Followers | 715 |
Posts | 21838 |
Boards Moderated | 4 |
Alias Born | 04/30/2007 |
![](https://investorshub.advfn.com/uicon/99749.png?cb=1709547129)
Friday, January 29, 2021 11:37:34 PM
Message in reply to:
Citadel & Point72 bailed out Melvin Capital which was the GME short selling bagholder, but it does not end here.
There are other short sellers. And these stocks, not just GME , but others too, became extremely volatile and on giant volume .
So first there is the issue of liquidated funds that do not have immediate cash.
They hold positions and would have to unwind them to get cash to cover their margin calls.
Melvin Capital I read was down 30% and got bailed out, so they still have assets, just not liquid, no immediately available cash.
Trust me, if they had a gun to their head they'd have immediately available cash, they'd manage.
Second, even after what happened in 2007-2009, financial institutions with systemic risk are not THAT capitalized.
It's not new and never gets solved: in 1987 NYSE specialists had to bed big banks to provide them with more cash or the whole world would collapse.
And I think bureaucrats do not understand how this all works very well. No one does honestly. But bureaucrats are really clueless and under or overreact. Always.
It gets scary for the clearing firms when you have GME making $35 billion volume and going up 400% in 2 days, AMC making $20 billion and gap 300%, higher volumes than Apple and Amazon that are already higher than usual and on 100 times the volatility .
Interactive Broker CEO was the most honest in my eyes and in an interview with CNBC said they halted trading to protect their clients, the clearing houses, the market, and themselves. He said if they had not done it the short squeeze would have kept "going and going", so regulators & brokers agreed to stop it all to "stop the losses".
Robinhood decided to re-open trading and the CEO pretended he halted trading of the very volatile stocks as routine like "oh didn't notice anything special was going on."
Webull CEO said in an interview their clearing house told them they could not take trades anymore. I think they use another entity than Robinhood does.
Not sure why Robinhood halted buying (and not selling). There's really the need for an investigation here. I can't tell you what happened because we do not know.
My 2 cents:
Short sellers are still very strong on this stock, I think they might even have added, I don't know if they are friends with the clearing house but either way they (ch) get stuck in this game, and retail investors are understandably angry at getting blocked like this.
Brokers don't have billions to my knowledge with which they can cover counterparty risk and they have no contractual obligation to do so and I mean they're not santa claus.
My personal opinion is short sellers refusing to liquidate and take the L is the source of all risks and problems (most of it might be options that they can just hold? Not sure how this gets counted in short interest).
Maybe already the counterparty clearing firms got wiped clean, but regardless of this if the price skyrockets further and the bagholding shorts that refuse to close while they can end up being liquidated and margin called, it's truly over for the market. Everyone is going bankrupt, WSB crashed the world.
The counterparty providers risk is real, but I am not their accountant, I do not know how bad things are, and we don't know what actors (if any) are of good faith. It could be (it probably is) shorties refusing to take the L, putting the whole market at risk.
I think they are really worried the price gets to 5000. From the Peterffy ( IBKR ) interview they really expected this. And it might still happen.
Lehman Brothers, James Cordier, Melvin, same story. They get greedy, they refuse to get out, they get rekt.
And sometimes they get an unfair bailout, and are so deluded they actually think they got unlucky when they really messed up.
Recent AMC News
- Sight & Sound Partners to Premiere Their First Ever LIVE Broadcast into Movie Theaters Nationwide, Courtesy of Fathom Events • GlobeNewswire Inc. • 07/09/2024 02:00:08 PM
- BP Slashes Profit Forecast by $700 Million; Morgan Stanley Predicts S&P 500 10% Drop, and More News • IH Market News • 07/09/2024 10:54:32 AM
- More Than 4 Million U.S. Moviegoers Spent Part of Their Extended Holiday Weekend at AMC Theatres® as the Company Recorded Its Highest Domestic Attendance – for a Wednesday Through Sunday – in 2024 • Business Wire • 07/08/2024 12:15:00 PM
- UPS Divests Coyote Logistics in $1.025 Billion Deal with RXO, Under Armour Agrees to $434 million Settlement, and More News • IH Market News • 06/24/2024 11:00:20 AM
- AMC Theatres® Records its Most Attended and Highest Grossing Weekend of 2024 – Domestically and Globally • Business Wire • 06/17/2024 01:28:00 PM
- AMC Theatres Offers Movie Lovers Eight Ways to Save at the Movies This Summer • Business Wire • 06/07/2024 10:45:00 AM
- Amcor's new European Innovation Center brings brands the latest in material science and packaging design • PR Newswire (US) • 05/30/2024 07:02:00 AM
- Mike Rowe Presents SOMETHING TO STAND FOR Coming to Theaters Nationwide - Beginning June 27 • PR Newswire (US) • 05/23/2024 01:00:00 PM
- Summer Movie Camp Returns to AMC Theatres® With Popular Family Titles at Just $3 Plus Tax Per Ticket • Business Wire • 05/23/2024 10:45:00 AM
- Chubb Stock Soars 9% with Berkshire Acquisition, AST SpaceMobile jumps 37% on AT&T deal, and More News • IH Market News • 05/16/2024 11:27:07 AM
- Nike Cuts Jobs at Converse, Ilya Sutskever Departs from OpenAI, WBD Increases Buyback Offer, and More News • IH Market News • 05/15/2024 11:49:06 AM
- Meme Stock GameStop Rallies After Roaring Kitty Post • IH Market News • 05/14/2024 12:31:22 PM
- Walmart Corporate Job Cuts and Office Centralization, GameStop and AMC Surge, and More News • IH Market News • 05/14/2024 11:26:02 AM
- Airbnb Stocks Drop 8% Amid Bleak Outlook; Bumble Surges 14% on Global Download Rise, and More in Earnings • IH Market News • 05/09/2024 11:56:30 AM
- AMC Entertainment Holdings, Inc. Reports First Quarter 2024 Results • Business Wire • 05/08/2024 08:22:00 PM
- U.S. Futures Slightly Dip Amid Corporate Earnings and Quiet Economic Calendar, Oil Prices Fall • IH Market News • 05/08/2024 12:29:17 PM
- Bottles of the Year Program from Amcor Showcases the Best New Designs in Responsible Packaging • Business Wire • 05/07/2024 03:00:00 PM
- Alphabet CEO’s Billion-Dollar Wealth, Microsoft’s $1.7B Indonesia Investment, and More News • IH Market News • 04/30/2024 11:58:40 AM
- AMC Entertainment Holdings, Inc. Previews First Quarter 2024 Preliminary Results and Announces First Quarter 2024 Earnings Webcast • Business Wire • 04/26/2024 08:15:00 PM
- United Shares Surge 5.3% in Q1 2024 Earnings Beat; Take-Two Cuts 5% of Workforce, and More News • IH Market News • 04/17/2024 10:57:39 AM
- Walgreens Slashes Annual Profit Forecast; MillerKnoll Nosedives 17% on Bleak 4Q Outlook, and Latest News • IH Market News • 03/28/2024 01:48:04 PM
- Amcor announces CEO transition and reaffirms fiscal 2024 outlook • PR Newswire (US) • 03/19/2024 08:15:00 PM
- Zoom Rooms at AMC Is Now Live at Several AMC Locations Across the Country as AMC Theatres® and Zoom Redefine Interactive Business Meetings and Hybrid Events • Business Wire • 03/14/2024 10:45:00 AM
- AMC Entertainment Holdings, Inc. Provides Settlement Notice • Business Wire • 03/12/2024 08:30:00 PM
- AMC Significantly Expands the Availability of its Popular Grocery Store Popcorn Through the Addition of Publix and Kroger Stores, and Amazon.com • Business Wire • 03/11/2024 05:09:00 PM
Greenlite Ventures Completes Agreement with No Limit Technology • GRNL • Jul 19, 2024 10:00 AM
VAYK Expects Revenue from First Airbnb Property Starting from August • VAYK • Jul 18, 2024 9:00 AM
North Bay Resources Acquires Mt. Vernon Gold Mine, Sierra County, California, with Assays up to 4.8 oz. Au per Ton • NBRI • Jul 18, 2024 9:00 AM
Nightfood Holdings Signs Letter of Intent for All-Stock Acquisition of CarryOutSupplies.com • NGTF • Jul 17, 2024 1:00 PM
Kona Gold Beverages Reaches Out to Largest Debt Holder for Debt Purchase Negotiation • KGKG • Jul 17, 2024 9:00 AM
Avant Technologies Welcomes Back Former CEO with Eye Toward Future Growth and Expansion • AVAI • Jul 17, 2024 8:00 AM