Generational Dynamics Forum - New Site

Higgenbotham wrote: Wed Jan 27, 2021 5:35 pm > Congratulations to the guys on Reddit who flushed the billionaires
> down the toilet. I salute every one of them.

• The concept of "panic" can take many forms.
• There is a possibility that today will be the panic that triggers
  a significant long-term event.

Higgenbotham wrote: Thu Jan 28, 2021 12:45 am > With regard to the Reddit event, first of all, the masses went
> into battle with the billionaires and the masses won hands down.
> Probably the buying today (in Gamestop, etc.) was mostly forced
> unwinding of short positions by the funds. The masses know how
> much volume would be required (approximately) to complete the
> unwind. The reason I say approximately is the short position at
> some point in recent time is known but all of the volume since
> that known date and number of shares can't be pinned down as to
> what exactly it was, but it can be estimated fairly closely, I
> would think.

> What effects will that have?

> I would guess that the Reddit crowd will try it again. The
> authorities have already indicated they will fight back by
> suspending trading in any stock that is targeted. Imagine what a
> mess that will turn into. I can't imagine how and how far both
> sides are willing to carry it, but my guess is farther than most
> can imagine.

> For example, one thing the Reddit crowd can do, or any imitators
> can do, is threaten to target a stock, but not target it in
> reality. They can move the site of their activity to another
> place on the Internet. They can use other forms of communication.
> And probably half a dozen other things I can't even think of and
> don't know about.

> This could turn into a financial war of sorts.

> The other effect this could have is to reduce short positions
> overall for fear of being a target. Short positions are already
> quite low on average. What effect will this have? One example
> would be, when a stock is under pressure and I am considering
> whether to buy, one thing I check is the short interest. I can get
> that in about 2 seconds and if I see that the short interest is
> relatively high, I tend to avoid the stock. Not always, but I
> tend to unless I feel I know something the shorts don't. And
> there's also the realization that the funds can start an
> unwarranted feeding frenzy on a stock. If funds are afraid to
> short, people who use similar procedures will on balance be more
> likely to be long, in my estimation. It could exacerbate the
> upside and the downside.

John wrote: Thu Jan 28, 2021 1:10 am ** 28-Jan-2021 World View: Reddit masses

I think you're describing the Reddit "masses" in waaaay too rational
terms. You say the masses know how much volume whatever. Maybe a
few do. But I don't think that the masses will know much of anything.
I think they're playing with the same irrational emotions as the
current bitcoin craze.

You say that the Reddit crowd may try again. Yeah they will -- the
ones that survive the first round. They're turning into addicted
gamblers that have to keep playing until they lose everything. And,
as long as they survive, they have the thrill of beating "the man."

Well, anyway, that's all speculation again. Tomorrow is another day.

Higgenbotham wrote: Thu Jan 28, 2021 12:45 am With regard to the Reddit event,

What effects will that have?

If funds are afraid to short, people who use similar procedures will on balance be more likely to be long, in my estimation. It could exacerbate the upside and the downside in some situations and reduce it in others.