed. Tie spending increases to required tax increases. Make it painful for politicians to spend more. Any time they spend money on pet project X, Y, or Z, then they have to tell their constituents why they raised tax rates. Then I'd agree with you.

 

[IronWing]

Slight clarification needed. Tie spending increases to required tax increases. Make it painful for politicians to spend more. Any time they spend money on pet project X, Y, or Z, then they have to tell their constituents why they raised tax rates. Then I'd agree with you.

That's the point, make spending hurt to the people who matter (the rich) and spending will come down.

 

[FelixDeCat]

We need an 49% income tax on everyone just to keep up with out of control wasteful spending on overpriced items.

 

[IronWing]

We need an 49% income tax on everyone just to keep up with out of control wasteful spending on overpriced items.

Nah, just tax all income at consistent, progressive rates and all will be well.