Quote:
Originally Posted by hmmhmmcamo
My GME predictions that nobody asked for. I don't know anything about anything. Mostly collecting my thoughts but am interested in hearing what others think.
- the short squeeze hasn't happened yet. I think we have several more days to go before this plays out.
- the retail investor army is holding the majority of their shares as shown by the lower trading volume today. Some of the lower volume could also be attributed to the crap trading apps were pulling, but I think any extra volume from those would have been positive given they always had the ability to sell.
- the hedge funds involved in this aren't too big to fail and will be made an example of because everyone is watching now and sees how greedy they got. They will obviously continue to fight back as they have been but ultimately I don't believe the math is on their side if the retail investors continue to hold and wall street doesn't continue to bail them out.
- GME will issue new shares to help pad their bank account which will help support a higher share price in both the short and long term.
I think the squeeze will be accelerated if:
- an announcement is made soon about the new direction of the company going forward - see letter from Ryan Cohen to the board: https://s.wsj.net/public/resources/d...o_GameStop.pdf).
I think announcing RC as CEO would add even more fuel based on his past experience.
- an announcement is made of more stock being acquired by the major shareholders that puts even more pressure on the shorters by dramatically reducing the shares available to them...similar to the Porsche/VW squeeze in 2008. I've read but not verified that RC has an option to purchase up to 20% of the shares.
I also think RC's last tweet on Jan 17 "so you're telling me there's a chance" gif is him trolling/acknowledging the short squeeze potential just before being under a gag order due to year end financial reporting. I haven't been able to verify the gag order part yet. |
Why do you think this? The squeeze happens the moment the shares are worth more than they short-sold them at. And the higher the price goes, the greater the squeeze. These are hedge funds, they have teams of professional traders, they are not sitting around worrying that masses of amateurs are going to squeeze them and ruin them. They would be actively playing this entire process. One of the ways they would have protected themselves is by buying call options (or putting on other hedges). They would also be trading the #### out of this volatility.
The lower volume today doesn't mean that retail investors are holding, it means that there are fewer new buyers. These things run out of steam for this exact reason.
As for the company issuing more shares, they may, but it will not have the effect you are hoping for. The company is unable to actually apply any increased capital to grow the business (the business is flat), so increasing the float will only dilute the shares further. They would be playing a very short-sighted game if they do that.
I would imagine we will here reports that executives have been selling some of their own shares. If they also
raise capital for the company at the same time, they will be facing an investigation from the regulators.