I don't think people realize how stupid this idea is. The first few people to buy stocks, maybe, because they're practically betting that some mouth breathers will follow their lead. But after that, what's gonna happen is that it'll spike when everyone else buys, but the justification for buying is complete malarkey, because if the big investors see the price spike, THEY CAN KEEP HOLDING THE POSITION. What's essentially happening is that dipshits are buying expecting everyone who shorted to buy back the stock all at the same time, but all that's happening is that people who think they're big braining stocks are inflating the stock price by buying it in the first place, and they're gonna lose their shit when people realize what a stupid idea that is, and then the big investors are gonna cover their position when everyone else sells their stock.
TL;DR: Internet mob thinks people shorting a failing company is stupid, so they buy it, artificially increase stock price, and will eventually run the stock price into the ground after the meme is dead and people sell the overvalued stock, causing the big investors who aren't stupid to buy back the stock at an even lower price than expected in the long run.
You're not understanding my argument. Right now the stock price propped up by people constantly buying it. If people stop buying it, the price will stagnate at where it was i.e. drop because it's overvalued because of speculation. If the price starts to drop, people will most likely panic sell in order to make sure they don't lose money, in which case the selling will accelerate the price drop, causing the stock to become undervalued, and THEN big investors will drop all at once. The problem isn't that investors will sell all at once, it's that the stock buyers think they can beat out the big investors by forcing them to buy at an artificial high, but you can hold a short position indefinitely, and the buyers have to keep buying in order to prop up the price, whereas there is no opportunity cost for the big investors to hold their short position until this idiotic charade ends.
Yeah, I used stagnate incorrectly there. I want to specify that what will most likely happen is that after people realize that they can’t get any more people to buy the stock (because the long term price is dubious), people will start to sell over time. It might even be true that some people will short the stock AGAIN because it’s so high. Whatever the case is for management at GameStop, nothing it’s been doing could warrant a tripling in common stock value over 10 days. In the end the only people making profit are the shorters who held or started now and the people who bought and sold the stock already.
It depends on when the short gets called for the stock. If the prices remain artificially high until then the hedge fund is going to get fucked. But, I doubt Gamestop is going to have that much more momentum after the initial surge. The real investors who jumped in have already jumped out and made their profits.
I don't think people realize how stupid this idea is. The first few people to buy stocks, maybe, because they're practically betting that some mouth breathers will follow their lead. But after that, what's gonna happen is that it'll spike when everyone else buys, but the justification for buying is complete malarkey, because if the big investors see the price spike, THEY CAN KEEP HOLDING THE POSITION. What's essentially happening is that dipshits are buying expecting everyone who shorted to buy back the stock all at the same time, but all that's happening is that people who think they're big braining stocks are inflating the stock price by buying it in the first place, and they're gonna lose their shit when people realize what a stupid idea that is, and then the big investors are gonna cover their position when everyone else sells their stock. TL;DR: Internet mob thinks people shorting a failing company is stupid, so they buy it, artificially increase stock price, and will eventually run the stock price into the ground after the meme is dead and people sell the overvalued stock, causing the big investors who aren't stupid to buy back the stock at an even lower price than expected in the long run.
You're not understanding my argument. Right now the stock price propped up by people constantly buying it. If people stop buying it, the price will stagnate at where it was i.e. drop because it's overvalued because of speculation. If the price starts to drop, people will most likely panic sell in order to make sure they don't lose money, in which case the selling will accelerate the price drop, causing the stock to become undervalued, and THEN big investors will drop all at once. The problem isn't that investors will sell all at once, it's that the stock buyers think they can beat out the big investors by forcing them to buy at an artificial high, but you can hold a short position indefinitely, and the buyers have to keep buying in order to prop up the price, whereas there is no opportunity cost for the big investors to hold their short position until this idiotic charade ends.
Yeah, I used stagnate incorrectly there. I want to specify that what will most likely happen is that after people realize that they can’t get any more people to buy the stock (because the long term price is dubious), people will start to sell over time. It might even be true that some people will short the stock AGAIN because it’s so high. Whatever the case is for management at GameStop, nothing it’s been doing could warrant a tripling in common stock value over 10 days. In the end the only people making profit are the shorters who held or started now and the people who bought and sold the stock already.
It depends on when the short gets called for the stock. If the prices remain artificially high until then the hedge fund is going to get fucked. But, I doubt Gamestop is going to have that much more momentum after the initial surge. The real investors who jumped in have already jumped out and made their profits.