Reply to Robin Hood just ended trading on GameStop and AMC

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I understand there is huge risk if DTC and Apex go under because Melvin can' cover their losses.  That being said, if retailers aren't allowed to buy, then shorts shouldn't have been allowed to sell and should have been allowed to buy only.

Restrict both sides of the trade. [/quote]do you understand the simple fact that the shorts do not trade in Robin Freaking Hood?  I keep saying this. If you think trading should be halted for tell at NYSE. But frankly you guys seem to feel entitled to special status. You could be on a bigger brokerage and kept trading. Your choice of a startup to execute a short squeeze is like landing  at Normandy with nerf guns. [/quote]

Do you no understand this was entirely triggered by the fact that there was massive risk that it was feared that Melvin wouldn't be able to cover their short losses?  The losses don't magically disappear.  They get passed onto the clearance houses, which is why DTC began requiring 100% collateral.  It's not a RH problem, it is a dumbass Melvin Capital problem. And now that Melvin exposed the entire market to huge risk they're still allowed to get away with whatever they want.  They messed up so they should face restrictions as well.

Oh, so its OK for Melvin to drive down the price with free rein while the public isn't allowed to buy, so that they can buy to cover their shorts at a cheaper price, yet retail can't buy to maintain a higher price for sale?  Hell no.

I'd be perfectly fine BTW if the NYSE halted the stock and they settled upon price for a payout of $400-500.  That way everyone is somewhat happy and risk to the entire market is mitigated.

[/quote]
The longs also exposed the market to huge risks and they knew it.  They want it.  The want to blow up the shorts no matter what the collateral damage to the market or themselves.  And you are arguing that RH should let them do it.  [/quote]

Right now the biggest risk to the market is any large move either way.  The longs didnt cause this.  Over leveraged big money gambled and caused this.  If they got out on Thursday then the risk is contained.  If they didnt get out then we are all effed and they need to be wearing orange for the rest of their lives.  It may seem counterimlntuitive but, considering the amount of pension and index fund money long, gamestop at $500 is less destabilizing than Gamestop at $100.[/quote]
I agree that overleveraging is bad and should be prevented, but that's not the issue.  You manipulate the market, you create risk.  These people manipulated the market and made money.  They also identified a type of risk that was ignored before and should be closed in the future.  Good for them!  But they don't get a medal, they don't get to dictate a price, and the stupid shorts did not break any laws.  Sorry, it just doesn't work the way you think it does.[/quote]

Sorry, it doesn't work the way you think it does either.  Massive leveraged short trade like this are attempts to manipulate the market.  As the former head of SEC enforcement said on Bloomberg yesterday, people dont take on shorts like this because they are scared.  The shorts went all in, with borrowed money, with an Ace high before the flop.  They got called.

And yes, when you naked short a stock and need to cover then you need to pay whatever price the seller demands.  That is exactly how it works.  That's why naked shorting is not recommended by anyone.  That's why the potential losses are infinite.

Yes, it completely sucks to be caught in the middle.  My holdings were down tens of thousands because of the contagion but that doesn't blind me to what happened.    The shorts lost.  They need to just pay up, lick their wounds and apologize.  The market makers gave them an opportunity to do that on Thursday.  If they didnt, and we'll find out soon whether they did or not, then they have just destroyed everything because they couldn't admit that they lost the hand.[/quote]
Yes, the shorts lost, but no, they aren't going to have to pay whatever a bunch of little guys demand.  Shorts have been given extensions to pay up before. And exchanges and regulators have changed rules on people who have tried to corner a market.  
[/quote]

Regulators will change the rules for shorting.  They played, they lost.  They lost big.[/quote]
No doubt they will.  This subthread started with a complaint about Robin Hood protecting it's own interests but really it's all about justifying a bumch of fools who are about to get their own asses handed to them.  [/quote]

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