On Tuesday, March 2, 2021 at 11:51:08 AM UTC-5, Scott Lurndal wrote:
writes:


I told you I don't play commodities but I imagine people who do can
tell you some stories. As for the options market, just look at those
people who were stuck in a short squeeze on GameStop and they bought
on a margin.
The "shorts" who were "squeezed" were mainly institutional
investors and hedge funds, and yes, many recorded losses - albeit affordable
for them; it was simply a hedge that didn't pay off, part of
daily business in a hedge fund.

The amateurs who got hurt were, as noted, buying on margin;
the same behavior that cause the big crash in 1929.

Mostly agree, but the amateurs that got hurt were not necessarily limited
to margin buyers. There are likely dummies that bought it at $400,
expecting it to go to $1000. Dummies that bought it at $400 and are
still holding it waiting for it to go back so they can break even, etc.
This is really bad. It's the first time the internet has been used to flagrantly
organize a campaign to manipulate a stock price. And if it expands to more
stocks, it's the path to using the internet to destabilize stock prices.