SpaceX stock falls below its $135 IPO price to $115.26, giving short sellers $15.5 billion in paper profits as traders double down on bearish market bets.
  • ColeSloth@discuss.tchncs.deEnglish
    2 hours

    I would have loved to short this stock, but Tesla’s idiotic valuation and stock price made me nervous about it.

    Watching the big slide over the past month has been pretty funny, though.

  • yesman@lemmy.worldEnglish
    10 hours

    $15.5B dollars, invented out of ether, and bestowed on the lucky gamblers. The stock market is so efficient that it can create wealth without bothering with economic activity. No jobs created; no products produced; and nothing to trickle down.

    • stoly@lemmy.worldEnglish
      3 hours

      Not invented, siphoned off from those who can’t game the system like they can. That means you and me.

    • boonhet@sopuli.xyzEnglish
      9 hours

      Unlike the market cap numbers that get thrown around when people say X dollars “destroyed” from the stock market or Y dollars “gained”, this isn’t nearly as imaginary (or invented out of ether).

      Depending on whether we’re talking about real shorting, or put options, it’s one of two things:

      1. They borrowed expensive SpaceX shares, sold them, bought back for cheaper, the people who bought shares at the higher price paid for it.

      2. They bought put options and exercised them. The bank or financial organization selling the put options paid for it.

      Now I went to actually read the article and this particular number was #1, but I’m sure a lot of people profited through #2 as well (the wallstreetbets types).

      • Bustedknuckles@lemmy.worldEnglish
        9 hours

        I did #2 except I didn’t exercise, I just sold it to someone else when the pice was up a bit on my small bet. I like to think that circuitously, Elon bought me a few lunches because screw that guy

    • tal@lemmy.todayEnglish
      9 hours

      Investment provides resource allocation, which is not something that just happens on its own. That is, it says “this company or project is a worthwhile project to allocate capital to, and this is not”. The money here was also not invented out of ether, but rather lost by investors who shifted capital to SpaceX earlier, and gained by those who tried to shift capital away from SpaceX earlier; other investors came to agree with those shifting capital away. Those who do so earlier are rewarded; this encourages earlier efficient movement of capital.

      Resource allocation is a necessary part of economic activity; any economic system will require such a thing to be done. You could have your government do it instead of investors, as in a command economy. Countries generally don’t do that, because it has run into more serious problems of misallocation.

    • Bustedknuckles@lemmy.worldEnglish
      9 hours

      Short sellers are an important part of the equity ecosystem as it provides downward pressure in price discovery. Lucky gamblers have made, and are making, far more than that with long positions in equity and options.

      It’s difficult to say that we don’t need markets at all (e.g. would you plant cotton with no idea what it will sell for at harvest?). It then becomes a slippery slope of abuse and wealth concentration.

      If anything this all feels like a failure of regulation and the SEC not going far enough

      • [deleted]@piefed.worldEnglish
        9 hours

        It then becomes a slippery slope of abuse and wealth concentration.

        That’s what stock markets are right now.

    • sem@piefed.blahaj.zoneEnglish
      9 hours

      It provides a service of figuring out what the value of spacex really is.

      Why that service is allowed to generate so much money for people is bonkers to me.

  • db2@lemmy.worldEnglish
    10 hours

    This doesn’t hit these sociopaths, the whole stock market system is rigged so they make paper profits no matter what happens, at the expense of others who aren’t in the Epstein class. A pump and dump like this is just a little faster.

    • henfredemars@infosec.pubEnglish
      9 hours

      In the same vein, this is partly why I’ve never understood the mindset of individual investors. Like, it’s extremely arrogant to seriously believe that you have an edge over highly resourced institutions and billionaire investors who can afford the best analysts and mathematical models on top of their market influence. I can assure you that whatever strategy you have, theirs is better, and they don’t have to play by the same rules. What can you hope to bring to the table when you’re swimming with these sharks?

      • Jhex@lemmy.worldEnglish
        9 hours

        who can afford the best analysts and mathematical models on top of their market influence.

        Why bother with that when you can just do a little inside trading during the next child raping party?

      • Sims@lemmy.mlEnglish
        8 hours

        What can you hope to bring to the table when you’re swimming with these sharks?

        …more food…

      • Bustedknuckles@lemmy.worldEnglish
        9 hours

        Some folks like to gamble! More and more people are desperation gambling these days out of doomer mindsets that see 0dtes and kalshi bets as their way out of crushing poverty.

        And here and there, it’s possible to look at pricing and conclude it’s pants-on-head bananas. Trading and therefore price action is dominated by algorithms which amplifies hype cycles. Who couldn’t see SpaceX as being overvalued? Other than the assholes at NASDAQ

        • dogslayeggs@lemmy.worldEnglish
          4 hours

          And here and there, it’s possible to look at pricing and conclude it’s pants-on-head bananas. Trading and therefore price action is dominated by algorithms which amplifies hype cycles. Who couldn’t see SpaceX as being overvalued?

          But that’s the problem. Many of us definitely knew SpaceX was overvalued. It should have been a no-brainer to short this stock at IPO… however, look at Tesla stock. That shit should have cratered years ago but still hasn’t. I wanted to short this stock, but I didn’t trust the Musk morons to not continue humping his sack. Even when you can see that something is pants-on-head bananas, there are enough idiots out there (and enough insider traders) making shit irrational.

      • phdepressed@sh.itjust.worksEnglish
        9 hours

        Movies like the Big Short, Margin Call, shows like Billions, or whatever the inheritance show was, make people think they can be the ones smarter.

        However, most individual investors aren’t usually of the arrogance that they’ll do better than the billionaires and hedge funds just of the arrogance they can still get more scraps than others and won’t get eaten themselves.

        • wasabi_noir@lemmy.zipEnglish
          9 hours

          There’s also the individual investors who care about the morality of their investments more than the profits. Not putting money into Nazi owned companies for example. Fuck anyone with a single cent in spacex or Tesla or anything with musk’s disgusting fingerprints on it.

          • henfredemars@infosec.pubEnglish
            9 hours

            I think this is a much more attainable goal. You’re not trying to do better in a numeric sense but in a moral sense.

      • Gsus4@mander.xyzEnglish
        3 hours

        If investment and retail banks are not separate…you are always touching the stock market.

  • Jaysyn@lemmy.worldEnglish
    10 hours

    At what price point does Muskrat get his loans called in?

    • MightEnlightenYou@lemmy.worldEnglish
      10 hours

      His net worth is still half a trillion more than it was a year ago.

      He didn’t buy shares in SpaceX, he already had them before the IPO

      • Jaysyn@lemmy.worldEnglish
        10 hours

        FYI, that stock is used as collateral for the loans which fuel his lifestyle. When that stock drops to a certain price, those loans get called.

        FFS, he doesn’t have anywhere near half a trillion in liquidity.

        • NotMyOldRedditName@lemmy.worldEnglish
          4 hours

          He does have loans, but a lot of people think he still has them from purchasing Twitter, but he actually went away from that during the Twitter purchase. Im sure its a lot without twitter even, but its not the crazy large number it was briefly.

        • Bustedknuckles@lemmy.worldEnglish
          9 hours

          That only matters if lenders a) don’t believe he can pay the loans back, and b) would not themselves be hurt by calling in loans. With how incestuous the Epstein class is, my cynical bet is that he gets away with far too much for far too long

  • Akh@lemmy.worldEnglish
    10 hours

    I dont think this was due to short sellers…

  • Gorilladrums@lemmy.worldEnglish
    9 hours

    This is actually pretty normal. The stock usually drops after the initial launch hype dies down, and then it begins to slowly rise again over time.

    • NotMyOldRedditName@lemmy.worldEnglish
      4 hours

      It’s just made worse this time by the smaller float, and the soon to be earlier than usual blackout window for insiders lifting

    • tirateimas@lemmy.ptEnglish
      7 hours

      Lets wait to see how low and how long it goes until it starts to raise.

    • PattyMcB@lemmy.worldEnglish
      8 hours

      Not at my old company… no wonder they laid off so much of the workforce and dismantled and sold the rest

      • FlashMobOfOne@lemmy.worldEnglish
        8 hours

        Nothing is really guaranteed in investing (unless you’re in public office and can insider trade or you’re a billionaire), though the post IPO dip has happened often enough that, yes, it probably isn’t the worst idea to have a plan.

        • PattyMcB@lemmy.worldEnglish
          5 hours

          I mean… short selling requires a buyback at a set price… it’s one of the few guarantees there are in the stock market.

          Granted the value isn’t guaranteed to go down, just the buyback and price