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  1. In Memory of LAJ_FETT: Please share your remembrances and condolences HERE

JCC What's Wall Street up to today?

Discussion in 'Community' started by SuperWatto, Dec 18, 2015.

  1. dp4m

    dp4m Chosen One star 10

    Registered:
    Nov 8, 2001
    That's basically it. And yes, it's as bad as it sounds, but it's actually worse overall conceptually.

    Generally, a central bank -- of which there are both country-wide (like the Fed, or Central Bank of England, etc.) or region-wide (EU) -- who set interest rates to drive lending or holding. Lower interest rates tend to drive spending. This is why you see banks offering interest rates at Prime + X%.

    However... if negative interest rates become a thing (and they already are) then it stimulates spending, at the cost of lending. While this is sort of great for countries, as they have to spend money rather than save it, it sort of sucks for banks -- and therefore customers.

    Traditionally, a retail bank (like a normal bank where all you do it have a bank account or get loans), will take deposits and leverage those deposits to loan money to people / businesses. Ideally, you'd cap loans at 98% of deposits or somewhere in there, but I think that's not been the norm for decades. If there is no incentive to lend, it drastically affects small-businesses and individuals more than large corporations, though those will also feel some sting. The only place to park funds at that point is into assets (real estate, art, other discretionary spending), spending (food, goods and services, etc. -- which is what it's designed to do), the stock market, or your mattress. The trouble is that, especially if Bernie Sanders wins the Presidency, those stock market transactions will be taxed as well (and this is already happening in some Euro-states), which may depress the market even more as it will reduce discretionary spending there.

    I've probably screwed this up, and Watto or Ender can jump in and correct me, but it's not a good thing.
     
  2. Ender Sai

    Ender Sai Chosen One star 10

    Registered:
    Feb 18, 2001

    Investopedia explains it best: http://www.investopedia.com/articles/investing/070915/how-negative-interest-rates-work.asp
     
  3. Point Given

    Point Given Manager star 7 Staff Member Manager

    Registered:
    Dec 12, 2006
    Having hedge funds nearly bankrupted by memes on Reddit, apparently.
     
    BookExogorth, Rew, Juliet316 and 2 others like this.
  4. 3sm1r

    3sm1r Force Ghost star 6

    Registered:
    Dec 27, 2017
     
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  5. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    Poor GameStop. They’ll crash in a few days.
     
  6. Point Given

    Point Given Manager star 7 Staff Member Manager

    Registered:
    Dec 12, 2006
    Well yeah, this entire situation is about forcing the Gamestop short-sellers to crash and burn and make a quick bundle while doing so before it plummets back to earth.
     
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  7. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    Oh I know. It’s just not gonna be pretty.
     
  8. 3sm1r

    3sm1r Force Ghost star 6

    Registered:
    Dec 27, 2017
    @Point Given
    turns out to be passionate about trading. What a twist!
     
  9. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    Trading is fascinating I just don’t have the money for it
     
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  10. Darth Punk

    Darth Punk JCC Manager star 7 Staff Member Manager

    Registered:
    Nov 25, 2013
    Funny story. I’ve never heard of GameStop. Are they predominantly a nationwide bricks and mortar computer game retailers?

    If so, it is probably a short.
     
  11. anakincol

    anakincol Jedi Grand Master star 4

    Registered:
    Jul 28, 2009
    The Wallstreetbets sub is a bitter hive of scum and villainy so much racism, misgony and anti semtism on That sub which is hilariously ironic because they worship the ground Jim Cramer walks on and he is Jewish.
     
    Last edited: Jan 26, 2021
  12. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    It is? I have never gone on the sub myself and have only seen it on r/all of Reddit.
     
    Last edited: Jan 26, 2021
  13. a star war

    a star war Force Ghost star 5

    Registered:
    May 4, 2016
    The subreddit r/wallstreetbets started buying Gamestop stock (which was in the dumpster) in mass quantities to spite a hedgefund that was shorting it. The hedgefund has already lost $3 billion, and they mean to go after the rest of the 13bn it was valued at in march of last year.
     
    Last edited: Jan 26, 2021
  14. anakincol

    anakincol Jedi Grand Master star 4

    Registered:
    Jul 28, 2009
    Yeah.

    I had a reddit user who was a regular on that sub go after me for being Jewish on a Warhammer meme sub reddit. For all the War hammer fandoms issues with Alt-Right facists not getting the game is a parody of racism(the imperium is pretty facist and also a dystopian hellscape) the other posters quickly down voted his antisemitic comments to the negative hundred and mods at r/Grimdank quickly banned him making me proud of the warhammer community.
     
    Last edited: Jan 26, 2021
    Rew likes this.
  15. dp4m

    dp4m Chosen One star 10

    Registered:
    Nov 8, 2001
    I woulda shorted it at the top of the peak, if I'd known about it!
     
  16. Darth Guy

    Darth Guy Chosen One star 10

    Registered:
    Aug 16, 2002
    Oh boy all this **** is gonna come crashing down when the Fed's cash flow stops or stops working. In the meantime I'll be using RobinHood and getting investment advice from FinTok.
     
  17. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    Why though? Just completely out of spite to **** with people
     
  18. 3sm1r

    3sm1r Force Ghost star 6

    Registered:
    Dec 27, 2017
    If my grandma had wheels, she'd be a wheelchair :p
     
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  19. anakincol

    anakincol Jedi Grand Master star 4

    Registered:
    Jul 28, 2009
    Its a bunch of people who watched the Wolf of wall street and boiler room one to many times
     
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  20. a star war

    a star war Force Ghost star 5

    Registered:
    May 4, 2016
    Yes. They believe they are the "future" of trading, and that hedge fund managers live in the past and also have a vendetta against them, so they're attempting to burn it all down.

    What is probably definitely going to happen is they're going to drive it up a bit more before someone blinks, and then there's going to be a huge selloff and most of the people doing this are going to get third degree burns, while whoever gets out first will make off like bandits.
     
  21. Darth Punk

    Darth Punk JCC Manager star 7 Staff Member Manager

    Registered:
    Nov 25, 2013
    OK, so according to the FT, it’s a common-or-garden short squeeze. The twist here is that it’s normally hedge funds doing it to retail traders. This time round it’s a crowd sourced bunch of traders from reddit turning the screws.
     
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  22. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    Okay I can’t say I am a fan of that. It’s ****ing with game stop, it’s ****ing with people’s savings I ain’t a fan.
     
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  23. a star war

    a star war Force Ghost star 5

    Registered:
    May 4, 2016
    Sounds like you’re not a fan of the stock market. Nice.
     
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  24. Darth Guy

    Darth Guy Chosen One star 10

    Registered:
    Aug 16, 2002
    Wait 'til you hear about 401(k)s.
     
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  25. Jedi Knight Fett

    Jedi Knight Fett Chosen One star 10

    Registered:
    Feb 18, 2014
    Edit
     
    Last edited: Jan 26, 2021