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  1. #1521
    Join Date
    Nov 2007
    Location
    Raleigh, NC
    Quote Originally Posted by duke79 View Post
    Yea, no doubt that all of these lousy companies (GME, AMC, etc) whose stock price is being bid up by the so-called Reddit traders should be trying to do equity offerings as quickly as possible to raise as much money if they can find enough "suckers" who will pay exorbitant prices for their shares.
    Wouldn't the "suckers" in this case likely be the hedge funds that are getting squeezed?

  2. #1522
    Join Date
    Dec 2009
    Location
    North of Durham
    Quote Originally Posted by duke79 View Post
    Yea, no doubt that all of these lousy companies (GME, AMC, etc) whose stock price is being bid up by the so-called Reddit traders should be trying to do equity offerings as quickly as possible to raise as much money if they can find enough "suckers" who will pay exorbitant prices for their shares.
    AMC is one step ahead of you. Looks like they did an equity offering on Wednesday that captured some but far from all of the stock price run-up. Then they had convertible debt get converted to equity, cleaning up their balance sheet. And now they are looking to issue more equity. In their case, I would think that once we are hopefully through the worst of the pandemic they have a decent chance of returning to something resembling business as usual, so the cash they are getting really could be meaningful in buying them some time, unlike Game Stop, where I feel like it is more of a stay of execution unless they truly are finding a way to pivot.

    Disclaimer: I have not studied either of these stocks in detail so these are my thoughts on them based on basic knowledge of what they do and not a complete understanding of their business models or finances.

    https://www.cnbc.com/2021/01/29/amc-...urces-say.html

  3. #1523
    Quote Originally Posted by CrazyNotCrazie View Post
    AMC is one step ahead of you. Looks like they did an equity offering on Wednesday that captured some but far from all of the stock price run-up. Then they had convertible debt get converted to equity, cleaning up their balance sheet. And now they are looking to issue more equity. In their case, I would think that once we are hopefully through the worst of the pandemic they have a decent chance of returning to something resembling business as usual, so the cash they are getting really could be meaningful in buying them some time, unlike Game Stop, where I feel like it is more of a stay of execution unless they truly are finding a way to pivot.

    Disclaimer: I have not studied either of these stocks in detail so these are my thoughts on them based on basic knowledge of what they do and not a complete understanding of their business models or finances.

    https://www.cnbc.com/2021/01/29/amc-...urces-say.html
    I think the true test of AMC really depends on what's going down in Brazil.

    https://www.npr.org/sections/goatsan...nt-from-brazil

    If COVID-19 is here to stay (for awhile at least) and we have to social distance for a continued amount of time, I don't see how they can make it. Part of the hope is we get the vaccine, we eradicated COVID-19 and all returns to normal. If we are in this for a protracted length of time, where this is like the flu, but not seasonal and is something that can kill hundreds of thousands of people in a season...I can see the AMC going under in short order.

  4. #1524

    WSJ Interviews Redditor Who Led the GME Craze

    It's been a 34-year old who worked (until recently) in marketing for Mass Mutual Life Co and has a 2-year old daughter who has been the leader of the GME trade. Keith Gill goes by "DeepF____Value" on the forums. He started his trade with GME in the summer of 2019.

    https://www.wsj.com/articles/keith-g...al-11611931696
    Mr. Gill posted a screenshot of his brokerage account Wednesday, showing a roughly $20 million daily gain on GameStop shares and options...The next day, Mr. Gill posted another screenshot—showing about a $15 million loss. After Thursday’s market close, his E*Trade brokerage account, viewed by the Journal, held around $33 million, including GameStop stock, options and millions in cash...Mr. Gill said his life has changed overnight and hasn’t set his future plans. He would like to continue the “Roaring Kitty” YouTube channel, maybe buy a house. “I thought this trade would be successful,” he said, “but I never expected what happened over the past week.”
    I think one major concern is people want to try to emulate this (and subsequently lose their life savings which happens all the time on r/wallstreetbets) but it was basically the equivalent of winning the lottery and was extremely lucky.

    Although he is a CFA and has a youtube channel ("Roaring Kitty") where he talks a lot about his pick in detail (doesn't have very many videos)...So, he certainly has SOME knowledge.

  5. #1525
    Join Date
    Dec 2009
    Location
    North of Durham
    Quote Originally Posted by PackMan97 View Post
    I think the true test of AMC really depends on what's going down in Brazil.

    https://www.npr.org/sections/goatsan...nt-from-brazil

    If COVID-19 is here to stay (for awhile at least) and we have to social distance for a continued amount of time, I don't see how they can make it. Part of the hope is we get the vaccine, we eradicated COVID-19 and all returns to normal. If we are in this for a protracted length of time, where this is like the flu, but not seasonal and is something that can kill hundreds of thousands of people in a season...I can see the AMC going under in short order.
    I don't know how close AMC was to the edge but the money they raised this week through their equity offering plus the reduction/elimination of outstanding debt (I'm not sure which) likely bought them a lot of time. I assume they have slashed their variable costs but still have huge fixed costs that they are supporting. A basic investor can fairly easily figure out what their updated liquidity position is and estimate their cash burn and use that to figure out their end date - whatever that end date was a few weeks ago is now significantly later.

    The primary issue is when will people feel comfortable going back to theaters. Also, when can they convince the studios that people are comfortable going back to theaters so that the studios start releasing new movies to the theaters. There is a large AMC theater a block from my home that I walk past on the days I am lucky enough to take my kids to school (5 out of 10 days). Their primary billboard is for My Spy coming out on March 13 - I now have to remind myself that it is a year old and not for something coming out this March.

  6. #1526
    Join Date
    Jan 2010
    Location
    Outside Philly
    Quote Originally Posted by Bluedog View Post
    It's been a 34-year old who worked (until recently) in marketing for Mass Mutual Life Co and has a 2-year old daughter who has been the leader of the GME trade. Keith Gill goes by "DeepF____Value" on the forums. He started his trade with GME in the summer of 2019.

    https://www.wsj.com/articles/keith-g...al-11611931696


    I think one major concern is people want to try to emulate this (and subsequently lose their life savings which happens all the time on r/wallstreetbets) but it was basically the equivalent of winning the lottery and was extremely lucky.

    Although he is a CFA and has a youtube channel ("Roaring Kitty") where he talks a lot about his pick in detail (doesn't have very many videos)...So, he certainly has SOME knowledge.
    World's getting weirder and weirder.

    Keith-Gill-Roaring-Kitty-a.jpg

  7. #1527
    Quote Originally Posted by bundabergdevil View Post
    World's getting weirder and weirder.

    Keith-Gill-Roaring-Kitty-a.jpg
    That guy really ought to sell off a million or two just to have something left after it all crashes.

  8. #1528
    Quote Originally Posted by PackMan97 View Post
    That guy really ought to sell off a million or two just to have something left after it all crashes.
    Apparently, he has already closed some positions and has several million pocketed, but he can't sell too much off for fear of being accused of having "paper hands" by his wsb redditors and instead needs to maintain "diamond hands." (yes, those are the terms used on the subreddit). After reading through that site, it's definitely like a frat/cult/something else. There's a unique lingo, much of which is NSFW or this site.

  9. #1529
    Join Date
    Sep 2007
    Location
    Bethesda, MD

    John Cochrane on Gamestop

    https://johnhcochrane.blogspot.com/2...ver-again.html

    Probably not everyone's cup of tea, but John is one of the best financial economists.

  10. #1530
    Quote Originally Posted by CrazyNotCrazie View Post
    AMC is one step ahead of you. Looks like they did an equity offering on Wednesday that captured some but far from all of the stock price run-up. Then they had convertible debt get converted to equity, cleaning up their balance sheet. And now they are looking to issue more equity. In their case, I would think that once we are hopefully through the worst of the pandemic they have a decent chance of returning to something resembling business as usual, so the cash they are getting really could be meaningful in buying them some time, unlike Game Stop, where I feel like it is more of a stay of execution unless they truly are finding a way to pivot.

    Disclaimer: I have not studied either of these stocks in detail so these are my thoughts on them based on basic knowledge of what they do and not a complete understanding of their business models or finances.

    https://www.cnbc.com/2021/01/29/amc-...urces-say.html
    It is amazing that I don't understand most of this. At all.

  11. #1531
    Join Date
    Jan 2010
    Location
    Outside Philly
    Quote Originally Posted by Lord Ash View Post
    It is amazing that I don't understand most of this. At all.
    There are people that post here that are true experts and can tell you all the ins and outs. The gist is that issuing stock raises capital; AMC is trying to take advantage of the demand for shares (evidenced by the bid up) to issue new shares at the high stock prices. They need money, this is an opportunity to get it.

  12. #1532
    Join Date
    Nov 2007
    Location
    Vermont
    Quote Originally Posted by bundabergdevil View Post
    There are people that post here that are true experts and can tell you all the ins and outs. The gist is that issuing stock raises capital; AMC is trying to take advantage of the demand for shares (evidenced by the bid up) to issue new shares at the high stock prices. They need money, this is an opportunity to get it.
    But wouldn't one have to be a severe dullard to buy shares at the current elevated prices? (I'm not following the price at all, but presumably it's still frothy, right?) Great move by AMC of course, but not so much for buyers...

  13. #1533
    Quote Originally Posted by Bluedog View Post
    It's been a 34-year old who worked (until recently) in marketing for Mass Mutual Life Co and has a 2-year old daughter who has been the leader of the GME trade. Keith Gill goes by "DeepF____Value" on the forums. He started his trade with GME in the summer of 2019.

    https://www.wsj.com/articles/keith-g...al-11611931696


    I think one major concern is people want to try to emulate this (and subsequently lose their life savings which happens all the time on r/wallstreetbets) but it was basically the equivalent of winning the lottery and was extremely lucky.

    Although he is a CFA and has a youtube channel ("Roaring Kitty") where he talks a lot about his pick in detail (doesn't have very many videos)...So, he certainly has SOME knowledge.
    Becoming a CFA Charterholder is incredibly difficult. I know 2 Fuqua MBAs that gave up because it was too hard. I know a CFA that does not have an MBA but earned an incredible job over several MBAs from top ten schools. If he is a CFA he certainly knows his stuff. I've followed the reddit thread for about 2 weeks now. There is a lot of nonsense but also some really good analysis. Make no mistake, there are people on that thread that know much more than the average bear.

  14. #1534
    Join Date
    Feb 2007
    Location
    Washington, D.C.

    There

    Quote Originally Posted by nmduke2001 View Post
    Becoming a CFA Charterholder is incredibly difficult. I know 2 Fuqua MBAs that gave up because it was too hard. I know a CFA that does not have an MBA but earned an incredible job over several MBAs from top ten schools. If he is a CFA he certainly knows his stuff. I've followed the reddit thread for about 2 weeks now. There is a lot of nonsense but also some really good analysis. Make no mistake, there are people on that thread that know much more than the average bear.
    Or bull, apparently!

  15. #1535
    Join Date
    Nov 2007
    Location
    Manhattan
    Quote Originally Posted by PackMan97 View Post
    That guy really ought to sell off a million or two just to have something left after it all crashes.
    He’s closed about $13M worth of his original $53K investment. Still has about $30M or so of skin in the game left. He’ll be fine.

  16. #1536
    Join Date
    Jan 2010
    Location
    Outside Philly
    Quote Originally Posted by Native View Post
    He’s closed about $13M worth of his original $53K investment. Still has about $30M or so of skin in the game left. He’ll be fine.
    They say invest in the things you buy and that guys looks like a GameStop customer.

  17. #1537
    Join Date
    Feb 2007
    Location
    Washington, D.C.
    Quote Originally Posted by Bluedog View Post
    It's been a 34-year old who worked (until recently) in marketing for Mass Mutual Life Co and has a 2-year old daughter who has been the leader of the GME trade. Keith Gill goes by "DeepF____Value" on the forums. He started his trade with GME in the summer of 2019.
    Makes sense that a 2-year old would be the brains behind this.

    Sorry -- couldn't help myself.

  18. #1538
    Join Date
    Nov 2007
    Location
    Vermont
    If you like digging into some of the high stakes games played in our financial markets, may I strong recommend Flash Crash by Liam Vaughan, which chronicles the shenanigans behind the 2010 mini crash in which the Dow dropped 600 points in five minutes...a prime takeaway being that it can take years for regulators to figure out precisely what has happened (not implying it will take that long to decipher this current case)...

    If people can make money by gaming or bending the rules, they will. Flash Crash is pretty fascinating...featuring the proverbial guy sitting in his bedroom at home mangling markets.

  19. #1539
    Join Date
    Jan 2010
    Location
    Outside Philly
    Quote Originally Posted by budwom View Post
    If you like digging into some of the high stakes games played in our financial markets, may I strong recommend Flash Crash by Liam Vaughan, which chronicles the shenanigans behind the 2010 mini crash in which the Dow dropped 600 points in five minutes...a prime takeaway being that it can take years for regulators to figure out precisely what has happened (not implying it will take that long to decipher this current case)...

    If people can make money by gaming or bending the rules, they will. Flash Crash is pretty fascinating...featuring the proverbial guy sitting in his bedroom at home mangling markets.
    If people can get an extra nugget in their happy meal by bending the rules, they will.

  20. #1540
    Quote Originally Posted by budwom View Post
    If you like digging into some of the high stakes games played in our financial markets, may I strong recommend Flash Crash by Liam Vaughan, which chronicles the shenanigans behind the 2010 mini crash in which the Dow dropped 600 points in five minutes...a prime takeaway being that it can take years for regulators to figure out precisely what has happened (not implying it will take that long to decipher this current case)...

    If people can make money by gaming or bending the rules, they will. Flash Crash is pretty fascinating...featuring the proverbial guy sitting in his bedroom at home mangling markets.
    Great, fast paced read. Certainly raises interesting questions as to why some kinds of market action is deemed manipulation. Main character certainly no fan of hedge funds.

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