School me on investing...

2xidb!

Whatever happened to her?

 

10 kids?

Everyone else pretending like they didn't see it or know.

 

Anyone jump back into GME? I did... This stock is so crazy lol

+52% as of 3pm

The entire BoD are about to be replaced woo hoo!

 

Hell to the no... didn't jump back in at $40, see no reason to now

 

Bought back in a few shares before earnings just in case they announced something wild and the stock took off. I planned to average down every day this week thinking it was likely going to tank (it's plummeted after earnings every quarter for years). My average is now ~$160, so I guess I'm not averaging down anymore

 

You really hate money?

 

root of all evil! or is that Gingers...?

 

GME at it again..

 

well....

 

and down at it again.

Gambling at its finest.

 

it's the stock market

 

FTFY

 

Guys heads up. Somethings is up. Goldman just liquidated a hedge funds position for margin call and in the process tanked a fee blue chip stock prices. Check out ViacomCBS and Discovery. Massive drop. Some are speculating this is due to Fed not extending the supplementary lending ratio that was relaxed during covid. Ie institutions were allowed to increase their lending multiplier to add liquidity to the market during covid. Seems some institutions used it to over leverage themselves.
If this is a bigger issue then just a few HF (I guarantee you it is, it explains this massive stock market surge last 6 months) and the Fed doesn’t extend this SLR leeway, a ton of banks will be margin calling their customers who will liquidate stocks to get liquidity back.

 

I'm not very bright. What does this mean for the average American with a 401k and some other "general investments"? Is this a time to buy, hold, sell, or start burying cash in coffee cans in the back yard?

 

Well, its a complicated answer. Lets just look into whats happening and maybe you can decide on what to do with that info. Money Makers, AKA, banks that are bankrolling these Hedge Funds and Investment companies allowed them to over leverage them during the covid. As per Feds authority. So if they have a say 10-1 lending ratio, if a Hedge Fund has 10 billion investment portfolio, they will have up to 10x that lent from the bank. So they have 100 billion in the market, Invested in whole bunch of different things. Stocks, bonds, options both short and long (puts and asks). They fully expected Fed to extend this SLR rule for the forseable future. I mean, when has Fed actually throttle the market? Well it expires on the 31st of March and Fed has neither confirmed nor denied that they'll extend it.

So, theoretical number, the leverage ratio now goes to 8-1 or 6-1. The Money Makers looking at the Hedge Funds going "fuck, if they get themselves in a tough position, they are already over leveraged and now by the rules, if they fail, we wont get paid"

So Money Makey asks the HF add liquidity to their portfolio to meet the new ratio rule. They have two options....raise more capital, or liquidate their positions. Its called a Margin call, and if youre investing into stock options you can be margin called by your broker as well. Sometimes they'll just automatically do the choosing for you. They'll simply sell off part of your portfolio to meet the margin. Why would they do this? If they believe your portfolio is at risk.

So now that we know WHY its happening, lets look at the repercussions. If most institutions maxed themselves out during the SLR time period (and why wouldnt they?) that means this new rule will require a lot of them to deleverage themselves. Most will have to liquidate their positions. Massive sell off...these people work on a huge scale and their sell off will have massive impact on the stock market.

So, knowing this, and just how unstable the market has been for the last month, where the slights news is making it jump up and down 5%, i cant see this as being a positive thing. Many insitutions may just sell their position while at the peak and wait until the market settles down.

Imagine you had $ in what was deemed a stable stock like Discovery or Viacom and you just lost 6 months worth of gains in a single 30 min period....

Personally, im pulling some positions out for now.. see what shakes out. Stuff that im almost breaking even on, might as well pull it out, stuff that im deep in the red, no point pulling money out.

 

“Honey, call our broker and tell him ‘SELL SELL SELL’ and do it NOW!!!!”

“What’s the matter? What’d you hear?!?”

“Well, it’s not good. Rebel635 says we’re in for a reckoning.”

 

Official wording for having to cover for shorting GME

 

Here's an article that @Rebel635 probably wrote
https://www.cnbc.com/2021/03/28/stock-market-open-to-close-news.html

 

https://www.ft.com/content/89b560ec-212c-4e82-b52e-c3e1408a9e6b

 

BAYP