The GameStop Gamma Wall Breaks Down as Virus Variants Ring Alarm Bells

Published on
January 29th, 2021
Duration
55 minutes

Robinhood on Shaky Ground and Potential Market Destabilization to Come


The GameStop Gamma Wall Breaks Down as Virus Variants Ring Alarm Bells

Daily Briefing ·
Featuring Jack Farley, Lily Francus, Ash Bennington, and Ed Harrison

Published on: January 29th, 2021 • Duration: 55 minutes

In the intro, Real Vision senior editor Ash Bennington speaks to Lily Francus, derivatives trader and PhD candidate in Bioinformatics at the University of California San Diego, about the unique market mechanics that have characterized the run in GameStop Corp ($GME). In the main segment, Ash welcomes managing editor Ed Harrison and editor Jack Farley to debate whether the Robinhood ban on trading is unfair and if it reveals unseen holes in the functioning of capital markets. Jack provides data on options flow in $GME, and the three explore whether the wall of gamma will break down or get even higher, agreeing that Monday will be a turning point as this is when $GME calls with higher strike prices could get written (and can be bought by retail traders). Ash and Ed discuss how susceptible the various COVID-19 variants are to the vaccines and how their ominous spread will impact the reflation trade.

Comments

Transcript

  • CD
    Carl D.
    31 January 2021 @ 04:45
    As a millennial who bought trivial amounts of game stock, Nokia, Macy's, and bed bath beyond a year ago and had been sitting on them, I can say my that my thought process was kind of a fuck it attitude, stocks and bonds are ridiculously expensive, I already own a ton of gold/miners, I'll amuse myself by buying these near dead companies cause I don't know what else to buy. If you want insight into my hot hand, other picks that haven't worked out were some coal companies and Pharma companies sued for the opioid epidemic.
    • AB
      Ash B. | Real Vision
      31 January 2021 @ 05:01
      Hehe. I’m curious, Carl: What made you pick $M + $GSE out of the universe of beaten down stocks? Was it chatter on Reddit or Twitter or somewhere else?
    • CD
      Carl D.
      3 February 2021 @ 01:59
      its factor based investing using the nihilistic factor
  • CL
    Carlos L.
    30 January 2021 @ 00:57
    Of course it's generational. These idiot Boomers not only have failed to provide meaningful reform, have strengthened the hold of corporations in power, failed to regulate, failed to fund their own fucking pensions and are inheriting us a f'ing climate crisis because they are too lazy or too brainwashed to take bold action. F THEM ALL.
    • mf
      massimo f.
      30 January 2021 @ 01:09
      The implication being that if we had been in their position, we would have done something different? Don't be naive.
    • DW
      Dean W.
      30 January 2021 @ 02:06
      Boohoo, poor snowflake...
    • MC
      Michael C.
      30 January 2021 @ 03:09
      Every generation feels the last one left them a mess.
    • JF
      Joao F.
      30 January 2021 @ 17:56
      A generational divide is clearly taking place and the power will gradually shift to millennials (some millennials will be the majority of voters). My opinion is that this change is not only fundamental but highly necessary. Not all boomers are malicious obsviously but clearly failed to provide the solutions to build a better, more sustainable future.
    • LF
      Liam F.
      1 February 2021 @ 21:18
      Stop blaming others Carlos. Especially stop blaming an entire generation. I'm a very tail-end boomer (or is it a bleeding-edge X-er?). Believe me, the world seemed like a giant shithole to inherit growing up in the 60's and 70's. We were staring down nuclear annihilation, major energy shortages and gasoline rationing, getting drafted at 18 to go fight a war of Empire in Vietnam, etc. We also had the CIA running rampant all over the Americas taking out left-leaning Democratic governments because they were "Commies". Personally, I feel very little generational affinity for the early-stage Boomers. These were the hippies who were tuning in and turning on when I was a just baby. By the time I turned 18 Vietnam was long done, and Reagan was President. I hate, HATE what has been done to our financial system and where we find ourselves today. However keep in mind that this is the product of 40 years of neo-conservative and neo-liberal clusterfuckery that began with Reagan and Thatcher (both of whom were NOT Boomers I might add), and which has continued under each and every Republican and Democratic administration since. Ironically, Joe Biden may just be the FDR that saves the USA from doing the Ouroboros. I sure as hell hope so for all our sakes, because frankly I don't see any millennials riding to rescue us in the immediate future. But your time is coming, and I wish you guys all the best. I'll be an old man when your generation has all the power and hopefully you won't stick your grandparents out on the ice floe. From what I'm seeing, some of your generation will do a great job; while others (looking at you Josh Hawley) are going to be complete f***king disasters.
  • ND
    Nivtej D.
    1 February 2021 @ 21:02
    Anthony Dean was right. The market lies lol great old interview by Grant Williams and it put a lot of things into perspective for the investor. As Jim Rogers said everyone wants a hot tip lol
  • DS
    Dan S.
    1 February 2021 @ 19:51
    Naked Options should be banned. But Wall Street makes fees off naked so gov won't do that.
  • DS
    Dan S.
    1 February 2021 @ 19:36
    100% Effectiveness? I call B.S.!
  • MC
    Michael C.
    30 January 2021 @ 04:38
    from the Arkansas Times the Piggly Wiggly squeeze (the article discussed GME) So, what does that have to do with Piggly Wiggly? Surprisingly, a lot. In 1919, Clarence Saunders of Memphis, Tennessee, founded Piggly Wiggly, the first modern grocery chain. Unlike other grocery stores at the time, which required customers to give the grocer a list of items to collect from the stockroom, Saunders created a self-serve store where customers could browse the aisles and choose items for themselves. This new model was cheaper to operate and allowed customers to make impulse purchases. It was an instant success. By 1922, Piggly Wiggly was a publicly traded company on the New York Stock Exchange. According to Memphis’s Pink Palace Museum, Saunders and Piggly Wiggly sold millions of dollars in stock in the first year. Then, a Piggly Wiggly franchisee in New York failed. Sensing that the company’s stock was about to start falling, Wall Street traders began short-selling Piggly Wiggly stock and attempting to artificially drive down the stock price by spreading rumors disparaging the company. Saunders, much like the Redditors of today, fought back. Just as the investors who are buying up GameStop stock are motivated by a love for the company and disdain for Wall Street, Saunders believed that the short sale of his stock was an insult to him, to Memphis, and to the South. According to a 1959 article in the New Yorker, Saunders took out a loan of $10 million and started a buying campaign to drive up the price of Piggly Wiggly stock. Audaciously, Saunders attempted to corner the market by buying up a large percentage of Piggly Wiggly shares himself, and for a while, it worked. By March 1923, Saunders claimed that he controlled 198,872 shares of the outstanding 200,000 shares of Piggly Wiggly stock. That means that he now owned many of the stocks that the short sellers had borrowed for their gamble, and on March 20, Saunders called for the delivery of all his shares. That meant that the short sellers (often called “bears”) were forced to return their borrowed stocks, and in order to do so, they had to buy them at the prices Saunders demanded. The stock price soared and elite investors stood to lose millions. On paper, it looked like Saunders was set to make tens of millions of dollars on his crusade to beat Wall Street. That’s when the New York Stock Exchange stepped in and suspended trading on all Piggly Wiggly stock. The Exchange also granted the short sellers an extension of time to deliver their borrowed stock. The next day, the New York Stock Exchange permanently banned Piggly Wiggly and gave the short sellers even more time to deliver their stock to Saunders. As the Pink Palace museum explains, The first pronouncement hurt the company; the second ruined Saunders. The five extra days gave the short-sellers time to search out every available share of Piggly Wiggly. Small investors who had held onto the stock for the long term received offers to sell for a large profit. All of the short-sellers repaid Saunders in shares of now nearly worthless Piggly Wiggly stock by the new deadline. Saunders owed his creditors millions. The company’s treasury was broken. Despite the fact that the grocery chain’s sales and profits were through the roof, Piggly Wiggly was broke, and Saunders was irate that the Exchange had changed the rules to prevent him from succeeding. “Wall Street got licked and then called for ‘mamma’,” he said. Although he became a folk hero to many for taking on Wall Street, Saunders was soon forced to put his stock, his company and his personal property, including his unfinished “Pink Palace,” on the public auction block to pay his debts. Saunders eventually went bankrupt and had to give up the company he founded. In 1928, Saunders came back with the Clarence Saunders, Sole Owner of My Name, Stores, Inc. grocery chain. Unfortunately for Saunders, the Great Depression soon hit the country, and he went bankrupt again. My note: Saunders tried to corner the stock and failed because: 1) the shorts found more supply (I expect many of these companies are preparing shelf offerings and anyone who had worthless shares are calling their brokers) 2) NYSE stepped in to help the short sellers and suppressed demand through various means, ending the squeeze. The corner was broken. While WSB has utilized technology in an interesting way (the Hive mind...grin) and formed an international confederation of sorts, that, in and of itself, is no guarantee of success. Next week will be "fun".
    • KR
      Kristian R.
      30 January 2021 @ 20:30
      Whoa
    • DS
      David S.
      31 January 2021 @ 07:41
      Thanks for the interesting information. DLS
    • JK
      Jeanne K.
      1 February 2021 @ 18:27
      Gret story! Remember when the Hunt brothers tried to corner the silver market and they changed the margin requirements and drove them into bankruptcy?
  • DD
    Dan D.
    1 February 2021 @ 16:45
    I can't help but notice that this video didn't include any gender politics and had no problem getting loads of likes. It's almost as if, despite all the intra-communal accusations of sexism regarding these videos, that most of the RV subscribers just enjoy good quality content by bright people and that they don't like feeling as though they're being lectured to, especially by guests.
  • JS
    JD S.
    1 February 2021 @ 07:28
    Interesting piece. 5 year market trends: https://survivalnomicsnow.com/great-reset-markets-trends-next-5-years/
  • CD
    C D.
    1 February 2021 @ 01:25
    27 mins onwards... Ash/Ed, be strong...
    • CD
      C D.
      1 February 2021 @ 01:28
      Could I get an explanation of the "Maginot Line"?
    • DM
      Don M.
      1 February 2021 @ 03:42
      To C D. After WWI, France built a defensive line of turrets and guns connected by tunnels along much of its border with Germany. It was thought to be impenetrable and it was called the Maginot Line. Unfortunately for France it was also immobile and German troops simply outflanked it.
  • SS
    Steven S.
    1 February 2021 @ 03:28
    Looking over some of the comments, I'm motived to post that taking in the perspective from people trained outside the field of finance is extremely important/ I'm a professor that does research in bioinformatics and statistical genomics, I believe it is rather valuable to listen to the take of people outside financial circles to gain insights into the action of social media-driven gamma squeezes, etc. Indeed, investment banks realize this and we had several approach my graduate class on stochastic partial differential equations with the aim of recruiting students into finance. In any case, excellent discussion Ash, Jack and Ed. I found it simply wonderful.
  • LA
    Linda A.
    1 February 2021 @ 02:14
    cheerst o all- thank u so much for the proompt commentaries! U guys are great!!!
  • DJ
    Dennis J.
    1 February 2021 @ 01:32
    Thanks Lily! Will check out blog. Two points. The initial catalyst for GME flip was bringing over Ryan Cohen from Chewy's plus 2 board members from highly successful online platform company (funny it's in same sector, online pet supply, as the typical joke example from crash of 2000). Second, short to interest ratio above 100%. Without those, we prob wouldn't be discussing GME today! As for restrictions, they're all moving to Fidelity and here's the rub...they don't have to pay 25%+ interest daily to carry a short. Time's on their side.
  • RM
    Richard M.
    30 January 2021 @ 16:32
    Probably one of the best explanations of the whole GameStop saga to date (other than what RVDB did on Friday) is what the All In podcast/video show on Friday night. Check it out here: https://www.youtube.com/watch?v=rWEPSKkkdKQ
    • MJ
      Mark J.
      31 January 2021 @ 23:19
      Great recommendation. Listened to and subscribed!
  • DH
    David H.
    31 January 2021 @ 23:05
    Finally, a compelling explanation for TSLA. The “god meme”
  • AS
    Ash S.
    30 January 2021 @ 21:10
    Let's get Lily back on with Ash. She's a very good communicator.
    • MJ
      Mark J.
      31 January 2021 @ 21:39
      And Lilly with Lyn Alden. "L&L - Girls Gettin' Gold"
  • JL
    J L.
    30 January 2021 @ 03:07
    As of Friday's close the Redit army is winning. The shorts should be panicking right now. There is no reason whatsoever for them to call off the squeeze; there are multiple reasons for the squeezers to feel triumphant. Time is on their side, their firepower is increasing, and the shorts look caught in a doom loop. Some unmentioned factors to consider in where GME goes next: — CONVICTION-BASED KNOWLEDGE OF HOW AN INFINITY SQUEEZE WORKS In the Volkswagen short squeeze of 2008 the shorts lost something like $30 billion. If GameStop goes to $1,000 the GME shorts (and their brokers could lose $60 billion). The squeezers win if they can force the hedge funds to cover, either because their risk manager orders them to buy back or their prime broker (who has liability) shuts down the account and puts in buy orders at the market. The exit strategy for an infinity squeeze is thus wholly rational. If you succeed, you exit via the blood of your target, because they are forced to cover their short and buy the long position you sell to them as you exit. Imagine a prime broker or a risk manager ordering a hedge fund's shorts closed at the market, when buying at market means hitting sell order prints at $3,000. You could have a retail investor who paid $300 for 10 shares get a $30,000 payday because his limit order to sell at $3K was filled by a short covering fund who had to exit at any price (because it was game over in terms of ability to hold). The "Maginot Line" is what the shorts have to hold. The squeeze play is the blitzkrieg. The Reddit army understands this, which is why they have high conviction. They know that if they hold and don't sell, and keep pushing, they can trigger a point where not just gamma impacts but forced covers from margin calls to the shorts start ramping the position higher and higher. This narrative is spelled out very clearly for those who peruse the WSB boards. It is a factor in the game because this narrative is rationally mathematical — this thing could work, the math checks out — which means those who are saying HOLD, HOLD are doing so for a real payday. And they know it. — Increasing size of the Reddit army, as measured by members on the WallStreetBets message board. The number of official members on the WSB forum is increasing by 500,000 to 1 million per day. They were at 2.2 million members a few weeks ago; at last look they are at 6.5 million members. When the story broke all over the news, they added a million members in a day. That is a LOT of new buying power. There isn't a clear metric as to how much buying power a run rate of half a million members to a million new members per day translates to, but at minimum, we are seeing 1) hundreds of thousands of people per day newly absorbing the story and 2) getting pitched on the notion they can participate in a movement, and possibly triple their money 3) at the cost just a few hundred to a few thousand bucks with limited risk The structure of this thing favors the squeeze because 1) the story is mega-viral 2) the story is understandable 3) the story is emotionally compelling 4) it is very easy to participate with limited risk — just buy 10 shares, or even 1 share. — INCREASING BORROW COSTS ACCRUING TO THE SHORTS Time is on the size of the squeezers, not the shorts, in part because the shorts are paying insane borrow rates. Reported borrowing costs for GME shorts we recently 30% for existing short positions and 50% for new short positions. Just to maintain their short positions, the shorts have to pay the equivalent of a predatory payday lending rate of interest. — THE BROKERAGE RESTRICTIONS AS A SIGN THE GAME IS WORKING Citadel categorically denied influencing Robinhood's decision. I am inclined to believe Citadel because the other explanation makes more sense: Robinhood restricted GME because it got really, really scared, which is also why it raised a billion dollars in capital. This activity is a sign that the squeeze is working. The brokers are restricting shares because there is no float to be found, or hardly any. The squeezers understand this too and take the pain of the restrictions as a sign of encouragement. They are gettting positive feedback telling them they are breaking through. — MORE FIREPOWER NEXT WEEK AS EX-ROBINHOOD ACCOUNTS ACTIVATE AT FIDELITY As soon as Robinhood started restricting GME buys, Robinhood accounts started looking at how to switch to Fidelity, and other brokers who give more of a free hand in GME. It takes time to switch accounts and get the cash available for trading etc; that means more firepower could be coming in next week. — SIGNS OF PROFESSIONAL BUYING POWER RAMPING INTO THE JAN. 29 CLOSE The Friday close (Jan 29) looked ominous for the shorts, because the degree of buying power that came in at the end suggested big players (e.g. non-retail) coming in on the side of the squeeze to push GME back above $300. If a critical mass of prop traders, small hedge fund managers, and large individual traders decide to bet on the side of the squeezers, the shorts go further into a doom loop because now they are up against big guns as well retail investors. The hedge fund community is far from monolithic; the more that hedgies who aren't short see rationality in participating in the squeeze, the more likely that firepower in the squeeze will increase. — QUANTS AND PROP TRADERS PLAYING FROM THE LONG SIDE If conviction increases that the squeezers are winning, and the trend heads upward as the noose tightens around the shorts, quant funds and prop traders will increasingly orient towards quick hits that are long but not short, just in case the melt-up phase hits where all of a sudden forced short-covering buy orders start hitting the market and the whole thing goes into vertical rise mode. In this sense, you get a dynamic feedback loop contributing to melt-up conditions — because the big price of forced short covering waits just above the market — with algo traders and prop traders contributing buying pressure by biasing their scalps to the long side in case all of a sudden GME breaks through $500 and then gets to $1,000 or $2,000 in a heartbeat. — RATIONAL EXPECTED VALUE CALCULATIONS INCREASING WITH TIME Let's say that, with GME at $500 per share or below, there is a 50% chance the share price could double to $1,000 or more. This is a rational estimate because of the factors mentioned above: The staying power of the squeezers; the pain of the shorts (who are bleeding money just to hold their borrow); the run rate of new WSB members of 500K to 1 million per day; and signs that big money is particpating on the squeeze side. If you calculate there is a 50% chance the stock could double from $500 to $1,000 — with a further possibility of going well beyond $1,000 if the shorts have to cover en masse — then buying GME is a no brainer. Why? Simple expected value (EV) calculation. The opportunity for a possible 100% return, at a 50% hit rate, with limited risk, is such a positive EV play it is a no brainer, if you accept the 50% assumption of the squeeze being successful. Even at 40% odds of success, the chance of a 100% return — with a tail possibility of an even bigger return — is +EV. And it is entirely possible the price goes past $1,000 if they pull it off, because, again, the squeeze ends in victory if the shorts are priced out at whatever limit sells the victors impose on them, because the shorts are taken out by their risk managers and brokers in the end. Wealthy traders (and poker players) can do this EV math in their head in a New York minute. If they see that the squeezers are winning, they can then say "why not" and join the squeeze with long GME buys. Based on the Friday Jan. 29 close, I would say some variant of this is already happening.
    • MC
      Michael C.
      30 January 2021 @ 03:13
      The corner will break.
    • JL
      J L.
      30 January 2021 @ 03:22
      @ Michael C. Your blanket assumption is already invalidated by what happened with Volkswagen in 2008. I repost my replies to your comment below. it is false that "corners" always break. If the operator of the corner can force his target to buy, the operator wins. Say you are short and I buy all the float. I drive the price to X. You are forced to cover your short because your broker buys you out. You have no more margin. As you cover your short (with your broker forcing it), your buys are my sells. As you go bankrupt, your wealth is transferred to me. I (as the corner operator) won. That is what Reddit is trying to do. If they get the GME price high enough, the shorts get taken out of the game, involuntarily, and fill the exit limit orders of the squeezers at four-digit prints. This is also what happened in 2008, when Volkswagen shorts lost $30 billion. Porsche won that corner -- they made eight times more money from their VW corner than they did selling cars that year. Corners do not always break. ------------------------------------------------- The squeezers are winning right now. To assume otherwise is to underestimate the global virality dynamic. The membership rate of the WSB message board is increasing by 500,00 to 1 million new members per day. Think about that for a second. Think about the firepower being amassed; the staying power of communication through the boards; and the likelihood of professionals joining in on the side of the squeeze when they see the squeezers can win. It is NOT at all clear the hedge fund shorts survive this. I would bet on the Reddit army at this point, unless the SEC or some other entity shuts them down. Nobody has ever seen a corner that is global, with traders all around the world, in dozens of countries, acting as one entity, in one stock with a float that is more than 100% short. That is what is happening now.
    • MC
      Michael C.
      30 January 2021 @ 03:49
      @ JL the VW example is interesting but not conclusive. Read the last paragraph. I assume equities supply will be increased thru secondaries or a seller as in the case of Macerich or demand will be suppressed. The home players got lucky when hedge fund risk managers went to sleep at the switch. And when the other hedge funds smelled blood in the water, they went after their brethren with no regrets. I just don't believe these squeezes can continue. Is there a moral to this story? Perhaps it's that hedge funds are now far more vulnerable to sudden and artificial stock rallies when it comes to stocks that they had been shorting for months or years, betting on troubled companies to lose stock value in difficult financial times. A much smaller company than VW, Porsche had made a lot of money in a short period of time due to hedge funds betting on VW losing money. In the case of GameStop, the rally was prompted by a large number of small retail traders willing to wager and even lose hundreds of dollars in an effort to create a short squeeze that would hurt big hedge funds, and some of these traders have become millionaires in a matter of days by investing tens of thousands of dollars into the effort, and then bailing out. Perhaps another moral of the story, one that could materialize relatively soon in response to this debacle for hedge funds and institutional investors, could be heavier regulation of retail traders—not the big banks or hedge funds. That's a pessimistic view for sure, since very little regulation emerged in the aftermath the 2008 financial crisis. Still, that punishment could come down on small-time traders sitting at home, as hedge funds run to the government screaming for help as AMC theaters and BlackBerry stock are appearing in the sights of the Reddit trader army.
    • JL
      J L.
      30 January 2021 @ 04:11
      @ Michael C. The aftermath of the Volkswagen corner was messy because of lawsuits, but it works as proof of concept. The Porsche corner did not fail — the angry losers pursued Porsche in the courts afterward, which is another thing. If you want a more definitive example, check out what Cornelius Vanderbilt did to Daniel Drew. At any rate, I did not say the Reddit army is certain to win. I said it looks like they are winning right now, and have a very reasonable probability of winning outright, i.e. at least 50/50 — which means that betting with them, rather than against them, looks like a positive expectation trade given the return potential. Speaking in probabilistic terms is not the same thing as certainty of outcome. I'm just looking at the structural mechanics of this thing — and the mechanics say the Reddit army can do this, that it is not only possible, but plausible, and perhaps even likely. They can still fail for any variety of reasons — 50% odds or even 60% odds are far from a sure thing. Even pocket aces lose a good deal of the time. I reject a sense of certainty that disregards the structural mechanics in terms of the factors that are old combined with the ones that are new, in ways that merit thinking creatively about. Hiistory can be a guide, but it shouldn't be a straight jacket. I think those who assume it can't happen are underweighting the global virality dynamic, as I stated. We've never seen a corner executed by hundreds of thousands to millions of people, acting in coordinated unison, via global marketing channels, with an ideal target in their sights (a stock which has more than 100% of the float sold short). Of course they can fail — but I'm not at all sure they will. Right now it looks like they are winning.
    • JL
      J L.
      30 January 2021 @ 05:22
      p.s. I should clarify the EV calculation. You need a better than 50% probability if 100% of the stake is at risk, but not if you are limiting the exposure of the stake via timed entries and exits, while building your odds of being long at the point an accelerated melt-up comes into play.
    • TC
      Tim C.
      30 January 2021 @ 16:06
      The reason why Robinhood restricted trading is because they had to. NSCC rule 4a requires them to have supplement deposits to cover execution of the ITM 1/29 $GME calls. The value of 1/29 $GME ITM calls was roughly $1.6B (executed at $325). No idea how much of that action RH had, but they needed to be able to cover their SDL obligation at the clearing house (from Friday to Tuesday). There's also other 4a requirements that have to do with "special activity" so I imagine they had to cover that as well. Leading into next Friday, same issue occurs. All depends on where $GME ends up at expiry. Higher it goes, less action RH can take unless they secure a bigger line of credit...
    • JL
      J L.
      30 January 2021 @ 18:30
      @ Tim C. Makes sense -- one wonders, then, why Robinhood didn't just explain things clearly, rather than let their reputation get destroyed by the widely held perception they were playing Grima Wormtongue to Citadel's Saruman. That is either an epic, catastrophic fail in the public relations department or they didn't want to encourage the squeeze by giving the Reddit army full confirmation they are breaking the system. The higher the value of GME collateral obligations go, the closer the hedge funds come to getting blown out by their risk managers or brokers...
    • JL
      J L.
      30 January 2021 @ 21:27
      They bought a billboard on Times Square. Very Fight Club. And also more publicity --> more people on the boards --> more firepower... https://nypost.com/2021/01/30/redditors-buy-times-square-billboard-as-gamestop-stock-saga-rages/
    • PC
      Peter C.
      31 January 2021 @ 03:59
      Thanks J L. for all your detailed insights / writing & being open to excellent comments like the clearing house's margin requirements for RH.
    • JL
      J L.
      31 January 2021 @ 14:14
      Jim Bianco on Twitter: "This squeeze does not stop until this short gets covered" https://twitter.com/biancoresearch/status/1355265967463542785?fbclid=IwAR2kG98f0gTH646ZFGUrMDl5WlYar3oI6yKiX8z1RAk_biJLkcs46vQGdhM
    • MC
      Michael C.
      31 January 2021 @ 19:14
      This is first level thinking. See Raoul video 1/31
  • MC
    Michael C.
    31 January 2021 @ 17:16
    Open letter from Valueline WHAT YOU NEED TO KNOW ABOUT THE CURRENT TRADING FRENZY SURROUNDING GAMESTOP AND OTHERS Several stocks, most notably GameStop (GME) and Blackberry (BB), have experienced wild price swings over the past couple of weeks. This volatility is not based on the fundamentals of these issues or on the prospects of their underlying businesses. Instead, the price action stems from a battle between individual investors and hedge funds. Traditionally, such large financial institutions have had the money and influence to move the market, both up and down. Now, with the help of Twitter and social network Reddit, individual investors can collaborate and effectively pool their financial resources to do the same. In regard to GameStop, Blackberry, and many others, there were and are serious concerns in regard to the strength of their underlying businesses. Not surprisingly, many hedge funds established short positions, betting that their stock prices would fall. These situations are commonplace and are part of our financial system. What is uncommon, is what came next. A Reddit community of about three million people banded together and started aggressively buying these equities and related options (to purchase the stocks at a later date at a set price); countless individuals spent hundreds or thousands of dollars each. As the stock prices went up, the hedge funds’ short positions became more and more unprofitable. This triggered a “short squeeze”, as the large financial institutions then bought the stocks to limit their losses, further aiding the price advances. This push and pull has now led to extreme volatility and dangerous investment conditions. It is anyone’s guess how this will all play out. Of course, there will be winners and losers, and the stakes and risks are sky high. At Value Line, we have long recommended good-quality investments that come with risk commensurate with the underlying strengths and weaknesses of the businesses behind the stocks. We don’t encourage or endorse the frantic trading that is now engulfing the market.
  • MC
    Michael C.
    31 January 2021 @ 15:13
    Zerohedge Hedge funds are puking longs to cover short squeeze losses https://www.zerohedge.com/markets/hedge-funds-are-puking-longs-cover-short-squeeze-losses My note: It is naive to think there are not unintended consequences in the RH flash mob's actions and the other hedge funds piling on large short/small float positions held by hedge funds similar to Citron and that the short squeeze is a closed loop system. If this play destabilizes the system (which it does IMO), impacting long only funds, passive investing ETFs forced to sell winners and buy cats and dogs to maintain tracking, etc, pension funds, clearinghouses, brokerages, etc. the powers that be will not stand for this very long. This could be another LTCM event. I would venture Raoul and Julian have either reached out to/been contacted by their GS alumni and other big hitters to discuss concerns and possible outcomes. Yes, the box score shows WSB crowd winning for now but it's like the 3rd inning. I expect the corner to be broken but we'll see in the fullness of time.
    • JF
      Joao F.
      31 January 2021 @ 15:43
      If WSB hold the line this might end up not very well!
    • MC
      Michael C.
      31 January 2021 @ 16:40
      @ Joao F I believe one must look at all the moving parts and pieces and some that have not moved yet. 1) Hedge funds getting free shots at other hedge funds like Melvin. Suggestion in WSJ and other places that big boys are playing as huge block trades on long side are being shown. At what price/profit level, do they decide to ring the register? 2) Will the early WSB players decide they've have enough? Or see blood in the water elsewhere and move on to "greener" pastures? 3) Will the brokerages continue to support this type of play? Fidelity and TDAmeritrade came out after Friday's close and basically put their customers on notice. Increased margin requirements, limited buy orders, etc. 4) Will the SEC, clearinghouses, etc tighten requirements? 5) Suggestions that this volatility could create problems beyond these cats and dogs....rebalancing books to manage risk. Risk managers across the board (IMO) have prolly said to their PM to derisk both shorts and longs. 6) The last thing the Fed wants to do is a massive rescue...check LTCM, etc. Will they overtly or covertly swing to action, jawboning or something more concrete? IDK. Again it is naive to think this is a closed loop between the longs and shorts. The game's afoot.
  • DM
    Don M.
    31 January 2021 @ 15:49
    So much potential and such a let down. A few thoughts. 1 - GameStop was not on the doorstep of bankruptcy. This is the narrative those who were short and now want an excuse are pushing and it was disappointing to see RV led by the nose. Look at the financials before any of this started. 2 - CNBC uses Jim Cramer as an "expert". I can watch their BS for free. I don't want to hear what pump and dump Cramer thinks. Frankly, who would know since lies tumble out of his mouth at a rate rivaling our recent President. 3 - I understand stocks; or I did before your guest. I understand she's really smart but she has work to do on being interviewed. Why let her just struggle on when normally Ash is so good at stepping in and helping guests be clear? Too bad.
    • DM
      Don M.
      31 January 2021 @ 15:50
      3 - I understand options... Sorry
  • MC
    Michael C.
    31 January 2021 @ 14:44
    Jump the shark moment https://www.youtube.com/watch?v=9LqK8GiIMYw&ab_channel=SaturdayNightLive
  • FI
    Frank I.
    31 January 2021 @ 14:36
    There will be both alternating allergenics 50 % will "Hold the line" on Gamestop and 50% will move on like locusts after the Gamma This way they all make a bit of cash and the ALL deliver the message to the 1%. It's over, pack your shit hedge funds you're going away.- Every like minded honest ordinary "Joe/Jane" will keep this momentum on a delayed rolling cycle Annalise that! . No Reverse Gear!
  • PU
    Peter U.
    31 January 2021 @ 14:32
    https://www.youtube.com/watch?v=VMuEis3byY4&feature=emb_logo Jim Cramer wants this removed from youtube. I see why!
  • jl
    johan l.
    30 January 2021 @ 21:23
    Thanks for introducing us to Lily. She was really great. Hopefully she becomes a regular. It would be nice of you to drop a link to her blog in the description.
    • VS
      Viktor S.
      31 January 2021 @ 13:09
      Should be that one: https://nope-its-lily.medium.com/
  • AP
    Allan P.
    31 January 2021 @ 13:06
    Loved this one!!
  • DF
    Dwight F.
    31 January 2021 @ 12:41
    https://seekingalpha.com/instablog/52817466-andreas-repeta/5549401-sell-side-banks-pressured-hedgefunds-restricted-global-trading-in-wsb-stocks-to-avoid-losses#comment-87836828 From the article In other words, unlike 28/1, the aim in 29/1 was to prey on people's impatience in order to increase the attractiveness of selling, so that shorts could cover their positions more easily. The selective buying, was put in place after much politicalpressure in the U.S. on brokerages, as to make it appear that trading was allowed again for PR-purposes. Strategy & end-goal The buying restrictions on 28/1 & 29/1 can be understood as means of depressing price of GME and synthetically manipulating it, by placing buying restrictions on retail brokerages, and only allowing selling. Those who buy the shares back are the hedgefunds covering their short-positions at what of otherwise should be significantly higher prices. Particularly during 28/1, the buying restrictions coupled with calculated and exquisite timing of trading halts, enabled hedgefunds to cover their short-positions and lower market prices of GME and avoid increasing short-losses. The strategy, is based on selectively and quietly killing the momentum of the short-squeeze on GME, and with Robinhood being by far the most popular trading platform on /WSB, the placed Robinhood buying restrictions were successful in reducing U.S. buying liquidity on 28/1 & 29/1. While, the strategy is pretty obvious, it begs the question; How could almost all brokerages in the U.S. and internationally, simultaneously restrict buying of GME on 28/1 and have similar restrictions on 29/1?In order to answer this question, we need to provide some context and discuss order-flow & order execution.
  • JF
    Jonathan F.
    30 January 2021 @ 16:59
    What brokerage firms didn’t limit trades last week?
    • DF
      Dwight F.
      31 January 2021 @ 11:50
      Fidelity
  • jc
    james c.
    31 January 2021 @ 11:46
    Dearie me ! All this brilliant analysis of behaviour that is negligibly linked to value - indicating we are really well into the bubblesphere. All because of the insane availability of fiat. My 20 year old son thinks that anything less than a monthly return of 5% is disappointing. Catastrophe is bearing down.
  • JT
    Jason T.
    30 January 2021 @ 11:35
    Does anyone on here seriously need an options 101 from a 25 year old non finance person
    • IO
      Igor O.
      30 January 2021 @ 13:39
      WTF is Bioinformatics?
    • AW
      Abhijit W.
      30 January 2021 @ 16:18
      Don’t be an ass.
    • MF
      Michael F.
      30 January 2021 @ 18:32
      Absolutely - who better to tell me what is going on than an elegent, brilliant phyonista! RV please make her another interviewer now!!!
    • MF
      Michael F.
      30 January 2021 @ 18:34
      From the google god.............. Bioinformatics is a science field that is similar to but distinct from biological computation, while it is often considered synonymous to computational biology. Biological computation uses bioengineering and biology to build biological computers, whereas bioinformatics uses computation to better understand biology.
    • DA
      David A.
      31 January 2021 @ 11:30
      I didn't find the options 101 in this daily Briefing helpful to be honest (it was not clear enough for a beginner and too basic for a more experienced trader). But in her blog, Lily shows she has serious insight and understanding.
  • DS
    David S.
    31 January 2021 @ 00:01
    Covid, Covid, Covid! New variants!, Lockdowns! Run for the hills.....the regular flu has disappeared! This ridiculous level of fear porn is off the charts.
    • DS
      David S.
      31 January 2021 @ 07:22
      The other David S. disagrees. I understand that we are all completely feed up with COVID. Regardless we need to take suggested precautions, get vaccinated, get better treatments, and rapid testing. Inexpensive rapid testing is the key to opening the economy. DLS
  • WE
    William E.
    30 January 2021 @ 18:00
    I think Ash found a girl as nerdy as him and is in love.
    • MF
      Michael F.
      30 January 2021 @ 18:27
      I'm a part time investor and photographer and Lily Francus is brilliant. While watching the segment I was torn between listening and grabbing my camera.
    • PC
      Peter C.
      31 January 2021 @ 04:20
      lol
  • MC
    Michael C.
    30 January 2021 @ 03:39
    I just saw this on Zerohedge And as a postscript, while we expect that the turmoil will be contained at Robinhood, whether in the form of new capital infusion, a takeover, or bankruptcy, there is the possibility that the liqudity shortfall goes as far as the clearinghouses. What happens then? Below we excerpt from a monthly letter written by Horseman's Russell Clark who had a good recap of "what if": Pre-financial crisis, banks and clearinghouses were part of one big and messy system. Banks mainly traded with other banks as it was cheaper, but every now and then they would trade through a clearinghouse. There were two types of trades. Circular trades, which are trades where each bank has a position, but the system has a flat position, and directional trades, where the system would match up buyers who wanted to take a view on future movements of financial markets. Directional trades are more dangerous; risk will be less evenly distributed as it will have no offsetting trades. When Lehman went bust, LCH, the biggest interest rate derivative clearinghouse, found they only needed one third of the initial margin to cover losses. This encouraged regulators to move clearinghouses to the center of the financial system. However, this has caused two big problems. Firstly, clearinghouses have no real "skin in the game". They act like a bookie, that takes bets from punters, and transfers money from winners to losers. But how much risk should they take? What is the correct level of initial margin? Clearinghouses used to piggyback on bank's risk measures, but without banks to guide them, how should they set risk? Clearing houses and regulators chose to use a backward-looking model, with risks set from market data from between 3 and 10 years in the past. This has caused the markets to have a built-in momentum model which amplifies cycle both ways. Hence, many of the normal trading rules don't apply. There will be no signs of problems in the market until right at the last moment. Markets are no longer discounting mechanisms and have become more akin to momentum models. Secondly, banks are now deeply capital constrained, and at the start were very reluctant to move old trades to a centrally cleared model. This problem was resolved through a carrot and stick approach. The stick is uncleared trades carry a capital charge, and the carrot is that the exchanges offer very attractive "netting". What netting means is that banks can give details of all their trades to a third party, and any circular trades can then be netted off thus requiring less margin. LCH claim to have done a quadrillion of compression trades or netting in the last year, this is more than twice the notional of all outstanding interest rate derivatives. The problem should be apparent. Clearinghouses were safe because, if there was a problem, the circular trades netted off on settlement. But by aggressively netting off at the margin stage they are no longer as safe. In fact they are very risky. This was highlighted by the near failure of a small clearinghouse in Europe last year. Using BIS data on the penetration of central clearing, and pricing of interest rate derivatives as a proxy of initial margins, I would say that initial margin in the system needs to rise by about 6 times to make the system "safe". Looking at previous periods of rising initial margins in 2000-2002 and 2007-2009, the pro-cyclicality of claringhouses should be obvious. Finally, cash hoarding and repo market problems could be a sign of counterparties beginning to worry about clearinghouses. If initial margins rise significantly, the only assets that will see a bid will be cash, US treasuries, JGBs, Bunds, Yen and Swiss Franc. Everything else will likely face selling pressure. If a major clearinghouse should fail due to two counterparties failing, then many centrally cleared hedges will also fail. If this happens, you will not receive the cash from your bearish hedge, as the counterparty has gone bust, and the clearinghouse needs to pay from its own capital or even get be recapitalised itself. One way to think about it is that the financial crisis only metastasized when MG failed, because at that point, everyone suddenly became un-hedged, and everyone needed to sell.' My note: As I stated in my earlier post, these "trades" have created severe risk in the system and the clearinghouses and brokerages will NOT let themselves go under for the Cause or to help the WSB flash mob pick up their "free" money. To think the Fed, the SEC, other govt agencies and Wall Street are going to stand by and let these games go in the name of a free open market is height of foolishness IMO. The brokers/bankers will band together and restrict demand through increased margin requirements, limit number of futures contracts etc. The phone lines between DC and NY will, again IMO, be busy over the weekend.
    • PC
      Peter C.
      31 January 2021 @ 04:18
      Really like your conclusion But I also think we have more additional fat tails are created by growth of leveraged trading like the increase use of options and massive spikes in individual underlying's from WSBs,...; governments forcing of interest rates to zero / negative; passive investing ...
  • BK
    Brian K.
    31 January 2021 @ 01:44
    BREAKING NEWS: Raoul Pal sidelined due to stiffness in his pitching elbow. Lilly Francus rookie sensation pitched two scoreless innings to preserve the win for RVDB (Friday edition) Great Job by all on today's episode. Tom H thanks for the link to The Street.com Episode.
    • AB
      Ash B. | Real Vision
      31 January 2021 @ 03:09
      Ha. Epic comment. Note: Raoul will be back pitching shutouts next week.
  • DM
    Dominic M.
    31 January 2021 @ 02:26
    Fascinating discussion all around—thank you Jack, Lily, Ash, Ed.
  • MF
    Michael F.
    30 January 2021 @ 18:28
    Lily Francus mentioned a stock called "Funcode" I think - anybody know what its symbol is?
    • LF
      Lily F.
      31 January 2021 @ 02:10
      FNKO
  • jb
    joseph b.
    31 January 2021 @ 02:05
    First of all every market is manipulated. The cozy little club with JP and GS sitting at the head of the table have been gaming the system for decades. Is shorting a companies stock to the tune of 140% legal? The SEC is not a regulatory body in any sense of the word. JP kills PM"s and gets a slap on the wrist fine. Those fines , which are serial, are on the balance sheet as a cost of doing business. Does any GS trade ever go south? Do these people get bailed out? Does mainstreet get screwed? Let's get real and answer some serious questions. Does the FED pisk winners and losers? Are 80% of stocks owned by 20% of the population? Are savers being punished? How about we step back and take a long hard look not only at the inequality and the anger and discontent burt let's examine how the deck is stacked against mainstreet, joe 5 pack, ( the suits ripped off one of his beers) the Millennials who will never see Social Security and Medicare yet are paying for it. Then there is the student debt which is the only debt that can only be discharged by death. This is the next step of the Occupy movement. Wall St and their captured government figured it went away. This is just the beginning. People are pissed off. They will be even more pissed off when the SEC rewrites the rules to all of a sudden make what is perfectly legal when done by some pirates in suits in corner offices. illegal when those outside the club fight back. Damn right Ed it is adversarial. How could it not be? Jim Bianco has a great take on it in this interview with Adam Taggart on Peakprosperity.com. https://www.peakprosperity.com/stock-wars-reddit-rises-up-against-wall-street/. BTW I will not get vaccinated. There are effective therapeutics that are superior to the vaccines with far less risk and cost. Just another establishment manipulation.
  • TH
    Tom H.
    30 January 2021 @ 23:15
    Jim Cramer and Arron Task https://www.youtube.com/watch?v=EaNuRsNA0OU
    • BK
      Brian K.
      31 January 2021 @ 01:45
      thanks for the link.
  • JR
    Jake R.
    30 January 2021 @ 21:44
    Nice episode guys. Enjoyed the 3 way conversation. Lily's awesome, gonna be a star
  • HS
    Han S.
    30 January 2021 @ 21:33
    The name "Robinhood" is not fitting at all for what they have done.
  • MH
    Muddshir H.
    30 January 2021 @ 21:22
    Great show
  • JS
    Jon S.
    30 January 2021 @ 21:21
    Kudos to Real Vision and staying true to Raoul's mission of democratizing financial information. Bringing in a guest like Lily was a great add IMO.
  • JV
    Jay V.
    30 January 2021 @ 20:45
    This interview is labeled under the title as published January 28 2021, instead of January 29th 2021, the correct date noted in other sections of the post.
  • RH
    Rob H.
    30 January 2021 @ 14:14
    Great Job Ash! Lily was great, looking forward to reading her blog. It's would be nice if RV added links to guests' Twitter and blog pages, not a huge deal to find but it would simplify the hunt and give value to your guests.
    • AO
      Audie O.
      30 January 2021 @ 19:58
      I agree with you and well said.
  • TP
    Timothy P.
    30 January 2021 @ 18:30
    I'm getting a whole "Bear Stearns" vibe to this Robinhood thing. Similar pattern, CEO of Bear Stearns comes on CNBC, says "Everything is fine" - they burn through whatever capital they have left and fail soon after. The CEO of Robinhood comes on CNBC, says "Everything is fine" and subsequently rushes to raise 1 Billion with a "B" in additional funding -- and they slam the spigot shut on any trades. (As Ash said, the restrictions were so narrow it might as well be a full ban.) So, it gets me thinking -- outside of the millions that were traded and netted out from a risk management perspective, they must have some counterparty risk rearing its head which scared them into pulling funds from credit lines. It gets worse, though. I've been hearing rumors that some crypto whales smell blood in the water, and they want to get in on the game (no pun intended) and push the trade as far as it can go. Think Robinhood can survive that? I have my doubts. Never mind the hedge funds that ironically weren't hedged, at all.
    • TP
      Timothy P.
      30 January 2021 @ 18:56
      You can track the hilarity here -- https://isthesqueezesquoze.com/ Should get interesting...
  • AH
    Ali H.
    30 January 2021 @ 16:18
    The GameStop ITM calls that were bought, and picked up on here, were exercised to get around the broker limits in buying the stocks themselves. This was a loophole discovered by the Wsb guys!
    • JF
      Jack F. | Real Vision
      30 January 2021 @ 16:43
      That’s a very, very, very compelling idea which I had not considered. Thanks, Ali. Makes sense as gamma slam OTM calls are Uber cheap
  • MC
    Michael C.
    30 January 2021 @ 16:22
    Ric Edelman on Gamestop The Usual Suspects Kobayashi: Because you have stolen from Mr. Soze, Mr. Fenster. All of you. That you did not know you stole from him is the only reason you are still alive. He feels you owe him. You will repay your debt. Edelman: Wall Street has been robbed...they will not rest. Me: hehe
  • DB
    Donna B.
    30 January 2021 @ 16:06
    Proud of you guys. Ash, thank you for introducing Lily. Invite her back. Jack shines again. Ed always profound.
  • MC
    Michael C.
    30 January 2021 @ 16:01
    TDAmeritrade statement Securities with trading restrictions We have placed some restrictions on the following securities. These restrictions will not prevent clients from making basic buy and sell transactions. This list is as of January 29, 2021, 4:30PM ET. AMC, CVM, EXPR, FOSL, GME, NOK, BB, BBBY, FIZZ, GSX, IRBT, NCMI, TR, UONE, VIR, NAK, NAKD, DDS, KOSS The following restrictions are in place: Stocks - 100% holding requirement (not marginable) Long calls and puts are allowed Covered call and short put orders may only be placed with a broker. Please be aware that wait times to speak with a broker may be longer than normal due to current market conditions. Covered calls only allowed if your account currently has the shares Short puts only if you have the maintenance/cash to cover the entire exercise amount of the short puts All other complex options orders will not be accepted Please keep in mind that this list is not inclusive of every security restriction and may change at any time.
  • MC
    Michael C.
    30 January 2021 @ 16:00
    Charles Schwab statetment 1/29/21 WESTLAKE, Texas--(BUSINESS WIRE)-- The Charles Schwab Corporation announced today it has issued a statement regarding recent trading activity: In recent days, much attention has been paid to trading in a group of securities that include GME, AMC, EXPR and others, that are part of what is being called a “short-squeeze.” As part of the increased media attention around this activity, there has been some confusion about what Charles Schwab & Co. and TD Ameritrade have each done in response to the situation. To clarify: Neither Charles Schwab & Co. nor TD Ameritrade halted buying or selling ANY stocks this week. Neither firm restricted buying or selling basic options. Both firms did adjust margin requirements on select stocks to ensure clients had sufficient assets to pay for stock purchases. Both firms also restricted certain advanced options strategies. More specifically, the actions taken include: Both firms put in place some restrictions on certain types of options transactions to help mitigate risk. For example, we are not allowing clients to sell naked call options in order to mitigate an unlimited risk situation. These decisions are based on risk and volatility and are made on an individual security basis. Both firms, as normal course of business, review and alter margin requirements in highly volatile securities. As margin requirements increase, clients are required to hold more equity in their accounts to make trades in these securities. As an example, for the GME security, both firms changed the requirement to 100%, thereby removing margin from the security. This process began on Jan 13th, 2021. Since that time, clients have been restricted from using GME as collateral for a margin loan; before Jan 13th clients could do so in a limited way. The example below illustrates what this means: Client owns $100,000 of a marginable stock (i.e., XYZ). They can take out a margin loan against XYZ to buy non-marginable securities, like GME. Client owns $100,000 of a non-marginable stock, like GME. They cannot take out a margin loan against GME to buy XYZ. We believe these steps appropriately balance investors’ ability to trade these securities with the firm’s duty to protect itself from potentially absorbing losses incurred by an individual’s trading or investing strategies. They are consistent with our long-standing risk management practices and similar to steps we have taken with other high-risk or highly volatile securities in the past.
  • MS
    Mark S.
    30 January 2021 @ 15:44
    What software are you using in the chart with OI and Moneyness please?
  • OM
    Owen M.
    30 January 2021 @ 15:42
    what are ya'll drinking!? Cheers, great show
  • OM
    Owen M.
    30 January 2021 @ 15:42
    what are ya'll drinking!? Cheers, great show
  • JC
    James C.
    30 January 2021 @ 15:41
    OK, this kinda info is why I find value in the subscription to Real Vision. Not gonna get this on mainstream fintech news!
  • MB
    Matthias B.
    30 January 2021 @ 13:06
    with regards to manipulation, if the SEC goes after the WSB leaders under the premise of giving advise as unregulated ´entities‘, then it should go after E Musk as well for that BTC tweet for sake of consistency. I fear though that the outcome will exactly be the opposite, ie at the end the mainstreet guy will be at the losing end. Georg Orwell‘s animal farm comes to my mind.
  • BT
    Boris T.
    30 January 2021 @ 12:53
    Kudos to Ash and Ed for pickign up the fact that "Maginot Line" doesn’t fare very well for the WSB crowd if if the historical analogy is to play-out in full ;-)
  • SG
    Steve G.
    30 January 2021 @ 12:52
    Really enjoyed the 3 person lineup. With 3 people it allows for a more natural free flowing conversation that's way more enjoyable and informative to watch.
  • WT
    WILLIAM T.
    30 January 2021 @ 11:53
    Note to SEC: Naked shorting (e.g. short interest >100%) must stop now. This has been going on for years with no consequences.
  • DK
    Danny K.
    30 January 2021 @ 10:50
    Actually a nice feeling to be intellectually humbled by you guys. Loving the insights. For what it's worth, I think the stampede into stocks is built on the wider gambling epidemic. I can stand in a pub and everybody there is throwing £20 at a football game. As far as I'm concerned we have a problem. Read in the paper today too that cocaine use has increased 5x among 16-24 year olds in 20 years (might have been 10...). I feel like it's related somehow. We're crying out for some leadership. They're like lambs to the slaughter.
  • DA
    David A.
    30 January 2021 @ 10:48
    Your coverage of the gamma squeezes and short squeezes of recent weeks has been really excellent. However, there's lot more to keep sight of - the sharp rise in volatility and drop in breadth look ominous. I'd like to see some focus on that next week. Tony Greer will cover this no doubt on Tuesday but it would be great if you could get Peter Boockvar on too as he has such a good handle on sentiment and breadth.
  • LL
    Lance L.
    30 January 2021 @ 09:14
    Cash app would not let me sell for nearly an hour after open. I lost so much profit on AMC on that first day it ripped.
    • B
      Bojo .
      30 January 2021 @ 09:52
      Same here, just in my case it was a short-squeezed gold mining stock (TRX) I have held for 5 years. It went up 150 percent on the opening, and the server was ''waiting acknowledgment of the market'' when I wanted to sell some.
  • sc
    sohyung c.
    30 January 2021 @ 03:24
    I am new to this. Sorry if this is a dumb question. Jack said that passive funds needed to buy more GME due to it being a bigger part of R2k suddenly. Otherwise, they would be net short on the stock. I am a bit lost on that comment. Can someone explain please.
    • PB
      Patrick B.
      30 January 2021 @ 04:56
      As it’s market cap goes up, it becomes a bigger and bigger weight in the index. If index trackers don’t own it they are underweight and their performance could deviate from the benchmark/index
    • AB
      Alastair B.
      30 January 2021 @ 05:14
      Keep asking questions, we are all learning - even after decades. Consider using the exchange to search for your questions as well
    • FD
      Frank D.
      30 January 2021 @ 09:12
      The indexweight might go up as the price of GME outperforms the index itself, but think of it as each indexbasket holds a specific amount or fraction of GME shares. As the stock might rise, the fractional amount of shares per index basket do not change even as the dollarvalue or weight in the index rises. This means that passive that are already long the indexbasket do not need to buy more GME. The fractional amount only changes if the index provider makes an adjustement of the free float of the GME shares in the index To my knowledge this has not happened.
  • BF
    Bret F.
    30 January 2021 @ 07:08
    What if these folks go silent for now. But set up many many more Gamma sneezes. (with much more tactical thought) Instead of a crazy week. It could be crazy months.
    • PP
      Peter P.
      30 January 2021 @ 08:31
      Agree - I do not know if these markets are accessible by all overseas investors but perfect roadmap for an enemy state to act to attack the foundation of the derivatives market. Check out & apologies for pointing to ZH -> they supposedly have an (older?) Russell Clark piece on the weakness of the clearinghouses. Overwhelm the clearinghouse / tilt the markets.
  • VF
    Vassilios F.
    30 January 2021 @ 08:23
    Fantastic. Thanks guys!
  • RC
    Robert C.
    30 January 2021 @ 07:43
    Ash throwdown on wwii history - respect
  • mw
    michael w.
    30 January 2021 @ 07:18
    Pretty sure the smart money accounts for the majority of those option trades. Why we now see less far out of the money calls.
  • SL
    Shawn L.
    30 January 2021 @ 05:55
    This is the very nature of a "melt up", reflexive loops everywhere. ie. passive funds sucking up shares, gamma squeezes against shorts destabilizing brokerages, volatility product funds auto liquidating, CTA algos triggering significant moves. We are one synergistic bad day away from significant down side. This Fed induced "run away" market melt-up can not be controlled even by regulators "adjusting rules" to kill volatility. Market professional have long used "knowledge arbitrage" to make money while retail struggled to understand. Retail has learned, time to change the game. How are you going to do it again, Wall Street?
  • SL
    Shawn L.
    30 January 2021 @ 05:36
    Burry missed out on over $1 billion by being out of GME early. https://www.forbes.com/sites/antoinegara/2021/01/26/the-hedge-fund-genius-who-started-gamestops-4800-rally-now-calls-it-unnatural-insane-and-dangerous/
    • SL
      Shawn L.
      30 January 2021 @ 05:38
      Blockbuster (BLIAQ) up from $0.05 to $0.3 Fundamentals do not matter
  • SL
    Shawn L.
    30 January 2021 @ 05:10
    3rd option is the bad guy was the DTCC, as they use existing rules of increasing margin maintenance to 100% just to kill volatility. This twitter thread explains in great detail what is believed or proposed to have happened step by step: https://twitter.com/KralcTrebor/status/1354952686165225478?s=20
    • SL
      Shawn L.
      30 January 2021 @ 05:14
      I wish this twitter feed had been out before this episode, but time pressure is difficult. Isn't the DTCC required to explain their actions? Is reporting not required? https://twitter.com/KralcTrebor/status/1354952686165225478?s=20
    • SL
      Shawn L.
      30 January 2021 @ 05:23
      Also, this WSB GME, AMC gamma squeezes have disrupted the markets enough through hedge fund liquidations and capital movements to cover margin calls to increase systemic volatility. This increase in volatility (vix>30) has/can force the vol products to liquidate in large measure. This is not over yet. Until the vix quiets back down, this frothy market is at even greater risk for an unwind. And this is why I believe the DTCC stepped in to manipulate the markets via margin maintenance rules adjustments to protect the systemic market over the individual RH traders who were well within normal rules. This completes my view of the whole picture.
  • RC
    Rich C.
    30 January 2021 @ 05:15
    So Designer Brands is next. Thanks for the tip!
  • DG
    David G.
    30 January 2021 @ 04:43
    Ed alcohol is overrated. It's 2021, have a sativa and coffee, at your next happy hour.
    • AB
      Alastair B.
      30 January 2021 @ 05:12
      Is that a fancy way of saying weed?
  • MH
    Michael H.
    30 January 2021 @ 04:58
    hey cool ucsd!
  • JA
    John A.
    30 January 2021 @ 04:25
    Honestly, if you save asset prices at all costs, what the fuck did people expect to happen eventually?
  • JD
    Jesse D.
    30 January 2021 @ 04:08
    I don’t like how people try to value GME, there is so no rational for a lot of valuations in the market. GME is actually improving fundamentally and there are WAY higher valuations out there.
  • DS
    David S.
    30 January 2021 @ 01:09
    Mr. Harrison it is reasonable to believe that the young merely have the internet skills to unify a new attack strategy coupled with gaming and social networks to pull this off. I am in the leading edge of the of the Boomers. If I had their skill set, I would jump in. This is normal Wall Street greed with a new skill set. I still dismiss the fourth turning as fatuous. DLS
    • EH
      Edward H. | Real Vision
      30 January 2021 @ 02:49
      Much respect DLS. So I take note. The fourth turning is contentious and theoretical, so I am not wedded to it.
    • DS
      David S.
      30 January 2021 @ 04:05
      Edward H. - One of the best DB. Thanks to all of you and Ms. Francus. I agree with the Fourth Turning as a marketing tool. I am overly sensitive to it in financial analysis as I think it can easily mislead. Thanks for your comment. I am off for cheese and red wine. It may help with dementia. At 75, I need all the help I can get. All of you have a great Friday night somewhat within the bounds of safety. DLS
  • AE
    Arash E.
    30 January 2021 @ 03:58
    What a week!
  • MC
    Michael C.
    30 January 2021 @ 03:04
    Taking the 30,000 foot view of the shenanigans on Wall Street this week, to me, the activities are a dressed up form of trying to “corner the market” or running a “stock pool” From Wikipedia Cornering a market can be attempted through several mechanisms. The most direct strategy is to buy a large percentage of the available commodity offered for sale in some spot market and hoard it. With the advent of futures trading, a cornerer may buy a large number of futures contracts on a commodity and then sell them at a profit after inflating the price. Although there have been many attempts to corner markets by massive purchases in everything from tin to cattle, to date very few of these attempts have ever succeeded; instead, most of these attempted corners have tended to break themselves spontaneously. Indeed, as long ago as 1923, Edwin Lefèvre wrote, "very few of the great corners were profitable to the engineers of them."[1] A company attempting to corner a market is vulnerable due to the size of its position, which makes it highly susceptible to market risk. By its nature, cornering a market requires a company to purchase commodities or their derivatives at artificial prices; this effectively creates a situation where other investors attempt to profit off of these machinations through arbitrage. This has a chilling effect on the cornering attempt, since these investors usually take positions opposed to the cornerer. Furthermore, if the price starts to move against the cornerer, any attempt by the cornerer to sell would likely cause the price to drop substantially, subjecting the cornerer to catastrophic risk. In nearly all cases, the company simply runs out of money and disbands before getting close to controlling prices. In the few cases where companies have purchased a dominant position in a market, governments and exchanges have intervened. Cornering a market is often considered unethical by the general public and has highly undesirable effects on the economy.[2] From Investopedia The Stock Pools Until the 1920s, most market fraud affected only the few Americans who were investing. When it was confined largely to battles between wealthy manipulators, the government felt no need to step in. After World War I, however, average Americans discovered the stock market. To take advantage of the influx of eager new money, manipulators teamed up to create stock pools. Basically, stock pools carried out Daniel Drew-style manipulation on a larger scale. With more investors involved, the profits from manipulating stocks were enough to convince the management of the companies being targeted to participate. The stock pools became very powerful, manipulating even large cap stocks such as Chrysler, RCA, and Standard Oil. When the bubble burst in 1929, both the general public and the government were staggered by the level of corruption that had contributed to the financial catastrophe. Stock pools took the lion's share of the blame, leading to the creation of the Securities and Exchange Commission. Ironically, the first head of the SEC was a speculator and former pool insider, Joseph Kennedy Sr. (John Authers from Bloomberg recommended “The Good Years” by Walter Lord which covers the years 1900 to WW1 and some of the market manipulations) Using either definition prolly works. As your guest pointed out, these companies are “cats and dogs”. I recognize many (not all) of them have been dropped from the Valueline Investment Survey of 1700 companies. And it appears that hedge funds who hoped to short these companies to zero overstayed their welcome and did not manage their risk (tip of the hat to Tommy Thorton). So through their joint, clever efforts, the WSB flash mob has exaggerated the demand but there’s no supply, starting the corner. But as Jack’s author, Edwin LeFevre (Jesse Livermore) states “Corners always break”. It could be from the supply side that the companies in play take the opportunity to issue more equity especially at such elevated contrived prices. Or split shares...I don’t know the ends and outs of corporate finance to say. Or in the case of Macerich, a large pension fund rang the register. And Silverlake sold its AMC shares. High enough price, shares are found. (See the Piggly Wiggley corner) From the demand side, the unity could break and the pool falls apart. (I haven’t figured how one can extract his profits before the pyramid falls). I think we got a taste of unexpected demand restraint when Robinhood restricted buying (but not buying?). I would expect the SEC or some other govt agency might get involved, cooling demand. But more likely, I am guessing the clearinghouses and the brokerages will join forces to dampen or end this play as there could be major counterparty risk. There were rumors (Doug Kass, realmoney.com) that Robinhood might be taken over this weekend which would not be surprising since the RH founder said they have no liquidity issues (when they say it’s not the money, it’s the money) yet restricted buying of these gunned issues to ONE share. Thomas Peterffy, Interactive Brokers, was interviewed on Bloomberg TV and said he was worried that a broker might go under and the rest would have to make good for them. Bottomline the corner will be broken as Wall Street always take care of itself and the magic "free" money will disappear. And IMO, there will be much gnashing of teeth and moaning…;)
    • JL
      J L.
      30 January 2021 @ 03:16
      The squeezers are winning right now. To assume otherwise is to underestimate the global virality dynamic. The membership rate of the WSB message board is increasing by 500,00 to 1 million new members per day. Think about that for a second. Think about the firepower being amassed; the staying power of communication through the boards; and the likelihood of professionals joining in on the side of the squeeze when they see the squeezers can win. It is NOT at all clear the hedge fund shorts survive this. I would bet on the Reddit army at this point, unless the SEC or some other entity shuts them down. Nobody has ever seen a corner that is global, with traders all around the world, in dozens of countries, acting as one entity, in one stock with a float that is more than 100% short. That is what is happening now.
    • JL
      J L.
      30 January 2021 @ 03:20
      Also, it is false that "corners" always break. If the operator of the corner can force his target to buy, the operator wins. Say you are short and I buy all the float. I drive the price to X. You are forced to cover your short because your broker buys you out. You have no more margin. As you cover your short (with your broker forcing it), your buys are my sells. As you go bankrupt, your wealth is transferred to me. I (as the corner operator) won. That is what Reddit is trying to do. If they get the GME price high enough, the shorts get taken out of the game, involuntarily, and fill the exit limit orders of the squeezers at four-digit prints. This is also what happened in 2008, when Volkswagen shorts lost $30 billion. Porsche won that corner -- they made eight times more money from their VW corner than they did selling cars that year. Corners do not always break.
    • MC
      Michael C.
      30 January 2021 @ 03:56
      @JL It is about the bottom of the 3rd inning. The game has not been called. I suspect demand will constrained in some manner by the SEC/et al or the brokerages/banks/clearinghouses. But we shall see...makes it fun, doesn't it?...;)
  • lw
    lloyd w.
    30 January 2021 @ 03:50
    Like the use of multiple RV staff.
  • GT
    Gabriel T.
    30 January 2021 @ 03:41
    The issue with Robinhood is in two parts, first they themselves can't cover the trades on their platform, but part of that is due to DTC which raised there rate of the trade settlements, which takes two days to settle most of the stock trades and the options in some case the same. which affected several brokerages, and seems to have affected Robinhood the most. The second part of this issue with Robinhood is how they handled this entire issue and how little clear and real information they gave to not only the public but to the traders on their platform. But Robinhood, and WeBull and others had to either halt trades or limit buy order amounts. Remember these transactions have to clear via clearing and money needs to be there and it seems they somewhere in the chain there was not enough money to cover the trades.
  • NI
    Nate I.
    30 January 2021 @ 03:40
    My trust in US markets has been declining for decades. Slowly, but surely, I've been moving out of stocks/bonds and into tangibles (gold, silver, real estate, etc.) This week has me really wanting to accelerate that move. Maybe even get completely out of US public markets entirely. I had no GME and this particular situation didn't affect me, but the way I see it is that if RH can liquidate customer GME shares without their permission and get away with it (not even on a margin call), then my brokers could do the same to me with anything I happen to own. That's completely unacceptable. I'm also very concerned about how brokers lend out my shares and there seems to be no way to stop that. Who is to say they could ever get them back in a GME type situation that happened to involve my shares of Intel or Microsoft? If I'm thinking that way, others probably are and that isn't good for business formation in America. Nobody seems to fully understand this week's events. It would seem that Apex was involved somehow. Public tweeted about it (below). I wonder if we'll ever get to the truth about what happened this week or if we'll just get a 2008 style white wash and resume business as usual - dancing on the deck of the Titanic until it finally sinks? https://twitter.com/public/status/1354826467184578571 I hope RV will stay on this story and not let it go until we get a logical, believable, consistent explanation that would hold up in a court of law.
  • MK
    Martin K.
    30 January 2021 @ 03:31
    Absolutely brilliant from Ed & the team, as always. Ash's discovery of Lily the biometric quant's mind is equivalent to the early days of the Yukon gold rush; you could just walk around picking up fist-sized nuggets off the ground, no mining required. She is going to make someone a serious amount of money; if she's into crypto, Raoul should make her an offer pronto! As far as Wall Street Bets situation is concerned, the military metaphors are extremely apt. The WSB generals will marshal their army to roll the gamma squeeze through the market, all the while accumulating capital and momentum, until they have enough in the war-chest to target systemically significant players. By that point, they will have evolved again, and the smartest amongst them will have worked out how to split the financial atom. They will deploy that firepower in a burnt-earth blitzkrieg assault the likes of which may never have been seen before in financial markets. They will each take the hundreds of thousands, even millions of dollars in some cases, that came easily over the last week-or-so, and they will happily burn it if they can watch the System consumed by the resulting conflagration.
  • ES
    Erik S.
    30 January 2021 @ 03:21
    Great conversation. The fact that I personally was stopped from freely trading on the open market has way larger implications about the status of the open market and the idea of the free market. questions such as... 1) Loss of faith in the trading system, a modern day bank run with regard to trust in certain platforms and the market. 2) Liquidity for exchanges being an issue in this environment seems suspect, but if true is damning. 3) SEC enforcement not publicly announcing an investigation on any firms that halted buying only eroding faith by the hour.
  • AS
    Ananth S.
    30 January 2021 @ 03:20
    Bubble pooper Ed. Lol. Not appropriate for a Friday session man!.
  • SE
    Seth E.
    30 January 2021 @ 03:14
    Great briefing guys. Incredibly relevant & insightful. Please have more content like this. Hats off to you guys. Enjoy the weekend.
  • TT
    Tokyo T.
    30 January 2021 @ 03:13
    Raoul is normally on here on Fridays, but you boys smashed it today. Nice job!
  • BC
    Barry C.
    30 January 2021 @ 03:07
    Canada's new travel restrictions announced today (in effect until April30) basically made any international travel too expensive and cumbersome to bother with. Here is a millennilal or genZ comment minutes ago. "Hahahahaha, self-entitled boomers have to stay here like the rest of us. No more Florida RV trips for you." There is intergenerational conflict.
  • DN
    Douglas N.
    30 January 2021 @ 02:47
    You broke up when you said Lilly's website? what is it?
    • LF
      Lily F.
      30 January 2021 @ 03:00
      nope-its-lily.medium.com
  • JH
    Joel H.
    30 January 2021 @ 02:53
    Feel like there's alot of value in conversations like these, don't worry about running overtime when you're delivering like this. Thanks guys.
  • NH
    Nick H.
    30 January 2021 @ 02:48
    Great summary gents, as always!
  • DW
    Dean W.
    30 January 2021 @ 02:47
    The GME fiasco... just the big "screw" of the fourth turning making another quarter turn. Great show!
  • sc
    steven c.
    30 January 2021 @ 02:37
    Please, when you interview someone include their information in the description as many of us don't hear that well. Thanks!
  • VR
    Vladimir R.
    30 January 2021 @ 02:33
    Oh Robinhood... you really let us all down. You effectively "union busted" the WSB crew in the service of your masters. History will not be kind to you.
  • BT
    Billy T.
    30 January 2021 @ 01:28
    How does Robinhood unwind their long position in GME?? Who would buy at $300/share?
    • JL
      J L.
      30 January 2021 @ 02:30
      They win by driving the price to a place where shorts are forced to cover, whether they want to or not, because their risk manager or their prime broker closes the position. This would likely be north of +$1,000 per share.
  • GB
    Gordon B.
    30 January 2021 @ 02:29
    Great format and Lily was an awesome guest!
  • OA
    Oliver A.
    30 January 2021 @ 02:22
    One of the best Daily Briefings, I think there's a crazy energy coming out of this week and I felt it channeled into the show today in the best way. It's a lot to process heading into next week and I appreciated everyone's insights. I especially identify with Jack in the fact that I momentarily forgot there were other stocks for sale than GME. It was also great to hear Lily's thoughts and I've enjoyed following her on twitter. Have a great weekend guys, I'm headed for the scotch.
  • JD
    Jonathan D.
    30 January 2021 @ 01:49
    “Once it crosses the maginot line you can post a screenshot of your tendies”. One of my new favorite RV moments.
    • AB
      Ash B. | Real Vision
      30 January 2021 @ 02:03
      hehe
  • DS
    David S.
    30 January 2021 @ 01:57
    Great interview with Ms. Francus. Added a great deal to my understanding of my lack of understanding. I would like to know her assessment of how much this will affect the overall markets. Mr. Harrison did bring up the passive investment angle. Anyone else have any ideas? Thanks. DLS
  • CG
    Chris G.
    30 January 2021 @ 01:53
    Great interview with Lily. I loved the format of the three of you discussing what's what. Totally agree with Ed...it's time for a drink. Thanks for the great content.
  • JB
    Jack B.
    30 January 2021 @ 01:50
    Thoroughly enjoyed the discussion and interplay between the three gentlemen; so much better than the cable guys. Our President and his party intentionally bypassed any efforts to reform a corrupt system in 2008; one that destroyed the dreams of so many middle class families. The Treasury Secretary accepts more money than most families can dream of from hedge funds making money from retail investors. Hedge funds can do it - according to Jim Cramer - but retail investors can't? Let's hope the majority party, who campaigned to fight for working American families, take advantage of their second chance. If Mr Cruz and Ms Ocasio-Cortez can agree for 15 seconds, maybe it's different this time...
  • RT
    Richard T.
    30 January 2021 @ 01:42
    Superb Show! Go go for the Good Stuff tonight. Cheers!
  • NL
    Nikola L.
    30 January 2021 @ 01:41
    Guys not sure about effectiveness of the vaccines. I start to see more and more articles saying the opposite and warning about how effective these vaccines are against new strains. I can see gentle messages in the articles (especially if they are coming from Gov agencies) about being very cautious and these people sounded bit too dark for my liking.
  • CG
    Christine G.
    30 January 2021 @ 01:36
    Great discussion. Keep it going. Love the metaphors and the fact that they weren't mixed.
  • SW
    Suzanne W.
    30 January 2021 @ 01:30
    Great discussion tonight guys! Would love to see you three together every Friday. Cheers!
  • KT
    Kevin T.
    30 January 2021 @ 01:29
    Great depth and video today!
  • TC
    Tim C.
    30 January 2021 @ 01:18
    I love Ed's Maginot line reference! Priceless! That chart Jack showed looks like it was made with Bokeh. Good representation. All that aside, it looks like Robinhood's real problem is Rule 4a from the NSCC. They needed funds to cover the exercise for ITM calls expiring Friday. The short + gamma squeeze made the notional amount YUGE. Think about someone buying a call with a $50 strike two weeks ago for $20 ($2000 for the call). Robinhood needs to put up $30,000 to the clearing house for that one call option. And practically speaking, the need to put up more than $30,000 due to volatility. And oddly enough, short maturity ATM calls could be worse for Robinhood in terms of their rule NSCC requirements next Friday. This is wack!
  • DC
    David C.
    30 January 2021 @ 01:16
    Love this format. That was great. I wish they would drive up Twinkies!!! TWNK
  • AW
    Aaron W.
    30 January 2021 @ 00:25
    Where can I find Lily’s blog?
    • JD
      John D.
      30 January 2021 @ 00:38
      I second this request!
    • AB
      Ash B. | Real Vision
      30 January 2021 @ 00:55
      https://nope-its-lily.medium.com/
    • SN
      Scott N.
      30 January 2021 @ 01:13
      Yes, I had trouble getting the name from ash. What's the url? I googled her name but nothing came up.
  • JD
    Jesse D.
    30 January 2021 @ 01:12
    Great free form- nicely done this was some week wasn’t it!?! Couldn’t wait to see what this episode take was going to be u guys rock!!! Thanks again for all u do and please keep it up! (I need several beverages myself now! 🙏💪 *cheers🍻
  • DB
    Dennis B.
    30 January 2021 @ 01:12
    we were warned in 2008 about naked shorting https://www.sec.gov/comments/s7-30-08/s73008-17.pdf
  • BS
    Benjamin S.
    30 January 2021 @ 00:30
    Thanks guys. Talk about some DeepF$##ingValue - you guys are it. It been an epic week, lots of great RV content to catch up on. Wish you had mentioned the Massachusetts complaint against Robinhood from December. Its pretty hilarious. https://www.sec.state.ma.us/sct/current/sctrobinhood/MSD-Robinhood-Financial-LLC-Complaint-E-2020-0047.pdf And Robinhood's defense ; “Over the past several months, we’ve worked diligently to ensure our systems scale and are available when people need them. We’ve also made significant improvements to our options offering, adding safeguards and enhanced educational materials.” Oooops!! Hoisted by their own petard. To TLDR the WSB Ethos : “Be careful out there, I don’t know where this ends, but this is all stupid. GME 400, 500, 3000 or 10,000, but it all ends in tears.” $10,000 you say?? $10,000 confirmed!!
    • AT
      Aaron T.
      30 January 2021 @ 01:07
      https://nope-its-lily.medium.com/
  • JD
    John D.
    30 January 2021 @ 00:36
    What a find with Lily...RVDB rocks!!!!
    • AB
      Ash B. | Real Vision
      30 January 2021 @ 01:03
      Yep. Super impressive. She's lightyears ahead of where I was...
  • MR
    Michael R.
    30 January 2021 @ 00:53
    @nope_its_lily is a mind-shattering interview. Love the term "mind-web". Best ever DB!
  • RL
    Remmelt L.
    30 January 2021 @ 00:53
    #silversquees
  • DS
    David S.
    30 January 2021 @ 00:46
    Even if everyone who wants a vaccine gets the full dose, COVID will still be here. We need to work just as hard on instant testing at stadiums, bars, restaurants, airports, train and bus stations, etc. to be safe. We will get better at treatment too. This best defense is not to get COVID in the first place. Be safe. DLS
    • EH
      Edward H. | Real Vision
      30 January 2021 @ 00:49
      Agreed
  • MR
    Michael R.
    30 January 2021 @ 00:30
    Hearing Ash explain about order flow, options and routing to exchanges makes my head hurt. All this financial legacy settlement, pedestrian speed, and rehypothecation of underlying into financial marvels of engineering is a house of cards. Can't we just do public blockchains and get over this? Such a waste of time..