diff --git "a/reddit_finance_43_250k_8.txt" "b/reddit_finance_43_250k_8.txt" new file mode 100644--- /dev/null +++ "b/reddit_finance_43_250k_8.txt" @@ -0,0 +1,10000 @@ + +I just don't get it, is there something I am not understanding? +Inspired by [this post](https://www.reddit.com/r/thetagang/comments/n7ns5n/rthetagang_has_doubled_in_size_in_the_last_2/) to create a more concise and obvious one... + +# Any financial/investment sub with memes turns to shit, period. + +And JK by the way, you couldn't change my mind if you tried. For people investing 6-7 figures and/or who have been investing/trading for more than two years I think the consensus would be that you'd rather have strong discussion, great ideas, in-depth analysis, etc than a giggle from an over-used moderately humorous meme that gets recycled on every sub over and over with slight variants until it's literally beaten into the ground from redundancy. + +TLDR: If this post was too long for you to read so much so that you need this then **YOU'RE the problem.** +Inspired by [this post](https://www.reddit.com/r/thetagang/comments/n7ns5n/rthetagang_has_doubled_in_size_in_the_last_2/) to create a more concise and obvious one... + +# Any financial/investment sub with memes turns to shit, period. + +And JK by the way, you couldn't change my mind if you tried. For people investing 6-7 figures and/or who have been investing/trading for more than two years I think the consensus would be that you'd rather have strong discussion, great ideas, in-depth analysis, etc than a giggle from an over-used moderately humorous meme that gets recycled on every sub over and over with slight variants until it's literally beaten into the ground from redundancy. + +TLDR: If this post was too long for you to read so much so that you need this then **YOU'RE the problem.** +There is a prevailing mis-understanding among people fresh to the market that you can buy and sell as much as you want at the "market price." This is false. You are buying and selling from real people or algorithms that believe they can scalp your order. The idealized scenario is that GME rallies, Melvin covers, and everyone at reddit gets out at the top. This represents a misunderstanding of market mechanics. Melvin will cover before we truly know it, and the crash will happen as quick as the rally. + +So with recent events, you must ask yourself: + +# Who is Your Counterparty? + +Nothing is a sure bet. How confident are you that your counterparty is who you think it is? Thousands of redditors & new traders beyond have been buying stocks fully confident that Melvin Capital hasn't exited their trade. This is also supported by some analysis provided by two different firms, although their estimates differ some amount. Confounded in this is the interpretation of the data: Does this include market makers and dealers that are short stock but covered with calls or options deltas? Is their information fully accurate in an event the likes of which has never happened? It's tough to know for sure. + +# Know Everyone's Hand + +Your guess on *how much they've covered* and *when they covered* has a massive effect on how you perceive the value of this trade. Buying if you think Melvin has $10b notional to cover is a much better bet than if they only have $2b to cover. You also have to consider how much notional the rest of the market has bought in anticipation of a squeeze. The difference between the two represents your effective edge. + +Remember, we don't *actually* know Melvin's current position. We don't know what's going on behind closed doors. We only know the hand they're showing us via media. Has their clearing firm taken over? Has a much bigger collection of firms absorbed the position? Have they been buying since Monday? Have they covered and have new funds entered the space at a much better level? + +You are fighting Goliath at a poker table in the city of Gath. The pot is worth $25 billion dollars. Ken Griffin has *never* lost. Melvin's prime brokers Morgan Stanley, Goldman Sachs, Deutsche are not used to losing (well, Deutsche is). They will do whatever it takes to take the pot *from you* and leave you holding the bag. They will not blink twice because there is a *lot* of *fucking money* on the line. + +# Know What Can Go Wrong + +Nobody could have guessed everything that happened this week. Prepare yourself for the unexpected. Your brokerage will undoubtedly close out your position at the worst possible time. The stock could be halted for days. You could be assigned on ITM options. Your stock could get delisted. Your stock may get diluted. + +# Only Spend What You're Willing to Lose + +This one is self explanatory. Your investment could go to zero. Even if you think you make money on every trade, if your bet size is 100%, the long term value of your portfolio is **zero*****.*** + +# Don't Take Out Loans on Emotional Capital + +If you are new, you really don't know the gut-wrenching, stomach-turning feeling of seeing the possibility of your net liquidity hitting zero or negative. It fucking sucks. You just know the highs. You're buying along the speculative frenzy and frantic rallies, wrapped in anti-billionaire & pro-underdog themes. It may even feel good to think that a guy who cut his teeth at a firm notorious for an insider trading scandal is getting his comeuppance. We love the feeling. **If you are fully invested financially & emotionally, you are completely overleveraged and will pay the price.** Make feeling good your goal, and set limits that you can stomach. + +There are several feel-good stories of people making life-changing money to pay off their student loans or their family members' surgeries. Please think twice about this, and only spend what you can afford to lose. If placing a bet makes the difference between your pet living or dying, you may have a gambling problem. These were success stories because they got in at a much better level and could have had a much sadder ending. + +Secondly, don't take it personal. There are people on the other side of your trades, your brokerage support line, the subreddit, the media. They are all playing their own hand to the best of their knowledge. It's easy to blame a broker, yell at their support desk, hate-tweet at a company, or even rage-text that guy you know who develops APIs at ETrade. A lot of people across the industry are *rooting* for you. Fuck, even Ted Cruz and AOC are *rooting* for you, because this transcends politics. If you're mad at Melvin Capital or Ken Griffin or the guys who crashed the economy in 2008, keep it that way. They will try and misdirect your anger in every single direction: brokerages, the media, and reddit. If your enemies are a few guys at the top holding a $25b short position and moving levers, keep it that way. + +Thirdly, if you don't want to be a human being for the sake of the person on the other side, be a human being for your wallet's sake. You make better financial decisions in the absence of emotions. +https://www.nytimes.com/2020/08/06/technology/trump-wechat-tiktok-china.html + +The tiktok ban will probably result in the sale of TikTok to Microsoft. The wechat ban is going to be much more complicated. + +The executive order appears to include a ban on any financial transaction with Tencent. Tencent investments include reddit. +One of the major arguments against a UBI is that it'll cause inflation. I understand how more people having more money increases demand and therefore raises prices, but would supply not simply rise to meet demand in the long run? Sure the initial shock might cause prices to rise, but would it really cause runaway inflation? + +If the source of inflation is more people having more money, why didn't the prosperity of the 50s cause inflation? Or was it just pushed into the 60s and 70s? + +Also, does this mean that capitalism is structurally incapable of providing everyone with a decent standard of living? +TL;DR - pretty successful. On average, Scion's stock picks sold at a potential maximum gain of 97% and a potential minimum gain of -28%. \~60% of trades sold with a potential max gain of 40% or higher. Full dataset, methodology, and visuals available at [this post](https://www.reddit.com/r/Burryology/comments/nmzp6o/how_successful_is_burry_when_it_comes_to_trading/?utm_source=share&utm_medium=web2x&context=3) on r/Burryology. + +I analyzed 14 quarters of 13F data (everything that's available on Whale Wisdom) for Scion Asset Management. The goal of this analysis was two-fold. First, on the buy-side, are there any technical characteristics that can be gleaned from when the stock was purchased? Second, on the sell-side, which ones were ***potentially*** the most successful? Least successful? What's the overall success rate? + +This post answers the latter. A future post may attempt to answer the former. + +Data: + +# Largest Potential Profits: + +* **Precision Drilling (PDS) in Q4 2020** + * Min/Max % Gain: **-41% to 262%** + * Min/Max Total Profit: **-$37M to $74M** + * Held for 2 quarters +* **Gamestop (GME) in Q4 2020** + * Min/Max % Gain: **56 to 607%** + * Min/Max Total Profit: **$5.5M to $32.7M** + * Held for 7 quarters +* **Michaels (MIK) in Q2 2020** + * Min/Max % Gain: **-84% to 786%** + * Min/Max Total Profit: **-$25M to $26M** + * Held for 1 quarter + +# Largest Potential Losses: + +* **Tailored Brands (TLRDQ) in Q2 2020** + * Min/Max % Gain: **-92% to -53%** + * Min/Max Total Profit: **-$38M to -$11.2M** + * Held for 8 quarters +* **Precision Drilling (PDS) in Q4 2020** (same position documented above) +* **Michaels (MIK) in Q2 2020** (same position documented above) +* **Jack in the Box (JACK) in Q2 2020** + * Min/Max % Gain: **-67% to 355%** + * Min/Max Total Profit: **-$18.1M to $18M** + * Held for 1 quarter + +# Largest Definite Gains: + +* **Gamestop (GME) in Q4 2020** + * Min/Max % Gain: **56% to 607%** + * Min/Max Total Profit: **$5.5M to $32.7M** + * Held for 7 quarters +* **NexPoint Residential Trust (NXRT) in Q3 2016** + * Min/Max % Gain: **29% to 82%** + * Min/Max Total Profit: **$2.5M to $5.9M** + * Held for 3 quarters + +# Largest Definite Losses: + +* **Tailored Brands (TLRDQ) in Q2 2020** + * Min/Max % Gain: **-92% to -53%** + * Min/Max Total Profit: **-$38M to -$11.2M** + * Held for 8 quarters +* **Gamestop (GME) in Q2 2019** + * Min/Max % Gain: **-70% to -8%** + * Min/Max Total Profit: **-$7.3M to -$572K** + * Held for 2 quarters +South SF Bay born and raised. I’m done. Moving to Colorado. + +I bought a house almost 12 years ago in a desirable neighborhood for $550k. It is on Zillow for 1.7, everyone I talk to says it’s worth $2M. + +I bought a townhome in Colorado a year ago. I can move there easily. I love it there. + +If I sell the California house, I can buy a great house in Colorado and rent out my townhome. If I keep the California house, I can rent it out (around $4k/month) and it pays for itself but I need to live in the smaller CO townhome. + +Let’s pretend for the sake of argument that I have reasonable income in both locations. + +What would you do? +What papers did you read (about) that caught you off guard, make you think differently about something you cared about, or solve a problem so creatively you felt privy to a “eureka” moment? +As consumers shop more through the ApolloX network, the overall value of the ApolloX +network increases, as well as the value of ApolloX token. When someone proposes to +significantly increase transaction costs on ApolloX, members of the community will realize that +such behavior will reduce the overall value of ApolloX, thereby reducing the value of ApolloX +token in its hands, and thus oppose such behavior. The way this organizational structure +secures the interests of the organizers and participants in the community is unique to +blockchain and is also the core strength of decentralized e-commerce marketplace. +https://apollox.network +https://www.fox4news.com/news/dallas-considers-restricting-home-sales-for-real-estate-investors + +These cities will try anything... except building more homes... +The quarterly dividend went from 0.9$ per share to 1$ per share. + +https://www.reuters.com/business/finance/jpmorgan-chase-increases-quarterly-dividend-2021-06-28/ +So if you're recently graduated, unemployed, or have another life event don't be surprised to see a $12 a month "account maintenance fee" if your account has a penny under $1500 at any time throughout the month. + +Edit: Congratulations to all the students graduating this month and the next. I know bank fees are the last thing you want to be concerned about while graduating and looking for a job, but it's always important to stay on top of your personal finance and I hope this reminder has been helpful. I know many of you signed up for the account when you were sixteen. I'm glad that this made the front page of Reddit and I thank the mods for stickying this for this month. If just one person saves some money from this reminder, I'll be happy. + +Edit 2: If you have a direct deposit of $250+ every month from your job you will also dodge this fee. This post was targeted at the soon to be unemployed so that probably isn't relevant to you however. The comments are full of alternative banks and credit unions with no such fee if you're interested in switching, and [this comment covers how many of the former loopholes people used to avoid this fee have been closed.](https://www.reddit.com/r/personalfinance/comments/6c35ne/this_is_just_a_reminder_that_bank_of_america/dhs1b3j/) I also saw a comment that there was a class action lawsuit when a certain amount type had this happen to them, so if you've never seen this fee you may have been grandfathered in under that account type. +I just want my lifetime back. I'm 27 and the clock ticks so fucking fast. Before investing in crypto I had no hope of financial freedom. Now I do! I hope we all gonna make it.. +>The wealthiest 10% of Americans now own 89% of all U.S. stocks, a record high that highlights the stock market’s role in increasing wealth inequality. The top 1% gained over $6.5 trillion in corporate equities and mutual fund wealth during the Covid-19 pandemic, while the bottom 90% added $1.2 trillion, according to the latest data from the Federal Reserve. The share of corporate equities and mutual funds owned by the top 10% reached the record high in the second quarter, while the bottom 90% of Americans held about 11% of stocks, down from 12% before the pandemic. The stock market, which has nearly doubled since the March 2020 drop and is up nearly 40% since January 2020, was the main source of wealth creation in America during the pandemic — as well as the main driver of inequality. The total wealth of the top 1% now tops 32%, a record, according to the Fed data. Nearly 70% of their wealth gains over the past year and a half — one of the fastest wealth booms in recent history — came from stocks. + +The IPO system probably plays a part... Also there is a saying that they never sell but rather take a loan on the stocks. +In a recent note to clients, strategists from JPMorgan (NYSE:JPM) suggested a one percent portfolio allocation to Bitcoin and other cryptocurrencies. + +As reported by Bloomberg, JPM strategists Joyce Chang and Amy Ho opined that Bitcoin could serve as a hedge against fluctuations from traditional assets like bonds, stocks, and commodities. However, they advised clients to allocate a small percentage due to the risk of major downturns in Bitcoin’s value. + +After setting a new all-time high above $58,000, the value of the digital asset slumped to less than $45,000 and has been struggling to recover ever since. + +Chang and Ho told investors: + +>*In a multi-asset portfolio, investors can likely add up to 1% of their allocation to cryptocurrencies in order to achieve any efficiency gain in the overall risk-adjusted returns of the portfolio.* + +Bitcoin has welcomed major investments from the likes of Paul Tudor Jones, Tesla (NASDAQ:TSLA), and MicroStrategy. The endorsement from JPM comes at a time when institutional players are rushing to accumulate the digital asset. As per Bloomberg’s report, America’s oldest bank BNY Mellon (NYSE:BK) has also announced plans to enable Bitcoin transactions for its clients. + +The strategists were quick to add that cryptocurrencies should be viewed as an investment vehicle and opposed to being funding currencies like the USD or EUR. This appears to be contrary to earlier statements from other JPM analysts that called cryptocurrencies the “poorest hedge for major drawdowns in equities.” + +[https://www.investing.com/news/cryptocurrency-news/jpmorgan-advises-clients-to-expose-1-of-their-portfolio-to-bitcoin-2431724](https://www.investing.com/news/cryptocurrency-news/jpmorgan-advises-clients-to-expose-1-of-their-portfolio-to-bitcoin-2431724) +Hi everyone, + +I would like you to consider this part DD and part thought-gathering. It's quite long, but I can't imagine I captured everything and I would appreciate any constructive feedback. **It is predominantly forward looking**. Though certain financial elements have been considered and noted in places, it has not been the primary objective to assess the current financial health or strength of the companies listed. + +&nbsp; + +^***Disclaimer:*** *^This ^post ^has ^been ^produced ^based ^on ^my ^own ^interpretation ^of ^the ^UK ^government’s ^energy ^white ^paper, ^which ^is ^available ^[here](https://www.gov.uk/government/publications/energy-white-paper-powering-our-net-zero-future). ^I ^am ^not ^a ^professional ^investor, ^nor ^am ^I ^qualified ^to ^give ^financial ^advice. ^It ^reflects ^my ^personal ^opinion ^and ^is ^for ^informational ^purposes ^only; ^it ^should ^not ^be ^construed ^as ^being ^in ^any ^way ^instructional. ^If ^you ^trade ^based ^solely ^on ^what ^I ^have ^written, ^you ^do ^so ^having ^accepted ^fully ^all ^of ^the ^associated ^risk ^and ^liability ^of ^financial ^investment. ^You ^are ^reminded ^and ^urged ^not ^to ^act ^upon ^the ^opinion ^of ^either ^myself ^nor ^that ^of ^others ^without ^performing ^your ^own ^due ^diligence. ^Sources ^are ^provided ^throughout ^but ^not ^exhaustively. ^.* + +&nbsp; + +# **WIND** + +There will be a very heavy focus on building upon and further utilising wind power in the UK. The paper does mention that CfD auctions will be open to onshore wind, however the emphasis appears more heavily orientated towards offshore farms. The government are aiming to have an offshore wind energy capacity of 40GW by 2030 [p. 3]. As of right now, the capacity is 10.4GW [[1]](https://www.renewableuk.com/page/UKWEDhome). That's a four-fold increase in capacity which will require a lot of expansion and upgrade to the existing array of windfarms, including expanding upon floating windfarms and the integration of other technologies to compliment the infrastructure. One particular area of development will be floating offshore wind, as it allows turbines to be built in places traditional windfarms can't be. As there are no major UK manufacturing companies involved with building turbines, the approach I have taken is to look at who has been involved in the production and operation of the existing UK windfarms (both operational and planned). + +&nbsp; + +**PRODUCTION** + +Main pick: +## **Siemens Gamesa** +- There are 35 operational offshore windfarms around the UK, and 60% of the turbines are made by Siemens [[2]](https://en.m.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_Kingdom). It seems likely, though of course not certain, that they will have a role in building the turbines for the four offshore farms currently under construction as well as the further five farms proposed for 2023/25. +- Over 80% of shares owned by institutions, private companies and public companies. +- Price to book (4.6x) overvalued compared to industry average (3.3x). However, share price is still rising (36% in last Q). +- F-Score 3/7. + +&nbsp; + +Secondary pick: +## **Vestas Wind Systems** + + +- Vestas is the other most likely candidate for producing turbines for offshore UK windfarms, with 30% of currently operational offshore turbines having been produced by them [[3]](https://en.m.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_Kingdom). +- 40% institutional ownership including BlackRock, Vanguard and Invesco amongst others. +- Healthy Financials. +- Price to book (11.3x) overvalued compared to industry average (3.3x) but earnings are expected to grow significantly over the next three years. + +&nbsp; + +**OPERATION** + +Main pick: +## **SSE** +- SSE are surprisingly heavily involved in wind energy. They jointly operate 11% of the operational UK windfarms ~~and will be jointly operating one of four farms under construction currently (Neart Na Gaoithe, Scotland).~~ Disputed, and I'm inclined to agree. +- The white paper makes clear in chapter 6 that the government intends to provide opportunities to existing oil and gas companies to repurpose their operations away from unabated fossil fuels, and towards technologies such as carbon capture, utilisation and storage, or clean energy production from renewables and hydrogen. They are financially incentivising large companies to take up those clean technologies. With the well-established operations in the wind sector, as well as government incentives to invest in carbon capture, SSE appear well placed to survive the green transition and receive support from the government to expand further into renewable areas. +- It is also worth noting that Airtricity, who own six onshore wind farms, are a subsidiary of SSE; and that SSE themselves own other onshore wind farms as well. +- SSE are also a member of Catapult's Offshore Renewable Energy (ORE), the centre of excellence for floating offshore wind in particular. As this area off offshore wind expands, SSE are highly likely to be involved [[4]](https://ore.catapult.org.uk/what-we-do/innovation/floating-wind-centre-of-excellence-2/). +- SSE are exploring carbon capture. SSE Thermal is part of the Zero Carbon Humber project, a partnership of leading organisations leading a £75m bid to accelerate decarbonising the north of England by utilising carbon capture and hydrogen technologies [[5]](https://www.sse.com/news-and-views/2020/10/sse-thermal-backs-zero-carbon-humber-bid-to-bring-commercial-scale-ccs-one-step-closer/), [[6]](https://www.zerocarbonhumber.co.uk/). + +&nbsp; + +Secondary pick: +&nbsp; +## **Ørsted** + +- Orsted are one of the major windfarm operators in the industry. Of all the operational UK windfarms, Orsted own and operate either in whole or in part 37% of them. Further, they are the owner of HornseaProject3 which was just granted consent on 31st December [[7]](https://www.hornseaproject3.co.uk). +- Mentioned by name in the white paper as part of a case study in wind energy related the Grimsby port revival, but is also connected to the government's Department for Business, Energy and Industrial Strategy (BEIS) £505million Energy Innovation Programme [[8]](https://www.gov.uk/guidance/energy-innovation). This is in relation to ITM's plans to scale up their Proton Exchange Membrane clean hydrogen production to a 'Gigastack' system, which can then be integrated with offshore wind facilities. More on that to follow. + +&nbsp; + +Wildcard: +&nbsp; +## **Octopus Renewables Infrastructure Trust** + + +- ORIT is the publicly traded 'arm' (I'll show myself out) of Octopus Group, which has been around a while but only floated ORIT on the LSE in December 2019. It is currently trading at just under its ATH at ~114p. +- One of the largest renewable infrastructure groups in Europe, with over £3bn in assets under management [[9]](https://octopusrenewables.com/about-us/). +- Largest independent owner of onshore wind and solar assets in the UK [[10]](https://octopusrenewables.com/about-us/). +- Significant and consistent insider buying throughout 2020 and as recently as 31st December, with the chairman of the board and two board members making a combined purchase of 20,122 shares at market price on that date. The same two board members also bought thousands more shares at various points in 2020 [[11]](https://simplywall.st/stocks/gb/general/lse-orit/octopus-renewables-infrastructure-trust-shares#ownership). +- Octopus Investments, another arm, owns the Fraisthorpe windfarm in the East Riding of Yorkshire, an array of nine Vestas V112 wind turbines [[12]](https://www.powersystemsuk.co.uk/project/fraisthorpe-wind-farm-project/). +- Octopus Energy is a retail electricity and gas supplier with 1.35million domestic business customers as of December 2019. This company is mentioned by name in the white paper in reference to its smart utilisation and its cost saving 'time-of-use' energy tariff in particular, which gives users access to half-hourly energy prices updated daily. This means that when energy prices drop, so does cost to user. It can even go negative, meaning consumers would be paid [p. 23]. + +&nbsp; + +# **HYDROGEN** + + +The government is very interested in new hydrogen technologies and is working toward 5GW of low-carbon production by 2030, with views to scaling hydrogen neighbourhoods into hydrogen towns by the end of this decade [p. 12]. Hydrogen is a target (along with advanced nuclear) of a £1b energy innovation programme, and as alluded to previously, the government are looking at utilising synergies between wind and hydrogen. As well as that, hydrogen fuel cell technology has potential application for large vehicle power especially, like busses, HGVs and construction vehicles. The white paper indicates that in 2021, the government will invest £20mil in freight trials to pioneer hydrogen and other zero emission truck technologies, and £120mil in 2021/22 to start the delivery of 4000 zero emission busses, which will be a mix of battery electric busses and hydrogen busses [p. 94]. + +&nbsp; + +Main pick: +&nbsp; +## **ITM Power** + + +- As I mentioned, ITM are mentioned by name for their Gigastack project. This is a large-scale project involving ITM power, Orsted, Phillps 66 and Element Energy, aimed at demonstrating the efficacy (and carbon benefit) of developing synergies between wind and hydrogen power. The production of hydrogen power has traditionally been associated with high carbon emissions, and the purpose of this project is to produce hydrogen without the associated carbon emissions. Read more here [[13]](https://www.itm-power.com/news/industrial-scale-renewable-hydrogen-project-advances-to-next-phase). +- Given the government's focus on wind and hydrogen in the green industrial revolution, ITM appear uniquely placed to lead and capitalise upon the green development of the UK's energy infrastructure. +- Debt-free and has not had any debt for the last five years. +- Decent cash runaway. +- Recent insider buying by 7 individuals. +- 40% institutional ownership, including BlackRock, AJ Bell, HSBC, Barclays and Morgan Stanley amongst others. + +&nbsp; + +Secondary pick: +&nbsp; +## **Ceres Power Holdings** + + +Ceres are well placed for the green industrial revolution. Their core product is a unique type of solid oxide fuel cell they call the SteelCell, which they claim is not only cheaper to manufacture, more efficient, and more reliable than other fuel cells, but which can also produce power from hydrogen, natural gas, biogas and ethanol as well [[14]](https://www.ceres.tech/technology/why-is-it-unique/). The areas of application for this product are EVs, data centres, and distributed power generation. The only reason this isn’t the primary pick for me is that I am concerned about how much of the company’s growth potential may already be priced in. + + +- They have several big-name partnerships including Bosch and Doosan [[15]](https://www.proactiveinvestors.co.uk/companies/news/936171/ceres-power-partners-with-powertrain-specialist-avl-list-to-turbocharge-fuel-cell-adoption-936171.html). +- Overvalued price to book at 16.8x vs industry average of 2.8x. +- Very healthy financially, with no debt and cash runaway of 3+ years. Short and long term assets exceed short and long term liabilities. +- Insider sale in the last six months but no insider buying in last twelve months. +- 54.7% institutional ownership. +- Market cap: £2.27b. +- Shares outstanding: 172.1m. + +&nbsp; + +Tertiary pick: +&nbsp; +## **AFC Energy** + +If you've been keeping an eye on the electric vehicle (EV) market, you will likely have heard of American companies like Chargepoint, whose market is EV charging. AFC are doing the same in the UK. Their H-Power EV charging ports offer an EV charging solution designed to be modular, scalable, easily transportable, and independent of the grid. This could be especially convenient logistically for areas such as car parks, and companies that operate fleets of vehicles. + +- A global leader in alkaline hydrogen fuel cell technology focused on electric vehicle charging and distributed power generation. +- Announced in December a strategic partnership with ABB, a Swiss electrical systems giant with an established sales and distribution network of DC high power EV charge points, having sold 17,000 units in 80 countries [[16]](https://www.afcenergy.com/afc-energy-and-abb-partner-to-power-up-the-future-of-clean-ev-charging/). +- 34.9% institutional ownership. +- Market cap: £536.86m. +- Shares outstanding: 676.15m. + +&nbsp; + +Wildcard: +&nbsp; +## **Powerhouse Energy** + +Powerhouse Energy is in the business of recovering energy from unrecyclable plastics and end-of-life tyres to produce syngas and hydrogen through their 'Distributed Modular Generation' (DMG) process of gasification. The process involves the plastic being heated to a very high temperature where within a few seconds it melts and is vaporised into gases. Further heating within the chamber reforms the molecules into a syngas, comprising a mixture of largely methane, hydrogen and a smaller volume of carbon monoxide. The Thermal Conversion Chamber operates without oxygen, so there is no burning, however a non-combusting oxidising agent in the form of steam is added to control the process and the quality of the syngas. Once through the Conversion Chamber the syngas is cleaned, leaving behind a few inert harmless residues, which are typically less than 5% of the starting volume of waste plastics. These residues can then be reused for other purposes or safely disposed of. + +- Their product is their DMG system. Powerhouse Energy do not operate any plants of their own. However, the hydrogen their process produces can be used for fuel cells, micro-turbines or ultra-clean engines, meaning they could have plenty of potential clients going forward, especially with an uptake in EV and phase out of diesel. +- Given what the white paper outlines regarding hydrogen powered trucks and busses, as well as the green industrial revolution's emphasis on hydrogen more broadly, they are well placed to expand their business if managed correctly. +- 23.5% institutional ownership including Barclays, Fidelity, HSBC, AJ Bell and Deutsche Bank, amongst others. +- Currently trading at 10p. +- Market cap: £364m +- Shares outstanding: 3.72b. +- They have a lot to prove. Mid-high risk, high reward play. + +&nbsp; + +# **BIOMASS** + +Biomass will have a role in the green industrial revolution as the government consider it 'one of our most valuable tools for reaching net zero', but the extent of that role seems yet to be determined in any concrete sense. However, the government is aiming to deliver a preliminary position paper on this matter by summer 2021 [p. 53]. By 2022 the government intend to have established the role bioenergy with cabon capture, use and storage (BECCS) will play as part of a wider biomass strategy [p. 53]. +Biomass has been controversial due to an infamous loophole whereby the carbon debt of producing the wood pellets is not sufficiently factored in to the carbon cost of biomass energy production, because the pellets magically become carbon neutral in transit if enough trees have been planted to replace those cut down. The objection is that the newly planted trees take 50-100 years to mature, and so we ultimately run biomass at a deficit [[17]](https://greenguide.co.uk/uks-net-zero-emissions-2050-pledge-undermined-by-biomass-energy-loophole/). However, the government seems aware of the hidden carbon cost of biomass, and made it clear in the white paper that BECCS will be "critical to consideration" of biomass support [p 53]. Carbon capture is going to be a significant consideration in all areas of the economy going forward in the green industrial revolution as there is a real need for us to decarbonise. To that end, BECCS capable biomass power plants are appealing because they could potentially deliver negative carbon emissions. It seems unlikely that the Government will fund plants that do not utilise the technology, but that doesn't mean non-BECCS biomass won't be utilised at all, at least initially. + +&nbsp; + +Main pick: +&nbsp; +## **Drax** + +- Already trialling BECCS at Drax Power Station in North Yorkshire, aiming to capture up to a tonne of carbon every day [[18]](https://www.drax.com/press_release/drax-sets-world-first-ambition-to-become-carbon-negative-by-2030/#:~:text=Drax%20is%20already%20running%20a,zero%20carbon%20emissions%20by%202050). +- Aims to be a carbon negative company, not just neutral [[19]](https://www.drax.com/about-us/our-projects/bioenergy-carbon-capture-use-and-storage-beccs/). +- Significant insider buying this year. +- 96.5% institutional ownership including by big players Invesco, BlackRock, Vanguard, L&G and J.P. Morgan, amongst others. +- Healthy finances. +- Pays a dividend. +- Share price up 39% last three months. + +&nbsp; + +Secondary pick: +&nbsp; +## **Active Energy Group** + +- Recently granted US patents for their CoalSwitch and PeatSwitch biomass processes [[20]](https://www.bioenergy-news.com/news/active-energy-awarded-new-us-patent-for-coalswitch-process/). +- 33.9% institutional ownership including HSBC, AJ Bell, and Barclays. +- High debt but positive operational cash flow and decent cash runaway. +- Insider buying in last six months. +- Nb. Unclear if committing to BECCS and may be focusing primarily on US market. + +&nbsp; + +Wildcard: +&nbsp; +## **EQTEC** + +- Highly speculative. +- Specialises in gasification and working with third party plants to implement 'waste-to-value' solutions, but does own stakes in several energy producing plants such as Clay Cross Biomass in Derbyshire amongst others [[21]](https://www.hl.co.uk/shares/shares-search-results/e/eqtec-plc-ordinary-eur0.001/company-information). + +&nbsp; + +# **NUCLEAR** + +An unpopular sector, especially since Fukushima. Nevertheless, the government intends to invest into the next generation of nuclear technology - small modular reactors (SMR) and advanced modular reactors (AMR). With the exceptions of Sizewell B and the currently under construction Hinkely Point C, all 15 of the UK's operational nuclear plants are due to be decommissioned by 2030 [p. 41]. There do not appear to be a lot of nuclear investment opportunities in the UK, and the lead candidates in the government's AMR competition (Tokamak, Westinghouse, and Urenco) are private firms. However, opportunities remain. + +**Edit:** Westinghouse are owned by Brookfield Business Partners, which trades on the NYSE. + +&nbsp; + +Main pick: +&nbsp; +## **Rolls Royce** + +- Actively working on SMR technology. +- They were successful in both phase 2A and 2B of the government's nuclear innovation programme: advanced manufacturing and materials competition [[22]](https://www.gov.uk/government/publications/nuclear-innovation-programme-advanced-manufacturing-and-materials-competition-phase-2-successful-projects/advanced-manufacturing-materials-competition-phases-2a-and-2b-successful-projects). +- Leads the UK SMR Consortium, which aims to develop a Small Modular Reactor designed and manufactured in the UK capable of producing cost effective electricity. An initial £36 million joint public and private investment will enable the consortium to further develop their design. This is part of a greater bid into the Industrial Strategy Challenge Fund worth around £500 million (joint investment with the private sector), subject to future approvals and a final decision to make public investment. The consortium believes that a UK Small Modular Reactor programme can support up to 40,000 jobs at its peak with each Small Modular Reactor capable of powering 750,000 homes [[23]](https://www.gov.uk/government/publications/advanced-nuclear-technologies/advanced-nuclear-technologies). + +&nbsp; + +Secondary pick: +&nbsp; +## **Costain Group** + +Costain operates by delivering integrated, leading edge, smart infrastructure solutions to meet national needs across the UK’s energy, water, transportation and defence markets. They are one of the largest providers of engineering services to the UK nuclear market [[24]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/nuclear/). + +- Involved in new build, decommissioning, as well as nuclear waste management [[25]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/nuclear/). They are very well placed to handle the decommissioning of the currently operational nuclear plants, as well as assisting in the building of SMRs and AMRs down the line. +- Committed to clean energy and decarbonisation [[26]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/). +- Costain Group passed phase one of the BEIS SMR competition, and were listed as an eligible participant [[27]](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/665376/List_of_Eligible_Participants_in_Phase_One_of_the_SMR_Competition.pdf)(PDF). This is no guarantee that they will win the government funding, but it seems likely all the same that they will be involved in the government’s infrastructure plans in the end, even without funding. + +&nbsp; + +# **OIL AND GAS** + +When put together, those are two very dirty words in the clean energy sector, and quite understandably so. On ethical grounds, it is a respectable position to ignore existing industry giants. Some more than others. However, to write these companies off economically in the face of the green industrial revolution would be misguided. The fact of it is that these companies have sweeping infrastructure already in place, and it would be better to utilise it through modification than scrap it. +The government agrees, and in the first half of 2021 they aim to agree the North Sea Transitional Deal with the industry which has five key deliverables; + +- Cleaner energy production through rigorous emissions reductions. +- Supporting the delivery of carbon capture technologies +- Diversification of the oil and gas supply chain into new energies. +- Supporting the development of hydrogen production. +- Safeguarding existing jobs and establishing tens of thousands of new high-quality jobs across the sector in diversified energy technologies. + +I am sceptical about some of the oil and gas industry's sincerity in its efforts, believing certain players to be driven by legal obligation more than genuine desire to change or to capitalise on the progressive opportunity. But all the same, the existing industry merits at least a small position in a portfolio based upon the plan for a Green Industrial Revolution. + +&nbsp; + +Main pick: +&nbsp; +## **BP** + +- By far the most controversial pick on here. We're all aware of BP's disastrous oil spill, but there is a project BP are leading which is worth considering in relation to the government's plans. +- They are leading a very large carbon capture project called Net Zero Teesside together with Eni, Equinor, National Grid and Royal Dutch Shell, aiming at turning Teesside into the nation's first net zero industrial cluster [[28]](https://www.netzeroteesside.co.uk/). +Further, they are involved in another, related project called Zero Carbon Humber, which has similar plans. Of note, Drax and SSE are also involved in the ZCH project [[29]](https://www.zerocarbonhumber.co.uk/). +- Further, by 2026 the same group aims to capture and store 50% of the UKs industrial carbon emissions in saline acquifiers beneath the North Sea seabed [[30]](https://www.theguardian.com/environment/2020/oct/27/bp-leads-energy-companies-preparing-two-major-uk-carbon-capture-projects), [[31]](https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/news-and-insights/press-releases/energy-companies-form-development-partnership-for-carbon-emissions-in-uk-north-sea.pdf&ved=2ahUKEwit_-uEiIDuAhWCiFwKHSvXBJYQFjAAegQIBBAC&usg=AOvVaw35dCAqmNjbDqIK8f-eReDv&cshid=1609687319712)(PDF). +- Captured carbon has a multitude of possible uses in the production of cleaner concrete, bioplastics, and synthetic hydrocarbons that could be used to fuel planes [[32]](https://www.drax.com/technology/can-made-captured-carbon/). The capture and sale of carbon represents a significant opportunity for BP to capitalise on the green industrial revolution, and could form a significant part of their future business model, as well as that of other similar companies. + +&nbsp; + +# **AVIATION** + +Aviation is integral to our society. We can’t do without it, but it has to change if we are to reduce its carbon impact. Things like electric planes are a long way off, so in the interim we need to look at making the existing systems cleaner. + +&nbsp; + +Main pick: +&nbsp; +## **Velocys** + +- Velocys is a company involved in the production of sustainable aviation fuels. They use a fischer-tropsch process to produce a sustainable, drop-in aviation fuel from household, commercial, and forestry waste. Drop-in is key here, as it means that Velocys' fuel will not require any modification to the aircraft or their engines in order to be utilised. +- The government have established the Jet Zero Council; whose purpose is to accelerate the development of technologies to work towards net-zero aviation. Part of the plan is to offer a £15mil competition to support the production of sustainable aviation fuels. Velocys is well placed. +- Planning approval granted in June for a facility they are building in partnership with Shell and British Airways at Immingham. It will be the UK's first commercial waste-to-renewable-fuels plant and aims to take over half a million tonnes of waste per year and turn it in to 60 million litres of cleaner burning, sustainable jet fuel, for an estimated CO2 saving of over 80,000 tonnes per year [[33]](https://www.altalto.com/immingham/). +- Currently trading at only 10p. +- Market cap £108m. +- High number of shares outstanding: 1.06b. +- 22.4% institutional ownership including Barclays, Invesco and Fidelity. + +&nbsp; + +# **GRAPHENE** + +Graphene has been touted as the future for the last decade, but we may well be seeing some progress in this field in time for the green industrial revolution, especially in the field of battery technology. However, it is not mentioned in the white paper, and so I will leave this section as a direction for you to look into this area further. With a very significant need for energy storage and EV take-up, it is my opinion that battery technology developments are going to play a role in the green industrial revolution eventually. + +&nbsp; + +Main preliminary pick: +&nbsp; +## **Applied Graphene Materials** + +- Primarily involved in the production of graphene nanoplatelets. Although the company is so far mostly involved in graphene applications for things like paints, coatings and thermal adhesives, the large surface area, high levels of thermal and electrical conductivity, low density, mechanical strength and morphology of graphene nanoplatelets make them an ideal candidate for applications in electrochemical energy storage systems as well. Viewing their website, the company is clearly aware of this. As technology develops, graphene batteries are likely to play a substantial role in energy storage and EVs, as they are not only safer, but significantly more efficient than lithium-ion batteries [[34]](https://futurism.com/scientists-develop-better-battery-thanks-graphene). That makes graphene a good speculative mid-long term play in the green industrial revolution. +- Insider trading in October, with CFO picking up just north of 59,000 shares. +- 54.9% institutional ownership. +- Market cap: £20.4m. +- Shares outstanding: 49.7m. + +&nbsp; + +Secondary preliminary pick: +&nbsp; + +## **Haydale Graphene Industries** + +- Graphene and many other nanoparticles do not mix naturally with other materials. To ensure that its superior properties can be blended into products, nanomaterials may need to be ‘functionalised’, where compatible chemical groups are added to the material surface to enable effective dispersion of the nanomaterial. Haydale has developed a plasma treatment to that end - the functionalising of nanomaterials, especially graphene. +- Insider buying this year, but not since March. CFO purchased 275,000 shares on 12th March. +- 38.5% institutional ownership including Barclays, HSBC, AJ Bell. +- Market Cap: £18.5m. +- Shares outstanding: 425.28m. +I despise fake leather/pleather with all my existence. It looks ugly; it cracks, ruining favourite clothes and getting flakes everywhere - including my eye one time; and it's EVERYWHERE. + +Why is it so hard to find things with real leather or suede? They just discard the skin of all the animals they murder. I'm pretty sure real leather is the more ecological option, instead of producing brand new, plastic abomination. +\[This post is designed to serve as an introduction to new users of the subreddit, based on my own personal experience. Please read this post in its entirety before contributing to the subreddit, as it answers 95% of the questions most commonly asked by new users and investors. The Moderation Team will remove any submission that asks a question answered by this post. Nothing in this piece should be taken as legally binding financial advice. Even though citations have been included, please do your own research. While I ( u/Firstclass30 ) am the lead moderator of the r/dividends subreddit, I am not a licensed financial advisor.\] + +Good afternoon, and welcome to r/dividends. We are a community by and for dividend growth investors. Our community was started all the way back in 2009 as a discussion forum for dividend investors. Whether you are just starting out in your investing journey, or are months away from retirement, we hope you will find enjoyment in participating with this online community. This post will go over absolutely everything you need to get started in the world of dividend investing. Whether you are new or have been investing for years, it is well worth a read. + +**Part 0: What are dividends exactly?** + +From Investopedia: + +>A dividend is the distribution of some of a company's earnings to a class of its shareholders, as determined by its board of directors. Common shareholders of dividend-paying companies are typically eligible as long as they own the stock before the ex-dividend date. Dividends may be paid out as cash or in the form of additional stock.[^([1])](https://www.investopedia.com/terms/d/dividend.asp) + +Dividend investors are those who incorporate dividend payers into their portfolio. + +**Part I: Understanding the benefits and drawbacks of dividend payers** + +Dividend payers tend to be big, well-established companies that have an abundance of cash. According to Steve Greiner, Vice President of Charles Schwab Equity Ratings^(®), *"They \[dividend payers\] often can't compete with the rapid appreciation of fledgling, fast-growing companies, so they use dividend payouts as an enticement."* Because of this, many newer investors often think of dividend payers as being the opposite of so-called "growth stocks." In reality, it is usually dividend-paying securities that produce more growth over a long period of time. + +Dividends, when reinvested, can significantly boost total returns over time, making dividend-paying stocks an attractive option for older and younger investors alike. For example, if you invested $1,000 USD in a hypothetical investment that tracked the S&P 500 Index on January 1, 1990, but did not reinvest the dividends, your investment would have been worth $8,982 USD at the end of 2019. If you **had** reinvested the dividends, you would have ended up with $16,971 - nearly doubling your returns. The longer the timeframe, the more dramatic the disparity. According to research conducted by the Hartford Funds, "Dividends have played a significant role in the returns investors have received during the past 50 years. Going back to 1970, a whopping 84% of the total return of the S&P 500 index can be attributed to reinvested dividends and the power of compounding."[^([2])](https://www.hartfordfunds.com/market-perspectives/the-power-of-dividends.html) Drawing from the decades of data available, intentionally excluding dividends from your portfolio could result in significantly handicapping your portfolio for decades. + +With the S&P 500 yielding approximately 1.52% as of December 31, 2020, dividends paying securities can serve as an attractive alternative to Treasuries and other fixed income investments often pushed by professional retirement planners. + +The downside to dividends is that they are not guaranteed. This is important information to consider, as companies can and will stop paying dividends if necessary, or worse, if legally required. Certain market conditions like the 2020 coronavirus pandemic can create an uncertain environment for dividend-focused companies. In 2020, 68 of the roughly 380 dividend-paying companies in the S&P 500 suspended or reduced their payouts.[^([4])](https://markets.businessinsider.com/news/stocks/2020-dividends-a-year-in-review-1029885286) + +Fortunately, companies generally only cut their dividends when they are in distress, so favoring those with sound financial metrics can help mitigate the risk. + +**Part II: Understanding how to pick dividend stocks** + +If you create a post in the r/dividends subreddit asking for a list of good companies that pay dividends, your submission will be removed. This is because this community believes firmly in the "teach someone to fish" mentality. Instead of asking for a list of dividend payers, it is far more valuable instead to understand the fundamental ideas behind why specific individuals choose specific companies. By knowing and understanding these principles, you can build your own portfolio that, if properly executed, could beat 90% of lay investors with relatively little effort. While far from comprehensive, these six tips can help you identify dividend-paying stocks with strong financial health. + +***#1.*** ***Do not chase high dividend yields:*** If a company has a high dividend yield, there is always a reason (most of the time not a good one) that a security is offering payouts that are well above average. A good rule of thumb is that before you purchase a high-yield security (those with a yield of 5% or more), try to determine why it is so high. It is important to note however, that the dividend yield is not a fixed amount, but in reality changes every second a stock is traded. According to Investopedia: + +>The dividend yield, expressed as a percentage, is a financial ratio (dividend/price) that shows how much a company pays out in dividends each year relative to its stock price.[^([3])](https://www.investopedia.com/terms/d/dividendyield.asp) + +If a high or rising yield is due to a shrinking share price, that is a bad sign and could indicate that a dividend cut is in a company's future. However, if a rising dividend yield is due to rising profits, that indicates a more favorable scenario. When net profits rise, dividends tend to follow suit. Make sure you know exactly what is causing the increase before buying the stock. + +***#2. Assess the payout ratio:*** This metric (calculated by dividing dividends per share over earnings per share) tells you how much of a company's earnings are going toward the dividend. A ratio higher than 100% means the company is paying out more to its shareholders than it is earning. In such cases, it may be able to cover its dividends from available cash, but that can only last for so long. + +If a company whose stock you own is losing money but still paying a dividend for an extended period, it may be time to sell off and cut your losses. US tax law allows you to write off up to $3,000 per year in capital losses in exchange for a tax credit. Your circumstances may vary, so check your local tax authority. The reason you may want to consider this option is because dividend payers in financial hard times may try to stave off a dividend cut by funding payouts with borrowed funds or cash reserves. These actions will often drive away shareholders, forcing the share price down. History also shows these actions rarely turn things around, and are usually just delaying the inevitable. (To those of you who know about REITs, keep reading, they will be addressed further down. + +***#3. Check the balance sheet:*** High levels of debt represent a competing use of cash. Under most global securities laws, a company must pay its creditors before it pays its dividends. A fast-rising level of debt could indicate bankruptcy in the short or medium-term future. Under US and EU bankruptcy law, corporations in the bankruptcy process are (depending on the circumstances) legally barred from paying dividends to shareholders. Corporations with high debt levels may also look to the courts to assist in reorganizing debts without declaring bankruptcy. Oftentimes, judges in these cases will force reductions or suspensions in dividend payments to prioritize the repayment of creditors. + +***#4. Look for dividend growth:*** Generally speaking, you want to find companies that not only pay steady dividends, but also increase them at regular intervals (i.e. once per year over the past three, five, or even 10 years. **Research has also shown that companies that grow their dividends tend to outperform their peers over time.^([2])** Not only that, but a strong history of regular dividend growth also helps keep pace with inflation, which is particularly valuable to those who wish to seek financial independence and live off of their investments. + +With that being said, just because a company did not increase their dividends in 2020 or 2021 does not make it necessarily worthy of exclusion from your portfolio. Certain industries (like the top US banks) were legally prohibited by the federal government from raising their dividends during the COVID-19 pandemic. Most companies have been hoarding cash to help weather the economic uncertainty, so it is not unreasonable to for them to keep dividends stagnant until the economy bounces back. When it comes to companies impacted by the pandemic, look for other factors aside from dividend changes to determine whether or not the company is worth your investment. + +***#5. Understand sector risk:*** Some sectors offer a more attractive combination of dividends and growth than others, but they also offer different risk characteristics that you should consider when researching dividend payers for your portfolio. Stocks from the banking, consumer staples, and utilities sectors, for example, are known for steady dividends and lower volatility, but they also tend to offer less growth potential (though this varies from company to company). Dividend paying tech companies, on the other hand, could offer attractive dividends along with the opportunity for larger price gains, but they also tend to be much more volatile. If you are a long-term investor, you might be willing to accept tech's higher volatility in exchange for its growth and income prospects, but if you are nearing or in retirement, you might want to prioritize dividend-payers from less volatile industries. + +***#6. Consider a fund:*** If you are worried the potential for price declines eroding the value of your dividend stocks, consider instead a dividend-focused exchange traded fund (ETF) or mutual fund. Such funds typically hold stocks that have a history of distributing dividends to their shareholders, and they provide a greater level of diversification than you can achieve by buying a handful of dividend paying stocks. Funds are typically preferred by those who wish to take a more hands-off approach to their investments. These will be your best option if you lack the time or inclination to conduct in-depth research of companies. + +**Part III: Ideal age of the dividend investor.** + +Oftentimes inexperienced investors will claim dividends are for those at or nearing retirement. As was demonstrated earlier in this piece, nothing could be further from the truth. No matter what stage of your life or investing career, dividend-paying stocks can be a great way to supplement or even replace your income and improve your portfolio's growth potential. Just be sure you research their overall financial health, not just their dividend rates, before investing. There is no such thing as a right or wrong decision, as long as you achieve your desired outcome. + +**Part IV: When not to reinvest** + +Part I demonstrated how powerful reinvesting one's dividends can be, but there are certain circumstances where it can be more financially savvy to refrain from reinvesting your dividends. Below are three situations in which you might want to deploy dividend payouts elsewhere. + +* **You are in or near retirement:** When you are living off your savings, taking income from your dividends allows you to let more of your portfolio stay invested for growth. If you are nearing retirement, on the other hand, you can use the payouts to build up your cash and short-term reserves as you prepare for the transition to life after work. Some dividend investors have even built their portfolios to have their dividends cover 100% of their expenses. +* **Your portfolio is out of balance:** Reinvesting the dividends of a well-performing investment back into that investment can throw your portfolio off balance over time. In such cases, you might want to take the cash and reinvest it elsewhere. +* **The investment is underperforming:** If you are worried about an investment's future prospects but are not quite ready to let it go, you may not want to reinvest the payouts back into that investment. Instead, you might use the dividends to dip your toe into something prospective that could ultimately replace the underperforming investment. + +**Part V: Understanding Taxes on your portfolio** + +The question of taxes often comes up a lot in investing communities, and r/dividends is no exception. However, we mods prohibit direct questions regarding taxes and other questions of legality because nobody here is a licensed tax professional in every single tax jurisdiction on Earth. The question of taxes varies so wildly between regions that even making basic generalizations borders on pointless. The only constant is that you will pay taxes at some point in your life on your investments. Whether it is before you make your gains, after you make your gains, or somewhere in between, you will pay taxes. The different types of accounts and options available to you varies based on your income, geography, employer, and dozens of other factors. Some countries offer special accounts for those who serve in the military, law enforcement, or some other specialized profession(s). Some trade unions help pay the taxes you may owe on certain investment types. The variations on the tax question are so all over the place that I could break Reddit's character limit just covering the most general details. + +Typically the best resource for understanding your local tax situation is the government agenc(ies) responsible for collecting your money. As of 2021, most all have websites of various levels of usability. They should often be your first stop for most questions. When in doubt, always talk to a professional. + +**Part VI: Special Snowflake companies (REITS, MLPs, royalty trusts, etc.)** + +Some companies do not fit neatly into the category of an S-class corporation, and see themselves as special snowflakes worthy of a special tax status. Understanding these entities is a critical prerequisite to holding them in your portfolio, as many may require additional tax paperwork. In my personal experience, aside from REITS, most are not worth the time of the average investor. Unless you already have a preexisting knowledge of how these companies work, I would not go out of your way to understand in-depth how they operate when there are so many options out there that could provide better returns. + +The only exception to this rule is the Real Estate Investment Trust (REIT). Unlike other special snowflake investments, REITs are relatively self explanatory. They deal 100% in real estate. Nothing else. REITs are favored by dividend investors because of their special arrangement with the US government. In exchange for not having to pay most federal corporate taxes, REITs are legally required to pass on at minimum 90% of their profits under GAAP to shareholders in the form of dividends, which are taxed as income by the US government. The keyword here is GAAP. + +Most places on Earth (aka the United States and almost nobody else) requires the usage of the Generally Accepted Accounting Principles (or GAAP standard of accounting). GAAP is incredibly strict, intricate, complicated, and almost impossible to cheat. 100% of publicly traded companies in the US use GAAP, which makes comparing the finances of US stocks incredibly easy. However, the tax structure of Real Estate Investment trusts often causes the math behind GAAP (or any other accounting system for that matter) to break down. This can make REIT payout ratios look absolutely insane in relation to other companies, and can make most REITs look incredibly unprofitable. To combat this, REITs have developed their own standards utilizing simplified math, called the funds from operations (FFO) metrics. I originally had a more in-depth explanation of this concept (as well as information about BDCs, MLPs, and Royalty Trusts), but I had to cut it out of the final draft of this post because Reddit has a 40,000 character limit. The best I can do right now is to point you in the direction of Investopedia, which has an [excellent article on the subject of FFOs, linked here](https://www.investopedia.com/terms/f/fundsfromoperation.asp). + +The decision of whether or not to incorporate these types of investments into your portfolio is a personal one, and just like with any other type of investment, varies greatly based on your risk tolerance and portfolio goals. + +**Part VII: Performing in-depth research on companies** + +While anyone can read a balance sheet synopsis on Seeking Alpha and vaguely grasp its meaning, above understanding a concept is the ability to put one's knowledge into practice. The reason I put this skill above actually picking companies is because stock picking can be done with a relatively low knowledge base, but actually digging deep into financial statements and balance sheets to discover companies on your own not on the traditional press circuit can serve as the true test of someone's research potential. + +Oftentimes I come across even experienced investors unaware of just how many resources are available to them on this front. While websites, apps, and YouTube channels exist all over the place, an often underutilized resource for investment knowledge is the companies themselves. 99% of publicly traded companies have a website dedicated to serving the needs of investors, often with email addresses, phone numbers, and physical addresses just begging to be contacted. How much did Coca-Cola pay in dividends in 1926? Google doesn't know (I checked), but I guarantee you somewhere in an Atlanta filing cabinet lies Coke's dividend history from back in that time. It is obscure, seemingly random knowledge like that investor relations experts are paid to answer. + +\[Side note: originally, there was going to be a far larger expanded section about this, but it was cut for the sake of conforming to Reddit's character limit.\] + +**Part VIII: Diminishing returns and micromanagement** + +By paying attention in school, you may have been informed regarding the law of diminishing returns. When it comes to dividend investing (or any type of investing), the law of diminishing returns can play a big part of your portfolio management. While you should always be on the lookout for investment opportunities, if day trading is the reason you wake up in the morning, dividend investing may not be right for you. Strategies like buying right before the ex-div date and selling immediately afterwards rarely turn out in your favor, and even when they do are often not worth the trouble. Your gain will be a few cents at best, or worse you lose money. In my experience as the lead moderator of this subreddit, monitoring comments, I can say with confidence that most people **will** lose money on this day-trading type strategy. Most of the price action regarding a dividend took place days or weeks before the ex-dividend date, spread out over a period of time. Companies often issue dividends on a clockwork schedule according to the [ISO Calendar](https://en.wikipedia.org/wiki/ISO_week_date), so institutional investors are often able to predict when the dividend will be paid months or even years in advance, long before the boards of these companies officially announce their dividends. + +A similar thing can be said for those attempting to buy stocks at the absolute lowest possible price. I have seen individuals hold out for days waiting for a few extra cents. If you have a six figure portfolio, you do not need to be trying to time a 12 cent price drop. Your time will be better spent elsewhere. Understanding the law of diminishing returns can sometimes singlehandedly turn an underperforming portfolio into an overperforming one. By taking a hands off approach to most of your investments, you let the market work in the background of your life. As the old saying goes, "time in the market beats timing the market every day of the week." + +**Part IX: Debt and financing your investments** + +Early in your investment journey, the idea of purchasing dividend stocks on debt sounds like a great idea. Buy the stocks, use the dividends to pay off the loan, then keep the stocks and profit. It sounds foolproof right up until it isn't. What seems like free money is more akin to an advance on a sh\*\*\*y record deal. If you decide to take out a $50,000 loan to buy dividend stocks, don't be surprised if acquiring a home or auto loan becomes significantly more difficult or downright impossible depending on your circumstances. Banks and credit unions are often far more hesitant to lend out money to those with high amounts of preexisting debt. When these loans are given however, they often come with interest rates higher than what you would have normally had to pay if you had not decided to buy a bunch of AT&T with a personal loan. Any amount below $20,000 will hardly have a significant effect on your long-term portfolio (assuming you are still investing with earned income), and any amount above $20,000 could have serious ramifications on your ability to access credit in the event you truly need it. If you fail to disclose this preexisting loan to any prospective lender, then congratulations, you have just committed fraud, which is something we do not condone here on r/dividends. + +Your income and lifestyle should be sufficient to fund your investment needs. While I understand the frustration that can come with being a student with 0 disposable income, being a student is actually the best possible reason **not** to have a five-figure unsecured debt load. As someone with a degree in Management and a career in the field, I can tell you that many employers conduct background and credit checks on prospective employees (though credit checks on employees are illegal in certain states). A $20,000 personal loan made by a 20 year old raises a lot of red flags, and while it could signal personal illness or medical debt, it could signal a gambling problem. When you tell them you used the money to buy stocks, they will immediately assume gambling problem. Good things come to those who wait. + +**Part X: Brokerages and celebrity portfolios** + +If you came to this post or subreddit looking for nothing but a brokerage recommendation, I recommend you look elsewhere. While my wife and I personally use M1 Finance, and I do recommend it to friends and family, I have no idea who is reading this post. I know only what information Reddit gives me as a moderator, so I will say that for the love of whatever you believe in do not choose a brokerage just because some internet personality, or some random person on Reddit told you about it. Brokerages are not interchangeable, and they offer wildly different features and benefits. I like M1 because of the ability to form pies. [This for example is my personal portfolio](https://m1.finance/-1-XJi1meO28). I enjoy what I enjoy about M1, and what it is able to offer me and my family. Your situation is (likely) different. This is also the reason we explicitly ban referral links on r/dividends. The only recommendation I will issue is do not invest with Robinhood. Other than that, go nuts. + +**Part XI: Beyond dividends, and knowing when not to invest.** + +Equally important to the skills of investing are the skills of knowing when not to invest. If you have credit card debt, pay that off first, and make sure to pay 100% of your balance every month. If you do not have an emergency fund, create one. It should consist of roughly six months worth of expenses. If you lack a financial plan or budget, create one. My wife and I use [Mint.com](https://Mint.com) for our budget. We sync it with our cards, and everything comes out perfectly. I highly recommend it. + +**Part XII: Seeking feedback** + +Saving and investing can become an addiction, so it is important to know when to moderate it. Having a third party provide additional input or opinions on your decisions can work wonders. If you have a significant other or a best friend, I would recommend getting them into the investing mindset, if they are not already. Having a trusted voice to bounce ideas off can lead to not only financial reward, but emotional and intellectual growth. + +Since I took over this subreddit in August 2020, I have strived to create that environment here. It is from this base framework that I am hoping future discussions in this community can branch from. If you are just joining us, or have been with this community for years, I thank you for joining us on r/dividends. + +Happy investing, + +u/Firstclass30 + +\[This post was inspired by an article in Charles Schwab's Spring 2021 Investment magazine. The article was titled *"Rx for what ails you. Dividend-paying stocks could be just what the doctor ordered."* The research it presented served as the inspiration and backbone of the first half of this piece. Other works found through my own research constituted the majority of the factual content of this piece. The majority of this post's contents are my personal opinions, and should not be taken as financial advice. Invest at your own risk. Recommendation or mention of a security or service does not constitute an endorsement. I received no compensation from any individual or group for writing this post.\] + +\[The first draft of this post was over 50,000 characters long, and exceeded Reddit's character limit by more than 25%. For the sake of brevity and my own sense of perfectionism, this post's length was cut in half. As of original publication it contains over 4,100 words, with over 26,000 characters.\] + +Edit: This piece was originally written in Microsoft Word, and copied over to Reddit. A few formatting errors slipped through by mistake, and those were corrected after publication. +Edit: Please ignore my claim that the UK provides long term income data at the percentile level- I misspoke (aka was stupid and wrong) and the closest I can find to this now is annual income by decile. Apologies for any issues/trouble. + +&#x200B; + +I am a political science grad and one of the things that has been bugging me for the years now is why it is so hard to find long-term data on income over time for individuals. I live in the UK, and it is possible to view income over time by percentile (and therefore see, for example how the income level of the 10th percentile has changed year on year), but I have been completely unable to find any source of data detailing the yearly or quarterly changes of income for individuals over any extended period of time. + +&#x200B; + +This was not core to my degree, or the work I do now, but I have a genuine curiosity about a) what the financial history of individuals in this country (and many others) look like (how many trend up, how many trend down, to what extent, and in what distribution etc) and b) whether there is any connection between, for example, upwards or downwards trending personal financial history and political orientation, levels of political engagement, etc. I feel like it would be a useful way of collecting and consolidating data, but it also does not seem to be done, so I just wondered why that was. I understand that privacy would be a major concern, and that ethical considerations of data use would be important, but if these concerns can be addressed, would this not be something economists would find useful? PoliSci nerds definitely would. + +&#x200B; + +P.S. If the issue is a logistical one, why is that the case? I understand that it might be tricky to survey large numbers of people independently, and unlikely that all of them would even reliably report back yearly income from far in the past, but wouldn't tax returns serve as a valuable source of info? +So I was out with few work people not friends. Came time to pay the bill. And somehow this loud lady in the group decided on a 15% tip. + +I said hold on… this isn’t US and I don’t support tipping at all. I hate everything it stands for, its origins and what it represents. And we got into this argument about how servers do it tough etc etc. In the end some people tipped and some including me didn’t. I probably won’t be asked to go on this work shit again, which to me is a positive but I am wondering if I should have just shut my mouth. What are your thoughts? +From broken supply chains (such as China shutting down Shanghai to combat Covid-19, and those that are still broken from the pandemic), labor shortages (almost 3 million Boomers retiring early last year with declining world wide birth rates creating fewer workers and more retirees), the war in Ukraine (taking Russian oil off the market and crippling Ukrainian wheat production), climate change (we lost half our winter wheat crop to the worst drought in 1,200 years).... + +President Biden's $1.9 trillion American Rescue Plan. Massive federal spending packages to provide relief from COVID began under President Trump and initially had bipartisan support. Republicans argue that "exorbitant handouts" from the federal government, including a $300 weekly federal pandemic unemployment benefit, also have contributed to the labor shortage and rise in inflation. + +But those unemployment payments, which ended nationally in September, appear to have had limited impact on labor market participation. The mostly Republican-led states that blocked the payments added jobs in August at less than half the pace of other states that allowed the payments to flow. + +I'm not seeing any of this as Biden's fault. +Hi all, + +I see more and more people talking about the idea of working 4 days per week, so let's say world leaders agreed to move to a new kind of society where everybody would now work only 4 days, what would happen? + +In a way, I guess we could expect the world economy to slow down because less work = less wealth, but at the same time companies could hire more people (one full time and one half time for example). I find it hard to imagine the outcome of this new paradigm and all the consequences. + +Do you have any article or main thoughts about what would happen? +I've seen endless posts today asking "why is this stock down" "how do you deal with the dips"? If this is freaking you out, maybe lessen your exposure to equities, especially individual stocks. +Retail investment is at an all time high, interest rates are nil, we have a pandemic going on while valuations are at all time highs. +If a 2% dip in indexes freak you out, please learn more about the markets before investing your money. +**Preamble:** Jim Cramer is definitely a controversial figure. While argument can be made on whether he is on the side of retail investors or not, what I really wanted to know was how his stock picks are performing. Surprisingly, there were no trackers for the performance of Cramer’s pick in his program (his program is Mad Money, for those who are not familiar). + +**Where the data is from:** [here](https://madmoney.thestreet.com/screener/index.cfm). All the 19,201 stock picks made by Cramer are listed here. His stock picks are updated here daily. While Cramer mentions a lot of stocks in his program, I only considered the stocks that Cramer specifically recommended that you should buy or sell. (I have ignored the stocks where Cramer says he likes/dislikes the stock since I felt that it’s a vague statement and cannot be considered as a buy/sell recommendation). + +**Analysis:** There were 725 buy/sell recommendations made by Cramer in 2021. Out of this, 651 were Buy and 74 were Sell. For both sets, I calculated the stock price change across four periods. + +a. One Day + +b. One Week + +c. One Month + +d. Price Change till date + +I also checked what percentage of Cramer’s calls were right across different time periods. + +**Results:** + +https://preview.redd.it/ktjt7wrufyt61.png?width=624&format=png&auto=webp&s=dbdda542c6a5c020ed1032748b4183ac18d0aa6a + + Cramer made a total of 651 buy recommendations over the course of the past 4 months. If you had invested in every single stock, he recommended and then pulled out the next day, the returns were a staggering 555%. He was also right on 58.9% of the calls he made (Benchmark being 50% since anyone can pick a random stock and the probability of the stock going up is 50%). The weekly performance returns are also a respectable 42% but he was barely touching 50% in the percentage of right picks. One month from his recommendations, the stock return is an abysmal -223% and he was wrong more than he was right on his calls. The returns till date are also phenomenal with 446% return and Cramer being right a whopping 63.6% in his stock picks. + +&#x200B; + +https://preview.redd.it/9mtba8dwfyt61.png?width=607&format=png&auto=webp&s=eac79139dc2fe56db352c3fc3d7bb46650e37d24 + +Cramer’s sell recommendations performed better than his buy recommendations across different time periods. This stat is particularly commendable since we were in a predominantly bull market across the last 4 months. 57.5% of the stocks he recommended as a sell dropped in price the next day with a cumulative return of -118.9%. This trend is observed across the time period with returns for the sell recommendations being negative. The only statistic that is working against Cramer’s sell recommendation is the percentage of right picks till date being only 42%. But still, the cumulative return for all the stocks was -206%. Please note that Cramer made only 74 sell recommendations against a whopping 651 buy recommendations during the same period of time. + +**Limitations of the analysis** + +The above analysis is far from perfect and has multiple limitations. First, Cramer has made a total of 19K recommendations in his program. I have only analyzed his 2021 recommendations. The site which provides the data is extremely limited in terms of how we can access the data. Also, currently, the data is pulled from street.com which was earlier owned by Cramer. They update the data every day after the show, but I could not verify if they go back and change the calls down the line (very unlikely with it being a large business). Also, for the return calculations, I have only used the closing price of the stock across the time periods. The returns can theoretically be higher if you consider the intra-day highs and lows. + +**Conclusion** + +No matter how we feel about Cramer, the one-day returns on both his buy and sell recommendations have been phenomenal. I started the analysis thinking that the returns would be mediocre at best as there were no trackers actively tracking the returns from his calls. But the data points otherwise. It seems that there is a lot of scope for short-term plays based on Cramer’s recommendation. Let me know what you think! + +Google Sheet link containing all the recommendations and analysis: [here](https://docs.google.com/spreadsheets/d/1ah4JvEMIlGopn-zOjNwB8iWCUO4r-W5FV19oX_tM9oQ/edit?usp=sharing) + +*Disclaimer: I am not a financial advisor and in no way related to Cramer or the Mad Money show.* +Welcome to the ETH Daily Discussion thread of /r/EthTrader. + +*** + +The thread guidelines are as follows: + +- All sub rules apply here. Please review our **[rules page](https://www.reddit.com/r/ethtrader/about/rules)** to become familiar with them. The rules page is also linked in the announcement bar above. +- General discussion topics include, but are not limited to, events of the day, technical analysis, alternative Ethereum projects, or support issues. +- Breaking news or other important content should be submitted as a separate post. +- In-depth altcoin discussions should be referred to the /r/CryptoCurrency discussion thread. To view the thread, [follow this link](https://www.reddit.com/r/CryptoCurrency/search?q=%5BMonthly+General+Discussion%5D&restrict_sr=on&sort=new&t=all) and choose the latest entry on the search page. +- Pumping, venting, trolling, or any other similar behavior **should be reported** and redirected to the /r/CryptoMarkets trollbox thread. To visit this thread, [follow this link](https://www.reddit.com/r/CryptoMarkets/search?q=Trollbox+Thread&sort=new&restrict_sr=on&t=all) and choose the latest entry on the search page. + +*** + +* For newcomers who have basic questions about Ethereum, you can find answers by visiting /r/EthereumNoobies or our [Ethereum Education wiki page](http://bit.ly/2rMAXmq). + +* **[EXPERIMENTAL]** - To view live streaming comments for this thread, [click here](https://reddit-stream.com/comments/auto). Account permissions are required to post comments through Reddit-Stream.com. + +*** + +Thank you in advance for your participation. Enjoy! + +Bit of cheeky one. + +Its 2002, I was 13 years old and was offering a underground Payday loan service at my boarding school. I funded the business with a weekend dishwashing job at a nearby restaurant. + +Typically it was small change, $5 here $10 there. I would charge a flat 20% fee rounded up to nearest dollar. I would make around ~$20 a week in fees. + +There was one *customer* who was notoriously late on payment. I was cool with it at first but after some time I got fed up and wanted to deter her from coming back. + +All previous loans were on a handshake, but when she came to me I explained late payments were not tolerated anymore and if she wanted my services she would have to sign a contract. + +Yes, 13 year old me wrote out a contract for a financial loan and because it was a short term loan the interest listed was 10% per week compounding weekly. The loan was for $10. + +She was used to the flat 20% and saw the 10% as an attractive offer all the while not really understanding the compounding factor. + +I estimated the repayment to be about 4 weeks, which would total about $4.60 in interest, rounding up to $15 total repayment. Figured that would sting her and make her be more prudent in the future. + +Well, fast forward a month, the holidays happen, I shift to a new school, the loan is unpaid and forgotten about. + +20 years later that loan is still unpaid. The interest is still accumulating, compounding weekly at 10%. + +As of now I am roughly owed $111,787,325,172,283,990,000,000,000,000,000,000,000,000,000.00 + +I am considering legal action. +I recently watched an interview with Ray Dalio and Grantham. ([https://youtu.be/peCAzmkC5o4](https://youtu.be/peCAzmkC5o4)) + +They said the bigger the bubble the deeper the depression. This bubble is bigger than 2000-2008 or 1929. Like the saying goes no pain no gain. So expect a lot of pain in the very near future and a lot of gain after the market crashes to the bottom and goes to the next record-breaking High. Eventually expect the feds to introduce qe4 after their failed stimulus packages, never ending money printing policy, interest rates hikes and broken economy. Expect a lot of pain with inflation it will continue for a very long time. Hopefully the average American household income will raise to meet the inflation bubble. +I always either close too early limiting my profits or enter too early and be stopped out before the trade takes off. Is it FOMO? Any tips to help FOMO? I only load up $100 or less to trade with but my lots are always 0.10. When I had a $1000 account I was profitable but I haven’t seen that success since, do I need to just keep more money in my account? I’ve tried the different strategies but naked trading has always worked best for me. +[Why some Americans struggle even with higher incomes](https://www.npr.org/2020/12/16/941292021/paycheck-to-paycheck-nation-how-life-in-america-adds-up) \- NPR + +This is a great article about people who are making a decent income but still struggle to pay bills. My question is this: + +Can everyone, or at least most people, live within their means? Or is the cost of living just too high no matter if you're lower income or middle income? + +Survey after survey shows that most Americans live paycheck to paycheck, which always astonished me given America is supposedly one of the wealthiest nations in the world. + +In the linked article, there are actual people's budgets. They have a solid income, but still struggle. Of course they need a phone, but do they need to pay for the new iPhone? Would financial literacy help more people to make more informed decisions about budgeting? Or do we live in such a consumer society that keeping up with the Jones's is worth it to plunge into unnecessary debt? + + I'm really curious to know what some people think. +Me and my husband are both EU citizens. We moved to Canada a few years ago, but are thinking of moving again. We are considering a move to an EU country. + +We are both I.T professionals, and are hoping it wouldn't be too difficult to find a job in this industry. We earn good income in Toronto, but are considering moving due to a few reasons (high income earners are heavily taxed, winters are brutal, only 15 yearly vacation days, buying property is expensive, Canadian dollar value is weak). + +Where would you suggest moving to for the best quality of life and financial stability? We have considered The Netherlands and Portugal - but are open to moving to any country. + +(We are English-speaking, any country you would suggest avoiding due to language barriers having an impact on quality of life?) +This has been a crazy ride. Wow. I can't even begin to explain but I will try to. + +It started a little less than a year ago when I heard a candidate at work tell me about Ethereum and how it was going to change the world. On a whim I took out a medium sized loan from my 401k and invested it into ETH. + + In that time I have invested in ICO's, and other Alt coins like IOTA. I even ran Crypto Currency Slack group for a while. I became a household name under another screen name that was notorious for the amount of IOTA and ETH I held. + +Today me and my wife got married. I sold off my Ethereum, Dragonchain, Iota, Golem, and Substratum. I am now set for life and crying a bit while typing this. + +It is so bitter sweet. Everyone here can reach their moon. It is possible. Believe in the technology. I know I do, just at this time in my life, I would rather have the tangible money. I was able to pay off our cars, our house, the student loans and set up a trust fund for my future children. + +I am speechless. HODL. Hold on to dear fucking life, and know that the future of ETH is brighter than the light from a thousand suns. + +Peace out nerds. +https://www.sfgate.com/business/article/LinkedIn-laying-off-nearly-1-000-amid-hiring-15422429.php + +Interesting timing here, releasing 'bad' news ahead of earnings can sometimes be an indicator that a miss is coming and this could appease the markets some. + +That may be reading too much into the tea leaves though. +So I woke up this morning, drinking coffee, look at my etrade account, spit out my coffee. Somehow my account value increased by more than a factor of 10 overnight (cuz I was lookin at it yesterday). Upon closer inspection I noticed I had a fuckload of SPY shares. There is nothing in my transaction history to reflect this besides a couple shares I bought back in May. + +WTF is going on? + +A) Is this a fluke? +B) If so will this just be corrected on monday? +C) If not corrected, do I have to report this, or would I be getting myself in trouble if i just sold that on monday? +D) Did some secret wealthy friend of mine just gift me this? I feel like such a thing would still be reflected on my transaction history. + +Thanks +So I dropped 100$ a few years back in TQQQ just to play around. I never understood how they make you "loose" money if you hold for at least 5 years, with the exception of volatility. + +So this $100 is about $600 now and yes at one point I lost my entire 100, but it bounced back a few months later just like the market. So I have about $600 so, I now with a crash or bearish market, that $600 will easily become 100 again or below, but like any crash, I could have bought the lows as well and come back with more. + +So I am confused on how leveraged ETFs make you loose money with the exception of volatility? I mean, does the ETF can magically disappear and delist? is that what they mean? In that case, its just like any ETF that can delist. during covid, I hit negative number on TQQQ for a short time, but it never delisted. my share was still there. So can someone elaborate on how you lose money that DOES NOT include volatility from the market? + +&#x200B; + +Here is an example a site gave + +&#x200B; + +> The ProShares Ultra S&P 500 ([SSO](https://www.investopedia.com/markets/quote?tvwidgetsymbol=sso)) is an ETF designed to return twice the [S&P 500](https://www.investopedia.com/terms/s/sp500.asp). If the S&P 500 returns 1%, the SSO should return about 2%. But let's look at an actual example. During the first half of 2009, the S&P 500 rose about 1.8%. If the SSO had worked, you would expect a 3.6% return. In reality, the SSO went down from $26.27 to $26.14. Instead of returning 3.6%, the ETF was essentially flat. + +&#x200B; + +OK, well wouldnt you get your money back 10 years later with even more? +Upper year Econ major here. I’ve been massively disappointed by most my courses at Uni. They’ve all been so math heavy, not that I hate math (quite the contrary), but it’s always followed by the caveat from the professor that we don’t actually know what any of these values are in real life. So what’s the point of us doing 2 hours of homework solving it then??? + +I understanding the utility of mathematical models in validating assumptions and discovering blind spots in our thinking, etc. but why does this mean my learning has to consist of hours of doing calculus with made up values. I fail to see the value. Are these just badly taught courses or is this just what Economics is like? Apart from making the subject matter incredibly boring, I also fail to see the merit of it. + +I apologize if this comes off as ignorant, I just feel like I’m losing my mind doing this mind numbing work on a subject I was once deeply interested in. +Context: + +* Introduction ([https://www.reddit.com/r/fatFIRE/comments/pyqf2a/confessions\_of\_a\_hectomillionaire\_part\_1/](https://www.reddit.com/r/fatFIRE/comments/pyqf2a/confessions_of_a_hectomillionaire_part_1/)) + +\------------------------------- + +I was really at the right place at the right time to make the \~$30M windfall at the company IPO. Some of my co-workers argued it was not luck! We worked hard for it. Well my brother is a small business owner and way more hardworking than me. His net worth is nowhere near mine. Attributing this windfall to primarily hard work is just silly. It is true that there are tech executives who jump into late stage startups at just the right time and they could make tens of millions dollars per company if they have good judgment and the right skills. I would call that hard work plus good judgment. But that was not my case. I joined a very risky startup early enough to make the life changing windfall when the company truly took off. But if I looked at the risk/reward expectation of the company today, it was actually not a very good risk. I was lucky. + +There was a 6-month lockup before we could liquidate any of our stock so there’s a bit of time to prepare for it and it’s nerve wrecking seeing the price volatility. That was a decade ago, the stock market was not always up to the right. Earlier in my career, I was in a very unhappy job so I read a lot of FIRE stuff. I was an avid reader of the Retire[ Early Home Page](https://retireearlyhomepage.com/reallife21.html), which has lengthy analysis about SWR. I became quite financially literate because of that lousy job. I already had a vanguard account for a few years at the time of IPO. I had a pretty good idea of how to diversify the company stock from an implementation standpoint. + +I did talk to a handful of FAs. There are advisors from big banks who said they only take clients with $25M+, multi-family offices, index fund shops etc. But they were all trying to charge me 0.5 -1.25% AUM and I had to give them discretion to basically let them do whatever they saw fit. That was like $150K - $375K a year, which I found absurd. Here are some pitch points I heard from them: + +* They will manage this money well for me. I can focus on living and I don’t have to worry about my finances as long as I stick to a budget. They would be a steward of my money and help with big purchases, estate planning and handle friend/family money requests. I can focus on living the best life instead of worrying about mundane things like portfolio construction and risk management. +* They will do quarterly reviews and reporting and help with budgeting, goal setting and generational financial planning. +* They will get me a group of people who are in my situation. We rich people can all hang out with one another and we can learn fancy things like philanthropy or exotic red wines. +* I am a special snowflake and I will feel even more special with their service. I can get them to pay all my bills. They can help me book travel and get tickets to exclusive events. They could basically become my personal postmates, task rabbits and uber combined before those services were even available. +* They are good at money management and they can sell some calls and puts to generate income so I don’t need to worry about the 0.5% AUM. +* They can get me into exclusive private deals and IPOs that I won’t be able to get into myself. + +The first two bullet points are quite valid and can be real value-adds. But I couldn’t fathom paying my FA about one Lamborghini a year for their service. Am I getting a Lambo’s worth from their annual service or would I rather enjoy buying an exotic car each year and manage the money myself? That’s a tough question! One FA was acting like he was my friend and wanted to get to know me and my family. Am I supposed to share my darkest secrets with this guy?! That’s a big ask. Another FA was more gentle and asked about my plan. I told him I was thinking about selling enough to cover my farFIRE expenses and let the rest ride. But then he asked why I wanted to keep speculating on individual stocks. I already had enough and what’s the point of taking extra risks I don’t need? I supposed he had a point but am I being paid by this guy? Why was he lecturing me? In the end, I didn’t click with any of the full-service FAs. I implemented a very simple plan with a DFA advisor that charges a flat annual fee and pretty much manages the money myself. IMO, money management is very important for a FIRE life and the risk of outsourcing my whole financial life was simply too high. One month after the lockup expires, my after tax portfolio looks roughly like: + +* $15M into a DFA portfolio. 65% equity. 30% fixed income. 5% commodities. +* $5M mostly in cash and some other investments/savings prior to IPO (plan for investing into other discretionary and real estate investments) +* $1M real estate equity +* $10M company stock +* $2M into DAF/Foundation + +I did give a big bank a pool of money out of the 5M to manage to try it out. They were pitching me how they could upgrade my regular banking experience such as dropping off foreign currencies when I need to travel, skipping the waiting list to get a deposit box, discounted mortgage rates, etc. I tried them out for about a year. That year the stock market went up for at least 20% but the portfolio big bank managed for me returned a whopping 0.5%. There were tons of buying and selling but in the end it didn’t generate a return for me. I am sure it generated tons of transaction fees for the bank. I pulled out and decided it’s a waste of time talking to FAs. I know how to do it. + +The $15M portfolio generated the income we needed. It was projected to generate a bit more than 2% a year and a good portion of it is from tax-free MUNI. Along with the cash pile we have, our income needs are satisfied. With the cash pile though, the investor in me did have the urge to invest it quickly into productive assets since we have the $15M income producing asset already. I had zero experience but the risk taker in me started making angel investments and becoming small LPs into small VC funds. These alternative investments turned out to work really well with the great software-eating-the-world trend. I just did a quick tally and realized that I have so far plowed in almost $10M into angel investments/VC funds. But the projected unrealized values are between $25-$35M+ and I have got about $4M distributed back to me. Angel investments turn out to be a very viable asset class for the 2010s. Would it continue to perform into the 2020s? I have no idea. But I also believe I am better at investing in early stage companies after seeing plenty of successes and failures. Since I have nothing else better to do, I decided angel investing is going to be a focus. Hopefully, I can generate some future returns. If not, I could see it as an investment into human capital. + +Over the years, we paid off the mortgage of our primary residence (acquired before lockup expiration), bought a beach house and a few rental properties. The company stock was doing really well and we keep diversifying regularly. I wish I was more disciplined but I really was not. I would sell the stock when I thought the price was too high and it only went higher. Or I would try to wait for a higher price and then panic sell when the stock dropped suddenly. I think I am probably only slightly better than an average Robinhood user since I don’t YOLO into options. Based on long term total returns, I suppose we are doing alright. But I am pretty sure if I traded less frequently and just did it on a schedule, my performance would have been higher. The proceeds would go to individual stocks, real estate, angel investments, more index funds we build ourselves on vanguard. As mentioned in the previous post, today my portfolio looks like: + +* Index Funds. (Mix of DFA/Vanguard): $30M +* Concentrated Portfolio (kept some IPO stocks and other speculations including crypto): $45M +* Foundation/DAF: $5M +* Real Estate (incl primary residence, beach house and 4 rentals): $15M +* Private Investments (angel investments + vc funds): $25M - $35M+ + +I am at a point that I am done with real estate. I prefer passive investing and real estate is too operational for me. Sure I have property managers but structures get old and need repair. Some tenants are causing drama. The yield is not great. I also don’t have any mortgage on my properties any more and I dislike debt. Without leverage, real estate doesn’t really generate good returns. I will leave the properties I already have alone but I don’t plan to acquire more. I have constant work going on with my primary and secondary residence, which is a thing for most rich people I know. My mental space reserved for real estate is full and I can't take any extra load. + +My portfolio is currently in maintenance mode. I am basically only selling concentrated portfolios to make more private investments. As mentioned above, I received about $4M back from my private investments already. If I received public stock, they went right back to the concentrated portfolio and can later be liquidated for future investments. I have a nice flywheel going on and I can probably keep doing this until my official retirement. I don’t worry about tax too much. I just pay for it. It's an outrageous amount of money but I need to liquidate the stocks for a purpose. I don’t see any other solutions that are really worth the risk. + +A big drawback of managing money myself is I don’t have a good reporting system. I try to do a snapshot every quarter but I don’t have the discipline to do it religiously, especially when it was a big down quarter like March 2020 or December 2018. It was too depressing to make the report. I also made some stupid mistakes speculating like buying cheap small cap or large value stocks that are going downhill. I made up these stupid mistakes by buying into BTC and ETH early. Overall, my speculation is doing well. But it’s kind of a waste of time given these trades were less than 5% of my overall portfolio. I could have used that time making reddit posts but I chose to speculate on stupid stocks. That was a missed opportunity and a regrettable life decision. I don’t really trade individual stocks any more. I still need to liquidate my holdings regularly as mentioned but the mental energy spent on trading individual stocks could have been spent more wisely. + +Remember that FA who told me I should sell all my company stock because it’s not worth the risk? I understand his point but I found the logic incomplete. If a client walks in with $300M concentrated stock, is this FA also going to sell all the stock and diversify into a 50/50 portfolio? How much index fund does a person need? Another school of thought is “Ask yourself, if you are starting from cash, how much company stock would you buy?”, which ignores the path dependency nature of the stock diversification and tax considerations. My philosophy is that one should take the maximum amount of risk they could on their risk capital. Risk capital is defined as money one doesn’t need and of course, the risk one takes should be right on the efficient frontier. Translating what I just said into plain English is that I believe $15M is all my family and I need to live a good life and I can use the rest to make smart bets to optimize my return. + +My plan works well for the 2010s. I was deep into tech investments and I kept my cash level now. But if I implemented a similar plan in 2000 at the height of the internet bubble, my portfolio performance wouldn’t look good. According to the [Retire Early Home Page](https://retireearlyhomepage.com/reallife21.html) report, if I retired at the beginning of 2000 with a 60/40 portfolio and 4% portfolio withdrawal rate, at the end of 2010, my portfolio would have been 80% of my original investment. My tech investments would have been in deep sh\*t and dropped at least 50%. If I do a quick back of envelope calculation, my portfolio would have become $15M\*0.8 + $15M\*0.5 + real estate equity =\~ $20M after 10 years, a ⅓ drop. But I think I could live with that. Of course my timing turns out to be great but my general point is that only risking the risk capital is the key to uncertainties and opportunities we are facing. + +It’s probably not surprising to you that I am not a big spender. I am more of a saver and optimizer. We will talk about spending and expenses in the next post but we are able to stick to our budget really well and never spend over budget in the past decade. We did buy all the toys we wanted in the first few years and went on expensive vacations. But we stick to a generous budget and overtime, our spending actually goes down because novelty does wear off. Once I knew what it feels like to be on a private jet, I just don’t feel like taking it again because you know I could buy a Submariner if I am willing to cram into a commercial flight for a few hours. Since I have lounge access, it’s really not that bad flying commercial. + +The last thing I want to point out is that please don’t confuse consumption with investments. Investing in films, restaurants, wineries, art galleries or hospitality industry in general is not \*investing\*. If you are \*investing\* in something for bragging rights, it’s a consumption decision. There’s nothing wrong with that and I have done a couple of those. But I classify them into the expense categories and I think my watches are probably generating better returns than these as a whole. My investments are generally long term boring holdings that grow well YoY with high margins. I do make some \*impact\* investments that are supposedly to be long term sustainable businesses and may or may not deliver returns. I classify them as investments as of now but I might make them from my DAF in the future. + +I focus this post on the technical aspect of what I do with my portfolio. There’s also a psychological and philosophical part of it. Things like why I do what I do and why I take the risks I take. These are deep personal questions. I was trained to always improve what I was doing as a student and a corporate employee. Naturally I do the same thing for money management. Eventually I have to think beyond growing the portfolio but I am not there yet. I spent a good amount of time and energy on non-profits/philanthropy but as mentioned in my previous posts, I was not a fan. If my early stage investments go bust like what happened in 2000-2002, then I don’t have to worry about any of these any more. But if things go well, I will need to proactively make some changes. I don’t have answers to everything. I am a mere-mortal and I am constantly learning and adapting. + +\------------- + +Next week I will post about Expenses and Living with No Financial Constraints +Bit of cheeky one. + +Its 2002, I was 13 years old and was offering a underground Payday loan service at my boarding school. I funded the business with a weekend dishwashing job at a nearby restaurant. + +Typically it was small change, $5 here $10 there. I would charge a flat 20% fee rounded up to nearest dollar. I would make around ~$20 a week in fees. + +There was one *customer* who was notoriously late on payment. I was cool with it at first but after some time I got fed up and wanted to deter her from coming back. + +All previous loans were on a handshake, but when she came to me I explained late payments were not tolerated anymore and if she wanted my services she would have to sign a contract. + +Yes, 13 year old me wrote out a contract for a financial loan and because it was a short term loan the interest listed was 10% per week compounding weekly. The loan was for $10. + +She was used to the flat 20% and saw the 10% as an attractive offer all the while not really understanding the compounding factor. + +I estimated the repayment to be about 4 weeks, which would total about $4.60 in interest, rounding up to $15 total repayment. Figured that would sting her and make her be more prudent in the future. + +Well, fast forward a month, the holidays happen, I shift to a new school, the loan is unpaid and forgotten about. + +20 years later that loan is still unpaid. The interest is still accumulating, compounding weekly at 10%. + +As of now I am roughly owed $111,787,325,172,283,990,000,000,000,000,000,000,000,000,000.00 + +I am considering legal action. +Hello fellow traders - well, fellow traders isn't true l, considering I no longer am. + +I could tell you how I traded, but I'm sure you know already it was stupid. To make £200k in a year from 50k is pretty amazing - but I now know it was pure luck. + +The only reason I'm making this post is a warning - to keep in mind that if you're being stupid with your trades, you will eventually lose money. + +Just over 3 months ago, I had half a million pounds. Since then, I lost my home, relationship, and mental health. After losing my job due to my depression, I'm now 3 months behind on rent - so will soon be kicked out of this place. I've recently been in a psyc ward due to a suicide attempt. But the thing is, even at the top, It wasn't enough for me. I wanted more and look where it got me? Please, I'm 27 years old and I lived and lost my life in the space of a year - be careful folks + +Please, don't be an idiot with your trades people. I ha +Just launched , Buy now huge potential. Join telegram for more information: [https://t.me/mintyswap](https://t.me/mintyswap) + +&#x200B; + +What is MintyNetwork? 🍃 + +&#x200B; + +The fresh new platform to MINT NFTs and Swap Tokens 🤩 + +* MintySwap is a licensed cross-chain aggregation protocol. We are assembling a community of creators and supporters who want to establish and grow an innovative economy via the Blockchain. Create connections. Become allies. Get involved in the massive creative movement on MintySwap! + +&#x200B; + +&#x200B; + +&#x200B; + +A next level NFT community 👾 + +* We aim to provide consumers access to cryptocurrency-based financial services, allowing them to exchange, or ‘swap’, various digital assets. 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I made a tool called [FD Ranker](https://www.swaggystocks.com/dashboard/stocklabs/fd-ranker) that logs the average IV of some popular stocks. The tool is inclusive of almost 1,000 tickers now. + +**What is this tool good for** + +I often use the theta gang wheel strategy by selling cash secured puts close to at-the-money and I like to see where I can get some bang for my buck. A quick scan of the list will tell me what IV is looking like for certain stocks and when earnings is coming up and whether or not I want to do a weekly theta YOLO for earnings. You can sort by IV, stock price, or Earnings and filter by ticker. + +Here's some of the top tickers from this weekend. Instead of making a full list of tickers ranked by IV, I'll share some of the more common tickers mentioned. + +# High IV Tickers List + +\*Some of the market cap data is off, so always double check before entering any plays! + +|Ticker|Market Cap|Stock Price|IV (%)| +|:-|:-|:-|:-| +|GME - Gamestop|12.7B|$178.01|255%| +|GSX - Gsx Techedu|5.31B|$36.31|222%| +|SRNE - Sorrento Therap...|2.33B|$8.31|172%| +|SNDL - Sundial Growers...|1.88B|$1.13|162%| +|MARA - Marathon Digita...|3.54B|$35.87|157%| +|APHA - Aphria|5.49B|$17.34|155%| +|RIOT - Riot Blockchain...|3.25B|$48.08|151%| +|RIG - Transocean|2.08B|$3.37|150%| +|AMC - AMC Entertainme...|4.61B|$10.23|150%| +|CODX - Co-Diagnostics ...|275M|$9.73|143%| +|DGLY - Digital Ally|61.7M|$1.66|132%| +|IQ - iQIYI|12.5B|$17.14|125%| +|NNDM - Nano Dimension ...|1.5B|$8.70|124%| +|FUBO - fuboTV|1.48B|$21.84|117%| +|TLRY - Tilray|3.77B|$21.74|113%| +|SOLO - Electrameccanic...|413M|$4.62|111%| +|WKHS - Workhorse|1.69B|$13.34|111%| +|QS - QuantumScape|9.21B|$43.79|110%| +|FCEL - Fuelcell Energy...|4.25B|$13.20|109%| +|BLNK - Blink Charging ...|1.26B|$35.11|106%| +|JMIA - Jumia|3.05B|$34.26|102%| +|BB - BlackBerry|5.41B|$9.57|102%| +|CCIV - Churchill Capit...|4.76B|$22.99|101%| +|ARCT - Arcturus Therap...|1.06B|$40.40|99%| +|ACB - Aurora Cannabis...|1.8B|$9.11|97%| +|GRWG - GrowGeneration ...|1.62B|$43.86|94%| +|MSTR - Microstrategy|5.73B|$618.40|91%| +|OSTK - Overstock.com|2.79B|$65.04|91%| +|LAZR - Luminar|5.4B|$24.68|89%| +|PLUG - Plug Power|15.9B|$33.78|89%| +|NIO - NIO|56.3B|$35.62|89%| +|APPS - Digital Turbine...|6.72B|$75.11|88%| +|SNAP - Snap|76.9B|$51.29|87%| +|SPCE - Virgin Galactic...|7.01B|$29.28|86%| +|CLOV - Clover Health I...|3.34B|$7.58|83%| +|XPEV - XPeng|15.6B|$32.11|83%| +|AI - C3.ai|6.27B|$64.31|82%| +|X - United States S...|6.1B|$22.44|82%| +|LMND - Lemonade|5.3B|$86.54|81%| +|HYLN - Hyliion|1.89B|$11.12|81%| +|ENPH - Enphase Energy ...|19.4B|$150.48|80%| +|PENN - Penn National |16.5B|$105.55|80%| +|CRON - Cronos|3.33B|$9.24|79%| +|APXT - Apex|411M|$11.49|78%| +|DB - Deutsche Bank A...|25.4B|$12.30|78%| +|BIDU - Baidu|70.4B|$202.14|78%| +|NKLA - Nikola|5.51B|$14.05|78%| +|FOXA - Fox|21.7B|$37.51|77%| +|RKT - Rocket Companie...|2.76B|$23.96|77%| +|CHWY - Chewy|30.9B|$77.67|76%| +|FSLY - Fastly|6.83B|$65.53|76%| +|BBBY - Bed, Bath & Bey...|3.53B|$29.16|75%| +|FVRR - Fiverr|7.2B|$200.84|74%| +|PRPL - Purple Innovati...|2.02B|$30.44|74%| +|HUYA - HUYA|4.83B|$20.50|74%| +|CRSR - Corsair Gaming |2.91B|$31.67|73%| +|UPWK - Upwork|5.49B|$43.50|73%| +|TSLA - Tesla|594B|$613.83|73%| +|M - Macy\`s|5.08B|$16.37|71%| +|HOME - At Home|1.84B|$28.13|70%| +|CRSP - CRISPR Therapeu...|8.32B|$110.24|70%| +|PSTH - Pershing Square...|4.87B|$24.34|70%| +|SEDG - Solaredge|14.1B|$273.84|69%| +|SFIX - Stitch Fix|3.29B|$48.33|69%| +|PLTR - Palantir|39.3B|$22.45|67%| +|CNK - Cinemark|2.42B|$20.42|67%| +|FROG - JFrog|4.17B|$45.21|67%| +|DASH - DoorDash|42.4B|$133.40|66%| +|LL - Lumber Liquidat...|744M|$25.74|65%| +|CCL - Carnival|28.6B|$25.95|65%| +|CGC - Canopy Growth|12.2B|$32.01|65%| +|FEYE - FireEye|4.67B|$19.58|64%| +|MRNA - Moderna|53B|$132.29|64%| +|DKNG - DraftKings|25.3B|$63.36|64%| +|PTON - Peloton Interac...|28B|$105.86|63%| +|ROKU - Roku|38.9B|$305.68|63%| +|SAVE - Spirit Airlines...|3.6B|$36.77|62%| +|NCLH - Norwegian Cruis...|5.73B|$26.68|62%| +|CVNA - Carvana Co. -|11.9B|$255.30|62%| +|CREE - Cree,|11.8B|$106.19|62%| +|PINS - Pinterest|42.7B|$68.43|61%| +|U - Unity Software ...|26.3B|$94.15|60%| +|OXY - Occidental Petr...|25.6B|$27.49|60%| +|AAL - American Airlin...|14.6B|$22.79|60%| +|TWTR - Twitter|48.4B|$60.45|60%| +|COTY - Coty|6.67B|$8.70|59%| +|ETSY - Etsy|25.2B|$199.76|59%| +|TAN - Invesco Capital...|3.24B|$87.09|59%| +|ABNB - Airbnb|105B|$174.42|58%| +|W - Wayfair|26.3B|$341.87|58%| +|Z - Zillow|30.1B|$124.67|57%| +|EAT - Brinker Interna...|3.32B|$73.07|57%| +|TDOC - Teladoc Health ...|26.8B|$174.68|57%| +|RCL - Royal Caribbean...|21.4B|$84.09|56%| +|NET - Cloudflare|20.6B|$67.13|56%| +|SE - Sea|90.8B|$208.05|56%| +|DDOG - Datadog|17.7B|$79.88|55%| +|TTD - Trade Desk|28.4B|$665.14|55%| +|TWLO - Twilio|51.1B|$316.41|54%| +|UAL - United Airlines...|18B|$56.31|54%| +|CHGG - Chegg|11B|$85.09|54%| +|ARKK - ARK Investment ...|21.8B|$112.98|54%| +|CRWD - Crowdstrike|34.5B|$176.49|53%| +|NOK - Nokia|23B|$4.04|53%| +|CZR - Caesars Enterta...|18.3B|$87.63|53%| +|SQ - Square|90.1B|$212.03|53%| +|SNOW - Snowflake|66.2B|$232.92|52%| +|WORK - Slack|20.2B|$40.22|52%| +|ZM - Zoom Video Comm...|91.5B|$315.68|51%| +|SHAK - Shake Shack|4.45B|$114.00|51%| +|TEVA - Teva- Pharmaceu...|12.6B|$11.50|51%| +|SHOP - Shopify|128B|$1070.00|51%| +|LYFT - Lyft|20.6B|$64.39|51%| +|BYND - Beyond Meat|8.12B|$129.01|51%| +|HAL - Halliburton Co....|19.3B|$21.66|50%| +|MGM - MGM Resorts Int...|18.6B|$37.51|50%| +|BIG - Big Lots|2.59B|$69.84|50%| +THERE IS NO FUCKING THING AS VOTING ON THE RULE, PERIOD. DO NOT comment. Here is how these rules work by someone that has over 40 years of writing, reviewing, government regulations and rules. + +&#x200B; + +1. A kid sits down and writes a rule, he gets it approved by the boss and then it goes to a committee who shits all over it. +2. Kid gets it back, incorporates the comments, and again the review process. +3. Finally it passes all the bosses and attorneys and it is published for official comment. + +Now there are two roads. 1. A group of stupid idiots decide that they are "voting" and send a bunch of comments, in fact they flood the board with comments. LEGALLY the DTCC MUST go back and read every fucking suggestion and then they must all be considered. Those comments have to go back through steps 1-3 again, only longer because there are various hurdles and objections. You are talking added weeks. Then and only then after every attorney and boss in the DTCC have signed off on the new and approved draft, and everybody is happy they covered their ass again, it goes out for comment. Then another bunch of apes floods the comment section wither suggestions. and the process is repeated again and again. Months and years here people + +&#x200B; + +\-or\_ + +&#x200B; + +No comment on the rule and we put it in place. Period. So stop your stupid comments and thinking you are able to "Vote" Yes the rule is good, I have no comment, so put it into place Now. Thats what not commenting will do. Just leave it alone to get it put into action faster +They'll come on here, talk about some dividend stocks, and then say "but I can get better total return with X stock" + +(X stock pays almost no dividend, or doesn't pay at all. It's a growth stock.) + +Dividend investing is a DEFENSIVE strategy. If you think the current bull market is going to last forever. If you foresee uninterrupted growth into the infinite future, there is absolutely zero reason to focus on dividend investing. You'll get better returns just buying high multiple growth stocks. They will completely own the dividend payers. + +Dividend investing is for people looking at the market with a skeptical eye, as well as for those closer to retirement, who aren't willing to bet all their money on a stock that might tank and stay down for years or decades. Dividend investing is for people who see a bear or flat market ahead after a historic bull run. + +If you're in your 20s or early 30s with decades of investing ahead of you. You really ought not to worry about dividends. Just go 100% growth equities and DCA for the next 20 years. You'll do great. Just don't buy crypto, unless you're into momentum trading and are good at it. LOL + +Maybe next time I'll talk about the shortsightedness of "Dividend Growth" investing versus just buying stocks that pay solid and safe yields. +According to Bloomberg, FTX US donated to a super-PAC battling for Senate control in the midterm elections only days before the company’s demise. + +Crypto companies have **become a big participant in the** **2022** **election** **season**, with industry players giving **$84.1 million** **until** **mid-October as Congress considers laws regulating digital currencies**. + +However, the majority of that money, **84% ($70 million)**, came from Bankman-Fried and other FTX executives. House and Senate committees have scheduled hearings on the firm’s demise for next month, with **Bankman-Fried** as a possible witness. + +The **Senate Leadership Fund**, which is aligned with Senate Republican Leader **Mitch** **McConnell** and was the top spender in the 2022 midterms, received the **$1 million donation on Octorber 27**, according to its most recent filing with the **Federal Election Commission**. + +The contributor listed on the **FEC** donation report is **West Realm Shires Services Inc.,** and **FTX US** is its commercial name. + +FTX US also gave **$750,000** to the **Congressional Leadership Fund** and **$150,000** to the **American Patriots PAC**, both of which supported House Republican candidates. It gave **$100,000** to the **Alabama Conservatives Fund**, which backed \*\*Republican Katie Britt’\*\*s successful run for the state’s open Senate seat. + +Individual executives at the broader FTX company have given far more money. **Bankman-Fried** emerged as a major donor to Democratic candidates leading up to the **November 8** midterm elections, donating most of the **$39.4 million** that he gave to them, **FEC** records show. One of his top lieutenants, **Ryan** **Salame**, gave **$23.6 million** – mostly to Republicans. + +XRP lawyer **John Deaton** stated that FTX could approach those who received funds from it **90 days before it filed for bankruptcy**. This could mean that all political beneficiaries of SBF could face preference claims. + +While several members of Congress, including Illinois Senator **Richard Durbin**, a Democrat, and Republican Representative **Kevin Hern** of Oklahoma have said they would return donations from FTX executives or give the money to charities, there isn’t a requirement in election law for committees to return donations to companies that go bankrupt. + +Source: [https://news.coincu.com/146765-ftx-us-donated-70-million](https://news.coincu.com/146765-ftx-us-donated-70-million/) +I've seen endless posts today asking "why is this stock down" "how do you deal with the dips"? If this is freaking you out, maybe lessen your exposure to equities, especially individual stocks. +Retail investment is at an all time high, interest rates are nil, we have a pandemic going on while valuations are at all time highs. +If a 2% dip in indexes freak you out, please learn more about the markets before investing your money. +Thanks to u/NostraSkolMus for the post. + +What do I need to download/access/get onto to just start making a portion of my savings I’m willing to lose work for me? + +I don’t need to be a multimillionaire but would like to be able to afford a house one day? + +People talk about interest rates cooling down the housing market and causing the prices to drop due to reducing demand, eventually making them more affordable to some extent since a downpayment will be easier to save for. + +The part that confuses me is: what’s stopping highly wealthy corporations and investors who pay all cash from taking advantage of the crash and buying these homes at a discounted price? The high interest rates don’t really affect them since they won’t need to pay a mortgage. So then they would be limiting the supply of homes available for sale and driving up the prices even more, which forces more people to rent and also increases the prices on that side due to high demand. Win-win for them, loss for everyone else. + +Is there more to it than what I think? What prevents this from happening and why didn’t it happen on a larger scale back when interest rates were high and house prices were low? (Especially in the 80’s) + +Technically they do still do it, but nowhere near the same massive scale I figured it would be, otherwise there would be virtually no supply at all and prices would still be rising even with the interest rates. +I'm scared of this economy being built on paper money with companies being valued at insane multiples and countries being overloaded with national debts. Meanwhile governments are printing money as a stimulus at the cost of inflation and flooding the market with excess of devalued currencies. + +An average Canadian can't leverage debt so it throws money into the equity market hoping to luck out, instead of spending the money and circulating it back into the economy. The government is making policy choices that make jobs disappear and every sector other than tech is getting decimated and falling behind in times. + +I sense some form of major correction due, especially with money being thrown at tech and real estate particularly. A lot of people will bleed when the market re-balances. Just like in 2018. No way this economy holds up, surely we must be skating on thin ice. +[I was reading an article on Huffpost.com today, and here's a screenshot](https://imgur.com/a/YZguUQu). + +When [I check out statista.com](https://www.statista.com/statistics/192356/number-of-full-time-employees-in-the-usa-since-1990/#:~:text=This%20statistic%20shows%20the%20not,on%20a%20full%2Dtime%20basis.&text=The%20number%20of%20full%2Dtime,20%20million%20people%20since%201991.), they show that we have 130.6M employees, and if 44M have filed for Unemployment benefits, this means that the unemployment rate is 33.7%. + +Why is the official Unemployment Rate only around 13%? +Thank you all for the enthusiastic response of my previous post. ([https://www.reddit.com/r/fatFIRE/comments/pxcw4z/for\_people\_with\_100m\_nw\_how\_do\_you\_manage\_your/](https://www.reddit.com/r/fatFIRE/comments/pxcw4z/for_people_with_100m_nw_how_do_you_manage_your/)) It was a good place to share and organize my thoughts anonymously. It is an interesting journey to grow my net worth from scratch to $100M+. But it's not all rainbows and unicorns. I have some real struggles since I had my first windfall. I am no philosopher but it's hard to live with what I have without thinking through some hard questions about life. When you have a goal to reach $10M+ NW for fatFirers, it's pretty straightforward to work hard and to save hard to reach that goal. But if you are at $30M already, what's the point of going for another 3X or for another extra zero? Most people can live a very luxurious life with $300K a year but now I can afford to spending $1M a year, should I go for it? + +&#x200B; + + I am sure this group is filled with strivers who are hardwired to achieve. But what happens afterwards? Do you still work on the same job and keep climbing the ladder? What do you really want to do with your life? Being a corporate slave is probably not the answer for most people but being completely free and independent is HARD. You have to rebuild the structure, routine, social network and the identity that was centered around the work self. Most people want to focus on something that gives them meaning, purpose and self-mastery but where can people get that after they become FI? I didn't have a place to go after FI. It's after years of struggle that I settled on investing but that was not an easy transition and still isn't. I will share some of my thoughts in the subsequent posts and I would love to hear people's thoughts on this, especially people who have the same struggles. + +The loss of status is another challenge. I thought I was not very status driven but I realize people are status driven. I don't walk around with my net worth plastered to my forehead. But once I lost that prestigious corporate title, I feel I am no longer respected. People were less interested in talking to me and old friends from the company kinda disappeared. It shouldn't have been a surprise but I thought people respect me for me. It's quite an adjustment. Being an investor certainly helps relieve that. People are pitching me to give them money so of course they are very respectful. I think I know the game a bit better now and my naivete was just laughable. + +I want to write about one post a week in the subsequent weeks to cover topics people might be interested about FatFIRE and to write down thoughts that would help me think. Here are the topics that are on the top of my mind. Feel free to suggest more topics: + +* Investment and Portfolio Management +* Expenses and Living with No Financial Constraints +* Work and Purpose +* Time and Routine +* Keeping a Low-Profile +* Relationships are Complicated +* Staying Grounded +* I am NOT a Superman. + +\---------------------------------------------- + +I wish some of you will enjoy these posts but I am really writing them for me. I am sure when I look back 10 years later on these posts, I will be embarrassed but it's good to keep the records of my current state of mind. I will have to obfuscate some details about myself to not reveal my identity because you know, I want to be candid and intellectually honest here. +Thought this might be of interest: + +>The tax will begin as a 1.25% rise in National Insurance from April 2022, and will be a separate tax on earned income from 2023. +> +>Under the social care plans, no-one will have to pay more than £86,000 for care across their lifetime, while anyone with less than £20,000 of assets will get free care. +> +>People with less than £100,000 of assets will see their care costs subsidised. + +[https://www.bbc.co.uk/news/uk-politics-58476632](https://www.bbc.co.uk/news/uk-politics-58476632) +Meta is down 19% after hours, this should be a lesson for everyone to stay away from very risky meme stocks like blue chips! + +My positions are only SAFE STOCKS like AMC or BBBY +Please help me to clear my mind on this really dumb question. + +There's consensus that a few billionaires hold more wealth than the rest of the population (like [this](https://inequality.org/facts/global-inequality/), [this](https://www.globalcitizen.org/en/content/oxfam-report-billionaires-inequality/), and [this](https://www.oxfam.org/en/press-releases/worlds-billionaires-have-more-wealth-46-billion-people)). Suppose I want to make profit by selling a product, and assume that I'm a very successful salesperson that I can get almost all the money from everyone in the market except for the billionaires, then I still have less money than those billionaires. If I want to be another billionaire, the best way is to get money from those billionaires, not from the population. So can you help me to understand why and how someone can make money (and make themselves a billionaire) by selling product to the population, given that the population don't hold much wealth? + +Sorry I'm just a layman and not familiar with economic terms but I hope you get what I mean. Thank you for your answers. +Thinking about college. I paid my dues. Will college be free for everyone now? How can you freely pay off debt today and not someone’s five years from now? +I was reading an [article](https://www.investors.com/etfs-and-funds/sectors/sp500-warren-buffetts-panic-sale-two-stocks-cost-700-million/) this morning about Warren Buffet panic selling OXY and UAL. And I reflected yet again on the lousy job he did navigating the pandemic. At one point BRK.B shares were trading for less than $170 and BRK didn't repurchase any of them whilst sitting on >$100B in cash. As a long-time BRK shareholder, I am just at a loss as to how individual investors like me could trade the pandemic better than the greatest investor ever. And don't call it luck (or bad luck) or 20/20 hindsight--thousands of us were begging BRK to repurchase shares last March and they sat on their hands and did nothing (except panic sell stocks that are now up huge). Don't get me wrong, I am glad BRK is finally repurchasing shares aggressively, but how can you justify massive repurchases at $250+ and not at $170? +Buddy I work with who is absolutely an idiot financially just took a loan out to buy doge coin. I asked him why buy at this price. He said it’s so low it’s not like it’s gonna to lower. (Aside from the fact it’s a meme crypto) I literally heard Peter lynch in my head. One of The biggest mistake someone can make is to utter those words. It blows my mind people are willing to throw money at stuff they don’t understand. Yet it is common. I tried to tell him about value investing but he then brought up grand cardone and I knew there was nothing I could do haha +$70.1 billion and $68.1 billion + +RIL stocks to go higher probably, increasing the gap further. + +Edit: i just shared the news, why are you guys fighting over who is greater. Why is there need to compare? Both businesses are different, one does charity, one has inherited, different nations. Stop comparing and arguing ffs. +Well, I somehow managed to go from 1k initial investment to 15.5k in 3 months strictly playing meme stocks, then I went from 15.5k to 3.6k in 2 months. + +The good feeling from the upside is nothing compared to the depression of the downside. I’m at young guy that wants to make it in life, slow and steady. + +I will be updating you all on my painful learning curve, but I promise to not give up until I succeed. Road to 5k here I come +We (wife and I) toured a duplex that has been on the market for more than 30 days. The Listing Agent (not our agent) stated that they have one other offer but the seller is not satisfied with it so we made a full price offer. But now the Realtor is giving us a hard time because we are prequalified with a commercial loan to purchase. It seems that the Realtor does not understand why we are looking to purchase with a commercial loan since the property is not commercial and is afraid that the loan will not close because of it. Are Realtors REALY this ignorant? We have other properties (SFR) under this same financing. It seems like Realtors (in general) are not very educated. It is getting very frustrating to deal with them. I am not sure how to handle this if the offer is rejected due to a lack of knowledge on the Listing Agents part. +Was trading $ALF this morning on the short side then out of nowhere it when parabolic on me. Didn’t cut my loses when I could and over leverage myself on that position. I even 200% my account just this month. Lost it all in a single trade. I’m not even sad about the money or feel betrayed by the markets. I’m more disappointed about not following my rules and not having discipline. I will take a break from trading to self reflect on my actions before funding my account again. I hope my lost will help somebody learn to follow there rules. + +Edit: thank you for all the support and words of encouragement from this community, It was greatly appreciated. I’ll be gone for awhile but I hope to see you guys again in the trading floor. +Say a TV was $500 pre-pandemic and now is $700, could it drop to $600 once inflation is under control? Or is it unlikely and they will just continue selling the TV at $700? +***Personal Finance Rules for Being an Effective ETH (or any Cryptocurrency) Holder*** + +Before I was an ethtrader (*read ethholder*), I was (and still am) a Boglehead. If you don't know what [Bogleheads are](https://www.kiplinger.com/article/investing/T030-C009-S002-investing-lessons-from-vanguard-s-bogleheads.html), we are personal finance nerds who live relatively frugally and work to achieve solid investment returns, while minimizing costs and managing risks. We are named after Jack Bogle, the founder of Vanguard who pioneered low cost index funds. + +In my time as investor, I can count on *no hands* the number of people I know who "got rich quick" (and actually held on to the money), because it is zero. Becoming rich isn't just about making the right investment calls, it's about having the right mindset and secure financial position to build wealth over time. + +**Based upon how emotionally some react here to relatively minor price movements (or no movement), I get the sense that some people have dramatically overextended themselves to buy crypto.** This is bad for the individual, but also bad for all of crypto. It will exacerbate wild price swings and could tarnish crypto's image if there is a crash. I can't stop everyone from doing stupid things, but I can give you guys my advice. Take it or leave it. + +People who are overextended tend to make very stupid financial decisions when put under emotional duress, *and they often significantly underperform the market.* This is not just an issue of personality- this is *an issue of personal financial security and stability.* If you are insecure in your financial position, you are more likely to do something really stupid at exactly the wrong time. We've all been in that position before, but the question is how do you remove yourself from it? + +**Here are some questions to ask yourself. If you answer yes to any of these, then I would say you are very likely overextended in your crypto position:** + +- Do you NOT have a solid cash position in a savings account, to pay for at least 3 to 6 months expenses? +- Do you NOT hold any other investment assets besides crypto (like lower risk stocks and bonds)? +- Are you NOT saving for retirement outside of crypto? If crypto went to zero, would you be forced to retire at a later age than you have planned for now? +- Have you borrowed any money to buy crypto, even from low interest sources like home equity (*really terrible* idea, by the way)? Do you have any debt beyond your mortgage and student loans, either revolving (such as credit cards) or on depreciating assets (like big car loans)? +- If all of your crypto went to zero, would your lifestyle be negatively affected? Could you still pay your bills? Would you be put in a position where you would need borrow money or sell other assets to make ends meet? +- Are you concentrated in too few coins and does that make you nervous? (Note: At this moment, I am nearly 100% ETH, but it doesn't make me nervous. Because I answered "no" to all of the questions above, I can afford this risk.) +- Have you FOMO'ed in the recent past between coins? Do you think you'd be susceptible to doing it again? + +**If you answered "No" to all of those questions, then it really doesn't matter how much of your net worth is comprised of crypto.** Crypto has become a fairly substantial percentage of my net worth, but it's all gravy, and I can literally afford to lose it all. I wouldn't be happy, but I wouldn't be ruined. From a net worth perspective, I sort of pretend it does not exist. This gives me the stability to make smart, rational decisions, instead of emotional ones. + +**If crypto is a substantial percentage of your net worth, AND you answered "yes" to any of the questions above, then you could be in a risky, insecure position, where you are more likely to make really stupid decisions around your crypto investments and everything else related to your personal finances.** *If I were in that position, I would consider selling enough of my crypto so I could answer "no" to all of those questions.* It might not matter today, and it might not matter tomorrow, but one day it could (be it due to an unexpected rise or crash that you are not ready for). + +This mindset has also allowed me to participate in an amazing run-up in ETH, without feeling like I "have to sell." I can let this ride for a long while and let this mega bull market work for me, instead of me working for it. + +**In matters of personal finance, I always believe that it is prudent to be prepared for a worst case scenario. Manage your risk and your exposure, and you will be in a better position to make smart investment decisions.** If you do this right, you might not be rich tomorrow, but you very well could be in 5 to 10 years. And you will probably sleep better at night. +I don’t really care about politics right now. I don’t care if you like Obama or trump. I’m simply looking for facts. How did each of these administration’s policies impact the economy. + +I know critics of trump says he inherited a growing economy and I know supporters Obama say that he inherited the worst economy since the depression so it’s not his fault. + +I also know trump supporters say that it’s due to trump since the stock market soared the day after he got elected. + +But factually and numbers wise, what can we say about this and what do most economists agree on? +Warning: this is a long post, jam packed with facts and my personal analysis. Grab your favorite beverage - it'll take a while to get through all this info, but I believe it will be worth it to your investment account! + +# What is a Ghost Kitchen + + So you may ask, what is a ghost kitchen. “#Ghostkitchens, also known as #VirtualKitchens or #DarkKitchens, allow companies to prepare food strictly for delivery, sometimes with multiple brands under one roof sharing a kitchen. The concept also allows brands to operate virtually, without a physical restaurant, serving food for delivery only.” ([https://www.cnbc.com/2021/02/02/kitchen-united-westfield-to-bring-ghost-kitchen-tech-to-the-mall.html#:\~:text=Ghost%20kitchens%2C%20also%20known%20as,serving%20food%20for%20delivery%20only](https://www.cnbc.com/2021/02/02/kitchen-united-westfield-to-bring-ghost-kitchen-tech-to-the-mall.html#:~:text=Ghost%20kitchens%2C%20also%20known%20as,serving%20food%20for%20delivery%20only).) + +For the majority of cities, you can only order Skip The Dishes, Door Dash, Uber Eats from physical restaurants (in a 3-4 mile radius from you) that have partnered with these deliver entities. But a Ghost Kitchen allows restaurant brands to offer their food products to the masses without needing a physical restaurant. I live in a small city, and if I want food that I’d only be able to get in an Urban center, I’m currently out of luck – even with Skip, Door Dash, Uber Eats, Grub Hub, etc. But with Ghost Kitchens, these restaurant brands are able to partner with a ghost kitchen location to offer some of their menu items to markets where they would never be able to enter because economics don’t support a full brick and mortar location. + +Ghost kitchen and food delivery is growing fast with major celebrity brands and international companies taking interest in the space + +* From Wiz Khalifa to Tyga, Are Celebrity Ghost Kitchens the Next Big Thing? + [https://thespoon.tech/from-wiz-khalifa-to-tyga-are-celebrity-ghost-kitchens-the-next-big-thing/](https://thespoon.tech/from-wiz-khalifa-to-tyga-are-celebrity-ghost-kitchens-the-next-big-thing/) +* Virtual and Celebrity Restaurant Concepts - Ghost Kitchens +[https://www.virtualdiningconcepts.com/concepts/](https://www.virtualdiningconcepts.com/concepts/) +* Walmart in Canada Is Getting a Virtual Food Court Thanks to Ghost Kitchens +[https://thespoon.tech/walmart-in-canada-is-getting-a-virtual-food-court-thanks-to-ghost-kitchens/#:\~:text=Ghost%20Kitchens'%20concept%20is%20part,Beyond%20Meat%2C%20and%20Jamba%20Juice](https://thespoon.tech/walmart-in-canada-is-getting-a-virtual-food-court-thanks-to-ghost-kitchens/#:~:text=Ghost%20Kitchens'%20concept%20is%20part,Beyond%20Meat%2C%20and%20Jamba%20Juice). +* Grocery giant Kroger is opening 'dark' kitchens inside some of its stores to meet surging demand for food delivery +[https://www.businessinsider.com/kroger-grocery-supermarket-food-delivery-clustertruck-ghost-dark-kitchens-indianapolis-2020-10](https://www.businessinsider.com/kroger-grocery-supermarket-food-delivery-clustertruck-ghost-dark-kitchens-indianapolis-2020-10) +* Amazon is well positioned to capitalize on a hot new trend in food delivery: “dark,” “ghost,” “delivery-only” or “cloud” kitchens. +[https://www.cnbc.com/2021/02/03/amazon-looks-to-benefit-from-deliveroos-push-into-dark-kitchens.html](https://www.cnbc.com/2021/02/03/amazon-looks-to-benefit-from-deliveroos-push-into-dark-kitchens.html) + +And the list just goes on and on and on and on…. Do a simple google search, and you’ll see + +&#x200B; + +[Ghost Kitchen's Global Headlines](https://preview.redd.it/f7a7c2f5n7s61.png?width=539&format=png&auto=webp&s=a3e0c684a59350ec4d368c565d3b7bea31a249e7) + + + +&#x200B; + +# Meet JustKitchen; An Overview + +I first saw this stock mentioned on twitter: [https://twitter.com/HCCapitalMgmt/status/1379515475005120512?s=20](https://twitter.com/HCCapitalMgmt/status/1379515475005120512?s=20) ,& [https://twitter.com/airic101/status/1379789760764383234?s=20](https://twitter.com/airic101/status/1379789760764383234?s=20) (and have since seen it mentioned by others on twitter too) and decided to do some digging on the company and made a couple calls – and I like what I've heard, and read - A LOT. I also love the fact that $JK appears to be the first small cap company in this space! With their growth potential, its gives early retail investors an opportunity to multiply their investment by hundreds or even thousands of percent. + +JustKitchen is basically a vertically integrated "Door Dash" or "Uber Eats" that handles the software, infrastructure, and products/food/menu items. Restaurant brands lease space in the JustKitchen branded large kitchens, and JustKitchen handles all the ordering and logistics to get the meal delivered to the consumer (delivery is executed by partners such as Uber Eats and FoodPanda). They are currently in Taiwan and growing before expanding to the rest of the world, including Hong Kong, Singapore, and USA. Partnerships are in place with many Asian cuisine brands, but also have partnerships with American Steak House/Restaurants such as “TGI Friday’s”, "Smith and Wollensky", and "Dan Ryan's Chicago Grill", to name a few. + +JustKitchen operates a “Hub & Spoke” model where ingredients are first prepped in a massive 16,000 sq ft “hub” kitchen, before being sent to smaller “spokes” for final assembly and pickup by delivery partners (including Uber Eats and Foodpanda). To reduce operational costs, spokes are spread throughout cities for quicker deliveries. This also increases the reach the restaurant brands have as they don’t have the normal 3-4 mile restriction from their brick and mortar location that current food delivery (Uber, Skip, etc) companies + +&#x200B; + + + +# Leadership Team and Financial Backers. + +This management team is stacked and boasts decades of combined experience in the restaurant, hospitality, e-commerce, software, and capital markets industries, featuring numerous successful exits. (These biographies I took right from the prospectus) + +Kai Huang - Chairman + +* Mr. Huang was the co-founder and CEO of Blue Goji, an interactive fitness company that brings motivation and fun to health and fitness. Prior to Blue Goji, he co-founded the video game publisher RedOctane and was President and CEO of the company from 1999 to 2009. RedOctane was the publisher of Guitar Hero, which went on to become a multi-billion dollar global video game franchise and was acquired by Activision in 2006. Prior to RedOctane, Mr. Huang was the co-founder and CEO of Adux Software, which was sold in 1999. Mr. Huang started his career as a consultant with Accenture in the San Francisco office. Mr. Huang is a member of the Board of Trustees of UC Berkeley and advisor to SparkLabs Taipei and SparkLabs Korea. + +Jason Chen - President & CEO + +* Mr. Chen is Vice Chairman of Bayshore Pacific Hospitality Limited and on the board of directors of Smith & Wollensky Taipei. Bayshore Pacific Hospitality is a restaurant company that is dedicated to bringing popular western dining brand experiences to China. Smith & Wollensky is a premier steakhouse with international locations. Mr. Chen also has over two decades experience working internationally in the capital markets and private equity industries. Mr. Chen has extensive capital markets experience at the senior executive officer and managing directorship levels with 38 several Canadian investment dealers. Mr. Chen is also a Managing Director of a capital partnership corporation that specializes in corporate financings in both private and public sectors, with offices in Hong Kong and Vancouver, Canada. In addition, Mr. Chen is actively overseeing his private investment holding company and has held executive and board positions with a number of public and private companies. Mr. Chen also holds a Juris Doctorate and degrees in economics and philosophy. Mr. Chen is an employee and expects to devote 80% of his time to the affairs of the Company. Mr. Chen’s employment agreement include provisions which restrict him from engaging in business competitive with the Company. + +Kent Wu – Chief Operating Officer + +* Mr. Wu has, for the past 20 years, been a founder and entrepreneur in the in e-commerce sector. His experience and expertise revolve around online retail platforms and back end fulfilment and logistics. In 2001, Mr. Wu founded and operated ecommerce websites that specialized in direct-to-consumer of sporting goods. Revenue channels included 70% direct to consumer, 20% distribution to other businesses and 10% to government contracts. In 2015, this company was acquired by a major national sporting goods distributor. In 2016, Mr. Wu ventured into grocery delivery by founding Milk & Eggs, an online farmer's market offering artisanal prepared foods. Milk & Eggs is a curated online marketplace offering perishable and artisanal foods from independent food makers. The Company scaled to tens of thousands of orders a month and was acquired in 2019 by a publicly traded company in the food delivery sector. + +Freddie Liu - Director + +* Mr. Liu is a Taiwan based finance professional with over 20 years of experience primarily in the technology sector. Mr. Liu is the Chief Strategy Officer and former CFO of Taiwan Stock Exchange listed TPK Holdings, a manufacturer of touch panels for tablets, laptops and phone and a primary supplier to Apple. Mr. Liu has been the recipient of numerous awards including the Best CFO Taiwan in the technology sector from Institutional Investor. Mr. Liu holds an MBA from the University of Michigan, Ann Arbor and speaks fluent Taiwanese and English + +John Yu – Chief Marketing Officer + +* Mr. Yu is the founder and CEO of ALUXE, a wedding ring retail brand in Taiwan and Hong Kong. Mr. Yu is currently an active board member of an international hospitality company with operations spanning the Greater China area and Singapore. Mr. Yu has over 15 years of experience creating retail brands in Asia and is the founder of two consumer brands, Enchantee and Dr. QQ in Taiwan. Enchantee is a handmade cookie brand with a focus on the wedding cookie market, and Dr. QQ is an online toy brand that caters to young generations. Mr. Yu holds a B.A. in Computer Science from the University of Michigan, Ann Arbor. + +Mark Lin – Chief Technology Officer + +* Mr. Lin was the founding member of InComm Taiwan Branch, an international gift card platform provider prior to joining JustKitchen. Mr. Lin grew sales revenue from US $1 million to over US $15 million in three years and guided the company through local regulations and tax laws to launch over 30 gift cards with brick & mortar retailers, covering 12,000+ locations in the region. In his role, Mr. Lin managed all aspects of sales and operations. Mr. Lin’s areas of expertise include financial payment platform solutions, system integrations, business process analysis and international business development. Mr. Lin holds a B.S. in Operations Research from Columbia University. + +Adam Kniec – Chief Financial Officer + +* Mr. Kniec is an experienced CFO with over 22 years of CFO, senior management, accounting, auditing, financial reporting and regulatory compliance experience with Canadian and U.S. publicly listed companies. Mr. Kniec holds a Chartered Professional Accountant designation from the Institute of Chartered Professional Accountants, British Columbia. Mr. Kniec is a principal of ArkOrion Enterprises Inc., a firm that provides CFO, accounting and financial reporting services to private and public companies since September 2007. Recently, Mr. Kniec was the CFO of TSX Venture Exchange listed company Integrity Gaming Corp., a position he has held from October 2012 to February 2019. Previously, Mr. Kniec was the CFO of Petro Vista Energy Corp. from October 2007 to January 2019 + +Spark Labs + +* These guys were early investors and have serious name brand power including guys like Mark Cuban (pretty sure everyone knows who he is – Shark Tank guy, Dallas Mavericks owner, and serial entrepreneur) Steven Chen (Co-Founder of YouTube), Vint Cerf ( VP at Google), and a plethora of other major entrepreneurs and successful people. [http://www.sparklabsgroup.com/portfolio/justkitchen.php](http://www.sparklabsgroup.com/portfolio/justkitchen.php) )you can see more about the people by clicking on “who we are”) + +The board of directors and management are also focused on ESG issues including but not limited to transparent governance, cybersecurity, community investment, eco-consciousness and diversity + +&#x200B; + + + +&#x200B; + +# Share Structure + +&#x200B; + +[Just Kitchen Share Stucture](https://preview.redd.it/glv2yrmrn7s61.png?width=534&format=png&auto=webp&s=ff770e58b9ac6a301cae50ebcf6c97d40052c34b) + +JustKitchen just raised \~$8mm at 50cents (15,798,795 common shares). This will basically the only free trading shares. The total outstanding share count is \~59mm. Insiders hold 25.3mm of these shares or \~43%. These escrowed shares vest over 36 months. Of the fully diluted count (75.8mm), insiders own \~37.4mm or 50% of the total structure. + +Obviously, this is very impressive! Such huge insider ownership tells the market that management want this to succeed more than anyone! Insiders have a 36 month escrow agreement. In fact, of the total \~59mm OS, \~44mm are under Escrow or Voluntary Resale Restrictions. This float is TIGHT!!! + +&#x200B; + +[Voluntary Resale Restrictions](https://preview.redd.it/cmodyon7o7s61.png?width=611&format=png&auto=webp&s=c16424d2a6b9b4c79511d6b689c75296fe22a952) + + + +&#x200B; + +# Revenue, Growth & Numbers + +&#x200B; + +https://preview.redd.it/x3h2qu2co7s61.png?width=317&format=png&auto=webp&s=5744ec6da743e65304ca24f6ffdc1bf0f5ea6ca9 + +JustKitchen is already generating revenue. They are scaling from the 14 spokes at the end of 2020 to 35 spokes in 2021. They will also add a second Hub. From there they plan to expand across the world including Hong Kong, Singapore and the USA. + +Highlights: + +o Cumulative monthly growth rate for revenues of \~40% in 2020 + +o Target profit margin per Spoke over 20%, as compared to 5% for restaurants + +o Expect to be cash flow positive in 2021 + +o Payback period of between 0.37-0.48 years per Spoke; Avg of 110% one-year ROIC + +&#x200B; + +[JustKitchen Revenue Projections](https://preview.redd.it/pxen9v3go7s61.png?width=523&format=png&auto=webp&s=c15bb04e40854bbfb51abec451b88d97f8384264) + + Here are some other macro stats to backup the business model and sector it’s running in: + +Consumer preferences are shifting – diners want their favourite foods on-demand and delivered quickly + +* 43% of Taiwanese people order food 2-4 times per week, which equates to 1.1-2.2 billion meals ordered per year + +Global online food delivery market is expected to grow from US$111 to $154 Billion by 2023, which is a CAGR of 11.5% + +* Asia represented US$53 Billion of the online food delivery industry in 2019 + +The online share (via web or app) of food orders in major delivery markets grew from just 27% in 2015 to 58% in 2020, compared to the offline share (call-in, walk-in, pick-up) + +* This is why the software aspect of what JK is also so important. + +Under the "Comparables" section I break down what I think JK will trade at by end of year, once remaining plans for 2021 are executed. + + + +&#x200B; + +# JustMarket (Grocery Delivery) Kicker + +JustMarket is a complementary business that offers grocery items for the on-demand generation, either as part of their JustKitchen orders or on a standalone basis. Global online grocery estimated at US$198.5B in 2020 and projected to reach US$550.7B by 2027. That’s almost 3x growth in just a few years; and I believe it as my wife and I started buying groceries online this year because we are so busy, we were looking for ways to cut out time wasted doing mundane things. More and more friends and family are also ordering groceries online to either be delivered or picked up at your convenience. + +Just Market is using their brand recognition to enter this space and is targeting 20 location in Taiwan. They plan to roll out the concept through 5 of it’s spokes. An interesting fact is that this grocery order/delivery model is expected to grow its net revenue by a whopping 50% as JK doesn’t need to develop any additional infrastructure. + +&#x200B; + +&#x200B; + +# Comparables + +&#x200B; + +[JustKitchen Comparables ](https://preview.redd.it/pudhps1bp7s61.png?width=624&format=png&auto=webp&s=0199155aac933b890364c0b201eb7f7b6747303c) + + + +You can see how capital intensive this business can be. I really like that JustKitchen has started in the cost conscious Asia market, with number showing them to be profitable this calendar year – 2021. From there they will be able to self fund much of the growth to other area’s of the world. This limits shareholder dilution and allows early shareholders to maximize returns on their buy & hold strategy. + +Given the share count of 59mm at 50c final raise, this puts the market cap at $29.5mm. The final raise was when there only 8-14 spokes. In 2021 they plan to have 35 spokes. At the revenue estimate numbers above, they will be brining $48mm in annual revs JUST FROM TAIWAN. It is reasonable and conservative to assume that JK.v should trade at a 5x (or more) multiple to revenue. My basis for this is: + +UBER trades at 9.5x multiple of revenue + +DASH trades at a 15x multiple or revenue + +GRUB trades at a 3.5x multiple of revenue. + +Once revenues appear this should put our market cap at $240mm or OVER $3/share. And that should happen this year JUST on Taiawan revenues…. Again, this factors in ZERO growth to other parts of Asia, USA or the rest of the world. There is MAJOR Blue Sky Potential for this stock. + +&#x200B; + + + +# Conclusion + +From my discussions I’m under the impression that JustKitchen is hoping to list mid-end April (but obviously this can change based on the company, and the exchange). Early buyers stand to make a healthy multiple on their investment, imo. The team is by far the best I’ve seen. The financial backers are not passive, they are active and interested in making this successful. They have also agreed to lock up there shares for up to 3 years. + +I love the concept. JK is very early in this emerging space. They have developed brand loyalty and a network of hub/spokes already. Catalysts for revenue and growth/expansion await us. + +I sincerely believe this will be a multi dollar stock (as demonstrated above), and personally plan to buy on the market day one (just a first tranche, I will buy more over the days/weeks after listing) + +Asia has a large market for online food ordering and deliver. In 2019, its was a US$53 billion market and this was prior to the pandemic + +The JustMarket kicker is a strong bonus. This is essentially a grocery service, akin to what Good Food ($FOOD.T) is doing now. The business model leverages off the buying power and inventory already stocked at the hub and spokes. + +Is there a chance that JK is taken out/acquired? I think there is a high probability of this as their delivery partner Uber Eats is a $106 BILLION company. I could see them wanting to vertically integrate, and having the JK infrastructure in place would be a big bonus. This would also allow them to capture significantly MORE margin than they currently get just on delivery. + +In the end, do your own due diligence. I hope this helped save time for many potential investors. If you have a differing opinion than my very bullish one, I’m open to hearing it, and would appreciate it. Like everyone, I want to make the best financial decision. Good luck to all. +And this sub is turning into a cult. + +Say anything remotely negative about ETH, or positive about BTC, and you get downvoted into oblivion. I got downvoted for saying to take some profits at 700. I got downvoted for saying BTC might be breaking out soon. + +I'm all for Ethereum - I do believe it is the future, web 3.0. However, be reasonable and think for yourselves for once. It's okay to have different opinions. Save downvotes for complete garbage and spam. Give different opinions a chance to see daylight so that we might gain valuable insights and ground ourselves. + +**Down voting everything you remotely disagree with is how we end up in a mindset bubble and become ignorant.** + +This also extends to cryptocurrency space in general. [Look at all the hate Vitalik gets for voicing a contrarian view.](https://twitter.com/VitalikButerin/status/940744724431982594) +Video here : [https://www.youtube.com/watch?v=iQapdnQIxmU](https://www.youtube.com/watch?v=iQapdnQIxmU) + +Apparently a family wanted to deposit an FD in ICICI bank, but their RM (relationship manager) convinced them to put it into a tax saving fund (1-2 lakhs per year). He promised 15% rates. + +Then few years later, 20-30 lakhs started being deducted from their bank account. And apparently they were enrolled in over 14 ICICI policies without their consent. + +Or did they just enroll in schemes without realizing the risks? + +Edit - The channel posted a comment a week back - + +12 of the 14 policies offered to this family are traditional plans with tight premium forfeiture clauses, which means that if the family is unable to pay future premiums on these policies, their premiums will be forfeited. Only two policies are ULIPs, which allow them to get their money back after five years of coverage. Icici Pru Cash Advantage, Icici Pru Future Perfect, Icici Pru Assured Savings Insurance Plan, and Icici Pru Guaranteed Savings Insurance Plan are the traditional plans sold to this family. Premium forfeiture is a fact, and it has become the accepted norm. + +Going through the videos, many cases where agents said its just "one time payment" but in reality they have to pay every year. And then when they are unable to pay they face penalties. +Did we not say that important data would come out on 2/9? Where the heck did everyone go? + +The point of investing in GME was primarily to stick it to the hedge funds and ride it out until they couldn’t do it anymore. If you can’t stand to lose money, you shouldn’t invest or you invested more than you were willing to lose. + +If you’re a real holder, you’re waiting to see what happens. I hold 55 shares of GME at $224. + +Edit: Holy cow I’m getting ripped apart in the comments lol. Yes the point is also to make money, and I’m here out of principle. + +Edit 2: The main reason I bought so much is that I was so frustrated and upset by Citadel’s and Robinhood’s actions as well as those by other brokerages. If you don’t believe me, then I don’t know what to tell you. + +Edit 3: I just like the stock🚀🚀🚀 +I'm currently working within the technical sector. Within my job one of colleagues told me they were on £40kpa. + + +I'm currently on £26kpa, we did the same job he just had more experience. I have set myself a soft target of earning £30k pa before I turn 30. I'm 26 at the moment. + + +Recently I've spent some time on my CV to make it far more presentable, updated all the job boards/linked in profile. But it seems there's a 'wall' to get into this £30k+ region (Unless I'm setting this wall by myself). Without have a degree/uni education. Do I have a hope of getting to my goal? What would you all recommend/suggest I do? + + +I know it's pretty vague, so feel free to ask questions to help get a better understanding. + +EDIT: Not checked reddit over the weekend. I'll do my best to respond to as many comments tomorrow! +Hi everyone, + +I invested $2000 when ETH was around $35 a share and I sold it all at $352. I'm now out of the game. + +While I do believe in ETH long-term, being in debt I stupidly had way more invested than I could comfortably lose. Everyday I stressed over the numbers - the last correction for example was horrifying, though I didn't let fear at the time get to me. + +I was able to pay off all my credit card and student loan debt, and I still have a few thousand leftover to put in savings for an emergency fund. + +I no longer owe anything to anyone and I love the peace of mind with that. And finally I won't be checking Coinbase 50 times a day. + +I will probably regret selling as ETH continues to climb, but I know the regret will never compare to the pain I could have felt if I lost everything. + +Just wanted to share. Best of luck everyone. + + +ORT ($ORT) is a revolutionary new token that is designed to facilitate fractionalized investment in real estate. Through a partnership with one of Spain’s most prestigious luxury real estate brands (OMNI Estate Group), the development team at Passive Income ($PSI) have created an NFT marketplace designed specifically for real estate investors. + +\*What is the goal of $ORT?\* +The team at OMNI-PSI have been working with top real estate and blockchain lawyers to ensure that fractionalized sales of property through NFTs can be done legally and fairly. There is a private sale coming up for $ORT holders where a $3m villa will be up for sale via fractionalized NFTs, this will allow investors of all sizes to benefit from the increasing value of real estate independently of the crypto market. + +Following the success of the first sale, the NFT marketplace will open up with hundreds of properties listed where investors both big and small can purchase property either outright or through fractionalized NFTs. +ORT is going to disrupt the real estate investment industry through the use of Blockchain technology. + + +\*Benefits for ORT Holders\* + + +Even if holders of $ORT aren’t looking to directly invest in property, there are many ways that they can benefit by simply holding and investing in the $ORT token. +They include: +\- Ability to use the NFT marketplace +\- Early access to new properties +\- Cashback on NFT purchases +\- Commission fees from property sales and rentals shared with ORT holders +\- Access to future product presales +\- Free stays in a luxury villa +And most obviously, the benefit of investing in a low market cap coin that is ready to destabilize an entire industry. +\*Who is behind $ORT?\* +Omni Estate Group and Passive Income are pioneers in the region's real estate market and blockchain technology. With a stronghold of 22,000 properties in their database, OMNI Estate Group is at the forefront of the market as one of the most trusted luxury real estate agents and are also featured on the list for the world's most innovative agencies.  + +Passive Income is a blockchain startup with lots of experience in the crypto space and aims to connect real world businesses with blockchain technology, bringing the most innovative solutions to their clients. + +All team members for both companies are fully public and have been KYC’d. They regularly hold voice chats and live streams for their Telegram communities. + + +\*Marketing\* +There has already been a lot of interest from influencers in both the real estate and cryptocurrency space. These include names such as: + +\- Nate Diaz +\- David Rock +\- Marcus Dahlgren +\- Vincente Ortiz +To celebrate the launch of the NFT Marketplace, they will also be holding a launch party where they will be flying 2 $ORT investors out to Marbella, all expenses paid. This event will be filmed and launched as part of an OMNI-PSI branded podcast series which will feature guest appearances from both real estate and blockchain influencers. + +Following the launch of the NFT Marketplace, there will be a huge push on marketing this podcast on multiple channels to ensure a good crossover between a real estate and crypto audience.  + +Additionally, there will be a strong advertising presence both digitally and in traditional forms. Currently there are billboards across Marbella advertising the project and this will soon expand to other regions such as London and Dubai. + + +The aim is to make the concept as accessible to traditional real estate investors as possible, while also introducing real estate investment to crypto users. + + +\- Token Name: $ORT + +\- Contract: BSC [https://bscscan.com/token/0x1d64327c74d6519afef54e58730ad6fc797f05ba](https://bscscan.com/token/0x1d64327c74d6519afef54e58730ad6fc797f05ba) + +\*\*Pancake Swap\*\* [https://exchange.pancakeswap.finance/#/swap?outputCurrency=0x1d64327c74d6519afef54e58730ad6fc797f05ba](https://exchange.pancakeswap.finance/#/swap?outputCurrency=0x1d64327c74d6519afef54e58730ad6fc797f05ba) + + +\*\*Whitepaper\*\* +[https://omni-psi.com/main-images/omnipsipresentation.pdf](https://omni-psi.com/main-images/omnipsipresentation.pdf) +\*\*CERTIK Audit\*\* +[https://omni-psi.com/main-images/Certikauditreport.pdf](https://omni-psi.com/main-images/Certikauditreport.pdf) +\*\*Telegram\*\* +[https://t.me/omnipsi](https://t.me/omnipsi) +\*\*Twitter\*\* +[https://twitter.com/omniestategroup](https://twitter.com/omniestategroup) + +\*\*BSC Contract Address\*\* + +0x1d64327C74d6519afeF54E58730aD6fc797f05Ba +https://www.npr.org/2021/02/08/965483266/-15-minimum-wage-would-reduce-poverty-but-cost-jobs-cbo-says + +To what degree could the loss of jobs be explained by people no longer needing to work 2nd or 3rd jobs? Also, I'm starting to feel like there's no reason an advanced, modernized economy shouldn't consider workers getting paid more to do less a positive indicator, even something to be strived for, in which case less poverty and fewer jobs is perhaps the ideal outcome. Call me a dirty socialist, but what are the flaws in my interpretation here? I feel like my thesis must have lots of holes, but I don't understand economics well enough to spot them. +It was a headline for like 1 day and then the MSM stopped covering it. This is such a huge deal and most Americans don't even know/care about it. + + + +Federal reserve members got caught insider trading and using the Fed to pump their own stocks/options they own, at the cost of the US's long term economic health. They have now printed 25% of total USD in circulation in the last year, inflation is increasing and only gonna get worse soon. + + + +Are we just so used to corruption now that nobody cares anymore? Or is Reddit gonna pretend like huge corruption isn't happening just cause the Dems are currently in control? + + + +Our entire government is a sham and just a bunch of corrupt rich assholes using their power to get more money. +I like to sort this sub by “new” to keep up with the latest, but lately I have seen way too many “I’m new what do I throw all my money into” posts, & honestly it’s getting really damn annoying. Some people are just demanding the answers get handed to them. + +It’s not like you even have to do a ton of DD on your own - this sub is a goldmine of information (& this is where I’m going to interject a big “THANK YOU!” to the people who take the time to do write-ups). + +You can’t even be bothered to lurk here or be grateful when someone directly links you some DD? Are you really going to just take whatever recommendation someone throws at you & possibly lose everything, simply because you’re that lazy? + +The in-sub search bar exists, along with Google. Learn how to use it. + +Edit to add: someone who commented here was very salty that I was posting this when I have not contributed my own DD post. + +I know I don’t need to justify this but for anyone who wants to try to come at me for the same thing, I don’t/haven’t posted any DD because I simply don’t have the time or energy to compile anything I find into its own post. I am juggling a full-time job with also being a full-time student, in addition to my own personal responsibilities. I have an equity research background & currently work in the finance industry. I am more than capable of researching on my own - I am in this sub because I enjoy seeing other peoples’ opinions. Reading this sub (& others on Reddit) is literally how I relax. + +I shouldn’t need to have to defend myself, but apparently one or two people out there are feeling called out. If you’re offended by this, maybe you should reflect on why. 💖 + +Edit 2: because apparently this needs to be clarified again, I mean if you’re too lazy to at least read, not calling out people who don’t post DD. I obviously don’t. But I am NOT too lazy to read & search for the information when I need it, on or off this sub. + +Edit 3: thank you all for the awards, but save your money for your penny stocks!!! WE GOT MONEY TO MAKE Y’ALL! + +Edit 4: if you’re gonna award anyone, give it to those who do the great DD that makes sub what it truly is. :) +Your markets are run by bots. Now your daily threads are too. + +&#x200B; + +This thread is for plans and thoughts prior to the market open period. + +Maybe use this time to read the [wiki](https://www.reddit.com/r/asx_bets/wiki/index/) [.](https://styles.redditmedia.com/t5_2hqqj5/styles/communityIcon_41pmnaqp4zn41.png?width=256&s=59bf38425fb316fdcba30365b272a5f19352f370) + +&#x200B; + +Posts relating to the "Is /r/ASX_bets about finance or effect your mental health?" etc will lead to a ban of the mods chosing. [You have been warned](https://www.reddit.com/r/ASX_Bets/comments/l0l9et/the_does_asx_bets_effect_your_finances_emotions/?utm_medium=android_app&utm_source=share). + +&#x200B; + +[We have an active official/unofficial discord. It's open to all discussions, stonks related and non-stonks related](https://discord.gg/wsNDGTf5QH). +As a banker, I worked with highly efficient corporates in the first four years of my career. It was a wake-up call on how I handled my own money. Now I work as a branch manager. It pains me to see how much worse other people are with their money. So I decided to make a list of common rookie mistakes that people do with their money. + +&#x200B; + +If you aren’t doing any of these, you are already a cut above the rest of India. I did some of the mistakes mentioned below as well, but I can safely say I won’t be doing them again. So here they are: + +&#x200B; + +* Buying no-cost EMI even if you have enough money to buy it outright. Your no-Cost EMI actually costs more than an outright purchase. How? The interest levied on credit cards are subject to GST. This GST is added to your credit card bill. Credit card companies claim input credit on this and profit as they have to pay less GST now.(Example, if you buy a product for Rs 12000 on a 12 month EMI plan, you pay Rs 745 as interest over the 12 month period and 11255 as principal, totaling to Rs. 12,000. However, you will also additionally incur GST of 745 x 18% = Rs. 134.10 over the 12 month period.) +* Using insurance as an investment. Insurance is supposed to be a hedge against uncertainty. Stop investing in Unit Linked Insurance Plans. If you are looking to invest, put it in mutual funds. If you need insurance, invest in a term plan. + +&#x200B; + +* Taking out loans on depreciating assets. A home loan might be excused, since + * they have tax benefits + * the asset (land) might appreciate if you invested in the correct location + * The interest rate is low + +(But any other loan like car loans, personal loans, etc. are a no-no. The interest rate is much higher than inflation and you are buying a depreciating asset. [Delayed gratification](https://en.wikipedia.org/wiki/Stanford_marshmallow_experiment) works wonders for your financial health; I learned the hard way) + +&#x200B; + +* Keeping money idle. FDs hardly beat inflation. But people keep large sums of money lying around in their savings account, let alone invest in FDs. The corporates I worked with would immediately transfer excess (I repeat, excess) cash to a liquid fund. As instant redemption has been capped now, liquid funds are no longer attractive. The next best thing you can do is keeping an automatic sweep above a certain balance to FDs. Banks usually allow this for clients who maintain more than 10 lakhs in their current/savings account. + +&#x200B; + +* Not going through your Bank statement once in a while. No bank system is foolproof. Charges can be levied accidentally due to random technical issues. + +&#x200B; + +* Paying higher interest on your loans. RBI has ordered all loans to be linked to a benchmark called repo rate from October 1, 2019. It is cheaper by about 1% (currently) than their previous benchmark (called marginal cost of lending rate – MCLR). Since RBI only ordered new loans to be linked to it, loans taken earlier will continue to be in MCLR unless you specifically request to reduce your interest rate. + +&#x200B; + +Edit: formatting +Edit #2: MCLR is costlier than repo rate by about 1% currently for most banks. But the difference can reduce going forward. +Edit #3: My first award. Thank you kind stranger +In general, what proportion of the return from real estate is rent and what proportion is property value appreciation? I've been told you definitely can't beat the market without both. Is it about half and half in most cases? +Inspired by the $120M exit post ([https://www.reddit.com/r/fatFIRE/comments/pwunq5/120m\_exit\_fireing\_and\_trying\_to\_hire\_a\_private/](https://www.reddit.com/r/fatFIRE/comments/pwunq5/120m_exit_fireing_and_trying_to_hire_a_private/)), let's take a step back and discuss about how people with $100M+ net worth actually managed their money in real life. + +I am actually one of the lucky few that reached $100M. ((I had to sign up a new reddit account to stay anonymous but can show proof to mod.) I started with $30M of windfall through a company IPO about a decade ago and am currently at $120M-$130M at the moment depending how you value my private holdings. I am a rare bread that I don't use big financial advisors. But here is my current NW breakdown. + +&#x200B; + +\- Index Funds. (Mix of DFA/Vanguard): $30M + +\- Concentrated Portfolio (kept some IPO stocks and other speculations including crypto): $45M + +\- Foundation/DAF: $5M + +\- Real Estate (incl primary residence, beach house and 4 rentals): $15M + +\- Private Investments (angel investments + vc funds): $25M - $35M + +&#x200B; + +\------------------------------ + +I don't like big private banks. I tried to let one of the big banks handled my account, they generate tons of trades but returns was poor. I specifically asked them not to get into any private investments because I was going to make them myself. I am glad I did that so I could get the control back easily and I have been doing well on my own. In retrospect, I do feel I spend too much time on investing my money. If I had just put everything into a well balanced index fund, I probably will end up getting the same results. I am glad that I spent quite a bit of time on early stage investments though. I think it's a great way to stay close to the tech ecosystem and see a number of entrepreneurs grow their companies into behemoths and become great leaders. + +&#x200B; + +I see the $30M index funds as my safety net that will cover the expenses for the rest of my life. The Real Estate's value is mostly personal use assets while the rentals pay for property taxes and are tax efficient. I do plan to gradually move my concentrated portfolio into my foundation and private investments over the next 20 years. I know how to do early stage investing and I think it's a great way to invest into human capital and create long term value. + +&#x200B; + +Overall, I think focusing on the numbers and returns is the wrong approach with this level of net worth. It's more about + +1. What are my and my family's needs and wants? +2. What do I want to do with my life? +3. How do I make this wealth useful in the grand scheme of things in the long run? + +&#x200B; + +I think I have pretty good answers for 1) but I am constantly contemplating 2) and 3) still. I believe I will have the answers eventually by experimenting different things. I will report back if I have more thoughts. + +&#x200B; + +\--------------------------- + +For folks with $100M NW, how do you manage your money and life? +I was discussing a pay rise with my manager today (who is great and always looks out for my interests) and we were talking about a $10k pay rise and he asked if it was really the best idea as I would go up a bracket and get taxed more… + +What are some face palm moments you guys have had +Seriously. Don't do it. + +For starters, you are wasting everyone's time when you ask a question about your "algo" when it's clear you just want to humble brag about 100000% per year gains even though it's just a "backtest" you did in Excel. + +But more importantly, you are limiting yourself. + +I totally get the temptation to inflate success, even to strangers across the internet. When I first got into trading I would tell my buddies how much money I totally made on that one trade (in a paper account). Or how well my new algo was doing (that I was still executing manually). + +Lying to others makes it easier to lie to yourself. And lying to yourself makes it exponentially harder to improve. + +This applies to life more generally as well but I'm posting here because this is the corner of the internet where I spend my time and I've seen a lot of obviously crap posts lately. + +I'll get off the soapbox now. Best of luck to you all! +Hello Fatfire, + +I'm coming here for advice because I feel like you folks might have more relevant things to say than the normal personalfinance crowd. So my fiancé and I are wedding planning, and as I probably should of expected, it's prenup discussion time. He comes from a family worth mid 10 digits and he has a trust that will allow him to live a middle class life without having to ever actually work. He still works, but instead of working for money, he works low paying jobs that he loves and enjoys. + +I am the opposite. I work in tech exclusively for the money. The problem I'm facing is that if anything were to ever happen to us and we divorce, I'm expecting I would get completely screwed in every way in court. + +I work in tech make multiple times more than what he makes, have 2 investment properties, and I'm stacking my retirement and brokerage accounts as much as I can. + +He saves $0 from what he makes working (since he doesn't have to) and all of his assets are within an irrevocable trust that is managed by his families lawyers etc. On paper he has nothing to his name. He's also going to be gaining access to another \~$5M over the next 5-10 years as he hits age milestones, but again, it's all in his families trusts so nothing in his personal name. + +I'm wondering, since we do live in a community property state, how do I avoid getting lambasted if anything were to happen to us since on paper I make so much more and have so many more assets than him? How do I avoid him getting alimony, equity in my properties, parts of my investment accounts etc? Also how can I avoid his family crushing me under lawyer fees? The potential lawyer costs are honestly a huge thing for me. His family has a team of accountants/lawyers that manages their business and assets and they could just drown me if they wanted to. + +I know I'm going to get the answer of "just don't get married", I know that already, that's not why I'm here. + +And I also know that I should talk to my own lawyer. I'm planning to and thankfully his family is giving me a blank check to pay for whatever lawyer I go with. They say it's mutually beneficial for the both of us which is why they want to cover it (which to me just means it won't get thrown out by a judge if it's done by a real lawyer). I'm just trying to prepare ahead of time. +It's here! + +Find below the link to the AMA with Robbie Ferguson, President and Co-founder of Immutable X. Thanks to you all for the great questions, and to Robbie for being transparent and insightful. + +**Youtube Link:** [https://youtu.be/UKQQ3KCiKbI](https://youtu.be/UKQQ3KCiKbI) + +and dare I say.... please like and subscribe away. Please note, *Superstonk Official* is a non-monetised channel. + +**Transcript:** + +[https://www.reddit.com/r/Superstonk/comments/smp57i/transcript\_ama\_with\_immutable\_cofounder\_and/?utm\_source=share&utm\_medium=web2x&context=3](https://www.reddit.com/r/Superstonk/comments/smp57i/transcript_ama_with_immutable_cofounder_and/?utm_source=share&utm_medium=web2x&context=3) + +**Initial Request Post:** + +[https://www.reddit.com/r/Superstonk/comments/skiyk8/ama\_with\_robbie\_ferguson\_cofounder\_and\_president/?utm\_source=share&utm\_medium=web2x&context=3](https://www.reddit.com/r/Superstonk/comments/skiyk8/ama_with_robbie_ferguson_cofounder_and_president/?utm_source=share&utm_medium=web2x&context=3) + +&#x200B; + +&#x200B; + +[Credit to u\/bradduck\_flyntmoore](https://preview.redd.it/0v3ejk0onbg81.png?width=920&format=png&auto=webp&s=80a4dff140352b7b4dbbc3669833c80004ac7ee8) +**Introduction** + +I have been asked to jot down some thoughts on variance by u/gherkinit and u/Criand + +Variance/co-variance/volatility/simple variance/synthetic variance swaps, a year ago I had no idea what these were, over the past 3 months I and others have been diving into this black hole. u/MauerAstronaut has dug as deep on this as I have he is my VOLquant wanna be twin and a good friend, he has already had some post on the subject I highly recommend reading them before reading this. This subject is broad and extremely complex, the more reading the better here, without further delay let me share some thoughts. + +Let me preface by first saying this post may not be for everyone, some of it may be slight speculation based off of actual events and or positions reported. Even though I will go into detail about being "long variance" it is hard to find breadcrumbs of long variance because the portfolio of options to be built as a hedge are in fact sold, or in common terms "short", meaning these positions are usually not reported limiting the evidence left. That being said those that are "short variance" do leave similar hedging breadcrumbs, that is what has led me here. Obligatory "this isn't advice" if you think it is, I feel terribly sorry for you. + +**Brief Breakdown and Effects** + +First thing is first, what is a variance swap? In simple terms it is a bet on volatility. The seller is going to receive a fixed payment called the "fair variance strike as vol" which is a fancy way of saying annualized implied volatility over a period of time (usually 30,60,90 days). The volatility strike is going to be calculated and agreed upon inception, that is going to be the fixed payment that the seller receives upon maturity. The opposite side of the trade is the buyer, the buyer is going to receive "realized variance" payment on maturity, meaning that it is going to get paid based on the volatility realized during the agreed upon period. + +Here is an illustration showing the "*vanilla*" variance trade. Note the word "*vanilla*" not all trades are done this way: + +&#x200B; + +https://preview.redd.it/08ncdf576mx71.jpg?width=892&format=pjpg&auto=webp&s=fe0ceb134c323771924505c7447b6bbb289abd74 + +The above came from this [paper](http://quantlabs.net/academy/download/free_quant_instituitional_books_/[JP%20Morgan]%20Variance%20Swaps.pdf). Now to me this image illustrates a variance trade pretty well, it shows that the Market Maker buys variance as an insurance type play to their short options, then they also sell the replicating portfolio into the market to hedge against the long variance position. Easy peasy right? The buyer, especially when a Market Maker or a Broker Dealer, is pretty shielded here due to their role in the market. They basically get to roll with the tide, at the expense of their counterparty, since the effect of them delta hedging the replicating they sold as a hedge lets them stay flexible: + +&#x200B; + +https://preview.redd.it/lep5uera6mx71.png?width=936&format=png&auto=webp&s=9914d0d28c658fb18e35c0824eef13b06963fc42 + +&#x200B; + +https://preview.redd.it/6k7kyw2c6mx71.png?width=724&format=png&auto=webp&s=202e93311abb15a6e24ba42673da3465a9c3f634 + +What about the seller? The sellers are usually multi-strategy hedge funds whom themselves buy and sell variance on different securities and index(s). Dispersion trading is the name of this practice, it is the practice of going short index variance and long any number of constituent stocks. Or vise versa, like anything of course. This makes a pseudo basket effect, and is thus a CORRELATION TRADE. How many stocks does GME track? Aren't they all volatile? Aren't all the index(s) and ETF(s) they are in ODD to say the least?? Picture perfect dispersion set up. Ironic isn't it...... A quick illustration to help: + +&#x200B; + +https://preview.redd.it/d7w8zygg6mx71.png?width=721&format=png&auto=webp&s=c4a8e795d85f3dcff4e74b72ea4d965d60053107 + +&#x200B; + +https://preview.redd.it/q29uiuwr6mx71.png?width=630&format=png&auto=webp&s=59258fe700b40e11eb39e3e2a7cd17dfb92b4aa2 + +I am not going to go in depth about co-variance swaps/dispersion/correlation trades in this post as it will get rambling like and there just isn't enough room. We are in the process of really breaking this down and trying to model it better. This is just to shed light on the correlation effects we've seen and a reason outside of portfolio swaps, basket shorting, etc that the strong correlation is there. + +**How is this GME related?** + +We ran across this link [SDR Services - CFTC Ticker (dtcc.com)](https://pddata.dtcc.com/gtr/cftc/tracker.do) Which included these: + +&#x200B; + +https://preview.redd.it/sxxz4h6s7mx71.jpg?width=1125&format=pjpg&auto=webp&s=27818c1219e439aa0657708fa284d9c6cf92d820 + +https://preview.redd.it/2s8hbi6s7mx71.jpg?width=1125&format=pjpg&auto=webp&s=c668524a47cb68f51d7bf24c05c49d0ab9b21c38 + +There were more, but I think you get the point, this caught our interest so the next logical thing to do was search "GameStop Variance" that resulted in [GameStop, Variance Swaps, and Related Failures of Hedge Fund Risk Management (northinfo.com)](https://www.northinfo.com/documents/993.pdf) Well that really got me excited so then I went on to learn what this was all about. + +**The Replicating Portfolio** + +After reading [(PDF) More Than You Ever Wanted to Know About Volatility Swaps (researchgate.net)](https://www.researchgate.net/publication/246869706_More_Than_You_Ever_Wanted_to_Know_About_Volatility_Swaps) I learned the the replicating portfolio is quite important in the world of variance swaps. Two main reasons, it is the way a variance swap is priced so the two parties can come to an agreement on "fair variance" as the "variance strike", it also acts as a hedge for the forward contract the actual variance swap is. So what is it? Without getting all "mathy" it is a portfolio of OTM options (both calls and puts) that are used to best capture variance. Here is something to illustrate. + +https://preview.redd.it/h6v0x5gjcmx71.png?width=683&format=png&auto=webp&s=1765a70d37f92910c7681ecd3ed8e8fd191e966e + +This illustrates it pretty well, it highlights the "weights" or number of contracts needed at each strike to build this replicating portfolio of options to price and hedge a swap on an underlying with a spot of about 100. You can always tell where the spot of the underlying is on one of these by identifying where the puts and calls "meet". Here you can tell it is 100 because it is the only strike that it tells you to buy both calls and puts on. *Cool.* Another thing to note is it says European style options, all that means is here in America you hold till maturity. It is needed for correct payoff. + +Looking at this I noted, jeez they put a **lot** of emphasis on that lower strike put in this scenario don't they? That made a lightbulb turn on somewhere, I thought man GME sure does have a strange amount of open interest on lower strike puts like that, it also carries odd open interest in the higher strike ranges on the same expiry. Then I read more papers and I learn that GMEs option chains, especially on monthly expiry's are the perfect situation for someone long variance. So naturally I decided to look at options OI on January 21 2022: + +https://preview.redd.it/43zha5z3fmx71.png?width=1351&format=png&auto=webp&s=38a73b51033e9038c2fc3dff972924754e2640f6 + +https://preview.redd.it/tmamm1z2fmx71.png?width=1358&format=png&auto=webp&s=2f1201a6acd3876e70895b5b0c7ae325b63da797 + +That just seems oddly familiar to the example above doesn't it? Almost textbook how wide this option chain is, and the OI spread across strikes just as the papers recommend. If only I knew what this looked like for GME: + + + +https://preview.redd.it/fxbc9hilfmx71.png?width=266&format=png&auto=webp&s=545792ce7f692f7d181d7ab795672f43fe460ca3 + +This example replicating portfolio of GME was made by me approximately 2 weeks ago, as well as the pictures of the OI was around the same time, so the OI may have moved some, nothing to deter the point its just worth noting. This is for a 90 swap ending Jan 21 2022 it recommends a replicating portfolio, and gives a fair variance as volatility which is used for the "*variance strike*". + +So just to recap, hedge funds sell variance making them short, which in turn requires them to hold a portfolio of long OTM options to hedge the short swap. This should be making lightbulbs turn on, if it doesn't go check Citadel Advisors, Susquehanna, Simplex holdings and see they hold not only puts but calls come back and stare at the replicating above, it will click eventually. If not, never fear u/MauerAstronaut is making a post about the options OI and how it relates to the replicating in more depth soon. + +**Dynamic and Imperfect Hedging** + +Variance swaps require a log contract and would thus need an infinite amount of strikes to be perfectly hedged, without going into all the mathy details this means that narrow strike options chain = **bad** for them. Illustrations: + +https://preview.redd.it/wltipe1wlmx71.png?width=932&format=png&auto=webp&s=eb423c1aa1c2b4cc51d5e97c041f9e091c254ddf + +https://preview.redd.it/n5kqme1wlmx71.png?width=887&format=png&auto=webp&s=2d45b6087888712905c09a3943070fce9531c3a6 + +https://preview.redd.it/gkuqme1wlmx71.png?width=760&format=png&auto=webp&s=9388148709db5389d83e617d5469b89593580b60 + +I will now attempt to explain the above illustration (figure 3) in ape speak as well as one can. + +**A)** Perfect hedge if an infinite number of strikes existed, doesn't exist so its for reference + +**B)** This is what happens when you have a narrow strike range, you are not as hedged because of it. + +**C)** This is when you have more strikes available in a wider range. It mimics the reference one in a) much better. + +More Illustrations: + +&#x200B; + +https://preview.redd.it/oom1m8iymmx71.png?width=938&format=png&auto=webp&s=13c7209e7c94eaf1a71fcf9424ce69f8232dfbc2 + +&#x200B; + +https://preview.redd.it/up0n4269nmx71.png?width=755&format=png&auto=webp&s=47aa301a76363ce3608d3e4cc65d46860bf303ab + +Ok all that just to say that dynamic hedging tail risk is hard without those *really* deep OTM puts. It forces whomever is short the swap to buy more calls to get the exposure needed, which could force the stock upward which is usually not wanted. I will attempt to illustrate this with GME now: + +https://preview.redd.it/yxx3fyovnmx71.png?width=844&format=png&auto=webp&s=e1ef4f5dbcda8fec11bce087bd7476e4af0ced59 + +The above is an illustration I made to try to show what I described above in practice. I chose these historical "as of" dates (gathered from Market Chameleon) because they were the beginning of a snowball tumbling down a mountain that turns into a bigger snowball later. Basically they are the start of any major run up that we have had this year excluding February, it had a very wide options chain yet totally took off. February is an anomaly in many ways so I ignore it. Fuck February. + +If you look you will see that every one of these run ups had a limited chain, comparatively to what GMEs monthly chains look like. After each run up gets started (just like this most recent) the option chain(s) get expanded into more strikes, for several reasons, I just note this to why I picked these dates to capture what they were before expansion. This is key, especially as of the latest run ups, because it forces them to buy more calls for their dynamic hedge vs puts because that's where the vega and IV exposure lies to get their portfolio greeks where they need to be at the close every day since everything is measured close to close. + +To illustrate this I put a theoretical 7 day swap in my model using the 10/29/2021 chain: + +https://preview.redd.it/jh1rz2mcqmx71.png?width=376&format=png&auto=webp&s=3d6d8bc511946b8ebec239914c5479031b6af425 + +**OOF** that's a lot of 2's as well as some weights behind them. As you see from the graphic I posted above it was the same the week after (this week) and you see what has happened. When I made this I needed to confirm my bias even stronger and pull up the OI for the week I just made this and it was: + +&#x200B; + +https://preview.redd.it/c6op0dm9smx71.png?width=1432&format=png&auto=webp&s=cb4036b70a31f3a4a95c9a8d97b6dad99de50d0c + +Note, this was OI before the run up matching the tail risk replicating I modeled. It was pretty clear upward movement was coming. + +**Citadel and Volatility** + +Anyone could do a quick duck duck go containing "Citadel Volatility" scroll through and see, he has been hiring volatility talent for a while. No one more actually. More images: + +&#x200B; + +https://preview.redd.it/j5jqnxgitmx71.png?width=666&format=png&auto=webp&s=0594c6a712d2524870ccec7f38b565654f46c403 + +The timing and the context of this article someone transcribed for me is quite telling. A good dispersion trading strategy is going short credit (fixed income) vol and go long equity vol. So just to be clear Citadel has entities whom systematically short volatility (Citadel Advisors) one whom is buying volatility (Citadel Securities) and also one for credit volatility (Citadel RVFIF) its almost like Citadel is ***built*** around volatility and dispersion trading, hint: it is. They have a history in it, shown [here](https://volquant.medium.com/epic-failures-lessons-from-volatility-funds-blow-ups-6f4226c8334f), and considering how they have expanded into a broad spectrum as pointed out above have learned how to get a grasp on it. + +**Conclusion** + +Variance swaps, or volatility based swaps in general, seem to play a key role in this trade. Considering Citadel's entrenchment with it, it's easy to see to me anyway, how he was cocky enough to take on Melvin's position. Thinking he could hedge it away, internalizing all the risk and profiting off of dispersion trading and systematic variance shorting until everyone got bored and they could get out cheap. + +The problem is growing for them, people have held and bought more, making the risk that got/gets internalized much heavier to carry, meaning they have to release that risk back into the market sometime causing unwanted and unmanageable tail risk to hedge away which can in turn make the problem worse (see this week). DRS is having an affect simply because it basically marks registered shares as insider shares thus removing them circulation making delta hedging (which is daily on replicating portfolios) much harder and more costly. + +This is my short, and probably not only, thoughts on variance. I have had a lot of help from u/turdfurg23, u/sweatysuits, and u/atlasmxz I cannot thank them enough. There have been many others I am sure that I'm forgetting, know ahead of time I'm sorry. Thank you for your time. +>The collapse of economic activity in 2020 from COVID-19 has been immense. An important question is how much of that resulted from government restrictions on activity versus people voluntarily choosing to stay home to avoid infection. This paper examines the drivers of the collapse using cellular phone records data on customer visits to more than 2.25 million individual businesses across 110 different industries. Comparing consumer behavior within the same commuting zones but across boundaries with different policy regimes suggests that legal shutdown orders account for only a modest share of the decline of economic activity (and that having county-level policy data is significantly more accurate than state-level data). **While overall consumer traffic fell by 60 percentage points, legal restrictions explain only 7 of that.** Individual choices were far more important and seem tied to fears of infection. Traffic started dropping before the legal orders were in place; was highly tied to the number of COVID deaths in the county; and showed a clear shift by consumers away from larger/busier stores toward smaller/less busy ones in the same industry. States repealing their shutdown orders saw identically modest recoveries--symmetric going down and coming back. The shutdown orders did, however, have significantly reallocate consumer activity away from “nonessential” to “essential” businesses and from restaurants and bars toward groceries and other food sellers. + +[https://www.nber.org/papers/w27432](https://www.nber.org/papers/w27432) +If you’re not in retirement, or even if you are, what does it matter if you get the money every month, or bigger checks every 3 months? + +I know there’s a little time value of money involved, but not that much. +For those of you who have reached $1000/month or $12k/year in dividends...how long did it take you to get there? Just curious. + +Edit: Follow up questions to help us all. + +How did you reach that point? How long did it take? Did you soak away 1000 dollars a month for 10 years? Did you aim at getting 2000 dollars a year as yield? Please let us know your journey to the goal. +I just saw a commercial for a Honda Civic lease that is $99 a month (let’s round it to $100 for simplicity) and $3900 down. The minimum is 24 months…. So basically after 24 months, I’ve paid $2400 in lease and $3900 down with a total of $6300 and I don’t even own the vehicle at all… + +Like what is the point of a lease? It seems like incredibly poor financial decision and frankly kind of predatory on the lenders side. +Just launched , Buy now huge potential. Join telegram for more information: [https://t.me/mintyswap](https://t.me/mintyswap) + +&#x200B; + +What is MintyNetwork? 🍃 + +&#x200B; + +The fresh new platform to MINT NFTs and Swap Tokens 🤩 + +* MintySwap is a licensed cross-chain aggregation protocol. 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They sold shares without owning them and now have a liability to buy those shares back. They don’t need to have the cash on hand to buy these shares. They can just say, “we have value in other assets that we can sell later”. This is called margin. If the value of those assets goes down or the liability on the shorts goes up to the point where the assets no longer substantially cover the liability (i.e. the maintenance margin), the broker can force Citadel to cover. This is a margin call. + +&#x200B; + +All that to say Citadel needs asset value to avoid covering. + +&#x200B; + +Citadel is required to report their assets to the SEC every quarter on a form called the 13F. Specifically a 13F-HR, for holding report. This is public information and available on the SEC website. The website also hosts 13G forms, which become important in a second. + +&#x200B; + +At a glance, Citadel’s 13F looks normal. They own a wide array of stocks and options – except, interestingly enough, GameStop which they only hold options in. It’s a little peculiar they would own options without covering with underlying stock, but hey, what are you going to do when there are no shares around? That’s not the point of this DD though. + +&#x200B; + +What’s **really** interesting is the number of SPACs on their 13F. SPACs – or Special Purpose Acquisition Company’s – are publicly traded companies with the sole purpose of buying another company. Or in their own words: + +&#x200B; + +“<Insert Ridiculous SPAC Name Here> is a blank check company whose business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses….” + +&#x200B; + +I’m not going to get into any more details. Google it if you want. What’s important is that Citadel has been buying the shit out of these companies over the last year. How do we know? There are a couple ways to tell. First, a SPAC investor must file a 13G with the SEC if they own more than 5% of the total stock issued. Secondly, they need to report it on their 13F. + +&#x200B; + +\*DISCLAIMER: It’s possible not all the 13Gs filled by Citadel are SPACs, but after going through and checking many of them I would say the majority are\* + +&#x200B; + +Here is what the 13Gs say. Between January 2016 and November 2020 Citadel filled 40 of them. Between December 2020 and now they filled 203. What coincidental timing. There was a month in 2021 where they were buying a SPAC a day. The visual is quite jarring. + +&#x200B; + +[13G Forms filed by Month-Year](https://preview.redd.it/8wji1dcxs3h81.png?width=1371&format=png&auto=webp&s=035f31d5dd51e791d8d1eccb4bf9cfdf5b3f5ae6) + +&#x200B; + +Now what do the 13Fs say? It’s more complicated. 13Fs don’t include a date of purchase nor do they specify if a company is a SPAC or not. But it’s pretty easy to tell. Most SPACs have the word “Acquisition” in their name. Yeah, it’s that simple (good thinking, Ken!). Some don’t. There are a couple that use “Merger” or “Holdings” instead. But let’s call it a safety factor. + +&#x200B; + +Some examples of SPACs on the Citadel 13F: + +PLUM ACQUISITION CORP I + +SPARTAN ACQUISITION CORP III + +SPARTACUS ACQUISITION CORP + +&#x200B; + +Glossing over the fact that these names are hilarious, Citadel submitted that they own shares and/or warrants of 287 distinct SPACs. Warrants are just call options that were written by (and therefore exercisable against) the company itself. Combined, these SPAC assets total around $2.7 Billion. + +&#x200B; + +*OK quick check in: Citadel is short and needs assets to avoid a margin call. A lot of these assets are SPACs that they bought in the last year. The total value is upward of $2.7 Billion.* + +&#x200B; + +Still with me? Here is where is gets fun. And by fun, I mean a disgusting abuse of the open market. + +&#x200B; + +Going forward I’m going to pick one SPAC as an example, but what you’re about to read applies to all of them. I have picked Far Peak Acquisition Corp. Why? Because the name is short and easy to spell. You’re out of your mind if you think I’m going to type “Decarbonization Plus Acquisition Corp”, every time I want to search it. Yes, that is a real Citadel owned SPAC. But more importantly Citadel owns millions of shares of Far Peak which is enough to show up on a 13G. + +&#x200B; + +The question becomes where Citadel bought these shares and for how much. We know they didn’t buy them on the open market for a couple reasons. Firstly, they had 2.5M Far Peak shares on their December 31st 2020 13F, but the IPO wasn’t until January 19th 2021. Secondly, the 13G from January 19th 2021 (yes, the IPO date) states Citadel owns over 10M shares and the trade volume on that day just doesn’t match. So where did they come from? + +&#x200B; + +For answers, we look to Far Peak’s 424B4 form, also known as a Prospectus. The Prospectus is filled before an IPO and has financial and security information that must be given to potential investors. + +&#x200B; + +Here are the key takeaways from Far Peak’s Prospectus. + +1. After the proposed public offering there will be 64,750,000 shares outstanding +2. 55,000,000 of these shares are Class A ordinary shares that will be offered publicly at a price of $10.00\*\* +3. The remaining 9,750,000 shares are Class B ordinary shares that are owned by company directors and initial stakeholders. + +\*\*For just the low, low price of $10.00 Far Peaks will throw in 1/3 of a warrant too! + +&#x200B; + +These Class B ordinary shares must be what Citadel owned prior to the IPO because there were no Class A stocks created yet. Class B shares are also known as “Founder Shares” and they can be converted into Class A shares at a 1:1 ratio. + +&#x200B; + +Where is the 13G to support that Citadel bought these Founder Shares? There isn’t one because the company was still private. It isn’t until the IPO that they are required to report. Which is why on January 19th 2021 (again, yes, the same day as the IPO) they submitted that they owned over 10M Class A shares. Class A! They converted as soon as it was possible. + +&#x200B; + +*Check in #2: Still doing ok? Great. Citadel needs assets to maintain their margin. They buy a butt-ton of SPAC Founder Shares before IPO. Founder Shares convert to Class A public shares 1-to-1. The company is offering Class A public shares at $10.00 a pop on the exchange. Citadel exercises their conversion rights immediately on IPO day.* + +&#x200B; + +Ok, I’ll finally tell you how much Citadel paid for these Founder Shares that can be converted into $10.00 Class A shares. + +&#x200B; + +**$0.0026** + +&#x200B; + +Just over a fifth of a cent. + +&#x200B; + +[From Far Peak's Prospectus](https://preview.redd.it/ntfp4tbxt3h81.png?width=1560&format=png&auto=webp&s=ff6446b1c956d113e9e479961703d20f8c035391) + +&#x200B; + +And now everything comes full circle. Citadel is buying Founder Shares pre-IPO @ $0.0026 and then using the Class A conversion @ $10.00 for their asset reporting. Between Citadel and the other Far Peak initial stakeholders, they turned $25,000 into $97,000,000 overnight on just this one SPAC. Literally overnight. Remember, Citadel owns positions in at least 287 SPACs. + +&#x200B; + +And just to confirm let’s check the 13F again. + +&#x200B; + +[From Citadel Advisors LLC 13F-HR](https://preview.redd.it/g7tohyg7u3h81.png?width=1575&format=png&auto=webp&s=9f3addb3be5c888e76545c28ddfb76297ae60982) + +&#x200B; + +You can ignore the warrants and options for now. I might make a Part 2 later if there is interest. + +&#x200B; + +The fourth column is the USD value x1000 and the fifth column is the number of shares. So, 2,763,464 shares over a total value of $27,496,000 = $9.95 a share. I casual 382,592% increase in value. + +&#x200B; + +*Tl;dr / Final Check in: Citadel is buying Founder Shares in SPACs pre-IPO for cents on the dollar and then converting them to Class A stock worth 4000x more than what they paid. This creates false inflation of their asset book and helps them to stay under the maintenance margin.* + +&#x200B; + +\--- + +&#x200B; + +~~Let’s talk dilution. You can stop reading here. This section isn’t part of the original thesis, but it made my skin crawl and I had to include it.~~ + +&#x200B; + +~~When someone buys a share in a SPAC, most of that money goes into something called a trust account. The idea is that when the SPAC finds a target company to purchase, it uses the money in the trust account to do it. Makes sense. But what if they don’t find a company to purchase within the allotted time? In that case the trust is divided up and returned to the shareholders. Except wait. 15% of the outstanding shares are owned by insiders… And these insiders paid a fraction of what the average investor did. They get a chunk of that trust money too. And not a proportional amount to what they deposited. They get an equal split.~~ + +&#x200B; + +~~Here's an example. Let’s say there is (1) Founder Share that an insider bought for $0.01 and (1) Class A public share that I bought for $10.00. The trust account would have $10.01. In the case of a failed acquisition, I’m not getting my $10.00 back. I’m only getting $5.00. The owner of the Founder Share is getting the other $5.00. It's criminal imo.~~ + +&#x200B; + +~~But hey, if they are successful, you just paid for some hedge fund to own 50% of the acquired company - and that’s actually the better outcome.~~ + +&#x200B; + +THIS IS NOT TRUE. Founder Shares lose their redemption and liquidity rights when they convert to Class A stocks and an acquisition hasn't gone through yet. It's only after a successful acquisition that converted Founder Shares are redeemable. I apologize for the error. + +\--- + +&#x200B; + +Big shout out to u/3_Midgets_In_A_Coat for doing some amazing research and pointing out the Founders Share documentation. Would highly recommended their posts if you have the interest. + +&#x200B; + +As always not financial advice, please call me out if I made an error, I can’t say for sure Citadel hasn’t covered, yada yada. + +&#x200B; + +🚀 +My dudes, here's some perspective: + +&#x200B; + +* NASDAQ went from 9785 to 6657 between Feb 20 and Mar 20. \~32% (Markets unsustainable! 'Gonna crash' yelled the news. covid helped that along) +* Then it went from 12,300 to 10622 between Sep 2 to Sep 22. \~14% (Markets unsustainable! 'Gonna crash' yelled the news. i dont even remember why) +* Current drop started around 13,891 on Feb 16. It's at 12,195 today (Mar 5) \~13% (Markets unsustainable! 'Gonna crash' yelled the news. something to do with treasury yields) +* any of all the other 15% corrections/crash prior dating back to 2000. (Markets unsustainable! 'Gonna crash' yelled the news) + +My goodness, with all the self-therapy posts, it's like none of you were around before last month. Don't try to rationalize the reasons, the magnitude or the duration. it just is. + +* if you're in long-dated options or shares, then relax. +* if it's not money you need immediately then relax. + +however, if it's neither of the above, then I suppose it is what it is. + +Source: Doing this since late 90s. current portfolio about down -6% (2021). Overall, since 90s, up about 500% doing literally nothing but buying and holding most of the stuff and trading about 15% of account. + +Edit: hey folks... Since you pointed it out. Out of curiosity I looked up the S&P inflation adjusted return for the same period. It's about 399% for context. I started around '98. But that's a cop out. I had several awful years that had I just did nothing, I would have been better off. Especially when I started. +So let's see. Ethereum has the developer mind share. The most sophisticated developer tools. Enterprise adoption to the point of a global standard in technology. The most transparent and successful development plan than any other currency. **And a historical scaling solution that can literally make ETH the token of web3.** + +And the market remains silent. + +Hilarious. +I read Air India used to be pretty good before it was nationalized and started needing massive subsidies to get by. Nowadays it is one of the worst airlines. This gave me the impression that privatized airlines would do much better than Nationalized ones, yet Emirates is massively profitable and an incredible experience and is actually Nationalized. Adding to my confusion, Etihad is a nationalized airline which was also a luxurious experience, yet they financially do terrible! Plus, there are plenty of private airlines that also offer mediocre experiences and are sometimes unprofitable. So what gives? Could someone explain what is going on, and if privatization is better for airlines, or nationalization? +Hello everyone in the community + +Canada Penny Stocks needs help as soon as possible from the community. The page has grown much faster than anticipated thanks to the $GME hype train. For that reason, let us make a warm welcome to new members. For all the members who have been here since the start, thank you for staying regardless of you being an active member or just a lurker. + +**What we are looking for?** + +\- New Moderators (veteran traders and investors preferably) + +\- Feedback on what you would like to see in the future and what needs to change + +**What is happening to stop bots?** + +The minimum requirements to post are for accounts to have 30 comment karma and be 30 days old. Almost 50% of the posts and comments that are posted are accepted through this filter. The posts and comments you do see all go through this minimum filter. + +**How are low quality posts dealt with?** + +There has been some very good DD but, also some very bad DD that is not even worth the time to read. Posts where users strictly post links with no background information are manually deleted and users are banned for 2-5 days depending on the circumstances and the recurrences. About 10 bots have been permanently deleted who were not stopped by the automod filter. +In November of 2021, I had the bright idea of throwing nearly my entire life's savings into the stock market with very minimal research. As the title states, my initial investment was right around $45k and as of now, my portfolio fluctuates at the $20k mark. + +My portfolio is comprised of 73% of what I would consider as "agressive" stocks. Most of those are tech companies. The other 27% are in etfs. + +Currently, I run my own electronics business and I also work part-time (8 hours a week). I'm also a full-time college student but with grants and scholarships my tuition is practically $0. After taxes, I'm taking home about $3,000 a month with little to no "real" expenses. I'm pretty good with saving money but not sure what to do as I've put myself in a pretty deep hole at this point. + +What would you guys do in my situation? Any tips or advice would be greatly appreciated :). +Before y'all freak out and call him a shill, y'all need to upgrade your English comprehension. + +Carl is saying that with the state of the current system, it allows for shorts to not cover if they are able to drive the stock price down to nothing and get the stock delisted. This has been done many times already. + +So for gamestop, shorts don't have to cover IF the shorts are able to drive the price down to $0. + +But we know that this is not possible because: + +1. We know their tricks +2. Ryan Cohen turning Gamestop into the Amazon of videogames +3. Gamestop is in a very healthy financial position, sitting on hundreds of milliions in cash, all long term debt paid for. +4. Shorts have been bleeding heavily and continue to bleed from their short positions, and have less and less funds to continue their shorting operations. +5. DTC & friends are spitting out new rules and amendments that prepares for MOASS +6. Gamestop got a credit upgrade by S&P, which means institutions can now buy Gamestop to include it in their ETFs if they so choose. +7. The voting results is gonna reveal the truth in a few weeks time. +8. Able to pop this to the moon with a simple crypto dividend declaration. + +&#x200B; + +So in our case, yes, the shorts HAVE to cover for Gamestop in particular because they are not able to drive the price to the ground anymore, not with all of us diamond handing and HODLING. + +So go vote and continue to hodl and buy. Thx +I think beating the S&P500 on average is a given, or else why not just invest in the index. + +Apart from that though, what should a beginner aim for? It must be achievable, or else there is the risk of taking on risky investments to try to get there which will just hurt in the long-term. + +My initial thoughts are 15% target, but only making investments which I think will provide a 22% return (so a 7% margin of safety). + +My current portfolio is: + +30% BABA @219 +70% Cash + +BABA I’m hoping will give me a 30% return in the long term, though it seems like a rare opportunity that won’t come up often so I don’t want to wait around for something similar when I could be investing in great companies in the meantime. +Bond yields seem to be much lower than inflation, so why would anyone buy them? wouldnt it make more sense just to sit on the cash? + +I am looking at this site, please tell me if I am reading it incorrectly + +[https://www.treasury.gov/resource-center/data-chart-center/interest-rates/pages/textview.aspx?data=yield](https://www.treasury.gov/resource-center/data-chart-center/interest-rates/pages/textview.aspx?data=yield) +So for context how I grew up vs him. + +Me: Raised by Single mother, who was an immigrant. She was a maid to wealthy people. We lived in a room we rented in a house, where other immigrant women rented and shared the other rooms. Being hispanic, we ate A LOT of rice/beans/tortillas/all the animal parts (trotters, hearts, etc). Lots of flavor on a budget. Because I was raised in a multicultural immigrant community had better awareness of the world around me (mom had lots of immigrant friends from across Latin America and even some from Spain/Turkey). Got a little older, mom got married, had 2 more kids then it was 5 of us in a 1 bedroom apartment with me sleeping on the couch for years. I studied hard, applied and got scholarships for private high school then college. Then got smacked with the reality that you still need $ to get ahead in the career I wanted to be in. (fuck you unpaid internships) Ended up living with folks for a while and helping their small business they had put together. left for a few years and then did grad school and now I live with my folks and siblings again to pay off school debt. While I grew up poor, I was surrounded by a rich and vibrant immigrant community who was always banding together to throw potluck parties, share hand me downs, help each other move, eat and make the best of things, very positive and very much with the American dream mindset. My mother made it work with very little, and showed me you don’t need much to be happy as long as surrounded by good people. + +Him: Born the youngest in Appalachia, to parents who would go on to divorce. Very insular people don’t leave the town/10 mule radius. His dad raised him, and from the sounds of it, they were house poor. Had the house and not much else. His dad was very strict, angry, and religious. Very much a “by your own bootstraps mentality” pride man. My bf got into college but finally tasted freedom, fucked around and found out. Didn’t finish his first year, worked, moved out but fell into all the poverty traps. Dysfunctional mentally abusive (her to him) relationship lead to him losing his job, pawning things, payday loans, and finally even eviction; all the traps. He moved back in with his dad, got back on his feet. Paid off most of his debt but still suffers from the credit dings - especially from the eviction. Now he lives on his own in a shitty slumlord apartment with the worst downstairs neighbors because of said ding. We both make okay money now, though he is reaching the limit on his career due to lacking a degree. But we’ve both come far from our parents starting points. + +I love him. But we’ve lived very different lives and it never showed more than in a conversation when imagining the future. For him, all he can think about is having a roof over his head. He said he refuses to imagine things he wants to have or do because he is so afraid of being crushed and disappointed. While I can dream about all sorts of absurd things I would love to do and have, realistic and not because it motivates me. + +His poverty robbed him of the ability to dream and it just crushed me, because as the child of immigrants it is all I was ever taught to do. + +TLDR: Poverty is very situational and mentally affects people in many ways. + +Edit: since this blew up just a few things I’d like to clear up. + +1) love my BF and we both have our respective traumas to work through, we are both getting therapy. + +2) While I might have romanticized a bit the immigrant community, being immigrants comes with its own bag of shit. In my parents case operating outside the legal/health etc system. Having wages garnished for taxes they could never claim, depending on slumlords, and the only safety net you had really was the community. A few extra bonuses though. Payday loans aren’t really a thing when you don’t get W-2’s so only way to borrow money is from friends who charge interest in beer. Can’t burn your friends without being cast out of the community. Also the typical response to “I need money ASAP” would be “well this person needs help for $x on this day, want to come make some money doin this manual labor thing? So pluses and minuses all around. It’s complicated, traumatic in its own way as I grew up “behaving” with the constant anxiety of having the rug pulled out from under me at any moment and having my family deported. Woo trauma for everyone 😂 + +3) A lot of people rightly call out support systems make the difference. With this is mind, band together as much as you can. We are all on this big blue ball together. Be kind to one another, and even if you have nothing else to give, a kind word goes a long way and costs nothing. +This checklist might save your day or at least save you some dollars. + +You might think that you would never FOMO into a stock or you might be wondering if this applies to you. Ask yourself these questions to find out if you need the checklist. + +- Have you ever thought of buying some super hyped shares at ATH? + +- Did you consider dropping your savings into the flaming hot coals of BRN and hoping you don’t get BuRNed? + +- Have you thought about joining ‘the team’ in the short squeeze on GME? (there are no teams in retail investing it’s every man for himself) + +- Do you use ASX_Bets or WallStreetBets? + +If you answered yes to any of the precursor questions below then you are in danger of a FOMO trade and need this checklist. + +~~~~~~~~~~~~~~~~~~~~~~~~~ +HOW NOT TO FOMO CHECKLIST +~~~~~~~~~~~~~~~~~~~~~~~~~ + +1. Ask yourself why you want to buy the stock. Are you jealous of others gains? Do you want to be part of that weeks big thing? If yes to either then do not buy. Jealous trading is bad trading. + +2. Warren Buffet said “be greedy when others are fearful and fearful when others are greedy.” Ask yourself if people are being greedy with the stock you want to buy, do not buy if they are. + +3. Ask yourself “am I being a sheep?” Sheep do not make money on the stock market, they don’t even understand the stock market, they are sheep. Don’t be a sheep. + +4. Where did you see the stock? If it was on the news don’t buy it. If it’s trending on one of the subreddits then it’s probably too late. + +5. Is it often appearing on the subreddit and being regularly pushed by the same small crowd? Watch out cause without proof they are probably bag holders hoping to pass the bag to you. + +6. Can you explain to somebody what the company does and why it is a good idea to buy it? If not then you shouldn’t buy it yourself. + +7. Is the market mostly red or mostly green that week? Sell on green weeks and buy on red weeks. It might feel like the other way around at the time but that’s emotional trading. + +8. Is it a meme stock? If yes then be an early adopter or don’t adopt at all. + +9. Have you got spare capital? If money is no issue to you or if you are making a small punt that won’t harm your finances then go ahead. If you are making a big, late move into a meme stock then you’ll be seeing red. + +10. Does it have 🚀 emojis in the DD’s? If yes then disregard all previous steps and bet your house on it. +I would post to /r/depression but there is no activity there. + +I just need some emotional support right now. I have only 1 friend, I’m super far behind on bills and have shit to last me til Thursday somehow, I’m in a comical amount of debt and now have chronic pain. + +Birthdays are supposed to be happy but I’ve just been crying since I woke up, because after 35 years on this planet I have literally nothing to show for it. I wish I turned 80 today instead, at least then I’d be closer to death. I struggle with suicidal thoughts all the time too. + + +I’m just miserable 😩 + + + +I’ve had to make threads in financial assistance subs more than once so I can get to work for the week. It’s pathetic. Being poor is causing what seems like permanent trauma I’m going to have to learn to live with. + + +Edit :thank you everybody for the birthday wishes. I’m trying to respond to each of you but if I missed you still thank you. + +I was wondering if maybe this wasn’t relevant to post in this sub. But it turns out that it’s extremely relevant and there are a lot of us in similar situations. Its shitty that so many feel like I do but I’m glad to know I’m not alone. + +Edit 2: I just want to say thank you from the bottom of my heart. You guys have an incredible amount of empathy and some really great advice. I needed to hear all of it. I’m feeling a little better now, thank you. + + +Edit 4: had to edit to bring post in compliance. +We are about to receive a large number of refugees. Please be polite and welcome them into our community. Be polite and understanding, they come from a troubled land. +I spent $50,000 on surefire Egyptian bunny rabbit futures. This was money that was supposed to be saved for buying a new house and was mainly accrued from dumping pay checks into SPY over the years. + +On the 27th of February , I got tipped off from a buddy that works in the bunny breeding industry. He said that due to the pandemic, Europeans were buying pets like crazy, and one animal in particular... bunny rabbits. + +Now this made me look into Egyptian bunny futures as they produce the most bunnies in the world. The premiums were amazing, this was like buying fucking apple at IPO. On top of all of this, Easter was just a couple months around the corner and a massive shipment of bunnies was meant to leave Egypt and make its way to a port in France. I’m talking a fucking boat load of carrot munching, sex hungry, “what’s up doc” mother fuckers, not just a container. + +So I placed my bet, expiring the week of Easter, for when the shipment would come. Since there were barely any bunnies in France/ all of Europe, there was no supply to meet demand. However, I had it on good authority that prices would barely drop since so many Europeans wanted the little fluffy fucks. + +All was going well, my money was going up and it was the most euphoric feeling ever... + +Until on Wednesday at 10am, I wake up to check how many unrealized tendies I have. To my horror I was down 48%. I frantically called my aforementioned buddy in the industry and he tells me to look up the Suez canal. + +It turns out the shipment was delayed by a day out of Egypt and right after they left port, some big fucking ship decided to block the whole canal. Since Egypt shipped out essentially every last bunny in the damn country, they didn’t need any more bunny food. So every single one of them is going to run out of food over the next week and die on that ship (no point in bringing them back to port cause there’s no food to feed them). Once they arrive in France they will dump the dead bunnies, pick up the next shipment and move on. + +Idk how I’m going to tell my wife this, probably gonna need some protection from her boyfriend for a while too. + +Wish me luck +From [today’s filing](https://www.sec.gov/ix?doc=/Archives/edgar/data/0001326380/000132638021000090/gme-20210731.htm)! + +Doesn’t get more blatant than this. GME have to report every risk to their public investors, and ongoing failure to cover short positions — which they are clearly aware of — continues to be publicly reported as of today. + +GME know far more about the state of their stock ownership than we do. The fact this continues to be reported is bullish AF. + +Buy. Hodl. Stay zen. Be good. Don’t forget to call your mother. We all know what to do by now! 🙏🏻 +>The wealthiest 10% of Americans now own 89% of all U.S. stocks, a record high that highlights the stock market’s role in increasing wealth inequality. The top 1% gained over $6.5 trillion in corporate equities and mutual fund wealth during the Covid-19 pandemic, while the bottom 90% added $1.2 trillion, according to the latest data from the Federal Reserve. The share of corporate equities and mutual funds owned by the top 10% reached the record high in the second quarter, while the bottom 90% of Americans held about 11% of stocks, down from 12% before the pandemic. The stock market, which has nearly doubled since the March 2020 drop and is up nearly 40% since January 2020, was the main source of wealth creation in America during the pandemic — as well as the main driver of inequality. The total wealth of the top 1% now tops 32%, a record, according to the Fed data. Nearly 70% of their wealth gains over the past year and a half — one of the fastest wealth booms in recent history — came from stocks. + +The IPO system probably plays a part... Also there is a saying that they never sell but rather take a loan on the stocks. +&#x200B; + +# 0. Preface + +I am not a financial advisor. I do not provide financial advice. Many thoughts here are my opinion, and others can be speculative. + +I'm personally happy to see that there is a shift from GME DD to macro-economics DD. Because it provides a much wider insight into how the market is behaving, and how GME would **NOT** be the cause of a market crash. Everything has been a pressure cooker over the past decade, ready to burst, and the new DD provides insight on when things might go down. + +The new DD also diverges from the expectations of things to shoot up in price every week, where everyone is watching T+21/T+35/Net Capital cycles. It gives a general "MOASS will most likely occur when everything falls due to liquidation of defaulting Banks / Hedge Funds / Financial Institutions". + +It gives me peace of mind, because I do not watch for specific dates around GME to cause the surge. I watch the economy at the macro scale to understand when things could blow. + +**And to any skeptics - yes, it is possible that GME could never blow up. Do I think it will blow up? Sure I do. But I encourage YOU to read this post, disregarding GME, and to instead understand what is going on with the economy on the macro scale.** + +**Even if the GME play is wrong in your eyes, it is good to understand how the economy could crash harder than it did in 2008. I don't care if you don't believe in GME. I care about you, and don't want YOU to be hurt.** + +[Me IRL - Maybe - Sometime](https://preview.redd.it/pscahu4lxk671.png?width=727&format=png&auto=webp&s=2e5ee31eaef0413023a8cc4be07087210081554c) + +# 1. Before We Begin: An Overview of Repo And Reverse Repo + +Repo and Reverse Repo might be a bit confusing. You probably saw on this subreddit or in news that the reverse repo market has been blowing up, and it's a bit concerning. + +It's not too complicated if you just imagine it between two entities: the Federal Reserve and Banks. + +For both Repo and Reverse Repo, it is an agreement between two parties for one of them to sell some security for a price, and they agree to buy that security back at a later date at a higher price based on some interest rate (usually). This is called a "Repurchase Agreement", where "Repo" is a standard "Repurchase Agreement" and the "Reverse Repo" is a "Reverse Repurchase Agreement", the inverse of a "Repo". + +The length of these Repurchase Agreements can be various lengths. Such as overnight, one month, three month, etc.. But what we're seeing is **short-term** **overnight Reverse Repos**. The parties swap, and then the next trading day they swap back. **It is not a permanent extraction of the underlying security. It is an overnight swap. A permanent extraction comes from Quantitative Easing or Quantitative Tightening, both of which I will discuss later.** + +* **Repo (Repurchase Agreement)** \- This is where the bank swaps collateral (such as US Treasuries) for cash. This is used when the banks have too much collateral and not enough cash, or when the banks want to generate profit off of giving loans to other parties in the repo market. +* **Reverse Repo (Reverse Repurchase Agreement)** \- This is where the bank swaps cash (liquidity) for collateral (such as US Treasuries). This is used when the banks have too much cash (liquidity) and not enough collateral. The main reason behind this behavior is to pump balance sheets for the night. + +Below is a diagram I made which might make this more clear. It is between the Fed (left) and Banks (right): + +**Edit: I have a typo here. QT and QE should be flipped in the diagram. QT is permanent extraction of liquidity. QE is permanent extraction of collateral.** + +[Repo and QT Versus Reverse Repo and QE](https://preview.redd.it/ukum83cf2k671.png?width=1920&format=png&auto=webp&s=99d4c612df82013aed06ff2b22621500a80071cf) + +&#x200B; + +# 2. Quantitative Easing Can-Kick of 2008, Slowly Draining Collateral From The Market + +Note: If you want an overview of what led to the 2008 crash, check out [my previous post](https://www.reddit.com/r/Superstonk/comments/o0scoy/the_bigger_short_how_2008_is_repeating_at_a_much/) which has a summary of the documentary "Inside Job (2010)". It also describes where we're probably headed based on SLR, the DTC, ICC, OCC, NSCC rules, and mortgage default protections expiring June 30th, 2021. + +Zoom back in time to 2008. The economy took a massive dump due to Wall Street's abuse of derivatives and leverage. They created a bunch of toxic CDOs mostly consisting of [subprime Mortgages](https://www.investopedia.com/terms/s/subprimeloan.asp) to create an economic apocalyptic scenario around Mortgage Backed Securities (MBS). Everything was overleveraged and was a massive balloon of bets based on the performance of the MBS's. + +Currently, there's evidence of Wall Street doing the same abuse of toxic CDO's but this time with Commercial Mortgage-Backed Securities (CMBS). \[See above linked post for this detail\] + +The economy was hurting pretty bad from the 2008 crash, and it was going to continue going into a complete death spiral until the Federal Reserve (Fed) introduced Quantitative Easing (QE): + +>The Fed announced QE1 on November 25, 2008. Fed Chairman Ben Bernanke announced an aggressive attack on the financial crisis of 2008. **The Fed began buying $500 billion in mortgage-backed securities and $100 billion in other debt**. QE supported the housing market that the subprime mortgage crisis had devastated. - [Source](https://www.thebalance.com/what-is-qe1-3305530) + +If you're still scratching your head on what QE is, here's the Wikipedia overview definition, as well as (hopefully) a more simplified definition. + +[Quantitative Easing](https://en.wikipedia.org/wiki/Quantitative_easing) (QE) - is a monetary policy whereby a central bank purchases at scale government bonds or other financial assets in order to inject money into the economy to expand economic activity. + +* This is what the Fed will do to extract collateral (including US Treasuries) from the economy in order to push in liquidity. The Fed started doing this in 2008 to extract toxic collateral from the market and encourage economic growth because it allowed more cash flow in the economy. +* This pulls out collateral from the economy, and pushes cash (liquidity) in. +* **It was a ticking timebomb ever since it started, because it extracts collateral from the market, slowly creating a collateral shortage issue.** + +Check out the effects of QE on the Dow Jones Industrial Average ($DJI): + +[DJI Before And After Quantitative Easing Begins](https://preview.redd.it/cktjwttu8k671.png?width=1528&format=png&auto=webp&s=4e23f2e54e6204d8c56323d7e6bc8772c1a02535) + +It was helping the economy reverse the death spiral, and it has been pumping the economy ever since the introduction of QE. The problem is, of course, that collateral would continue to be sucked out of the market through the mechanics of QE. + +**And QE can't continue forever**, because collateral is a fundamental part of the repo market which allows cash to flow in the economy. When you don't have collateral, you can't post the collateral in the market for cash from banks, and thus the flow of cash basically shuts down. You cannot perform a normal repo transaction between a Bank / Hedge Fund / Financial Institution. + +The Fed tried to stop QE after a while. Instead of pulling collateral out of the economy, they needed to try to push collateral back into the economy. In order to stop QE, they tried what was, in essence, the "reverse" of QE called Quantitative Tightening (QT). + +[Quantitative Tightening](https://en.wikipedia.org/wiki/Quantitative_tightening) (QT) - (or quantitative hardening) is a contractionary monetary policy applied by a central bank to decrease the amount of liquidity within the economy. The policy is the **reverse of** **quantitative easing** **(QE)**, aimed to increase money supply in order to "stimulate" the economy. + +* This is what the Fed will do to extract liquidity from the economy in order to push in collateral. It is used to attempt to reverse the effects of QE, to try to regain balance in the economy. +* This pulls out cash (liquidity) from the economy, and pushes collateral in. +* **The Fed attempted QT in 2018, but it proved to have very bad consequences on the economy. So, they went back to QE in 2019, continuing to can-kick the effects of the 2008 crash.** + +This is a chart showing the Fed's "Total Assets", where collateral is an asset for the Fed. So when collateral was extracted from the economy through QE, it went onto their "Assets" side of their balance sheet. When collateral was pushed back into the economy through QT, it was extracted from their "Assets" side of their balance sheet. + +1. At the start of QE in 2008, there is a surge of assets due to the buying up of MBS's and treasuries. +2. Around 2018 the assets began to decline because the Fed attempted QT by pushing collateral back into the economy and sucking liquidity out. +3. Around September 2019 the assets began to increase again because the Fed went back to QE after realizing the negative effects it was having on the economy due to causing a liquidity shortage. + +So... what happened in September of 2019? **Why did QT fail after a decade of QE**? + +[https:\/\/www.federalreserve.gov\/monetarypolicy\/bst\_recenttrends.htm](https://preview.redd.it/x6pfomz2ck671.png?width=893&format=png&auto=webp&s=1c667c5cc3dbc94de50944208f107aac1dd72d73) + +# + +# 3. Quantitative Easing Cannot Be Reversed. The Can-Kick Continues Until The Economy Crashes + +Despite pumping in a bunch of liquidity into the market through QE, the economy was **still lacking liquidity**. When the Fed started to reverse QE through QT, the liquidity in the market tightened and thus the negative effects on the economy began to surface in September of 2019. + +[https:\/\/blog.pimco.com\/en\/2019\/09\/repo-rate-spike-a-tail-of-low-liquidity](https://preview.redd.it/9sd32gdxdk671.png?width=630&format=png&auto=webp&s=0ee9d749419bc2b6c0a84682f6f9b0b886ceca93) + +**Less than a year after starting QT**, a liquidity crisis emerged on September 15th, 2019, when the repo rate spiked up severely. This was a clash of events surrounding the lower liquidity issue. + +>Banks’ “reporting” dates are known inflection points in the short-term funding markets and typically fall at the end of the month, quarter, and of course the year. **But periodically, the 15th of the month is also a pressure point**. Such was the case this past Monday when a short-term funding rate that had been hovering around 2.21% soared as high as 10%. +> +>The funding market succumbed to a trifecta of pressures: + +1. Payments on corporate taxes were due on 15 September, leading to high redemptions of more than $35 billion in money market funds. +2. Cash balances increased by an additional $83 billion in the U.S. Treasury general account, which reduces excess reserves and simultaneously acts to reduce the aggregate supply of overnight liquidity available in funding markets. +3. Dealers needed an additional $20 billion in funding to finance the settlement of recent scheduled U.S. Treasury issuance. + +>... +> +>... +> +>On September 15, **as so many institutions needed funding**, **repo rates climbed well above the fed funds upper-end target at the time of 2.25% to briefly touch 5%.** **The following day, cash repo markets traded as high as 10% for those looking to finance agency mortgage positions overnight**. **Later that morning, the Federal Reserve Bank of New York acknowledged the pressures and conducted its first Open Market Operation (OMO) in more than a decade to add reserves to the funding markets that were clearly in need of the liquidity**. Subsequently, after its meeting Wednesday, the Federal Open Market Committee (FOMC) announced a cut in the interest on excess reserves (IOER) of 0.30% – five basis points more than its cut in the fed funds rate – providing some relief to the upper bound of money-market yields.  - [Source](https://blog.pimco.com/en/2019/09/repo-rate-spike-a-tail-of-low-liquidity) + +Due to the reduced liquidity from QT, because it sucks out liquidity and pushes in collateral, the markets hit a critical point where there was too much cash that was needed and not enough to supply those who needed the cash. There was huge amounts of strain on the economy. + +This was most likely due to continued large leverage + derivatives abuse stemming from what led to the 2000-2007 Housing Market Bubble. The Fed realized that QT could not continue because of the liquidity shortage that was arising. **They had to stop QT and continue QE in order to continue to pull out collateral and pump in liquidity. And thus, the collateral shortage time bomb continued ticking.** + +Below is the figure of when the repo rate shot up to \~10% within a day. This was awful, because it was much more expensive for loans to go out. The repo market would have shut down from nobody wanting to spend 10% on a repurchase agreement to get cash for the day. How would ANYONE get 10% return **overnight** to pay for these loans? The flow of cash was about to halt. + +[https:\/\/www.federalreserve.gov\/econres\/notes\/feds-notes\/what-happened-in-money-markets-in-september-2019-20200227.htm](https://preview.redd.it/86p3getwwj671.png?width=771&format=png&auto=webp&s=2a503c9055d655f80557da8bf46744c205f60011) + +# + +# 4. COVID Initiated A Liquidity Crisis In The Banks, Which Now Fights With The Collateral Shortage + +QE continued on until 2020, when suddenly, COVID came in. Nobody expected it. + +And boy, **oh boy**, did COVID wreak havoc on the economy and the financial world. While the Fed was slowly approaching a collateral crisis through QE, COVID exacerbated the issue due to the sudden impact it had on liquidity. COVID increased liquidity, and when you have a sudden surge of liquidity, you need to balance it with collateral. The economic balance was tipping as of March of 2020. + +This does not even take into account the effects of many people losing their jobs, being unable to pay rent/mortgages, and other issues that arose from COVID. Those all apply to another ticking time bomb: the CMBS issue, equivalent to the MBS bubble of 2000-2007, which I discussed in my other post. + +The COVID pandemic caused a surge of money being printed from stimulus packages in the US. When you print a bunch of money into the economy on a whim, you risk driving inflation of the currency itself. What does inflation encourage? Less spending from companies, due to the higher price. This leads to less loaning of cash in the repo market, and banks obtaining an ever-surplus of cash. + +COVID caused a sudden surge of trillions of dollars worth that the economy couldn't handle naturally. Compare the treasury balance versus the deposits over time, and the surge that occurred in 2020 in response to the pandemic. The COVID stimulus bills pumped in a **massive** amount of money into the economy at the risk of inflation. And we're already seeing the effects of inflation occur on the [supply chain](https://www.businessinsider.com/why-supply-shortages-economy-inventory-chips-lumber-cars-toilet-paper-2021-5): + +[https:\/\/www.federalreserve.gov\/monetarypolicy\/bst\_recenttrends.htm](https://preview.redd.it/amwahlvykk671.png?width=877&format=png&auto=webp&s=1e343c265451a1b2d6754a4d04971bb445e58f43) + +Stimulus checks were sent out to retail. Companies were bailed out. Unemployment increased, resulting in more unemployment benefits going out due to the relief bills. More money printed. More money deposited at banks. + +There was a ton of cash (liquidity) being pumped into the economy over the past year from March 2020 to June 2021. Because of this, due to inflation and an excess of cash, banks began to get a surplus of cash deposited. People had more cash. They didn't need to spend money on rent/mortages. Companies didn't want to spend more due to fears of inflation. So, bank deposits went up. + +**The main problem with this is that the cash deposited with the banks became a liability on their balance sheets. When you have a surplus of liabilities on your balance sheet, you need to 'balance' it out with assets, such as US Treasuries.** + +The banks were now in trouble because they had way, way too many deposits. They were at risk of defaulting due to their SLR requirements. Here is a figure showing how deposits (liabilities) of banks increased over time. It mushroomed during the COVID pandemic: + +[https:\/\/www.ft.com\/content\/a5e165f7-a524-4b5b-9939-de689b6a1687](https://preview.redd.it/6dm07sa3oj671.png?width=891&format=png&auto=webp&s=9acce6ceb03841c64828198eefff21eb06b1e310) + +To combat this issue, the Fed decided to introduce a relief program for banks regarding SLR because of the massive increase of liquidity due to the uppercut that COVID created on the financial world. + +>The supplementary leverage ratio (**SLR**) is the US implementation of the Basel III Tier 1 leverage ratio, **with which banks calculate the amount of common equity capital they must hold relative to their total leverage exposure**. Large US banks must hold 3%. Top-tier bank holding companies must also hold an extra 2% buffer, for a total of 5%. The SLR, which does not distinguish between assets based on risk, is conceived as a backstop to risk-weighted capital requirements. - [Source](https://www.risk.net/definition/supplementary-leverage-ratio-slr) + +In more of a simplified summary, SLR is a requirement of total equity that a bank must hold compared to their total leverage exposure. If they are exposed to leverage, they need to hold enough capital for that position otherwise they are at risk of defaulting. In this case, they only need to hold a measly 3%-5%, dependent on how large of a bank they are. Just like in 2008 - these banks can have massive leverage and SLR is to "help protect the economy" from them abusing leverage. + +But hey, the Fed put in place some protections for the year to help these banks since they were obviously overleveraged to begin with. These protections expired on March 31st, 2021. + +[https:\/\/www.fool.com\/investing\/2021\/03\/29\/the-fed-is-ending-one-of-its-pandemic-relief-progr\/](https://preview.redd.it/14pa4yngtj671.png?width=1433&format=png&auto=webp&s=534726bcf83b0bf40ede7b196191d66c29094d6e) + +>**The Fed's relief program last year allowed banks to exclude U.S. Treasuries and central bank reserves from the SLR calculation**. The relief program was a response to the many non-banking institutions selling Treasuries to raise cash, and coincided with other measures, including the $2.2 trillion CARES Act, which resulted in even more Treasuries being sold into the market. - [Source](https://www.fool.com/investing/2021/03/29/the-fed-is-ending-one-of-its-pandemic-relief-progr/) + +**Right after the expiration of the protection plans of SLR, the Reverse Repo market began to blow up because the banks had way too much liquidity and not enough treasuries on their balance sheets.** + +The argument that the banks were "parking their money at the Fed" was a reasonable explanation at first. Though, with 0% ROI from the RRP at the time, the banks would literally get no return on their investments. So for that argument, all of their other investments would have had to yield negative in order for RRP to be more enticing. Does this make sense to you that they'd use 0% RRP to be an 'investment'? + +The fact that the RRP began to ramp up and then explode after the SLR protections lifted makes this look like a collateral shortage issue. And of course, with QE occurring over the past decade, makes it more likely, because collateral was sucked out of the economy and onto the Fed's balance sheet over the years. + +**That was of course questionable on whether it was a liquidity or collateral issue, until, the RRP rate dropped negative in March of 2021, as well as in April of 2021.** + +&#x200B; + +# 5. Reverse Repo Rate Flips Negative; Warnings Of Collateral Shortage + +Think about it quite simply in a supply/demand factor and the reverse repo when the RRP rate dropped negative. + +You are a bank. You want to get Collateral from the Fed to balance your sheets. The Fed says they'll give you a small amount of interest for borrowing their collateral overnight. But now, imagine that the supply of collateral is too low and demand is too high. The Fed will no longer want to pay you for borrowing its collateral so it will shift the interest rate down. If demand really outweighs supply, then the Fed would then want cash from YOU in order for YOU to borrow the collateral. + +[https:\/\/www.reuters.com\/article\/us-usa-bonds-repo-explainer\/explainer-u-s-repo-market-flirts-with-negative-rates-as-fed-seeks-to-absorb-excess-cash-idUSKBN2C32AI](https://preview.redd.it/eysh9mx9ok671.png?width=961&format=png&auto=webp&s=4d9d1695922b01651eae06c6bcc2753ad0f5b789) + +This was just one of the warning signs that a collateral issue was arising. The RRP rates were already at 0%, so the only way for them to move was either up or down. An increase in treasury demand could shift it down, into the negatives, which it did. + +&#x200B; + +# 6. The Fed Is Fudging The Numbers And Hiding A Collateral Shortage + +The drop in RRP interest rates to the negative **came after** the Fed increased the total borrowing amount of counterparties in the RRP from $30 Billion to $80 Billion. + +[https:\/\/finadium.com\/fed-increases-rrp-limits-from-30-billion-to-80-billion-to-ensure-supply-at-near-0-rates\/](https://preview.redd.it/by2ftlpopk671.png?width=1028&format=png&auto=webp&s=747f50e2fb63aabaedb6e9e947aa117f6c75f91b) + +Why did they do this? Think of it again as a supply versus demand issue. For simple math, imagine the Fed has 50 members. + +* At a limit of $30 Billion per member, that is a total of $30B \* 50 = $1.5 Trillion that can be borrowed. +* At a limit of $80 Billion per member, that is a total of $80B \* 50 = $4 Trillion that can be borrowed. + +What is this doing? Why did the Fed increase the limit? + +**It's artificially inflating the total "supply" of treasuries that can be borrowed by counterparties in the RRP. It is attempting to keep the interest rate positive because there is so much demand for collateral and not enough supply in the markets and on the Fed's balance sheet. The RRP was already at 0%, there was nowhere for it to go besides negative, which as you know implies a shortage of collateral and a red flag for the financial world.** + +Not only did they artificially inflate the total supply to combat the demand by increasing the total borrow amount, **the Fed decided to not affect the assets side of its balance sheet during these RRP transactions**. **This effectively leaves the supply of treasuries on the Fed's balance sheet the same.** This is another method to can-kick to avoid interest rates going negative and flashing a collateral issue. + +>When the Desk conducts RRP open market operations, it sells securities held in the System Open Market Account (SOMA) to eligible RRP counterparties, with an agreement to buy the assets back on the RRP’s specified maturity date. **This leaves the SOMA portfolio the same size**, as securities sold temporarily under repurchase agreements continue to be shown as assets held by the SOMA in accordance with generally accepted accounting principles, but the transaction shifts some of the liabilities on the Federal Reserve’s balance sheet from deposits held by depository institutions (also known as bank reserves) to reverse repos while the trade is outstanding. - [Source](https://www.newyorkfed.org/markets/rrp_faq/rrp-faq-archive/rrp-faq-200715) + +We can see this visually from the Fed's balance sheet that they're not affecting their assets during the RRP. They're allowing counterparties to borrow treasuries **WITHOUT** affecting the supply - desperately trying to get away from the rising demand for treasuries and avoid treasury yields from snapping down (and likewise the price of treasuries up): + +[https:\/\/www.federalreserve.gov\/monetarypolicy\/bst\_recenttrends.htm](https://preview.redd.it/evxua80crk671.png?width=893&format=png&auto=webp&s=6a925b05e7a460b252457923ca97c730c511da6b) + +**On top of this, the Fed showed their hand ONCE AGAIN of fudging the numbers on June 16th when they bumped up the RRP rate to 0.05%. The short-term treasury yields briefly went BELOW the RRP interest amount of 0.05% on June 17th when the new RRP ROI was in effect.** + +**This is a BAD sign because now overnight RRP had a higher return than 2-month and 3-month treasury bonds.** + +**The Fed is fudging the numbers trying to hide the treasury bond shortage.** + +The Fed cannot keep this up. They're trying to keep the T-bill yield curve propped up despite the treasury shortage. They're not affecting their balance sheet, and they also artificially increased the amount of treasuries in their "supply" by increasing the counterparty borrow limit from $30 Billion to $80 Billion. + +[https:\/\/alhambrapartners.com\/2021\/06\/17\/the-fomc-accidentally-exposes-itself-reverse-repo-style\/](https://preview.redd.it/sp52qka5tj671.png?width=858&format=png&auto=webp&s=69d7ec8971035a7939f7bed116f7c923215019d6) + +[https:\/\/www.treasury.gov\/resource-center\/data-chart-center\/interest-rates\/Pages\/TextView.aspx?data=yield](https://preview.redd.it/1f64o77tsk671.png?width=972&format=png&auto=webp&s=48e83c02895066c4e300c5a8adf3d3a065a6b016) + +The Fed is also planning on increasing interest rates. This starts to scare the economy, which is most likely why we're now seeing the dump of the stock market over the past few days and the dump leading into the week of June 21st. This is **bad for the markets** because it means it's going to cost more for the economy to function (e.g. what happened in 2019 when Repo Rates spiked to 10%). Companies have to spend more to hire, produce, etc. **It costs the economy more to function.** + +**The Fed is pinned between a collateral issue from QE sucking out collateral, and a liquidity issue and COVID pumping in too much liquidity for the banks to handle.** + +[https:\/\/www.cnbc.com\/2021\/06\/16\/fed-holds-rates-steady-but-raises-inflation-expectations-sharply-and-makes-no-mention-of-taper.html](https://preview.redd.it/uhhhzguotk671.png?width=1202&format=png&auto=webp&s=cab32cef615311320c6cf27461fa7fb18b0fc7af) + +[https:\/\/www.bbc.com\/news\/business-57090421](https://preview.redd.it/p0v9ij2b0k671.png?width=1013&format=png&auto=webp&s=bf8f525bfc55e8f1287e921bbaaa408c5c27a253) + +# + +# 7. Quarter Ends Explode The Reverse Repo. The Next Quarter End Is June 30th, 2021. + +This is not a date to look forward to for GME potentially rising. This is a date of "Holy shit. **The RRP could explode to the point where treasury supply vs demand is unable to take it any more**". + +About 3-4 days prior to quarter ends, the RRP explodes up in the amount of collateral that is borrowed from the Fed. This is because of the underlying plumbing of the financial markets, identified in Section 3 above, causes additional strain on the financial markets. The banks need more collateral to prop up their balance sheets for the night of the quarter-ends. + +The RRP borrowed amount can shoot up almost **2-4x the current levels.** The amount of RRP at the moment is $747 Billion. **The RRP could explode 2-4x the amount it is at upon June 25th, 2021**. What if it's $1 Trillion by then due to the massive amount of collateral needed by the banks? More? + +**Can the Fed handle it?** + +**Can they still prop the yield curve up?** + +**Will the short-term treasuries dip below the RRP amount once more due to this shortage and flash red flags to the world of financial instability in the US?** + +[https:\/\/www.reddit.com\/r\/Superstonk\/comments\/nylihz\/previous\_rrp\_behavior\_on\_quarter\_ends\_massive\/](https://preview.redd.it/63daa1s8gk671.png?width=1277&format=png&auto=webp&s=d04d4a6b577152d26d6f7ea6e0c31f05f7ce80dc) + +If the US Treasury yield curve snaps down from this instability and the Fed no longer able to prop up the yield curve, then it can drive treasury prices up. + +If /u/atobitt's "[Everything Short](https://www.reddit.com/r/GME/comments/mgucv2/the_everything_short/)" is true and they're actually shorting treasuries, then that can lead to banks defaulting due to the price of treasuries shooting up. When they default, they'll be forced to buy up all the treasuries that they've shorted into the market. + +**And it is very possible that they are shorting treasuries.** + +When performing RRP of 0%, the repo market was most likely shut down due to nobody needing cash loaned out. The banks only profitable move was to perform the RRP with the Fed and then **short** treasuries into the market, **rehypothecating** the treasuries to other parties. This would have also helped prop up the market by artificially increasing the supply of treasuries (collateral) in the market. + +If it's true, and they have truly been performing the "Everything Short", then it could initiate a Global Financial Crisis equivalent to The Great Depression. + +Do I want that to happen? **No**. But is there a chance? **Yes, there is**. + +Is GME going to squeeze? Is the DD just false hopium? I don't think it's just hopium. I believe in the DD. + +But some users might think otherwise and not believe in GME or the DD. Hello users outside of /r/superstonk! If you're reading this, check out the DD on the subreddit! + +Even if there's a **slight** chance of a GME squeeze in **your** eyes, and all of these signs are pointing to a market crash... + +[Why not give it a shot](https://www.youtube.com/watch?v=l4nSHsbFe-o)? +I’ve seen headlines about how Wall Street is rocked by some market crash or huge pull back. Big banks sometimes rush to liquidate to avoid bankruptcy or margin call. + +How can they be “rocked” if they control most of the stocks? It wouldn’t be retail investors since we’re seen as the “little guys”. + +Wouldn’t the major selling be from Wall Street? +On November 28, 2017, the US Senate, Committee of the Judiciary held a hearing regarding bill S.1241: Modernizing AML Laws to Combat Money Laundering and Terrorist Financing. Despite little attention being given to digital currencies during the hearing, bill S.1241 itself would amend the definition of ‘financial institution’ in the United States Code to include digital currencies and digital exchanges. This could have alarming consequences for users of cryptocurrencies both in the US and abroad. + +Bill S.1241 would amend the definition of ‘financial institution,’ in Section 5312(a) of title 31, United States Code, to include “an issuer, redeemer, or cashier of prepaid access devices, digital currency, or any digital exchanger or tumbler of digital currency.” Currently, the definition of ‘financial institution’ includes banks, trust companies, credit unions, currency exchanges, etc. + +In her introduction, Mrs. Feinstein, Ranking Member of the Judiciary Committee, said (31:35), “The bill criminalizes intentionally concealing ownership or control of a bank account.” Although, during the hearing, no further clarifications were given as to the effects this would have on the cryptocurrency community, based on the amended definition of ‘financial institution’, it seems clear enough that the bill would “criminalize [those] intentionally concealing ownership or control of a [digital currency or digital exchange] account.” Wow. Let this sink in for a minute… + +The US senate is proposing a bill to make criminals out of anyone intentionally concealing ownership or control of a digital currency or digital exchange account. What’s more, according to the hearing’s prolonged discussion of US law enforcement’s handling of foreign banks and financial institutions, this bill is certain to have far-reaching effects on not only US citizens but the global community as a whole. + +If the above statement describes you, it is strongly recommended that you watch the hearing with this new definition of ‘financial institution’ in mind. If you’ve already watched the hearing, watch it again, but this time replace all mentions of ‘banks and financial institutions’ with ‘digital currencies and digital exchanges.’ The implications are really rather alarming. + +Interestingly enough, Ms. Kathryn Haun Rodriguez, a Coinbase Board of Directors Member, made absolutely no mention of digital currencies or digital exchanges in her testimony; nor was she asked any questions pertaining to these topics. + +Conversely, in her July 2017 written testimony to the US House of Representatives Committee on Financial Services and Subcommittee on Terrorism and Illicit Finance, she stated that some users of digital currencies use them “to conceal and move illicit proceeds because of the perception that virtual currency is untraceable.” + +Also in her prior written testimony, she stated that “the FinTech industry could be a very helpful partner to the government in addressing national security concerns;” that “investigators like digital footprints and that is exactly what digital currencies provide;” and that “of course, we can only follow the money to an individual or group if they used a Regulated exchange, one that follows basic AML/KYC laws.” Advertisement + +Contrary to the bill itself, the hearing was noticeably lacking in references to cryptocurrencies; although there was some limited mention of such. + +Ms. Klobuchar (2:16:58): + +“Is this transition we’re seeing from cash to digital going to make it easier or harder for law enforcement to track these money laundering cases, and you think these drug cartels are gonna start going cash free, and what do you do about it?” +Mr. John A. Cassara (2:17:15): + +“Senator, I’m just glad I had my career when I did because I don’t know what I’d do trying to follow the money when it comes to digital currencies, it’s extremely, extremely challenging…I think if you look at the metrics, the metrics suggest today [that] digital currencies are a small fraction of the threat that we face. That’s not to say it’s gonna be the case in 5-10 years from now. We’re right at a crossroads, and it’s going to be very, very interesting to see what goes forward.” +Due to the probable negative implications for the global cryptocurrency community, hopefully the interpretation of bill S.1241 in this article is proven incorrect; however, at this point, it seems fairly clear (at least to me, the author) that this is the intent behind the bill. If this is indeed the case, it will be the most recent attack on a growing list of State-backed attacks against the crypto-community. + +Furthermore, from the noticeable lack of references made to digital currencies during the hearing, it would appear this bill is yet another underhanded attempt of the US Government to further erode global freedoms and civil liberties, which markedly began with the introduction of the Patriot Act, shortly after the 9/11 attacks. + +As Tone Vayes mentioned, it would have been nice if Andreas Antonopoulos was there to impart some of the wisdom he shared with the Canadian Senate, on October 8, 2014. + +Tone Vayes’ summation*: “It’s bad…I think it’s gonna end in a very confrontational way between Bitcoin—even Bitcoin holders and users—and the US Government.” + +Jimmy Song’s summation*: “Yeah, the nice thing about laws is they take a long time…” + +Indeed it will be “very, very interesting to see what goes forward.” If this bill passes, how many of you future criminals out there are still set on hodling? + +*to be fair, neither had yet watched the entire hearing. + +Full Disclosure: Landon Mutch is a contributor to the Lightning Network, a layer-two Bitcoin protocol, also BTCManager is scamming it’s writers and not paying them :(. +Welcome to the **/r/EthTrader** Daily Discussion thread. + +*** + +The thread guidelines are as follows: + +- All sub rules apply here. Please review our **[rules page](https://www.reddit.com/r/ethtrader/about/rules)** to become familiar with them. The rules page is also linked in the announcement bar above +- General discussion topics include, but are not limited to, events of the day, technical analysis, alternative Ethereum projects, or minor questions. +- Breaking news or other important content should be submitted as a separate post. +- In-depth altcoin discussions should be referred to the /r/CryptoCurrency discussion thread. To view the thread, [follow this link](https://www.reddit.com/r/CryptoCurrency/search?q=%5BMonthly+General+Discussion%5D&restrict_sr=on&sort=new&t=all) and choose the latest entry on the search page. +- Pumping, venting, trolling, or any other similar behavior should be redirected to the /r/CryptoMarkets trollbox thread. To view the thread, [follow this link](https://www.reddit.com/r/CryptoMarkets/search?q=Trollbox+Thread&sort=new&restrict_sr=on&t=all) and choose the latest entry on the search page. + +*** + +**[EXPERIMENTAL]** - To view live streaming comments for this thread, [click here](https://reddit-stream.com/comments/auto). Account permissions are required to post comments through Reddit-Stream.com. + +*** + +Thank you in advance for your participation. Enjoy! + +All day everyday it seems that’s the vast majority of what’s posted. Can we move that to a mega thread or something? I want to really discuss what this sub was created for. +Let me first say that I love this community along with all of the mods and we are working diligently to prevent any serious action against the sub. We have received warnings about brigading and we take these VERY SERIOUSLY, so as a result we are hoping to enforce our [NO BRIGADING rule](https://www.reddit.com/r/Superstonk/comments/o80eky/no_brigading/) as well as minimize the amount of posts we need to moderate to make sure this can be enforced. + +Due to a very popular reddit subreddit going private due to apparent legal issues (Edit: It appears it is back online for the time being, but that is besides the point), we are increasing our timeline to enforce these policies. Please understand this is NOT an attack on the community but rather a dire attempt to protect it. I am hoping all of you can work with us on this and not make the situation worse. Thank you. + +[Let's take this seriously.](https://preview.redd.it/qa1czpggg1971.jpg?width=656&format=pjpg&auto=webp&s=36b2ee416cafcea9708079f7fb917941082d5226) + +# Increased Karma / Age Restrictions - Effectively Immediately + +I have reached to reddit admins to explain that we are on this and taking it very seriously, and I have initiated a vote with the mods to increase the karma restrictions. Therefore, effectively immediately, the restrictions are now as follows: + +&#x200B; + +||Karma (old)|Karma (NEW)|Age (old)|Age (NEW)| +|:-|:-|:-|:-|:-| +|Posts|2000 karma|8000 karma|120 days|240 days| +|Comments|500 karma|2000 karma|60 days|120 days| + +\*Please note that Award Karma does NOT count toward this, and that Approved Users will bypass these restrictions. Also, please note that other automod rules still apply to Approved Users. + +Please note that these are emergency restrictions and once we know more about the situation, we will relax these restrictions so that all apes can comment. However, we NEED to be able to successfully moderate the sub and this increase will help us do that effectively. Thank you all for understanding. + +[These limits are TEMPORARY - and for security and moderating purposes primarily.](https://i.redd.it/cjkbvivog1971.gif) + +# NO BRIGADING + +Brigading is discussing other subs in a negative light or in a way that they will not appreciate. As a result, we have already implemented a [NO BRIGADING rule](https://www.reddit.com/r/Superstonk/comments/o80eky/no_brigading/) and will be enforcing it diligently. We urge all of you to report posts that violate this rule: + +>Under NO circumstances, will brigading be tolerated on this subreddit or any other. Individuals who are discovered to be participating in this, risk being permanently banned for this reason. +> +>Brigading includes: - organized voting on other subs - harassing other subs - using [r/Superstonk](https://www.reddit.com/r/Superstonk) to defame other subs - posting screenshots from other subs +> +>Additionally, Reddit Admins have placed an irremovable code into our automod that prevents linking other subs entirely. + +Additionally, we have updated automod to include several key phrases and terms that are often use to represent other subs. Please avoid using these terms. We WILL be removing those under the NO BRIGADING rule and doing so more intensely if you try to circumvent the automod. Do not do it. Just stay focused on GameStop and use other mediums to discuss this content. + +I am okay if you want to discuss the suit against reddit if specific subs are omitted. Thank you for understanding and helping to make this subreddit the best on reddit. + +[Stay focused.](https://preview.redd.it/4jbk6bshg1971.png?width=849&format=png&auto=webp&s=8baa1b097ab0163681c5197a17f51f6c14ca494c) + +# GameStop: To the Moon! + +Let's all remember why we are ultimately here. It is not to push r/Superstonk to the top of the lists, but rather to have a safe and secure space to discuss our most favorite stock, GameStop (GME), and to build a community that rivals nations. Let's encourage each other to stay focused, and not get distracted by anything else. There is no reason to deviate from this discussion. + +I would like to remind you that our rules are designated to focus on GameStop stock, and not to focus on demeaning or engaging with other subreddits. You can discuss whatever you want in private chats, in Discord, and on Twitter. I ask that you please confine off-topic discussions to those avenues. + +[Art by u\/YoungbloodAA ](https://preview.redd.it/xxrczikjg1971.jpg?width=3840&format=pjpg&auto=webp&s=0b1b37824e5d255eacec0c11544bdcb3e9a55e93) + +# Remember: We are on Twitter + +[**https://twitter.com/ByeTriangle**](https://twitter.com/ByeTriangle) + +[**https://twitter.com/PinkCatsOnAcid**](https://twitter.com/PinkCatsOnAcid) + +[**https://twitter.com/RedChessQueen99**](https://twitter.com/RedChessQueen99) + +[**https://twitter.com/rensole**](https://twitter.com/rensole) + +[**https://twitter.com/u\_sharkbaitlol**](https://twitter.com/u_sharkbaitlol) + +[**https://twitter.com/BradduckF**](https://twitter.com/BradduckF) + +[**https://twitter.com/grungromp**](https://twitter.com/grungromp) + +[**https://twitter.com/StonkSandwich**](https://twitter.com/StonkSandwich) + +[**https://twitter.com/MetaMadie**](https://twitter.com/MetaMadie) + +**We are also on YouTube:** + +[SuperstonkLive YouTube - Emergency Broadcast System](https://www.youtube.com/channel/UCI4EET9NJPWxUuXGlG6fxPA) + +[ook ook!](https://preview.redd.it/yv59wd0tg1971.jpg?width=1280&format=pjpg&auto=webp&s=57c654f8e403e3c8f783f54faf748bce35e2f51d) + +# Let's all remember that reddit has its policies and rules and we should be following them regardless of our personal takes. Please confine off-topic discussions to other social media and private chats. Thank you! + +EDIT: While certain subreddits are now back to Public view, we are going to leave these restrictions in effect, at least for the weekend. I think we have a flood coming, of new users and discussion, and therefore think of this as "the levies" being raised. Approved Users will see no difference, and if you truly want to be added, you can contact a moderator who can fast-track this process, if you have solid post history. Thank you all for understanding. We are simply doing what we think is best for the subreddit, and know that all of this will be relaxed when things settle down. + +EDIT 2: I just noticed the table up top showed 3000 karma for commenting, but it's really 2000 karma. This is a typo because we changed it last minute to something more reasonable. You can see this has been reflected in the rules and wiki. Sorry for the confusion. +(EDIT: Please join https://ethguard.getopensocial.com/ and please join up in our slack if interested +https://join.slack.com/t/icoreview/shared_invite/MjEzNzQ4MjY0ODgwLTE1MDAzOTk2MjItMDk3Yjg4M2RkOQ) + +I think it's time our community decided to take initiative and provide a community rating for ICOs. We do a lot of bitching but not a lot of action taking. If anyone is willing to help me with site building and become part of a collaboration of minds we could provide a place where traders can contribute their well rounded insight on upcoming projects. If we can become a reliable "evaluator" of projects over time we might be able to enforce standards on ICOs in order for them to be successful (working proof concepts, auditable ICO token smart contracts, designated allocation of funds, etc). I'm willing to put in the effort to bring this to reality if anyone else wants to help or at the very least think this would be useful. + +Edit: it should also be made clear this rating wouldn't be a rating based on potential profitability. We wouldn't want to become the "amazon review rating" of eth projects. It is merely a certification of whether or not the team has done their due diligence on each respective project. +For what it's worth... + +This morning I called up Fidelity because I wanted to make sure my extended hours trading was enabled on my account...took 90 minutes on hold to get through. Apparently, they are slammed over at Fidelity, I asked the gal on the phone what's it been like today...she said because of all this stuff with Robinhood, they're looking at +700% daily volume for transferring accounts, which is quite amazing. + +Happy hunting! + +WE LIKE THE STOCK! + +STICK IT TO THE MAN! +The S&P drops 2% off ATH's and everyone is talking about how to trade in a bear market. + +There's usually a "5 year" and a "max" button on your charts. Look at them from time to time and take a deep breath. For reference to newer traders- + +\-5% to -10% = market correction + +\-20% = bear market + +We won't be in a bear market until the S&P drops down to the low 300's. Anyone trading last year would remember we went way below that in March, if you were buying in, you'd still be way up. + +Edit: I changed this to reflect that a 20% decline from a high technically constitutes a bear market, and not 30% as originally stated. +Your markets are run by bots. Now your daily threads are too. + +&#x200B; + +This thread is for plans and thoughts prior to the market open period. + +&#x200B; + +Posts relating to the "Is /r/ASX_bets about finance or effect your mental health?" etc will lead to a ban of the mods chosing. [You have been warned](https://www.reddit.com/r/ASX_Bets/comments/l0l9et/the_does_asx_bets_effect_your_finances_emotions/?utm_medium=android_app&utm_source=share). Last ban length: 131072 days + +&#x200B; + +[We have an active official/unofficial discord. It's open to all discussions, stonks related and non-stonks related](https://discord.gg/2sQBNuM). + + +ORT ($ORT) is a revolutionary new token that is designed to facilitate fractionalized investment in real estate. Through a partnership with one of Spain’s most prestigious luxury real estate brands (OMNI Estate Group), the development team at Passive Income ($PSI) have created an NFT marketplace designed specifically for real estate investors. + +\*What is the goal of $ORT?\* +The team at OMNI-PSI have been working with top real estate and blockchain lawyers to ensure that fractionalized sales of property through NFTs can be done legally and fairly. There is a private sale coming up for $ORT holders where a $3m villa will be up for sale via fractionalized NFTs, this will allow investors of all sizes to benefit from the increasing value of real estate independently of the crypto market. + +Following the success of the first sale, the NFT marketplace will open up with hundreds of properties listed where investors both big and small can purchase property either outright or through fractionalized NFTs. +ORT is going to disrupt the real estate investment industry through the use of Blockchain technology. + + +\*Benefits for ORT Holders\* + + +Even if holders of $ORT aren’t looking to directly invest in property, there are many ways that they can benefit by simply holding and investing in the $ORT token. +They include: +\- Ability to use the NFT marketplace +\- Early access to new properties +\- Cashback on NFT purchases +\- Commission fees from property sales and rentals shared with ORT holders +\- Access to future product presales +\- Free stays in a luxury villa +And most obviously, the benefit of investing in a low market cap coin that is ready to destabilize an entire industry. +\*Who is behind $ORT?\* +Omni Estate Group and Passive Income are pioneers in the region's real estate market and blockchain technology. With a stronghold of 22,000 properties in their database, OMNI Estate Group is at the forefront of the market as one of the most trusted luxury real estate agents and are also featured on the list for the world's most innovative agencies.  + +Passive Income is a blockchain startup with lots of experience in the crypto space and aims to connect real world businesses with blockchain technology, bringing the most innovative solutions to their clients. + +All team members for both companies are fully public and have been KYC’d. They regularly hold voice chats and live streams for their Telegram communities. + + +\*Marketing\* +There has already been a lot of interest from influencers in both the real estate and cryptocurrency space. These include names such as: + +\- Nate Diaz +\- David Rock +\- Marcus Dahlgren +\- Vincente Ortiz +To celebrate the launch of the NFT Marketplace, they will also be holding a launch party where they will be flying 2 $ORT investors out to Marbella, all expenses paid. This event will be filmed and launched as part of an OMNI-PSI branded podcast series which will feature guest appearances from both real estate and blockchain influencers. + +Following the launch of the NFT Marketplace, there will be a huge push on marketing this podcast on multiple channels to ensure a good crossover between a real estate and crypto audience.  + +Additionally, there will be a strong advertising presence both digitally and in traditional forms. Currently there are billboards across Marbella advertising the project and this will soon expand to other regions such as London and Dubai. + + +The aim is to make the concept as accessible to traditional real estate investors as possible, while also introducing real estate investment to crypto users. + + +\- Token Name: $ORT + +\- Contract: BSC [https://bscscan.com/token/0x1d64327c74d6519afef54e58730ad6fc797f05ba](https://bscscan.com/token/0x1d64327c74d6519afef54e58730ad6fc797f05ba) + +\*\*Pancake Swap\*\* [https://exchange.pancakeswap.finance/#/swap?outputCurrency=0x1d64327c74d6519afef54e58730ad6fc797f05ba](https://exchange.pancakeswap.finance/#/swap?outputCurrency=0x1d64327c74d6519afef54e58730ad6fc797f05ba) + + +\*\*Whitepaper\*\* +[https://omni-psi.com/main-images/omnipsipresentation.pdf](https://omni-psi.com/main-images/omnipsipresentation.pdf) +\*\*CERTIK Audit\*\* +[https://omni-psi.com/main-images/Certikauditreport.pdf](https://omni-psi.com/main-images/Certikauditreport.pdf) +\*\*Telegram\*\* +[https://t.me/omnipsi](https://t.me/omnipsi) +\*\*Twitter\*\* +[https://twitter.com/omniestategroup](https://twitter.com/omniestategroup) + +\*\*BSC Contract Address\*\* + +0x1d64327C74d6519afeF54E58730aD6fc797f05Ba +I’m in my early 20s and feeling a bit lost at the moment. I currently earn 87k and have begun saving to be able to purchase my first home. All is going perfectly but I’m still not satisfied because I can’t figure out the reason for doing all of this. + +Just the thought of going to work, coming home to a family, going on holidays once a year and repeating for 40 years sounds incredibly depressing. We are only on this planet for 80 years before we are gone forever, and all our accomplishments forgotten. A couple generations after we are gone, not even our own descendants will know who we are. + +So my question is, what really are your goals in life? is having a family, good job and a home all you really want to achieve? When your time is near, will you look back and be proud of what you have spent your valuable time on? +Hey all, + +Please suggest some of the YouTube channels that you follow to understand the fundamentals of economy... Like economics explained(https://youtube.com/c/EconomicsExplained) + +Also, if there are channels that helped you to understand the changes in economy +Hi all, + +I recently sold a part of my company that I’ve been running for many years and got a large sum of money (around 4 M USD). After a few months of research, I am starting to get an overview of an investment portfolio. It’s been quite difficult, as I’ve had no previous experience with investing, and everyone seems to only promote what they think is the way to go (banker wants me to invest in their funds, crypto friends say 100 % crypto, fire people say “index ETFs and chill” etc.). + +As I will keep working on my business, which is not at all related to investing, I want my investments to be fairly hands off. Additionally, I am a quite conservative investor. I do not want to risk losing my capital over long term. I have calculated that withdrawing 1.5 - 2 % per year from the portfolio would be enough to cover my living expenses. + +Would love to hear your thoughts on my portfolio, as this is the best sub I’ve found so far. I am planning to DCA over next 3 years or so. + +Cash: 7.5 % (5 years expenses on HY savings account) + +Equities: 40-50 % (All world ETF iShares/Vanguard) + +Bonds: 15-20 % (Haven’t decided exactly which ones yet, probably a split between Inflation Linked bonds and Long term Bonds) + +Gold: 5 % (Physical and via ETF) + +Crypto: 2 % (BTC and ETH) + +Own new projects: 3 % + +The last 20-30 % of the portfolio I am not sure about yet. I am leaning towards Real Estate as I want more diversification in the portfolio, but on the other hand I’m a bit resistant as I’m not looking forward to be a landlord, yields are super low in my city (like 3-4 % gross), and RE prices have increased with 50 % in past years. + +Thanks in advance! +I talked about the idea [here](https://www.reddit.com/r/investing/comments/9mvabs/z/e7htx2q), and it's a simple one, but potentially lucrative. All that needs to be done is identify public companies with major product lines enjoyed particularly by basic white girls and equal weight them. Intuitively it makes sense; these are customers with money and the ability to set cultural trends. Here is the American white girl index as I currently have it: + +* AAPL + +* DECK + +* DIS + +* EL + +* FB + +* LB + +* LULU + +* NKE + +* SBUX + +* UAA + +* ULTA + +* VFC + +If we add foreign stocks, we can include these: + +* ADDYY + +* DEO + +* LRLCY + +* LVMUY + +I don't remember the rest of what we came up with, but regardless, backtest and behold. White girls crush the market. + +EDIT: I'm back in this thread, and I agree about several of the proposed additions, most notably TIF. A lot of you are asking why I left out SNAP, though. I simply forgot about it, but even if I didn't, it's been public for such a short time that it would screw up any decent backtest, and I would probably not include a company with no history of positive EPS anyways. That said, if any of you put some money into a scheme like this, feel free to add or subtract whatever you want. I am powerless to stop you. + +EDIT2: In accordance with community consensus, we can go ahead and add these: + +* ETSY + +* FIZZ + +* GOOS + +* NFLX + +* SNAP + +* TGT + +* TIF + +I personally would decline to add a couple of those due either to very recent IPOs or a lack of history of profitability, but they do fit the stereotypes. +Long-time lurker, first time poster. + +I'm 26M, annual salary is \~$400k, NW is \~$1.3m, and I just bought a house last month with a $5k mortgage. Current company allows mega-backdoor maxing of retirement accounts. + +My current job is good (I'm happy overall) but I'm very excited by this startup. It's a company started by a former coworker, I believe in the problem it's solving, and I think it'll be successful (though of course who knows). This former coworker is one of the smartest guys I know. The salary would be around $160k (haven't confirmed yet the equity). + +My gut says to just f\*\*\*-ing do it, my brain screams no. + +Crunching the numbers, if this startup doesn't work out, I'd be setting myself back by at least 5 years just from the compounding. But if it does work out, I'd be very upset at having not taken this opportunity. What would you do in this situation? + +Update: thank you so much for the feedback. I read every single comment. I am still waiting to hear back about equity but I am 95% sure it's a no for me. While I'm working my current job I will save and put my effort + time into eventually starting my own company in 10 years after I'm fatfire. Thank you everyone for your perspectives! +What did you do with your bachelor degree in economics? I am interested in knowing what did you do with it and what careers did you pursue? Did you regret it or was it something that was worth it?? +I have almost all of mine in VWRP however I thought I would have a punt into crypto since i beat myself up for not getting on the bitcoin and Etherium train long ago. + +I went with cardano, Etherium, polkadot and enjin and put £200 in each which I didn't feel was too much and I'm looking at a 10 year hold. + +Ofcourse everyone's attitude to risk is different. I have 50k in my ISA and £800 in crypto. I guess I'm wondering what other people's attitudes to risk is towards crypto now that meta and the metaverse along with web 3 are now not going anywhere. Particularly when people who previously trashed it on wall Street are now in it. +I don't know how many of you heard of the man who got the 800k tax bill on 45k day trading profit because of wash sales rules (just Google it if you haven't cause dumb automod won't let me link it since it mentions the forbidden broker) but I got a question about that whole situation. So to all the frequent day traders/scalpers out there, how do you guys avoid such a catastrophe with the wash sale rule? I understand how the rule works I just don't entirely understand how you are supposed to not get slapped with a tax bill that is more than your profits if you continuously day trade/scalp same tickers for small profits and losses days in and out as losses are essentially disallowed in these instances but the profits are recorded. So if you have any knowledge in this area please share it with me because dumb Google gave me a bunch of articles on what a wash sale is and none on how day traders deal with it. Thank you :) !! + +EDIT: +Okay after reading all of your comments ( thank you so much for all the explanations btw!! ) here’s like a summary. Most of you don’t have to worry about this (assuming you are decent traders who can turn a profit EVENTUALLY lol). Even if you sell for a loss and buy back the same stock within 30 days the loss will be just added on onto your cost basis. So if you are scalping same tickers over and over again your goal is to eventually turn a profit on them. If you can’t turn profit on them cause you took a big loss on a ticker, stop trading it in the end of November (just to be safe) to the end of December (so 61 days passes) and your losses will get settled and everything will be good. What I think that guy did was that he had winning tickers and losing tickers but he never stopped trading the losing tickers so his 1.4 mil profit was booked and sent to the IRS but his 1.05 mil losses never settled because of wash sale and therefore were never sent to the IRS. So his 800k tax bill is on his 1.4 mil gains while his losses were not accounted for because of wash sale. So in the end just don’t be retarded :) +TLDR; OCC asking SEC if they can manipulate the market + +[\\"thereunder\\" - in accordance with the thing mentioned](https://preview.redd.it/5s8zzu2fkop71.png?width=991&format=png&auto=webp&s=8d4b15a8223f2b7a25110c0e9e62654f1e77d115) + +**This order approves the Proposed Rule Change.** + +https://preview.redd.it/ny0x7itjkop71.png?width=816&format=png&auto=webp&s=0204d59b72b2d4d13d8148d4e26785c36dee8b42 + +What this means is that OCC is asking the SEC to give them more room for manipulation. With these rules implemented, their board of directors would have more power in electing, clarifying authority and make other administrative changes. + +[wtf](https://preview.redd.it/wn78ybzkkop71.png?width=1066&format=png&auto=webp&s=b1b9448b5964fd015d1f5881718489c277594b88) + +1. Rule 1104(b) - authority to delay the immediate liquidation of a suspended Clearing Member’s margin deposits and to use such deposits to borrow or otherwise obtain funds from third parties +2. Rule 1106(e) - authority to determine not to close out a suspended Clearing Member’s unsegregated long positions or short positions in options or BOUNDs, or long or short positions in futures +3. **Rule 1106(f) - authority to execute hedging transactions to reduce the risk associated with any collateral or positions not immediately liquidated or closed out pursuant to Rules 1104(b) and 1006(e)** + +[Link to the rules.](https://www.theocc.com/getmedia/e8792e3c-8802-4f5d-bef2-ada408ed1d96/default-rules-and-procedures.pdf;) + +I'll keep reading but need apes help to understand what this really means. + +edit1: rule 1104(b) + +[if chairman of president think liquidation is not good for occ, NO LIQUIDATION](https://preview.redd.it/7rik866nkop71.png?width=846&format=png&auto=webp&s=201ccbf74273496fef0b0f4c4f41d6727bebc6a8) + +rule 1106(e) + +[if chairman, ceo or coo think that closing suspended clearing members longs\/shorts in futures is not good for occ, NO CLOSING POSITIONS](https://preview.redd.it/co98j8xpkop71.png?width=804&format=png&auto=webp&s=226243750535f81485eea795257eb6c1e9821ce6) + +rule 1106(f) + +[if chairman, ceo or coo think that occ can't close longs\/shorts in options or BOUNDs, or can't close longs\/shorts in futures, or can't liquidate margin deposits of a suspended clearing member, NO CLOSING POSITIONS AND NO LIQUIDATION](https://preview.redd.it/zlij1nvrkop71.png?width=790&format=png&auto=webp&s=0c9d59e7cb2ae6ebb2f57b56dccc69d42c64ab91) + +edit6: thanks u/Blanderson_Snooper + +https://preview.redd.it/3tliqojxkop71.png?width=833&format=png&auto=webp&s=945765fb9f62c59325a8645cec34851e3934926c + +edit8: could this possibly be a good thing? ask u/Rejectbaby + +https://preview.redd.it/rwadcgfzkop71.png?width=882&format=png&auto=webp&s=7117435650306632e9bb9fb675fc80eabb9914cb + +edit11: okay, we've got CFTC coming in hot. [Link to document.](https://www.cftc.gov/sites/default/files/filings/orgrules/20/06/rule060920occdco001.pdf) Again, don't be angry, keep a cool & clear head and ~~let's oust these motherfuckers.~~ Let's find out what this really means. + +>The proposed rule change by OCC concerns enhancements to OCC’s overall framework for +> +>managing liquidity risk. Specifically, the proposed changes would: + +&#x200B; + +https://preview.redd.it/ubfs9l6fnop71.png?width=969&format=png&auto=webp&s=23b75f587cbe875e056c050f4354714b84389084 + +https://preview.redd.it/7i11pl9gnop71.png?width=963&format=png&auto=webp&s=ac8e5b82cf490cdc892cb5792486fb0f250da91b + +edit12: thanks u/KosmicKanuck for this comment, check their 3rd edit, [link to the comment](https://www.reddit.com/r/Superstonk/comments/pv5z2v/comment/he7wyzq/?utm_source=share&utm_medium=web2x&context=3) + +https://preview.redd.it/b0du0yhvqop71.png?width=871&format=png&auto=webp&s=94c97e10023aef7e0e1a702769563ddcc7afc545 + +edit13: to clarify, rules 1104 and 1106 have been around for a while, this filing doesn't say that these rules are changed, only that OCC's board of directors and lower level execs can now enact these rules. This, to me, implies that somebody might plant someone (or already has) in the OCC board and they're sitting there like a manchurian candidate. Could be wrong. *drops mic* + +*picks up mic* edit 14: okay, I've been made aware that some of the things I said look like I'm calling for action and that wasn't my intention so I removed them and cleaned up irrelevant edits, and left the ones I believe are more relevant to the topic. There is also this [*counterpost*](https://www.reddit.com/r/Superstonk/comments/pvc7l7/occ_fud_is_being_spread_and_smooth_brains_are_too/)*,* make of it what you will, but it basically lists the same comments that I listed in my edits. + +OP of that post also says: + +>**Stop getting emotional about things you don't understand. Be zen.** + +It is unfortunate that this is how the post ends. There is, of course, more to the story then just staying zen. And just because I removed the stuff that looks FUDdy doesn't mean that I won't call for action. Fuck that. This is now a call for action. I had no idea until I found this that the market is **this manipulated**. These institutions are literally cheating and destroying the meaning of free markets. I invite every ape able to write to their representatives, ask questions on their twitters, if you don't understand something, just as OP said there, don't get emotional, **but don't just be zen either**. If you are able to do something to stop these things from happening again, then do it. + +I left a quote from Mike Tyson earlier but I believe this one is more appropriate. + +*Injustice anywhere is a threat to justice everywhere.* + +&#x200B; +Hey Everyone, + +I graduated college a few years ago with a computer engineering degree, I was (and probably still am) very arrogant. I thought because I could write good C++ code, I could print money with algo trading and somehow "scalping" stocks. Boy was I wrong! + +I spent the better part of 2 years playing around with strategies. 3 Bar play, some automated support and resistance stuff, ema...nothing ground breaking. I really thought my engineering skills could carry me through, and as I wrote my own code, I thought somehow because I had my own system (nicknamed Project Friday because I started it on a Friday and becauyse I like Jennifer Connolly) I would somehow gain an edge. That wasn't the case for me. + +This isn't to discourage anyone else, I've just decided to go seperate ways. What I've learned of the past 2 years is that trading is incredibly difficult, and I'm not convinced you should go into algotrading unless you are interested in actual trading. I still might swing trade easy stock picks here and there, but I don't see myself connecting to TDA's api in the near future. + +I just want to thank everyone in the community for answer my countless questions. I also want to leave a few thoughts, take it or leave it: +- Python is fast enough. I write C++ and C# code for a living, it probably won't matter for you unless you are somehow market making +- Reddit is the most supportive and most pessimistic community out there. Others who failed love to tell you no, but others will give you enough motivation to run through a brick wall + +I just wanted to explain my expierence. We'll see if its helpful. I've just left to focus on goals that make more sense to my engeering brain. A lot of the traders were helpful, but I'll also say, there are a lot of traders that LOVE to tell you how many THOUSANDS of hours its taken to master what they do, and how skilled they are. I'm very skeptical over that, as a lot of us have had pretty rigorous educations ourselves and theirs an approach like we can't learn it without insane time studying, but whatever, I'll make money in other ways and shovel it into SPY and enjoy life. Thanks everyone, I really mean it. +Earlier today Coinbase made a “transparency post” naming about 50 assets that they are planning to list on their exchange. Most of them are illiquid shitcoins that no one can figure out why they are even listing in the first place. + +&#x200B; + +https://preview.redd.it/42pb31wkc7t81.jpg?width=1170&format=pjpg&auto=webp&s=9dc7ecdf375b30f55f3d82565bf39284dbbfa2b6 + +A bunch of people on Twitter went digging on-chain and found out that there is an insider that has been buying massive positions in these tokens, which have all obviously skyrocketed after the announcement. + +&#x200B; + +[https:\/\/twitter.com\/alanstacked\/status\/1514026523430424579?s=21&t=e9d5EKQ8hH0MLQTe4Ongwg](https://preview.redd.it/473ifxcnc7t81.jpg?width=1170&format=pjpg&auto=webp&s=758acc72cbfa1d75ce0fb70edc2eb5765e2ceb6e) + +&#x200B; + +[https:\/\/twitter.com\/cobie\/status\/1513874972552355846?s=21&t=e9d5EKQ8hH0MLQTe4Ongwg](https://preview.redd.it/5bqkixqsc7t81.jpg?width=1170&format=pjpg&auto=webp&s=df7b48676d1b118d6eb76f2d2bc946d94a96afc8) + +&#x200B; + +[https:\/\/twitter.com\/zachxbt\/status\/1513915728671526913?s=21&t=e9d5EKQ8hH0MLQTe4Ongwg](https://preview.redd.it/aonnyk3zc7t81.jpg?width=1170&format=pjpg&auto=webp&s=4de895270bc23c94551ccbc6a6061a511a0c8277) + +&#x200B; + +[https:\/\/twitter.com\/scruffur\/status\/1491119583104991232?s=21&t=e9d5EKQ8hH0MLQTe4Ongwg](https://preview.redd.it/tecr3c73d7t81.jpg?width=1170&format=pjpg&auto=webp&s=20f08274d664a5857731dae2c70ecbdb202d508b) + +This is blatant corruption and insider trading. Yet the SEC won’t do shit about this and instead prevents a Bitcoin ETF from existing or bans US residents airdrops. This is why we can’t have nice things. +E.g. Greece went bankrupt a while ago. Since the country can't just disappear like a company, is there a possibility that billionaires will eventually give out private loans or even buy the country to run it? +Look I understand giving ideas to a company you love. I understand you probably think the introduction of your favorite sock puppets to Gamestop will soar their revenue next quarter. I've been noticing a trend around here lately it looks something like this: + + +Superstonk Fan: Gamestop you should really branch out into catheters! My grandpa needs one all the time it could be an amazing business addition! + + +Gamestop Representative: Uuhh yeah great idea, we will absolutely make sure that gets to the right department! + + +Superstonk Fan: *posts Instagram screenshot to r/superstonk* Look everyone Gamestop said they're going to sell Catheters soon!! I love this company! + +The comments then proceed to just be an echo chamber of false expectations for Gamestop to branch into some weird niche sector. You're raising expectations and hopes for the purpose of what? Karma farming? Make your suggestions, and keep them between you and the company. If you made the suggestion for the good of the company there is no need to flaunt their response as some sort of **BIG WIN** for GME shareholders. + + +**EDIT:** Just wanted to add a note after the fact since this gained some traction. I love Gamestop, I love the journey they are taking us on, and I love the GME shareholders. This company has single handedly changed my life forever and I sincerely want the same for every single one of you. This is not a FUD attempt merely a gauging of sentiment towards a particular trend arising. Thank you, Buy some more GME today yeah? + +**EDIT 2:** Alright to those who felt personally attacked by this post, sorry but it had to be said. I am done responding for now, boss will probably notice I'm not working soon. Need elaboration? Check the comment section. 🚀🚀🚀🚀 + +**FINAL EDIT:** Just got off work, what a fun day talking to you all. I appreciate the corroborating opinions, as well as the dissenting ones. If you feel my open conversation on an arising trend within the community was FUD or in any way malicious, I assure you that was not the intent. I'm happy for those who picked up on the hyperbole to add levity to the situation, and enjoyed the jokes. My post was not about cutting communication with Gamestop, rather the abuse of a dedicated sub to proctor small village sized echo chambers of support to a single business proposition and have it broadcasted to half a million users on slow news days. A 2k upvoted business idea about gamestop pizza is not a generally accepted idea from the sub just because the sub was slow when it gets pushed up. Have a good weekend everyone, next week should be fun! +I have put up a few Uranium and Uranium company DD posts previously - so for more company specific and sector performance feel free to look through post history. But for the influx of new members and the growing interest in the **Emerging Uranium Bull Market** I have compiled an updated summarised post - including key stats, charts and diagrams for easy reading. + + The post will cover a brief background on Uranium & Nuclear Energy, then dive into the gaps between **demand** and **supply**, Inventory, how **covid** has affected production, the **bear case,** how the **ASX is performing** and a **rocket rating** of the top picks on the bottom. It is a long post, but for anyone remotely interested, it's important to know all the info. + +# Uranium Background + +Uranium is primarily used in nuclear reactors for energy & electricity generation through splitting atoms - fission chain reactors - to heat water to produce steam to power turbines. There is also a large use in research reactors for production of medical and industrial isotopes and training as well as over 160 ships (mostly submarines) and counting are propelled by nuclear reactors. + +* Nuclear power is the **LOWEST** non-carbon operating cost per MWh fuel source +* Nuclear energy provides reliable base load power and accounts for **11%** **of total global electricity** +* Nuclear is rapidly being recognised by more and more countries as a **contributor to a low carbon future** \- one of the **lowest sources of carbon emissions** +* **Waste** is dense and low in total volume, BUT is now being utilised in advanced reactor technologies. +* **Inventory** built up since Fukushima is near exhausted +* The Uranium sector offers **exceptional asymmetric risk/reward** +* Growing interest in **Small Modular Reactors (SMRs**) in Canada, Scandinavian Asia and Middle east as well as using SMRs for mass **hydrogen** generation through electrolysis. +* Electricity demand will likely **double** over next two decades as result of influx of **Electric vehicles alone🔋🚗** \- sourcing the energy is biggest challenge. **\*ELON MUSK** has been quoted "Given the wind doesn't always blow, nuclear power may be necessary to meet tomorrow's electricity needs". + +[Nuclear Fuel Value chain \(\~2yr process from mine to reactor\)](https://preview.redd.it/pa5s04vzxcg61.png?width=1150&format=png&auto=webp&s=50dc863abe754742a32fd66a5687b7f5f0b3d9d6) + +# Demand - it’s increasing + +* Industry is driven by energy and electricity consumption which continues to rise yr-on-yr +* Strong Uranium demand growth +* As of 2020 **177Mlb (million pounds) required to fuel the** +* **442 operating reactors** **wordwide** – providing **11%** of worlds electricity +* Further **56 under construction** globally +* China building **14 new** reactors this year with further 41 planned over next 15yrs +* Further **108 reactors planned** for construction globally after 2020 +* US announced life extension of 12x reactors planned for decommissioing starting end 2021 +* Japan recently announced they are approving reactors shutdown since Fukushima to begin restart plans to meet 2030 zero carbon emissions +* **USA in 2020 announced Nuclear fuel fund for strategic resupply of Uranium stockpiles** + +**By Country:** + +* · **France** – depends on 78% of electrical production from nuclear with 56 operating reactors +* · **USA** – 20% of elect production with 94 operable reactors +* · **Canada** has 19 reactors for 15% with life extension under way for 30-35yrs to phase out coal +* · **Russia** – 38 reactors for 20% elect with 4 new under construction and **11 new plants by 2030** +* · **China** – 49 reactors with plan to build further 14 under construction and 41 planned **per their 2020 Energy Development Strategy** – with the impetus for developing new nuclear power for need to improve urban air quality +* India – 22 reactors for 3% elect supply with further 7 under construction +* **220 Research reactors** **in 50 countries** with more under construction. Production of medical and industrial isotopes and training. +* Over **160 ships (submarines** and air-craft carriers) propelled by some 200 reactors + +So that’s demand. It’s set and its increasing as the world’s energy and electricity demands increase and as Green Governance Policy is introduced to reduce carbon emissions. + +[Reactors under construction & planned \*as of October 2020](https://preview.redd.it/ultoyw8izcg61.png?width=1014&format=png&auto=webp&s=9c2dd10b23c5e7f1ca0ac0b6520ac83ade3b6696) + +# Supply - it's been decreasing, further accelerated due to COVID + +Since 2016, global supply of Uranium has been decreasing. This is due to sustained low uranium prices that have led to supply cuts (mines shutin) and small companies closed. + +* Mines were **scheduled to supply 135Mlb** in 2020 (demand was 177Mlb) with the rest coming from secondary supply and inventory drawdown. +* Due to covid this was **reduced to 115Mlb** +* The **two biggest uranium producers** (Kazataprom and Cameco) began closing mines in 2016 + * Cameco closed Rabbit Lake in 2016 + * Suspended McArthur River in 2018 (\~18Mlb/annum) + * Cigar lake suspended (due to Covid – see next section) +* **Kazahkstan** is the **world’s largest supplier** of uranium – they have actively been reducing production and in 2020 announced a continued **20% reduction for three years** – purely because of the low price. +* Kazataprom has openly stated they **will not replace the lbs of lost production** as it is not in their best interest to produce their finite resource at the lower Uranium prices. +* **Several of world's largest mines** will **cease production over coming years** starting with + * Australia's Ranger mine closed in Dec 2020 permanently + * Niger's Cominak mine closing this quarter +* Paladin’s Langer Heinrich was suspended in May 2018 + +https://preview.redd.it/njy4jeruzcg61.png?width=1152&format=png&auto=webp&s=cea8f888e98fcb6dda25f0fd1382a2d40c594ce5 + +https://preview.redd.it/0flf1kpj2dg61.png?width=903&format=png&auto=webp&s=382376cda735bb149ef6faf785cdadc99fe10135 + +# COVID Impact + +Further to the planned production shut-in and closures, **COVID has accelerated the looming supply shortage** with even greater production cuts and mine closures. + +* **Cameco** closed its Cigar Lake mine in Canada due to risk to a Native population. 18Mlb/yr mine closed indefinitely \*\*\***Production guidance due Feb 11th 2021** +* **Kazakhstan** in march 2020 announced suspension of pre-drilling ops. As they mine they have to drill ahead. **10Mlb/yr reduction in 2020 supply**. They drill 3-months ahead of where they are mining from which is halting production now (Aug/Sep 2020) + * Kazataprom having now 128 workers out of 666 at their Katco mines now return positive result for covid. i.e. **1 in 5 workers infected with covid** \- will likely lead to mine closure or limitation of future works if not brought under control. +* Namibia suspended **Rossing** and **Husab** mines on **28th-March 2020** +* Approx. 20Mlb hit to mine supply (135Mlb to 115Mlb coming out of mine in 2020 and dropping by about 5Mlb/month as each month of covid restrictions continues) +* **Accelerating the commercial inventory supply drawdown.** + +# Inventory + +Inventory (storage by utility companies, traders, and governments) has been drawn down year-on-year since 2014. +**COVID has exacerbated the drawdown in 2020 from 35Mlb to 50Mlb (still calc final yr figure)** + +* Utility companies (the reactor operators supplying electricity) **tend to hold 2-2.5 years of inventory** supply – they HAVE to have the guarantee of fuel for reactors. VERY costly to shutdown a reactor due to no fuel rod supply +* Additional **cold war / weaponry strategic inventory** of \~240Mlb in US and 360Mlb in Russia +* US has utility inventory of 110Mlb (2019) which is just over 2yrs supply to fuel their reactors (\~50Mlb/yr consumption) +* Kazataprom holds usually 6months of supply, though are down to less than 3months – i.e. they will build up own inventory first. \*announced they need to buy on spot market to make up lost supply. +* **China has no home-land uranium production**, but some of the **highest uranium demand**. They have \~400Mlb-425Mlb held by China and that will **not be for sale to the market**. +* **Russia** has a national industry policy to market their expertise – to build nuclear power plants for other countries. As part of that deal, they agreed to **supply all the fuel for the plants for the life of the plant**. Their inventory, though not widely shared is expected to be around 260-300Mlb though they need that inventory for future demand obligations + +In summary, a lot of lbs in inventory are just not available to be sold and will not be made available to the market. + +The **Market is in supply deficit and is using inventory to fill the gap between supply and demand**. The inventory is at record lows globally. + +# Market Outlook + +* Growing uranium **mine supply gap** to nuclear power demand + * On the back of COVID, **unplanned supply disruptions** has **further increased the gap** between the supply deficit. +* **Rapidly growing electricity demand** \- further propped up by **influx of electric vehicles and** government policies for reducing carbon emmisions with clean power targets + * Strong reactor build demand – especially china, India, middle east, EU \*and now US again +* Producers have been **cutting production since 2016** + * Decisions by many producers, including the lowest-cost producers, have been made to preserve long-term value by leaving Uranium in the ground -->increasing the number of supply disruptions. +* **Storage inventory** reducing and most of what is left won’t be sold into the market +* **Uranium spot price** has performed strongly year-to-date up from lows of US$23 to US$30 +* Uranium contract coverage in US declines markedly from 2022-2023, down to less than 50% by 2024 +* Further risk to supply from ongoing COVID disruptions + +**Who is going to supply commercial inventory?** + +There is no chance that primary (mined) + secondary (recycled) supply can meet consumption. That is even accounting for shut-in capacity coming back online right now – which won’t happen. + +So new projects HAVE to get started. + +* **Open pit mining** is where big volumes come from – all take atleast **2.5 to 3 years to build** and couple years to permit and prove to utility companies they have a high-grade product. +* **In-situ recovery (ISR)** (pump acid down, pump dissolved minerals back to surface) is the new age of uranium and mineral mining and is more cost effective for mine development. +* Due to sustained low prices since 2013 the **industry has not been invested in for last 7-8years**. +* No real capital has come in to replace **depleting assets** for close to decade now. i.e. **there is no backlog of projects that can come on-stream in a few years.** +* Nuclear reactor plants have been constructed but no investment into the mines and producers + +# The Spot Price + +Most uranium (>70%) is bought through long term contracts by utilities (nuclear power plants) from the producers (miners, enriches and rod suppliers). These contracts are for enriched uranium supply from 5-14years! i.e. Utilities need to guarantee they can supply their reactors. + +The **spot price usually reflects 20-25% lower price than long term contracts**. + +It has held flat around **$US30/lb for last 6 months** (up from US$23 Jan 2020). + +The last couple months (dec -> Jan 2021) the price has stayed flat on **near to no volume moved**. There was just over **500,000 lbs traded in December** which is just traders passing it back and forth. + + This indicates **when real volume buying comes in**, the thinness of the spot market shows itself and **spot price will move upward pretty substantially** and sometimes pretty quickly too. + +Both **Cameco & kazataprom** (the two world's largest Uranium producers) have announced they have been and **will have to buy more volume on the spot market** in **coming months** to meet their contracted **supply requirements** and **make up for the lost production** from closed in mines. + +It is expected that the spot price will hang around this area until these volumes come in - **\*\*likely March 2021, potentially late Feb.** + +There is no real downside in the spot market, unless there is a major liquidity event. + +# Bear Case - can we make one? + +https://preview.redd.it/6dprosms7dg61.png?width=1005&format=png&auto=webp&s=1bef1599078ca1080af7133f3fe9e2cff2e3299e + +# ASX Uranium Company Performance + +Of 16 companies being tracked on ASX, the top 10 have returned an average of 169% since 1st Sep 2020. The most significant gains have come since start of December 2020. + +[ASX Uranium Company Performance Since 1st Sep 2020 to Feb 8th 2021](https://preview.redd.it/6xog7ocqbdg61.png?width=1546&format=png&auto=webp&s=3a4e5eb8f0dc64d2cd5468f15f8c8bb6a61d9a16) + +**My Top Picks** (\*disclosure: i am not a financial adviser, this is not advice) + +[Hold time of 2-3years to ride the cycle](https://preview.redd.it/mq2jutzxcdg61.png?width=1220&format=png&auto=webp&s=6297237b61e282a6ffc37cde8a1a8deee8170eb4) + +**\*Update.** I bought Bannerman (BMN) last week at $0.12/share and will participate in upcoming capital raise if SPP offered. BMN new rocket rating upgraded to 4.5x🚀 + +https://preview.redd.it/gkutwn5wcdg61.png?width=1250&format=png&auto=webp&s=a3fb5ef05bade5c6fa4e023458580c9a3abdbebc + +**Key things to watch in coming weeks** + +* 11th Feb - Cameco announces updated **production guidance targets for 2021** and impact of covid on 2020 results +* **Large volume buying of spot market** from Cameco, Kazataprom and others late feb to Mid March +* **Global X Uranium ETF** (NYSE:URA) buying up new positions in BMN, LOT, PEN and 7 others as announced per part of their ETF re-balancing last week. +* Updates from US on strategy forward on **Uranium Strategic Supply Arrangements** + + **TL:DR** Uranium is in a significant supply deficit with next 12-18months proving inevitable supply gap coupled with increasing demand as world governments look to reducing carbon emissions and electricity and energy demand increases. + +Uranium Market has almost "officially" entered the new Uranium bull market cycle and the upwards potential has never been higher. There is an asymmetrical reward/risk unfolding. + +Uranium Market 📈🚀�� May radioactive☢ Tendies🍗 have you glowing with glee (and 3 testies) +It seems that recessions come like clockwork but what about economic depressions like the great depression? What is the likelihood of one occuring in the next 60 years or so and what (if there are any) signs are there that one is approaching? +Many Hollywood movies and sometimes even motivational speakers push this silly idea that to be successful, you just need to quit your job and follow your dreams. + +What they usually omit is ...this only applies to ***upper middle class*** people. + +Lower middle class is dangerously close to abject poverty and you are always one month's salary away from bankruptcy. But since you aren't actually in the poverty line, you don't qualify for any govt programs, so you have to pay for every emergency out of your pocket...making it harder to truly save up money. + +I remember watching once a story about victims of the Australian serial killer Ivan Millat and one of the tourists was backpacking because his Dad wants him to study to become a medical doctor, but he was not sure of his career path, so he took a year off to travel. + +I'm sure you've seen the movies where the main character quits his dayjob to go pursue his passion and becomes an immediate success. + +I've heard this in motivational speeches too. + +Here's the thing. That's just not possible for most of us. + +I can't just quit my job and travel. I would be broke in a week. + +The idea of quitting my job to start a business or become some sort of artist is romantic but....far fetched. + +I was reading up on Elon Musk and apparently (surprise surprise) ...he comes from old money. He didn't build from scratch. +When you do a google search, you'll find that most results say that only around 10% of traders make money. But as I search through Youtube, I realize that there are a lot of videos that teach Tech Analysis, give free strategies, some endorse their course for some money. I hypothesize that some of these maybe frauds, maybe they're really losing money. So I wonder, why are there a lot of these youtubers, tiktokers, twitter accounts that boast to earn a lot of money when statistic say that only 10% really earn money? +https://www.marketwatch.com/story/irs-ruling-allows-401k-student-loan-benefits-2018-08-27 + +The IRS is setting up a framework for companies to match their employees' student loan repayments in the same way companies match 401k contributions. This will be cost neutral for the employer (edit: as in, it would not be more or less expensive for the company than traditional matching). + +Edit: the employer's match would go into the employee's 401k account. + +According to the article, employees with student loan debt accumulate 50% less wealth in their retirement plans (by age 30) than their peers without student loan debt. I think most of us with student debt have at one point or another felt "behind". + +Thoughts? This is definitely a cool idea and would be a great hiring incentive/perk. + +Edit 2: due to the popularity of this post, I wanted to remind everyone of some of the rules on our sub. + +>We don't allow: + • Moralizing issues + • Petitions + • Political discussions + • Political baiting + • Soapboxing + +This is meant to be a discussion of personal finance, debt, and retirement savings, not a meta review of the pros and cons of capitalism. Please keep things on topic. + + +Edit 3: Since a lot of people are confused, I'll explain how a 401k match works. A 401k is a retirement savings plan that came into popularity as pensions fell out of the mainstream. The 401k is a tax-efficient vehicle to invest your money for retirement. Like the pension, employers can contribite to their employees' 401k plans as a benefit. This is usually done via a matching mechanism: I contribute 4% of my paycheck, and my employer matches that amount. Matches are almost always capped. + +With the method laid out in the article, you would be able to make qualified student loan payments and have your company match that amount as a contribution to your 401k, up to a certain amount. So say you make $2000 per month, your employer matches 5% of your 401k contributions, and your monthly minimum loan payment is $1000 (in this example, you have a lot of debt). You aren't contributing to your 401k currently. If your company chose to take advantage of this program, they would put $100 ($2000*0.05 match) in your 401k each month you made a payment on your student loan. + +This doesn't "hurt" people without loans. This is only subsidized by the government insofaras the 401k is tax-sheltered (you still pay taxes on that money), and this doesn't constitute your company paying your loans. Participation isn't compulsory. +Hello, thank you for taking the time read this. In July this year I started a lawn mowing business, and spent down to pretty much my last dollar to get started. I now have a new worth of $5000 (would be higher but I got sick for about a month in July/August). I am predicted to make 16k - 20k ($3000 per month in the summer, $1200 per month during school (Ido leaf clean up and other things after mowing season) this next year. I am wonder how to make the most of this money. My dream is to be a big business entrepreneur, I definitely don’t want to be in lawn care for the rest of my life. While I have opened an investing account and am scaling up my operation I don’t know what to-do with my spare cash (I want to turn into more money rather than spend it). I would really appreciate suggestion on what to do with this money. Thanks. +In terms of tax-funded benefits they receive and tax money they pay and other economic effects, how does immigration both legal and illegal look overall through pure cost/benefit analyses? +Hey everyone, + +&#x200B; + +We all just got screwed by Robinhood's screwup here. I'm friends with a lawyer who says we have a good case for a class action lawsuit. + +&#x200B; + +Everyone comment here if you have/had shares or calls in GME held in Robinhood at market open today. + +&#x200B; + +Let's show these guys the system can't fuck with us! + +&#x200B; + +Edit: + +Everyone take screenshots of Robinhood's app saying you can't buy, or blocking your orders. + +Edit the 2nd: + +Wheeeew lads let's get on it! I'll go through all these pms and comments this afternoon with my lawyer friend. Keep em coming! + +And please share! + +Edit 3: + +OMFG guys I'm getting 1000s of PMs! It'll take a while to sort through them all and reply, but keep messaging and sharing! Also if you were using WeBull or some other brokerage and got blocked, you might as well join too. + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +Edit 4: + +My team and the lawyers had a conference call, and it's on! + +We'll have an update in the next 48 hours with the procedures and next steps. + +If you have any questions or concerns, please PM me and I'll try to get through as many as I can once we have more details. + +Edit 1/30: + +Work is ongoing. Sorry for the lack of news, the lawyers are still getting their ducks in a row. I'll update with more info as soon as it's available. + +2/2 Update: + +Just to let everyone know where we're at, my team is currently doing the research and building the case. This is a pretty huge lift though, so we're getting people on the team with the expertise needed to give us the best chance of success. It's taking time to get the most qualified people possible, but I want to do this the right way. I hope to have another update with good news in the near future. Thanks for all of the support and encouragement! + +PS, sorry guys but I literally can't open my Chats now. Probably has something to do with the 8.9k next to it.... If you need to reach me you can send a Message, or leave a comment and tag my username. + +2/11: +Update: please see the [new survey here.](https://forms.gle/mPLrq329wUDboAdE8) +So, what is the bear case here? I know we have to worry about Chinese companies lying about their financials(luckin), I know there may be a worry that the US could ban Chinese companies on American exchanges until they face US audits. + +Is there anything i’m missing here? From my perspective, it looks like BABA is the greatest deal in the market right now. + +Much love ✌️ +So, what is the bear case here? I know we have to worry about Chinese companies lying about their financials(luckin), I know there may be a worry that the US could ban Chinese companies on American exchanges until they face US audits. + +Is there anything i’m missing here? From my perspective, it looks like BABA is the greatest deal in the market right now. + +Much love ✌️ +* RBI has asked HDFC Bank to pause adding new credit card customers +* Bank also has to pause activities under its Digital 2.0 initiative +* Many outages in the last 2 years +* The app was unusable for many days in early 2019 +* A recent outage happened in Nov due to power failure +* Another smaller outage this week +* The notification is based on the experience till Nov +* Bank board has been asked to 'fix accountability' +* This can be a case study of how messed up IT operations can bring down business operations + +One source: [https://www.moneycontrol.com/news/business/rbi-halts-hdfc-bank-digital-activities-asks-bank-to-stop-sourcing-new-credit-card-customers-after-multiple-digital-failures-6183521.html](https://www.moneycontrol.com/news/business/rbi-halts-hdfc-bank-digital-activities-asks-bank-to-stop-sourcing-new-credit-card-customers-after-multiple-digital-failures-6183521.html) + +Edit: More news reports indicate the theory from /u/crimelabs786 that an example is being set here. Also, there are good anecdotes in this thread. It may be a good read to have a thread just on the inside stories of IT stuff in major companies. +I would really love to read his Basic Economics book but I heard he’s a conservative. Not that that’s an issue for but I was wondering if it’s non bias in the sense he doesn’t try to convert you to believe in his ideals. I just want to learn economics straight up. Thanks for the help. +Comparative advantage in today's global economy is basically one countries wages are lower so stuff is built there and sold to countries with high waged worker what will happen when everyone is making a wage such that comparative advantage is lost will protectionist policies be put on to propel domestic industries like post great depression? +I've seen this time and time again on this sub and with my friends IRL. + +My friend recently interviewed at a job and they asked "What are your salary expectations?" To which he replied "I'm looking in the realm of $50-$60k". Guess what they offered him? + +Ding. You guessed it. 50k. + +When asked this question in an interview, do not give a number instead reply with something along the lines of... + +Interviewer: "Now, What would you say your salary expectations are?" +You: "I would just expect to be paid fairly for the experience and skills that I bring to the table" + +If they press further - tell them "I would be remiss to give a number because there are many aspects that go into overall compensation and I would need to be able to compare all aspects of it." + +This is a completely true statement as Bonus, Stock, Health Insurance, 401k, HSA, PTO and Education Reimbursement are all elements of a potential compensation plan. + + +EDIT: I realize that there isn't a one size fits all approach to this. If you know exactly what you are worth and have confidence in that number, all the power to you to give an accurate and informed number to HR. It is in your best interest to try to negotiate up as much as you can, and many HR reps will try to get good talent for low cost to the company. It definitely is a negotiation. I would argue that the majority of people do not know exactly what their range is, and yes research is key here, but doesn't always lead to the employee being confident in a number they should be getting paid. I think many people do do themselves a disservice by undervaluing their talent and come in low. That could be due to lack of research, lack of confidence, lack of negotiation skills etc. One way to combat this for people that are newer to interviewing and don't have a good sense of were they fall on that spectrum, is to try to abstain from giving a number. That's all my point was about. + +EDIT 2: I regret making this as an ultimatum. Went for effect and definitely got it. This doesn't apply to everyone. There are situations that giving a number is advisable. Also getting a lot of comments on online applications, and from HR or hiring managers railing against this idea. I appreciate all of the responses, difference in opinion, even the rude ones. Good to gain perspective on my part. +I may be wrong about this, but why does it seem like there is a conflict of interest between what's best for individual finance vs the economy? For example, it's best for a person to live frugally and use the most money to invest (education, health, retirement, etc.); whereas, it's better for the economy if everybody spends all of their money on not just essential but also luxurious goods. A society where people save more than they spend is a deflationary one. Likewise, a society where people invest more than they spend would probably cause a market bubble since more people buying a company's stock than it's product just drives its PE ratio through the roof + +Another example is having kids is expensive. It's best for a poor couple to not have kids or only one if they want to get out of poverty as fast as possible. However, in economics, every couple should have 2 kids to sustain the future workforce and consumer spending. +* He and brother used a trading account to transact Future Retail shares +* Many transactions done before a demerger decision +* Fine of 1 cr levied on them +* Edit: They also have to 'disgorge' the notional gains of about 18 cr; smaller fines and levies on two other employees involved in the deals +* Kishore Biyani can't trade in Future Retail share for 2 years +* Would be interesting to see how the tussle with Amazon goes after this +* There is a general feeling that a lot of insider trading happens in India; this decision can help fix this + +One source: [https://www.livemint.com/companies/news/sebi-bars-future-group-ceo-kishore-biyani-from-accessing-securities-market-for-1-year-11612357348986.html](https://www.livemint.com/companies/news/sebi-bars-future-group-ceo-kishore-biyani-from-accessing-securities-market-for-1-year-11612357348986.html) +For instance. + +A private company takes over the management of an electrical grid. To increase profits, they reduce maintenance, which makes privatization look like a good choice/efficient. But after a decade, the lack of maintenance catches up with them and service disruptions occur. They then say they need to increase fees. But if they'd not extracted that profit there would have been money for maintenance in the first place. + +Now, that's not to say that publicly managed utilities aren't mismanaged, etc. But is the criticism fair? After all, the public utility is using all the pie, while the private one is using only what isn't taken for profit. +I don’t have anyone to celebrate with but I want to say woohoo woohoo I’m getting there, I’m getting there! I’m there, I’m there! Lol last year I was proud to have saved $100 and now I’ve saved $10,000! + +How much do you think is a good amount to have before looking for a single family house? (I am pre-approved in the $160-170k price range and these are around the prices I’ve seen for 3-4 bedrooms in my area). How do I learn about the market in my area? What are some other things I should learn before house hacking? + +Edit: thank you all so much for congratulating and celebrating me 😊 and as always, for giving me advice. Y’all are awesome! +42 years old, medium/high cost of living area. Total Net Worth $21M (up from $4M a month ago :) ) + +Like many of you, I have been dreaming of writing this post for years - I just achieved what for me is FatFIRE eligibility, though I do not yet know when/if I will retire. + +\--- + +This is my story... + +I graduated from a good (but not elite) small liberal arts college. I did not apply myself during college (regretted later), had no idea what I wanted to do. The big 5 consulting firms at the time (late 90s) were interviewing on campus...I had a few friends who had graduated in prior years that were enjoying similar roles, and smart people I knew seemed interested in pursuing these on campus interviews, so I did it. + +Career Chapter 1: 6 years at a big 5 firm + +They put me in the "technology" practice because this is where they were experiencing the most growth (this was leading up to the dotcom bubble). After 6 weeks of intensive (and very high quality) training, I was put in the telecoms practice, writing COBOL for large telecoms company billing systems transitions. + +After 6 years of good but not great performance reviews and promotions, I went from $32K starting salary to $75K. I felt pretty good about it. I had a small 401K (maybe $50K) to show for it. I had lost about $4K of other savings doing margin trading right in to the dot com bubble. I had maybe $10K cash saved. The firm had IPOd and the partner track had lost appeal. I knew I was underpaid based on seeing my clients get paid 25-50% more than I was for doing less work, and I wanted to make money....but working in a cubicle at a large telecoms firm sounded like hell to me. I started taking the LSAT practice courses and decided to go to law school. I was accepted at a decent state school and enrolled to start in the fall. + +Then I got a phone call....I former manager in consulting was starting a software company in Asia and wanted me to come join. He had raised $5M and was forming the initial team. I'd be coding, writing requirements, helping sell, and forming the product vision. I joined as a technical product manager and moved to Asia. + +I took a HUGE pay cut (down to just basic living expenses in a VHCOL city in Asia), packed my shit, accepted some stock options (I had NO IDEA how to even understand how they worked much less how to value them - I trusted the founder was giving me a fair stake). + +Career Chapter 2: The tech startup game + +Immediately I realized I was SO MUCH HAPPIER and more productive working in small teams on concepts that were just visions on a powerpoint, bringing them to life in a software product. + +After 3 years of struggling to get our first clients, I decided I'd had enough and wanted to work back in the states. On what? I knew I wanted to work at a tech startup. From being in Europe and owning new modern phones with internet access and java apps/games, I had this inkling that we were about to see a revolution in mobile computing. I wanted to get myself wrapped up in this wave and hoped my boat would rise with the tide. + +After spending a few months unemployed and getting increasingly nervous, I got a call from a recruiter about a mobile apps startup in my home US city (midwest). I jumped at it. I borrowed a friend's blackberry for the job interview to show I was "obsessed with mobile" (I had a really cheap and shitty samsung phone at the time). I got the job. We spent 4 years working on a platform that would enable easier development of mobile apps. Nobody wanted it. iOS and Android launched and made our system obsolete. The company shut down after burning $30M of investor money with almost zero revenue to show for it. But I had learned a TON about how to design, build, launch and test mobile apps. At this point I was firmly on a path as a software product manager, and was an ideal fit for Sr Mgr or Director level jobs at startups dealing with mobile apps. I had made a good number of connections with mobile apps companies during my time trying to market our platform. One offered me a job and I took it. + +This company was in the early stages of hockey-stick trajectory. It was a consumer content/utility app that became a household name over the next few years as we grew to many tens of millions of registered users. I grew with the company and was the head of product management for the company....when a large public company came and bought us for a couple hundred million. I had amassed options worth around 1% of the company but hadn't exercised them. I learned a tough lesson about what happens with taxes when you get accelerated vesting on stock options. I spent 3 years at a large public company working on the integration and other huge M&A deals. + +My salary had grown from around $100K when I started to $300K + 40% bonus plus around $1M worth of RSUs in the company. After I left the company cratered and my stock was worth zero. I hadn't been diligent about always maxing 401K at during this process. + +I had maybe $700K in post tax brokerage accounts being self-managed, $300K in a 401K, and maybe $25K in cash. + +I had now seen "end to end" all phases of a startup from company formation to successful exit. And had seen a few unsuccessful exit/shutdowns as well. + +Career Chapter 3: Planting a Seed + +Along the way I started a tech startup with a couple of other guys. We each put in $30K, raised some friends and family money, and hired 3 young people to be the "founders" and try to get it going. It struggled for the first few years and nearly died, but eventually started to find a niche, and customers, and was now growing revenue at a healthy clip, I was on the board and stayed close to activities but never worked there. It raised several million dollars from a VC and was regularly getting inquiries from large companies about buying it. + +This chapter isn't really standalone, it runs in parallel, I spent maybe 10 hours a month on this company from board meetings to making intros to interviewing people etc. I funneled a ton of top talent into this company - anyone good I worked with who was looking, I would get them involved - this was the most valuable thing I did over the course of the 8 years the company ran, and I would say this is definitely a key to being successful with an approach like mine. If you can start a company with a couple of other people with deep and solid networks who are able to consistently put high performing talent in to the company, good things can happen. + +Career Chapter 4: My first CEO experience + +I started my own software company with some friends. It wasn't particularly successful but got "acqui-hired" after 2 years, which made for a nice story and an ok outcome (founders got a few hundred K in cash), and investors were made whole for the most part. I was made CXO of the acquiring company and stuck around for 3 years. + +Chapter 4: Winning + +We're now 20 years into a successful software career with experience from qa tester to software developer to product manager to VPx and CXO at companies ranging from 3 people in a garage to massive public companies. I'm plugging along in a pretty cush gig pulling down $400K + options (in something that could be worth zero but still), the company is way overcapitalized. The seedling I had planted 8 years earlier was becoming a small tree, and the market was noticing. We were approached by a large private company and 6 months later we completed the deal. 7 individuals got proceeds in excess of $1M and that was the most gratifying part, to see these people who had built this thing from zero get paid (including a handful I had steered towards the company). + +My take ended up being $17M. + +So that leaves me wondering where to go from here? My wife makes around $800K as a lawyer, I am happy in my job but it doesn't really move the needle financially for me anymore. Our annual family burn is around $220K. Thinking about ratcheting this up to $350K or so, but always maintain the optionality to have zero income from me/wife, indefinitely. Which seems more than doable now. + +I think I would be happy as an angel/advisor type if I could find 5-10 companies to help out. Ideally I'd work 20-30 hours a week but have total flexibility on the terms of it. In my heart I am more of an operator and believe advisors tend to lack the details to be truly useful. + +I'm sharing this because I wanted to remind myself of the journey and hopefully it can be useful for others thinking about the various paths to fatfire. + +Comments/questions welcome! +I'm looking at buying a 4plex that has tenants renting at VERY below market value. Market rent for a 2BR apartment is about 1100 and they're all paying 600. Tenants have all been there for 5-15 years. + +I want to buy it and raise rents to market, but I'm wondering why the rents are so low? This screams opportunity, but also may be a red flag, unless the previous landlord was just complacent and let them ride the gravy train for this long without caring. +I’m currently working for a engineering consultancy (non-tech) that has begun offshoring all work, even that was historically done locally. Now we just have mechanical engineers in India doing all the engineering work and local engineers have been let go. They are paid approximately 1/3 of the Australian salaries. The only people left are handful of project managers that require face to face meetings with the client. + +If all jobs can be done WFH, wouldn’t every company do this in the long run? +Welcome to the ETH Daily Discussion thread of /r/EthTrader. + +*** + +The thread guidelines are as follows: + +- All sub rules apply here. Please review our **[rules page](https://www.reddit.com/r/ethtrader/about/rules/)** to become familiar with them. The rules page is also linked in the announcement bar above. +- General discussion topics include, but are not limited to, events of the day, technical analysis, alternative Ethereum projects, or support issues. +- Breaking news or other important content should be submitted as a separate post. +- In-depth altcoin discussions should be referred to the /r/CryptoCurrency discussion thread. To view the thread, [follow this link](https://np.reddit.com/r/CryptoCurrency/search?q=%5BMonthly+General+Discussion%5D&restrict_sr=on&sort=new&t=all) and choose the latest entry on the search page. +- Pumping, venting, trolling, or any other similar behavior **should be reported** and redirected to the /r/CryptoMarkets trollbox thread. To visit this thread, [follow this link](https://np.reddit.com/r/CryptoMarkets/search?q=Trollbox+Thread&sort=new&restrict_sr=on&t=all) and choose the latest entry on the search page. + +*** + +* For newcomers who have basic questions about Ethereum, you can find answers by visiting /r/EthereumNoobies or our [Ethereum Education wiki page](https://www.reddit.com/r/ethtrader/wiki/education). + +* **[EXPERIMENTAL]** - To view live streaming comments for this thread, [click here](https://reddit-stream.com/comments/auto). Account permissions are required to post comments through Reddit-Stream.com. + +*** + +Thank you in advance for your participation. Enjoy! + +Bit of cheeky one. + +Its 2002, I was 13 years old and was offering a underground Payday loan service at my boarding school. I funded the business with a weekend dishwashing job at a nearby restaurant. + +Typically it was small change, $5 here $10 there. I would charge a flat 20% fee rounded up to nearest dollar. I would make around ~$20 a week in fees. + +There was one *customer* who was notoriously late on payment. I was cool with it at first but after some time I got fed up and wanted to deter her from coming back. + +All previous loans were on a handshake, but when she came to me I explained late payments were not tolerated anymore and if she wanted my services she would have to sign a contract. + +Yes, 13 year old me wrote out a contract for a financial loan and because it was a short term loan the interest listed was 10% per week compounding weekly. The loan was for $10. + +She was used to the flat 20% and saw the 10% as an attractive offer all the while not really understanding the compounding factor. + +I estimated the repayment to be about 4 weeks, which would total about $4.60 in interest, rounding up to $15 total repayment. Figured that would sting her and make her be more prudent in the future. + +Well, fast forward a month, the holidays happen, I shift to a new school, the loan is unpaid and forgotten about. + +20 years later that loan is still unpaid. The interest is still accumulating, compounding weekly at 10%. + +As of now I am roughly owed $111,787,325,172,283,990,000,000,000,000,000,000,000,000,000.00 + +I am considering legal action. +That OCC rule change on the front page. People aren't as furious as us here because the language used isn't something everyday people can understand. Here is my dumbed down version: + +The Options Market Makers are allowed to elect someone to make some changes by themselves on their behalf without going through long processes like votes etc. + +If a hedge fund borrows money to try to bankrupt a company and fails and the value of the company goes higher than the amount they borrowed, the leader of the board of the can choose to not liquidate the hedge fund (like the rules say should happen). Instead the leader of the OCC can instead use the borrowed money to borrow even more money to try to save this hedge fund. Hopefully we can bankrupt this American company if we all work together. Otherwise all the different Wall Street executives would lose lots of money (Billions probably) to cover this dumb hedge fund, and we would like that not to happen. Can we be allowed to change all the rules that stop us from doing this and let us just do this? Any complaints SEC? + +The SEC's Response: + +You're good homie. No complaints here. + +DO YOU SEE HOW BULLSHIT IT IS WHEN CONVERTED TO SIMPLE ENGLISH???? + +ALL THESE RULE CHANGES ARE LIKE THAT. CONVERT THE BS TO SIMPLE ENGLISH AND SEND IT TO THE FRONT PAGE!!! + +EDIT: Make no mistake this doesn't change the over all situation. Not an escape, a 🥫🦵 (can kick). DRS is the way personally. Do your own DD and make your own decisions. This is not financial Advice. + +EDIT2: So I saw the OCC post and made a smooth brain translation. Here are some solid counter points: [https://www.reddit.com/r/Superstonk/comments/pv97vs/regarding\_the\_new\_occ\_rule/](https://www.reddit.com/r/Superstonk/comments/pv97vs/regarding_the_new_occ_rule/) + +I guess my counter to this is, why make the new adjustment then that this mechanism can be done by others in the OCC leadership than what's there originally. Does that mean there isn't a united effort on their part to protect the markets? I'm less likely to think this than I was in July. All the rules were in place and no movement. Anyway, counter points should always be discussed so I figured it would be important to add here too. I also add this counter point: [https://www.reddit.com/r/Superstonk/comments/pv97vs/regarding\_the\_new\_occ\_rule/he98721/?context=3](https://www.reddit.com/r/Superstonk/comments/pv97vs/regarding_the_new_occ_rule/he98721/?context=3) + +&#x200B; + +Note that I still think these are side quests to discuss about over all market. DRS is still the way, imo, not financial advice. +I quit my job and today was my last day. This was made possible in part by Ethereum. + +I first bought Ether at 10 dollars back in January after hearing an interview with Vitalik. It sounded like a neat techonlogy and I thought maybe in 5 years I would see some returns. I had no idea what was about to happen. + +Fast forward 9 months and all I can say is it's been a hell of a ride. + +For my fellow Ethtraders, here a few lessons I've learned - usually the hard way - along the ride so far... + +1) You, me, Jamie Dimon, Mike Novogratz, ScienceGuy9489 and even Vitalik have no fricking idea what's gonna happen. He's said so himself. + +Ethereum could shoot up to 750 tomorrow and then fall to 75 the next day. Or it could lurk around 300 for the next two years before exploding to 3000. Who knows! If you have conviction in the technology invest what you are willing to lose and don't get hung up on the day to day movement. It's just noise. + +2) This has been said a million times, but for good reason: Don't invest more than you're willing to lose. For most people, this means no more than 10-20% of your money. This really goes for any asset class, even cash since there's inflation risk - but especially crypto. Ideally, in addition to crypto your money is diversified among a variety of asset classes like fiat, stocks, bonds, gold, etc. + +3) Never, ever buy or sell on emotion. As a rule, if you feel like you *have* to buy or sell right away, then you don't. Sure, you might luck out once or twice doing so, but this is called gambling, not trading. Being impulsive will ultimately screw you over. + +Our brains are running on millennia old legacy software designed to run away from threats e.g., panic sell, to follow the herd e.g., fomo buy, and in general to survive, *not* to be rational. When big dollar signs are flashing around, our lizard brains think it's life or death and all reason goes out the window. This is why the vast majority of traders, even professionals, lose money. + +Of course in a bull market everyone is a genius. So it's easy to kid yourself, but you're probably not a great trader. I know I'm not. I've read books on trading, and I'm not a total idiot, but the fact is I would be sitting on a lot more Ether right now if I had just bought and held rather than getting all fancy. + +There are a few folks who have zen-like discipline or years of experience, but for the rest of us, short-term trading is a losing game. That said, you can treat a small portion of your holdings as play money that you daytrade. Just don't be surprised if it's gone next week. + +4) Don't be a maximalist. God knows I was when I first arrived here. I thought Bitcoin was Myspace and Ethereum was Facebook. I came to realize Bitcoin and Ethereum are not competitors; they are trying to do different things. The world needs both gold and oil. + +5) This may sound blasphemous, but don't be absolutist about HODL-ing. For most, I think it's wise to take some profits as it goes up by selling a small to moderate portion of your holdings. Then, if/when it majorly corrects you won't freak out and panic sell. Instead, you can buy some back at a lower price. And if it doesn't correct, you'll still walk away with some profit and peace of mind. + +Now, if you are very patient and don't need to take profits it's fine to 100% HODL if you are truly able to stick with it. Just be honest with yourself. There are a lot of fair-weather 'hodlers' here who hit the sell button whenever there's a major pullback. It's better, not to mention a hell of a lot easier to sell when it's pumping up than when it's plummeting. + +6) It's human nature to never be satisfied. No matter how low you bought, you'll wish you had bought lower or bought more. Or you're gonna kick yourself for not selling at a peak. Remember, most people in this world still have no idea what Ethereum is and even if they do, they do not see its potential like you and me. We're early to the party. + +7) Keep your life in balance. This is more important than all the above combined. Sure, it's fine to go through a phase where this consumes your life, but if you spend all day and night staring at red and green on GDAX your health and happiness will suffer. Trust me, I've been there. + +Trading is already addictive but throw in a 24/7 market that never sleeps with bewildering volatility and you have the perfect recipe for sleep deprivation, anxiety, and manic ups and downs. + +If you're overly obsessed with checking prices, try either setting ground rules (what I do is that I only check prices between 10am and 10pm) or step away completely for a few days or a week. I've done this a few times and I always return to the markets with renewed energy and perspective. + +Money is important but once you have enough to get by, it's far less so than friends, family, health, and finding meaningful things to do in life. Remember guys, love over lambos, balance over Binance, and bros over blockfolios.. okay that last one was a stretch.. + +Finally, it's been said before, but that's because it's the truth: the joy is in the journey. Everything in this world is temporary. Whether Ethereum faces some existential threat and gets wiped out tomorrow or goes on to revolutionize human civilization for centuries to come, someday something else will come along and replace it. + +Likewise, your stash may someday be worth zero or a million. But either way you will have won the bigger game in town if you enjoyed the ride and learned a few things along the way. + +Stay safe, stay hungry, and enjoy the ride! + +*Note: Thank you guys for all the replies and encouragement, it means a lot. I had no idea this post would blow up like this. In hindsight, I wish I had titled this post something different and put less emphasis on the quitting job part because that's not what this post is really about. I realized from the responses that the post gives the impression that I am retiring for the rest of my life and intend to never work again. This is definitely not the case! Ethereum simply expedited me getting out of a job situation that I wanted out on anyway and has afforded me some more flexibility and freedom in the short to medium term. While I'm taking a bit of the break from the grind right now, I'll be pursuing work a bit down the line both for financial reasons and because it's part of a meaningful life* +Hi, I'm in my 20s and unmarried, and this will be the case for a long time. Here is what I have decided to give a dedicated portion of my salary to. + +**The one thing that bothers is where do I include expenses such as EMI for a Car let's say 20k/m? In that case what category should be squeezed to balance it out?** + +I'm still yet to finalize my funds and plans for my investment. Been lurking on this sub lately to get more clues. + + +Open to all of your opinions please feel free to adjust and let me know why so, Thanks. +1) Fixed amount must be invested to the upper limit + +|Name|Limit|\~ Percentage| +|:-|:-|:-| +| Investment (mutual fund) | 50,000 |35| +| Long-term investment\* (life Insurance) | 10,000 |7| +| Health Insurance (personal) | 5,000 |5| +| Critical Saving (recurring deposit) | 15,000 |10| + +&#x200B; + +2) Expenses remaining go to (4) + +| General Expenses (Rent, Food, Utility Bills) | 30,000 |21| +|:-|:-|:-| +| Travel Expenses | 5,000 |5| + + + +3) Good expenses to have for personal development only + +| Personal Development (Gym, sports, hobbies) | 10,000 |7| +|:-|:-|:-| + + + + +4) Unnecessary expenses for impulse buying, unexpected funds, non-investment related EMI + +| Personal milestones, unnecessary EMI, and unexpected funds |12,000|8| +|:-|:-|:-| + + +&#x200B; + +Charity! + +|Charity| 3,000 |2| +|:-|:-|:-| +House Speaker Nancy Pelosi on Wednesday rejected the idea of banning members of Congress and their spouses from holding and trading individual stocks while in office. + +"This is a free market, and people — we are a free market economy. They should be able to participate in that," Pelosi said when asked by Insider at her weekly press conference. + +Insider also asked Pelosi about "Conflicted Congress," a 5-month-long investigation by Insider that found 49 members of Congress and 182 senior congressional staffers have violated the STOCK Act, a law to prevent Insider trading. + +The Speaker said she had not yet seen the project, but said that it's important that members are complying with the law. + +"If people aren't reporting, they should be," she said. + +Pelosi's position puts her at odds with the likes of progressives like Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez, both of whom have called for banning members of congress from trading stocks while in office. + +"It is absolutely ludicrous that members of Congress can hold and trade individual stock while in office," Ocasio-Cortez recently wrote on Twitter. "The access and influence we have should be exercised for the public interest, not our profit. It shouldn't be legal for us to trade individual stock with the info we have." + +And on Tuesday, Sen. Warren told Insider that she had seen Insider's investigation, calling out the "brazenness" of members and staffers trading stocks even while having access to privileged knowledge. + +"We need both tougher laws and enforcement of those laws," the Massachusetts Democrat told Insider. "The American people should never have to guess whether or not an elected official is advancing an issue or voting on a bill based on what's good for the country or what's good for their own personal financial interests." + +Asked about progressives' position on the issue, a spokesman for Pelosi signaled that the speaker prefers a transparency-focused approach to insider trading. + +"The STOCK Act exists to shine a bright light on trades by members of Congress," said spokesman Drew Hammill. "Sunlight is the best disinfectant." + +"The speaker does not own any stocks," he continued. "As you can see from the required disclosures, with which the speaker fully cooperates, these transactions are marked 'SP' for spouse. The Speaker has no prior knowledge or subsequent involvement in any transactions." + +Pelosi's husband, investor Paul Pelosi, frequently trades significant numbers of stocks. With her husband's assets considered, Pelosi ranks among the wealthiest members of Congress, according to an Insider analysis. + +Insider has identified numerous examples of federal lawmakers trading stocks in industries they oversee as part of their congressional committee assignments, including within the defense, healthcare, and energy industries. + +bus inessinsider.com/we-are-free-market-economy-pelosi-rejects-stock-ban-congress-2021-12 +[Investopedia defines passive investing](https://www.investopedia.com/terms/p/passiveinvesting.asp) as a buy-and-hold strategy with minimum transactions. [Kuvera uses similar definition as well](https://kuvera.in/blog/what-is-passive-or-index-investing/). + +Investing in Index-linked assets (ETFs or Index funds) can help you reach that "passive investing" zenith, but there's more than that to passive investing than just investing in a Nifty or S&P 500 index fund. + +Index is an _ever-green_ asset, you can count on it to not under-perform the market over long periods of time, by definition. It helps you achieve passive investing. But if you try to "time the market" with your index fund / ETF, then even if you're investing in the index, it's not a passive strategy. + +In this write-up, we'd focus primarily on index investing. + +--- + +**Wait, yet another index vs active thread??!** + +No, this won't be one of those threads where someone posts a link to SPIVA report or lists CAGR of various bluechip funds vs UTI Nifty Index Direct Growth over 1Y / 3Y / 5Y / 7Y / 10Y period. And then claims only x% of funds has beaten the index. + +This isn't how people invest, fund's CAGR aren't investor returns. + +Rather, we'd look at some real world scenarios that closely mimics how people actually invest. + +--- + +**So how do real people invest in the real world?** + +Imagine being someone who wants to start investing in equity. You'd probably ask friends / relatives / LIC uncle, or sign up on one of those hundreds of platforms, or might as well google "top mutual funds" / "top ELSS funds" / "5 star funds". + +After some googling, YouTubing, and asking around (offline & online), you'd settle on 3-4 funds. + +And that's the part I want to focus on: where _you'd inevitably pick more than one fund_. + +Even if one or two of them indeed continue to be great, overall your portfolio would achieve high correlation with an index, and more likely to underperform it. + +And over time, as you'd review your portfolio, lose faith in some of the picks, you'd add new funds, maybe sell units in a fund or two. After 5-6 years, you'd have a hodgepodge portfolio of bluechip / emerging bluechip / multi-cap / smol-cap / mid-cap / contra / value / global / quant / PE / opportunity funds and other exotic products. What are the odds this entire portfolio does better than broader market? + +--- + +**Come on, how can you possibly know that? This is just guesswork!** + +That was my intuition, but as we get more and more people on the subreddit / discord share their portfolio details for review, I see it happening for real. + +Just 2 days ago, someone in our Discord asked to review their portfolio. They've been investing for ~3 years, presently ramped up and have been investing ~1.4L / month. These are the funds they've been investing in: + +- Mirae Large Cap +- PPLTE +- Axis Small-cap +- Mirae Emerging Bluechip +- Motilal Oswal S&P 500 + +Just from looking at these, one would think given how each of these have performed over last ~3 years or so, it'd easily beat a single Nifty Index fund portfolio. + +Let's clearly define a single Nifty Index fund portfolio: it's a _what if_, simulated portfolio, where all transactions on given date & amount are copied into a single index fund: UTI Nifty Index Direct Growth. I'm **NOT** comparing the return of actual portfolio, against CAGR of this fund. + +I was surprised that the [5-fund portfolio](https://imgur.com/OmPj99x) was actually behind the [1-fund portfolio](https://imgur.com/Ai7IrYh). + +In other words, if OP had just picked a single index fund and called it a day, 3 years ago, things would've turned out better, quantifiably. [Here's the Discord discussion thread](https://discord.com/channels/546638391127572500/547078913751515147/789530982666862642) + +This is only one such case. I've reviewed umpteen portfolios just like that in recent times, and yet to come across a single one that has done better than a 1-fund Index-based portfolio. + +I picked this one, because it looked promising based on the fund picks, that OP had somehow stumbled upon and got lucky in picking funds that have performed well (often better than Nifty TRI) _after_ picking those. And still, as a portfolio, it cannot stand up to gains from a single Nifty index fund portfolio. + +[Here's another example](https://discord.com/channels/546638391127572500/547078913751515147/784335339451187230). + +Another anecdote from a friend who started investing in June: Invested ~3.4L across ICICI Bluechip, Mirae Large Cap, Mirae Emerging Bluechip, SBI Small Cap, Axis Small Cap etc.: even with an XIRR of ~83% p.a. (markets fool new comers very easily), it's underperforming a 1-fund Index portfolio by ~8k (UTI Nifty Index fund with those exact transactions would've had a 87% p.a. XIRR). + +There are many more stories similar to this, but the broader point stands. + +--- + +**Don't even know where to begin, with everything that's wrong with this analysis!** + +You're right, I hear you. Cannot just check a comparison on a particular date, and conclude anything from that. If I check 6 months later, or 6 months ago; it could just as well be opposite. The multi-fund portfolio can be ahead of the single Nifty index fund portfolio. + +However, that wasn't the point I wanted to make. + +Look at the broader idea: _Most equity funds perform in-line with Indian equity benchmark_. + +Even if you pick US equity fund that has lower correlation, and mimic Nifty; for first few years of your investments, that won't be much _different_ at portfolio level, in absolute terms. + +By _different_, I mean your portfolio at times, can be ahead of the 1-fund Index portfolio, or behind; but the difference would be quite small. Small enough, that there's little to no downside to picking a single index fund and continue with that for few years. + +I'm focused on _price of being wrong_ in your picks, with something akin to _linear approximation_ + +--- + +**Returns aren't everything. What about risk-adjusted return, average volatility, drawdowns etc.?** + +I assure you, none of these investors know or had any of these in mind when they picked multiple funds to start their equity journey with. + +They wanted returns, they wanted their corpus to grow. While these are novel goals to have, these portfolios were not creates or designed with any of that mind. + +That's called _shifting the goalpost_. + +Reducing drawdown for someone who has been investing in equity for long term, and doesn't have any need for that money any time soon, makes no sense. It's probably a "good to have", not a "must have". + +It's of more value they build and take their corpus to a level where these become important enough to their portfolio, in absolute terms. + +--- + +**Wouldn't that be too volatile? A single equity fund. I don't feel comfortable with this.** + +All equity funds invest in markets, all equity funds are volatile. Markets are always volatile. You'll gradually get used to it, as you start seeing big crashes & red in your portfolio. + +As for single equity fund, if you pick a single active fund, I'd be worried. It's possible it turns in to a dud a la HDFC Equity or DSP Tax Saver, while other funds zoom up. + +What are the odds of that happening with an Index fund? Is it possible for most active funds to suddenly start doing lot better and sustain that for some time, while index fund gets left out in the dust? + +--- + +**What are you saying?! No Asset-allocation, no Debt / Gold in portfolio? This is just your recency bias talking, because equity markets have been doing well** + +Asset-allocation is important, but once your portfolio reaches certain level. + +A fun off-topic Physics fact: we don't know if Newton's law of gravitation is correct at smaller scales, because it's so small that even the best modern tools in labs cannot discern between output predicted by Newton's mathy inverse-square formula, and measured values. [Minute-physics has a video explaining this](https://www.youtube.com/watch?v=OTMELHUAzSM). + +When you're just starting out your investments, investing 20-30k / month in SIP, you've almost no corpus, compared to where you could be 20-25 years down the road. + +Your target should be to get through corpus milestones. The first 1L, then first 5L, first 10L, first 50L etc. Then review once you reach, say, 1 Cr. + +You could even have thumb-rules, for example not having debt in long term portfolio until your long term corpus reaches, say, 5x your annual salary. + +If you've 5Cr. portfolio, you could go up or down few lakhs everyday, because of day to day market volatility. At that scale, some Debt / other asset-class diversification helps. Certainly won't want to lose 1 Cr. in a week's correction. + +If your portfolio is 50k, it'd be cute to attempt an asset allocation rebalancing exercise. + +All I'm saying is, if you've size-able emergency corpus, decent fixed income allocation to take care of short term needs; you can start your long term portfolio with a single Nifty / Nifty 100 / Nifty 500 index fund or ETF. + +First few years should be focused on saving & "setting aside" as much as you can in that long term portfolio. + +--- + +**Wow you make it sound so easy. If it's so easy and settled, why are people discussing debating / analyzing equity investments all the time?** + +I didn't say it's easy. If anything, it's hardest of all to not give in to your "intuition" / "feeling" / gut based rationalization. + +When someone picks 5 funds to invest in, it's not because they've done rigorous analysis and found through backtesting that this particular 5 funds / underlying assets of these 5 funds have done better across market cycles. + +No. + +They do it, because it gives them comfort that _if some of these don't work out, at least one of the other ones would_. Except, that might work in case of stocks (you pick 10 stocks, hoping at least one of these turn out to be next HDFC / RIL, even if other 9 goes burst). + +This is primitive thinking, and given how MFs work under the hood, it doesn't work that way at all. + +Hardest thing of all, is to realize your own biases: the decisions you make where you're in control. + +No one likes to confront their own biases, because unintuitive results can be hard to swallow. + +If someone's picking a 5-6 fund set, they should compare it against various set of simulated portfolios, from time to time. + +If someone's selling when markets turn high, and buying more when markets correct a bit, they should compare with a portfolio where those transactions driven by human decision making, didn't exist. + +--- + +**Ok, this was very long and all, why not share a TL;DR?** + +**TL;DR**: Passive investing is about reducing decisions you make. Decisions are sources of underperformance/ outperformance; but most often, they end up being sources of underperformance. + +Always measure your portfolio against a passive portfolio, it may reveal if you're a good or a bad decision maker. +Imagine, losing all your $Chad and throwing away your fortune because one bad day in a market that goes on for decades. I mean, this is exactly why you short-sighted numbnuts are gonna be stuck toiling jobs and swing trading while the rest of us actual Chads sit around on our stacks. + +I mean, for fuck’s sake, Chad Token is already on CoinGecko, is being pushed out on CoinTiger, and is still letting you paper handed losers buy back in at a discount. + +**Almost at 10,000 holders**, Chad token is the most obvious success story that’s going to come out of this memerun. I mean, what other meme do you see more than Chad other than Pepe who already belongs to 4chan. + +You know this is the one that’s been waiting to erupt in the scene and if you saw the website, it’s obvious that there’s nowhere to go but up for $Chad. If you fucking wafes could hold your shit for more than five seconds before getting rekt on another swing trade, you might even just make it. + +So get in at its current $6M and enjoy the gains through the weekend (Saturday’s crypto’s busiest day) and get ready for waves of influencer marketing as this Chad has only begun to whale up. These movements won’t slow down until there is a billion dollar Chad token, and probably still well after that. + +Just look around the market. You’re not late to cryptocurrency like some virgin normie, you’re here early because you are a Chad, and you’re making your fortune off of the work of other Chads. + +Now go fuck off and enjoy your stacks. + +[Buy the Fucking Dip](https://exchange.pancakeswap.finance/#/swap?outputCurrency=0xea8eacce22bbb89709482c0100e75e7ab90f53f4) + +[Look at this Fucking Masterpiece](https://www.thechadtoken.com/) +I grew up with my grandma. She took me in when she was 60 and living on disability. Eventually, she'd take in my little sister too because my mom was suffering from mental illness and self-medicating in the worst way. So there were three of us, and we lived on $20k. (And this wasn't 100 years ago either; I'm a millenial.) Money was always, always tight. We didn't have a car, a computer, cell phones. We couldn't even afford a lawn-mower. A neighbor would lend his. What Save-A-Lot didn't sell we didn't eat. + +When I was 16, I got a job at Subway, and I had to walk two miles each way. Then I got fired because I didn't take my drug test in time. I didn't take the test, not because I was gonna fail it but because I couldn't get a ride to the nearest drug testing place, which was miles and miles away. + +All through high school, I kept dreaming that I would work hard in school and get a scholarship to Harvard and land a good job and bring Grandma (and myself) out of poverty. But that didn't exactly happen. + +First disappointment is that I didn't get into Harvard, but all in all, that actually didn't matter. I got into another good college on a scholarship. And I did work hard and plotted a path for myself where I would finally come up. I finished all my schooling three years ago, and I took my first adult job. I made enough just to cover all my expenses and have a small cushion, but it all felt very precarious. + +Last September, I interviewed for a good job, making six figures, a job that would actually change my life. I got the offer and accepted in October. My Grandma died in November. + +On the one hand, I made it out of poverty, so I should be happy. On the other hand, it all feels meaningless since I can't share my success with the one person in the whole world I wanted to share it with the most. + +With the new job came a new city. Nobody knows my story here. I'm just another guy in a suit, who went to good universities, whose life is 'working out.' +Original: [https://survivingtomorrow.org/why-do-so-many-famous-companies-lose-billions-every-year-3aa648ddc9d6](https://survivingtomorrow.org/why-do-so-many-famous-companies-lose-billions-every-year-3aa648ddc9d6) + +**(NOT MY OPINIONS)** + +\------------- + +Uber reported a [$1.1 billion](https://www.verdict.co.uk/uber-q3-results-2020/) net loss in Q3 2020.Pinterest burned [$208 million](https://investor.pinterestinc.com/press-releases/press-releases-details/2021/Pinterest-Announces-Fourth-Quarter-and-Full-Year-2020-Results/default.aspx) in Q4.[Snapchat lost $944 million in 2020](https://www.statista.com/statistics/668190/snapchat-annual-net-income-loss/). + +Don’t blame the pandemic. These companies have been losing money for years. + +It’s the same for Blue Apron, Casper, Lime, Dropbox, Lyft, Peloton, Slack, Wayfair, WeWork, Deliveroo, SoundCloud, Ocado, Zillow — pretty much every company you know that was started in the past decade or so — all of them went public for billions despite losing vast amounts of money. + +According to [one IPO specialist](https://www.vox.com/2019/3/6/18249997/lyft-uber-ipo-public-profit), “In 2018, 81% of U.S. companies were unprofitable in the year leading up to their public offerings.” + +The real question is: *How the heck do these companies still exist?* + +**Financialization:** + +*“We used to build things in this country, now we just stick our hands in another guy’s pocket.”* — Frank Zbotka, The Wire + +All of these companies are based on somewhat cool ideas and have good-looking brands, but they’re not groundbreaking patentable innovations that won’t eventually face brutal competition. Plus, their underlying business model is fundamentally unsustainable. + +**Yesterday’s biggest companies used to own assets and create goods and services. Today’s biggest companies own almost no assets and produce neither goods nor services, but instead act as middlemen who take an irrationally large cut for their minor role in the process.** + +* Uber and Lyft don’t own cars or drive people around. +* Facebook/IG/Snap don’t create content for its users to enjoy. +* Amazon doesn’t produce most of the products in its store. +* Airbnb doesn’t own houses or host travelers. + +So how did these companies come to dominate their industries? + +**One word: Financialization.** + +Amazon’s Jeff Bezos was the first person to really perfect this insidious art, and these famous “tech” companies are just the latest to capitalize on the lethal gambit. The process is simple: + +* Find a way to “disrupt” an industry of *real* producers. (IE book publishers, taxi drivers, content creators, house hosts, etc.) +* Create an attractive site/app and charge a fat fee as the broker. +* Build a huge amount of media hype to attract colossal amounts of debt and private equity across several rounds of funding. +* Rather than paying a dividend to shareholders, use their original investment and their annual profits to strengthen your team and strangle your competition. Make sure the story of your rapid expansion overshadows your mounting losses. +* Once you’ve destroyed the competition and have finally started to turn a meager profit, use the money to swallow up-and-coming competitors and coerce democracy to extract advantages that small companies can’t get. + +If this sounds like a giant, anti-meritocratic unethical fraud, it’s because it is. + +**A new paradigm:** + +In previous generations, such a dismal record of profit loss would make companies like these worthless, with investors avoiding them at all costs. In today’s fairy tale/nightmare of destructive financialization — paired with huge amounts of hype and publicity — they are seen as a brilliant and important investments, with stock speculators assigning them an initial public market “value” in the billions. + +**The old business valuation paradigm**: a company’s stock price was based on saleable tangible assets, plus net profits in the form of dividends, plus projected growth over a reasonable multiple. + +**The new business valuation paradigm**: a company’s stock price is based on pure media hype and the hope of a future global monopoly. + +It’s vital to understand that companies aren’t selling products and services anymore… *their real product is their stock price*. + +**It’s all about “story-telling”** + +Seth Godin says that all marketers are liars — and today’s big tech CEOs are the ultimate marketers. + +They’re so good at storytelling and myth-making that they’ve managed to convince a generation of young, mostly Robinhood-based gamblers to boost their stock prices to the moon. + +The [price-to-earnings (P/E) ratio](https://www.investopedia.com/terms/p/price-earningsratio.asp) is considered the benchmark number for comparing one company’s stock price to another. The ratio is based on the current stock price divided by the trailing 12-month earnings per share. If a stock price is $10/share, and the P/E ratio is 10, it means that company is earning $1 per share. If you buy a $10 share with a P/E of 20, it’ll roughly take you 20 years to break even. + +Warren Buffett likes to buy stocks with a P/E of around 12. The S&P 500’s long-term median P/E ratio is around [15](https://www.multpl.com/s-p-500-pe-ratio). + +Guest what the S&P 500’s *current* P/E ratio is? + +[**More than double the century-long average.**](https://www.multpl.com/s-p-500-pe-ratio) Despite the pandemic and a looming joblessness crisis. + +It’s even worse for the famous financilized fantasy-factory stocks: + +* Netflix’s P/E is typically 50+. +* Amazon’s is pushing 70. +* Tesla’s P/E ratio is currently over [300](https://www.google.com/finance/quote/TSLA:NASDAQ). (That’s [$0.50 worth of earnings for every $300 invested](https://www.nasdaq.com/market-activity/stocks/tsla/earnings). Would you buy a business with an ROI of 0.0015%? Would you acquire a company that will take 600+ years to break even?) + +Snap, Pinterest, Uber, and Airbnb don’t even have a P/E ratio *because you have to have some actual profits to measure against*. + +**Welcome to the Vampire Economy!** + +I’m sick of “disruptors.” Companies like Uber and Snap and Airbnb and Tesla are little more than [story stocks](https://www.investopedia.com/terms/s/storystock.asp). It took them a good idea and a metric ton of debt and private equity to strangled their competition. It made a few people very rich, and the wider society much poorer. + +These aren’t contributing companies — they’re **predatory** corporations. + +As someone wise once said: + +*The thing that gets me is that Uber and Lyft have never made a profit, yet they’ve decimated the taxi industry and have destroyed the livelihoods of many while paying sub-minimum wages to their own drivers. All while using infrastructure they don’t pay for, and changing labor laws (in CA) intended to help the people who work for them by paying millions of $ for calculated propaganda that could have gone to helping the people that work for them! These types of vampiric, exploitative, extraction dependent business models aren’t long-term sustainable in reality and need to be eliminated because they do real damage to the world we all live in without returning any value to anyone but their shareholders. It’s disgusting and evil.* + +Should society and the market really reward them for that? Or is it time to really question how we define contributing “value” to society? + +Do we need to stop letting them write off profits?Do we need to start [aggressively taxing them globally](https://medium.com/surviving-tomorrow/its-time-to-actually-tax-amazon-facebook-and-google-5191fa9afad3)?Do we need to [protect workers from the gig economy](https://bettermarketing.pub/uber-and-lyft-won-the-battle-but-they-will-lose-the-war-7d5cc7ab8113)?Do we need to ban financialization?Do we need to shatter monopolies? + +The startups of tomorrow must grow businesses with sound economic foundations, on long-term sustainable models, with care for workers, competitors, customers, investors, democracy, and the planet. Instead of being big and famous, they need to be *truly great*. +I recently found out my 74yo single mother is almost broke, and spent all her retirement. AND has been recently diagnosed with early stage dementia. I know very little about investing and I need to do something with the money she has left to make it last as long as I can. I have to be able to withdraw occasionally for bills, but like everyone else I need to make money quickly. How screwed am I? +Interesting read in the wake of the ProPublica article. Written by Abigail Disney (yes that Disney) + +[https://www.theatlantic.com/ideas/archive/2021/06/abigail-disney-rich-protect-dynastic-wealth-propublica-tax/619212/](https://www.theatlantic.com/ideas/archive/2021/06/abigail-disney-rich-protect-dynastic-wealth-propublica-tax/619212/) + +>My grandfather Roy O. Disney, who co-founded the Walt Disney Company with his brother Walt, was a fervent believer in this idea. He was so determined to prevent the government from taking any of the money he wanted to leave to his family that he created generation-skipping trusts to end-run the IRS. What he did back then was so effective that most of it is illegal today. +> +>I will protest to my dying breath that he was a good man—one of the best, in fact. +> +>But I will also add, at the very end of that dying breath, that he should not have been able to do that. + +Nothing revealing, just a unique perspective. +I ran a discounted cash flow model to determine the fair value of BABA. + +Link to video: https://youtu.be/PdvQaGzH7Nw + +BABA present fair value is $1388 based on my calculations/predictions making the stock insanely undervalued by almost 7x. +Would love to hear if some of you ran a similar model and what is your target price. +Some context: I am a 16-year-old high school student. I've always been a big fan of dividend stocks, however, my parents are not allowing me to get a job as I should be focusing on school. I am a lazy guy, I do not like to work, and do not plan on working for very long in my life; getting paid for literally not doing anything is just so appealing to me. Currently, I have around $1,400 invested in dividend stocks, all saved from allowance and/or from my past shoe reselling experiences. I am also investing with my uncle, and we are consistently making $1,000 in profit every month, of which I get a 20% cut. Additionally, I have invested a thousand dollars into cryptocurrencies and hope to leave it there to thrive for a couple of years. + +Now the question is, my parents, do not think that I will be able to live off dividends in 20 years, despite me explaining to them how compounding works and how over time the small amount I have invested will grow into big numbers. Are they correct? I have always looked at dividend stocks as my escape out of the typical 9-5s that all my peers are working towards. However, now I am worried that I am delusional and I will be working for the majority of my life. + +If anybody has been in my position before and has gone through with it, how did it work out? Did you succeed or are dividends simply not enough to live off of? +I’m a 24yr old electrician making about 600 a week and it’s almost impossible for me to afford anything. I had a roommate for a while, we were paying 600 a month for our place. That plus my 500 a month car note left me with pretty much no money. How do ppl do it? Especially ppl making less, working retail and fast food?? I wanna be financially stable but I just don’t see that happening.. any advice? +I am not very educated in economics and I love to be proven wrong. Throughout my life I always identified with the economics of the left. Recently I have been reading lot of books from famous economists, and hardly ever I find a good 21st century book about economically left leaning theories and most modern school of economics advocate for free market, deregulation etc.. Why is that? +With the Constantinople upgrade and issuance reduction (3 ETH per block to 2 ETH per BLOCK) around the corner, many argue that the bottom is either in or near, since the ETH inflation rate will be dropping to essentially match that of BTC's. + +Others argue that BTC has farther to fall and will drag everything else with it. + +So which is it? Has ETH bottomed or not? + +[View Poll](https://www.reddit.com/poll/9yg8r6) +This is an FTD cycle of the T+21 variety combined with a small gamma ramp! + +So for the love of Harambe, chill out and expect sideways or slight decline in price for the remainder of the day. If I’m wrong, I’ll delete! + +But also be wary of FUD/shills trying to get y’all to believe this was the squeeze. Get ready for all the bullshit to come out of the woodworks! +Finance should be a mandatory curriculum in school with emphasis on budgeting, concept of debt, saving for retirement and investing long term. I hear of so many horror stories of individuals in their 50’s, and much worse, 60’s and 70’s with no retirement, debt and having to work in their later years. Get these kids on track on the the importance of finance and retirement savings to save their self a life of being financially in despair and having to rely on social security if it is still around. So many kids are lost in finance with the mind frame of “I’m young I have enough time”. No! Time is not on anyone’s side because in a blink of any eye your already in your 40s with 0 saves. Time is on someone’s side when they invest early then I agree. I was at one time that young person. Now I’m 52 trying to catch up although I was savings during my years I start several years late and I didn’t put in enough time to be financially where I should be. Finance is an absolute must In this day and age for everyone but especially young kids! +Will post pics later + + +I worked 5 days and made 740, it was like 46 hours so it was rough but then I got like a shit ton of recycling and made over 100 and I already had 700 saved so now I have a bunch of money and Idk what to do with it +Quoting Bloomberg. + +>Zuckerberg appeared red-eyed and wore glasses, the person said. Employees were told he might tear up because he'd scratched his eye. + +Sounds like losing 21 Billion in net worth overnight will cause “eye scratching” + +Personally, I am actually long FB with 10 shares but I'd happily set that go to zero if it means Facebook goes down. Nothing excites more schadenfreude in me than Zuck losing billions. + +Anyways the metaverse is a stupid fucking idea. No one wants to wear goggles and completely immerse themselves in FB's dumb virtual world. +A close friends sister used credit card to transfer cash to the tune of appx Rs.50,000 by setting up a dummy seller account on Paytm Market. This was during COVID times when there was cash crunch during job loss and all. + +Unfortunately they are just normal middle class people who tried to explore this loop hole to get cash from credit card. Now they got a show cause notice from ED. FIR has been filed accusing them to collude with Chinese nationals to setup fake accounts to launder money.The family is scared about consequences seeing all the data. Their bank accounts are frozen by ED and the notice too is a genuine one. + +They are from a small village in Maharashtra where they do not have any PMLA practicing lawyers. They are basically scared to death now & finding it very difficult to get a proper PMLA lawyer to help them out. Even if they do get one, it's going to get a lot expensive & bail is very tough to come on this case from what I have read online. So next time some YouTuber gives a crazy trick to get cash from credit card to bank account stay the hell away from it 😞 + +I have already posted this in r\india and r\legaladviceindia but if you still have any suggestions on how can they tackle this situation please do let me know. +I can’t help to notice how many popular stocks recently have been following a pattern of manipulation, particularly $GEO and $WISH. Their pattern is distinctly different from the manic buying that happened early on with $GME. + +With $GME the behavior was that traders bought shares over a period of many days. This can be seen in the rise and fall of the stock over a period of well over a week (Jan 21 - Feb 4 2021). This makes a lot of sense as retail investors generally are not constantly making trades and don’t even possess software to issue fast trades (most brokers have a delay in order execution). This is what I’d expect if a stock is being manipulated by a group of people, coordinating actions takes time and no everyone is a professional trader. + +With $WISH and $GEO, we see a different pattern (although both were pumped on Reddit). Here, there is a fast rise and a fast fall over the course of 1 day. Interestingly enough both rallies end at market close when they started. The next day the rallies mysteriously die and both stocks return to normal. If both were being pumped by a group of independent individuals, I just don’t see how such a pattern would emerge, especially if the individuals were not already seasoned traders (which the general public is not). + +Why is this highly suspicious? +First both rallies end at day end. This is setting a perfect trap for individual investors who are not constantly checking the market. With such a strong rally the general public is bound to believe that the rally will continue on the next day. Also, they’re likely to check the news at the end of the day. + +How could an attacker profit? +By planning the date in advance, one or many attackers can simply buy low priced options for the given date at the expected strike price. By coordinating a mass buying (GEO and WISH have relatively low volume and market cap), the attacker can raise the price (especially due to mark to market). His options would substantially rise in price, which he could unload at a hefty profit. By selling the stock to the general public the day after the rally, the price would go back down (again, most of the general public is unlikely to quickly sell, hence the price would go back to what it was). The attacker makes a hefty profit on the options, and likely no loss (maybe even a profit) on the stock. I estimate that 200M would be able to easily make such moves for both GEO and WISH. 200M is not an insane amount for a fund. + +Both rallies look extremely suspicious to me, what do folks think? +Context: + +* Introduction ([https://www.reddit.com/r/fatFIRE/comments/pyqf2a/confessions\_of\_a\_hectomillionaire\_part\_1/](https://www.reddit.com/r/fatFIRE/comments/pyqf2a/confessions_of_a_hectomillionaire_part_1/)) +* Investments and Portfolio Management ([https://www.reddit.com/r/fatFIRE/comments/q2p32j/confessions\_of\_a\_hectomillionaire\_part\_2/](https://www.reddit.com/r/fatFIRE/comments/q2p32j/confessions_of_a_hectomillionaire_part_2/)) + +\-------------- + +I want to set a serious tone for this post by sharing this WSJ article: [Zappos CEO Tony Hsieh Bankrolled His Followers. In Return, They Enabled His Risky Lifestyle.](https://www.wsj.com/articles/tony-hsieh-zappos-death-entourage-11616761915) This is a really sad story. I don’t know him. But if you read through the article, I believe what really happened is that his money, not his followers, enabled his risky lifestyle. Everyone around Tony Hsieh was on his payroll and whoever was trying to talk him out of his self-destructive behavior would get marginalized or fired. Intervention is kinda impossible for an addict with a lot of money if (s)he uses the money to be in control. This post focuses on expenses and lifestyle. But instead of talking primarily about how I spend my money. I want to focus on what I do to (hopefully) avoid getting into big trouble. + +First, let’s get past this “guilt” or “moral high ground” of wanting to stay frugal once you hit it big. It isn’t really about “spending money is bad and saving money is good”. It’s also not this false dichotomy of “Experiences are good. Material things are bad.” Money is a tool. With money, you have options. Some options are good, some options are bad and some options are complicated. Super rich people can live a life with no financial constraints, But there are always other life constraints or consequences to consider. It’s important to think of the consequences before throwing money at various problems. + +Let’s start with my favorite topic: watches. I like buying expensive watches. It’s an inconsequential expense. It takes very little space to store, there’s virtually no maintenance issues and it lasts forever. The catch is I don’t really wear them in public and I definitely don’t wear them in front of old friends with different life circumstances. It satisfies my vanity without inciting envy and it doesn’t involve PEOPLE. The watches are so nicely designed with amazing craftsmanship and have great resale value. I limit myself to 1-2 watches per year though because after all, I only have two wrists and I don’t want overconsumption kills my appetite for them. + +On the other hand, I don’t have a personal assistant or full-time household staff. On paper, they could make my life easier by taking mundane things off my plates like booking travel or scheduling a plumber. But I would have to trust this person enough to give him/her enough work to make this arrangement productive. In other words, it's a very consequential expense. One time an acquaintance who was a PA to a prominent venture capitalist told me that she helped the family book a private flight to Europe and the cost was more than her annual salary. She sounded a bit bitter. I was not shocked by the cost but I was wary of the relationship between her and her employer. I don’t want a PA to talk behind my back and to be judgy of my purchases. Frankly, I don’t want to get into a complicated relationship like this. But I don’t think it’s easy to make this kind of relationship entirely transactional. + +Here is another depressing story. I know a self-made super rich couple who got divorced. The guy told me they hardly have their private space and time together. Their household employees were everywhere. They did try to carve out time and space to be with each other alone but that’s extra work. In the end, they grew apart and divorced. I always wonder if they would have still been together if they led a simpler life. + +Back to the Tony Hsieh story, just think about what could happen to a good person when everyone around him is on his payroll? It’s probably fine for a short period of time. But imagine if almost everyone you interact with on a regular basis for the past 10-15 years is on your payroll, what would that do to you? People around you will tell you that your ideas are so amazing, your heart is so big, your below-average art is the best and you are such a visionary/genius. I have seen good people become out-of-touch. I imagine only when they log into reddit and post/comment on something, people might call them idiots. Or if they do venture out into the wild, they probably would realize that whoa people do their own laundry, cook their own food and stand in line for hours to get into a buffet in Vegas???!!! If they live in their bubble, keep the money flowing and don’t get toxic people into their life, they will probably be fine. But if they have other problems like addiction or a severe mental illness, they could get into big trouble down the road. + +The main point I am trying to make here is that at a certain point, it’s not about how much money you can afford to spend anymore . It’s about the consequence of life choices. Hiring household staff is an option money enables but people need to think about if they want to pay for the price beyond money. Same for owning giant mansions, having paid \*companions\*, keeping multiple residences, owning a private jet or a big boat. It requires maintenance and manpower to own these nice things. But is it really worth all the effort and does it actually bring you joy? + +Also, I have kids. I would probably spend more lavishly on travel and experiences if I didn’t have kids. But I don’t want them to become Rich Kids of Instagram so I have to cut back on my excess. They already live in a bubble of safety and comfort. What will they become if they are used to a jet set lifestyle? + +In summary, being able to do something doesn’t mean you should do it or you actually want to do it. Here is a list of question we ask ourselves every time we are considering a significant expense($5K+): + +* What are the benefits? +* What’s the initial financial cost? Does the cost justify the benefits? +* Is there an ongoing financial cost like taxes, maintenance, membership dues, etc? +* Does it require me to spend extra time and energy on it? If so, how much? +* Does it affect our existing relationships, in particular kids, family and friends? If so, how? +* Does it require me to cultivate new relationships? + +If the answers to the last 3 questions are yes and significant, I generally avoid the expense. If the expense only involves primarily the first 3 questions, it’s a trade-off analysis. I am willing to pay for conveniences and experiences. I will also pay for house improvements that we can enjoy for a long time after it’s done. I bite the bullet and pay for all the digital subscriptions so I don’t get locked out of Bloomberg or WSJ. I have a country club membership and a wework all access membership. Here is the rough breakdown of our budget (not including investments and charitable donations): + +* Day-to-Day Basics (Food/Grocery/Trinkets/Utility/Insurance/Subscriptions/Memberships): $180K +* Kids Related (Babysitter, Enrichment Classes, etc): $70K +* Travel & Luxury Purchases & Gifts: $100K +* Home Improvement: $100K +* Services (Cleaning, Gardening, Accounting, Legal, etc): $50K +* Property Taxes on Primary/Secondary Homes: $100K (covered by rents from rental properties.) + +The above is the budget. In reality, we underspent on the basics, travel and home improvement categories by at least $100K in total. So our total budget is $600K but actual spending is a bit less than $500K. We kind of just run out of things to buy since we don’t spend much on consequential stuff. The biggest unnecessary consequential expense is our second home. We use it about 30-45 days a year. It’s nice but requires all the upkeep of owning a home. If we get rid of it, we will save at least $60K a year. We are keeping it because it lets us get closer to nature. But if I were to do it again, I probably wouldn’t buy it because the upkeep takes too much of my mental space. + +Going forward, we do expect to pay parents’ long term care expenses so we might add a couple hundred thousand a year in expenses for a few years and we will be happy to cover all that. We don’t give extended families money in general. They are all doing fine financially and have good professional careers. I don’t think it’s a good idea to give them money to remind them how rich we are. We do invite the family to trips for which we cover the expenses and sometimes we get turned down due to schedule conflict or awkwardness. We don’t talk about money with friends and family. If people try to bring it up, I just don’t say anything. I don’t like to mix money and relationships. I do like to spend time together with friends and family. We can talk about anything but money. If they want any financial advice, they can check out /r/financialindependence or /r/fatfire. A lot of good advice is available there. (Note: I do talk about the struggles with friends in the same situation. But our conversations are usually not about managing money but more about “what do we do with our life?”) + +I hope this post is not too disappointing because it’s not like I am having an amazing time spending money on luxuries all day long. Money is a tool to run our life smoothly. We eat healthy food, have nice gadgets, live comfortably in nice homes in nice neighborhoods, travel well, enjoy all the conveniences money can buy (, avoid inconveniences money can cause) and most importantly, have control of how I spend my time. We can cover any expenses should there be an emergency. IMO, the Godilocks FatFire number is $20M ($10M if you live outside VHCOL areas). Beyond that, there’s really very little marginal utility unless you enjoy living like royalty with employees gossiping behind your back. + +\------- + +Next week, I am going to write the infamous piece “I am NOT a superman”. It’s a post about philanthropy and I think it’s crucial to have it out first to provide context for the work and purpose post. +Do not take these government payments for granted. Not saying that you all will, but there will be a percentage who believe they are entitled to them and will forget all of this when the virus settles and the economy is back on track. + +Remember that these payments are always necessary to segments of the community and try and imagine you were someone on the much lower newstart payments before all of this happened or how you would be surviving if it didn’t exist in the first place. Don’t forget they stimulate the economy in their own way and are purposed to allow vulnerable Australians have a reasonable standard of living. This counts for all of the government stimulus packages. + +Think twice before voting for people that want to demonise those on welfare, particularly when a large percent are not by choice. + +I have always backed government welfare programs for the less fortunate and continue to do so now for everyone even though I have safe employment. Even though my taxes are paying for this I’m proud that I can help in some way. + +There are a lot of people that never would have imagined themselves in this position and have previously questioned why their money should go to those who do not have jobs. Might be a bit of a reality check to some. + +Remember too there are a lot of countries that would allow their people to starve without any benefits so I am grateful. + +I wish you all the best and hopefully we can all get through this if we work together and treat each other with dignity and respect. + +EDIT: Didn’t imagine this post would blow up. + +I’d also like to remind those collecting benefits for the first time to factor in the toll losing your job/ the uncertainty takes on your mental health and compare that to the small few on welfare that have the same mental health issues and end up resorting to substance abuse as a result. + +Don’t judge those for complaining to the government about exorbitant house prices when some just want a stable home. + +Take into account essential services, ambos, doctors, firies, nurses, police, teachers, retail workers and don’t be judgemental when they ask for a pay rise or demonise them when they are at work just trying to do their job. + +We need a society with less judgement and more caring, moving forward from this disaster. +43.4 % of Americans believe they have some chance of owning a home. The other 56 percent believe the American dream is dead to them. That is the first time in the history of the survey that the reading is below 50%. + +As more Americans are forced into renting, rents go up. Most housing that is being built is multi family rentals owned by large corporations that are borrowing from the Fed at very low interest rates. They're not even building condos and town homes for people to get their first step up on the housing ladder anymore. + +[https://thehill.com/changing-america/resilience/smart-cities/3273343-more-americans-losing-confidence-they-will-ever-own-a-home/?msclkid=fb5d992ac03c11ecb4a31f84259ea46e](https://thehill.com/changing-america/resilience/smart-cities/3273343-more-americans-losing-confidence-they-will-ever-own-a-home/?msclkid=fb5d992ac03c11ecb4a31f84259ea46e) +Do any of you invest in any side hustles or have a small business that you put your money into instead of dividends or do you just put any extra money into your portfolio to maximize your dividend potential? +I know you all know me for my memes. But it might surprise you to know I dont lose all my money!!! I will briefly explain in this post some newb traps and how to hopefully avoid them. + +1. Trusting internet randos. Dont fucking do it. 98% of the fuckers on hotcopper will lie to your face for 5c. Until you learn how to judge what a company is worth dont take advice from someone you cant walk up to and punch in the face for losing you 10k. + +2. Blindly following valuations. There are many brokers out there and some of them do good work. However there are many out there that are **PAID** to write good reviews about a company. Sure there are no lies there but that doesnt mean they are telling you the whole truth. Dont get me started on fucking morning star quantitative. + +3. Not knowing how the stock market works. Seems basic but i have seen people trade who dont know what the morning auction is. Or the closing auction. Or why some companies open before others. Or why liquidity matters. Or why buying a penny stock miner after it went up 2500% in a day is a stupid move. Or how a conditional order works. Or what an option is. Or what an ETF is. For fucks sake read the sidebar and ask questions before you lose grandma's inheritance, or your wifes shoe money. We will call you retarded but we will help. + +4. Getting fooled buy easily faked metrics. If i put a 50k order in for xxx in pre open and it looks like it is going to shoot up 30% and then a bunch of autists jump on and i remove my buy order and put a sell order in instead I have just manipulated the market. Guess what? If i can do that with 50k imagine what an institution can do with 20 bots and 1 million dollars. You cannot be faster then a bot. You cannot out money a bank. You are not smarter then the analysts. Your advantage is that you are working with smaller packages of money. You wont move the market, because you cant. But 100% of $1000 is still pretty good. However i would take 2% of $4,000,000 over that 100% anyday. Buy orders disappear. Sell orders can be reloaded. Numbers can be easily manipulated. Dont trust anything or anyone. Shoot your cat, its a warren buffet spy bot. + +5. T+2 trading or YOLOing more then you can afford to lose. Unless you have a great idea of the market sentiment, micro and macro environment of the stock you are trading, insider information about any upcoming announcements, a crystal ball that works or even visions from the future i would **NOT FUCKING GAMBLE WITH MONEY I CANNOT AFFORD TO LOSE** + +5. AGAIN DONT FUCKING DO IT + +6. Fucking with shit you dont know shit about. if you are a medical professional and you know your fancy science words go right ahead an get into med stocks. If you dont know what copper is used for but you just threw your 2nd mortgage into xyz the copper miner/lube emporium you might lose your money and never know why. + +5. Falling prey to FOMO. I know its exciting watching someone post gains porn. Dont jump on that meme stock at an all time high... you might make money but chances are you will lose it. + + +There are lots of other newb traps but there are a few of the obvious ones. I fell for most of them before i worked out what was going on. The best way to make money on the stock market is to not lose it all in the 1st 2 weeks. +I'll preface by saying this is half hypothetical, as the strategy is still bring refined and I'm trying to improve it, but I'm just going to talk as if I have already fully made it because easier I guess. + +So lets say I have a winning strategy, but it's a borderline HFT strategy if that makes sense. I have back tested and tested it live, accounted for commissions and spreads and all. And yes, I have asked myself why has no one else done this if this strategy is so good? And I have a reasonable answer I wont share because I would rather not give away the strategy. + +The issue is it won't work well with a low amount of capital and this strategy is most profitable with millions of pounds or dollars being used. I dont have much capital at all because I'm a student so I can't really employ this strategy myself. + +So I thought okay, I could sell it to a hedgefund who trade algorthmically. I dont know how to do that though. I'm based in London so I would ideally sell it to a hedgefund here. + +How would I find a hedgefund to sell it to? And more importantly how do I decide on a price for the algo? Let's say it makes 1% a day (literally just a random number), how do I decide it's worth? + +Also is it worth pursuing a masters or PhD in what I'm studying (mathematics and physics) to gain more credibility before I sell it? +Here we'll take a look at where the huge GME short positions might have been hidden since Jan and come up with some theories for why we've seen the odd price cycles in 2021[.](https://preview.redd.it/k12y1yxomjj71.png?width=4503&format=png&auto=webp&s=a71d022d84c6d3e2600632f853afb58185e74215) + +This post is heavily influenced by the phenomenal work of u/criand and other great DD posted on the sub in recent weeks. If you haven't already then go read [Are futures or swaps the secret sauce to price movements?](https://www.reddit.com/r/Superstonk/comments/p37osl/are_futures_or_swaps_the_secret_sauce_to_price/) and [The Puzzle Pieces of Quarterly Movements](https://www.reddit.com/r/Superstonk/comments/pb22oj/the_puzzle_pieces_of_quarterly_movements_equity/). Do it now. + +&#x200B; + +# 0. Introduction + +I always had doubts about the T-21 & T-35 price movement theories. How was it possible that all the different short funds line up their trades and FTDs neatly on just a few dates? Why would they choose to operate on a few critical cycles rather than spreading the buy in risk out over each month? + +Despite not really understanding the T-21 stuff there was definitely something to it so I just figured I was too smooth for that one. Then the OG of DD u/Criand shared an earlier version of this plot: + +&#x200B; + +[GME Quarterly Price Movements And Equity Total Return Swaps](https://preview.redd.it/koz9i1gqaij71.png?width=2435&format=png&auto=webp&s=98a3e727cf365ba4c52701bdc15ea57e82fcad39) + +Wow. Everything seemed to click. The cycles we are seeing come from derivatives settlement deadlines. They're predictable. And they get more violent each time. + +What I want to do with this post is to pull together a bunch of info I've found that helped me understand the fuckery and describe it as clearly as I can. Then go on to show some new data I have that might point us towards when this *death-spiral-swaps-cycle* began. + +Hedgies r fuk. After 8 months of this ride I like the stock more than ever. + +# 1. Total Return SWAPs, unhinged greed and the upcoming Minsky Moment + +This has been covered before in some detail but I'll go over the key info as simply as possible before getting into the more juicy stuff. + +https://preview.redd.it/txid9jx3rij71.jpg?width=1080&format=pjpg&auto=webp&s=af29b850c473ca59bb2e1c17ab4d667e24f86ce4 + +So a Total Return Swap (TRS) is agreed between two parties where *one side (Party A in the example) pays an ongoing fee to another party (Party B) in return for any change to the price of an underlying asset* (often an equity like GME). This gives exposure to the equity without ever having to own it and can be configured to go *both long and short*. + +*Why would a fund bother to use swaps rather than borrowing to short sell as is typically understood as going short?* + +***Loopholes and fuckery.*** + +Synthetic short positions in Swaps have the advantage of being poorly regulated, with lower margin requirements and are unreported in any real detail in public data. + +Here is a post I made a while back where Prof. Michael Greenberger explains Total Return Swaps in relation to Gamestop and Archegos: [https://www.reddit.com/r/Superstonk/comments/nwiuo5/total\_return\_swaps\_behind\_gamestop\_frenzy\_and/](https://www.reddit.com/r/Superstonk/comments/nwiuo5/total_return_swaps_behind_gamestop_frenzy_and/) + +In the video the following points are particularly interesting: + +* Total return swaps are the ***same financial instruments that led to the 2008 crash*** +* After the Dodd-Frank regulations Total Return Swaps should be transparent to US regulators and should have capital and collateral requirements (*hint*: they're not) +* Margin should be collected twice per day (*hint*: it isn't) +* Wall Street found a way around Dodd Frank regulations by 'deguaranteeing' their foreign subsidiaries ***providing a loophole that*** ***allows them to operate Swaps deals offshore with zero regulation from US authorities*** +* US investigators noticed that reported ***Swaps in the US were dwindling***, after months of investigation they discovered that ***US banks were moving their Swaps from the Wall Street facility to London, Japan, Berlin etc. and claiming that they are no longer US Swaps even if the deals were negotiated on Wall Street and then later assigned off-shore*** +* When markets are going well thats when ***speculation takes off, and that's when we hit a*** [***Minsky Moment***](https://en.wikipedia.org/wiki/Minsky_moment) \- a sudden major collapse of asset values + +So Prime brokers on Wall Street are financial terrorists who have gone right back to their usual antics after destroying the global economy in 2008. Using the exact same derivatives that fucked us in 2008. Circumventing the very rules that were put in place to protect the system from another 2008 event. And using tax payer bail out and stimulus money to fuel another bubble that's bigger than ever. A Minsky Moment must be around the corner. + +*But what's the reason for such massive speculation on Swaps to point where their bad GME bets could shake the entire system to its core and liquidate any fund caught on the wrong side of the bet??* + +***Leverage and Greed.*** + +Unlike with a usual short position margin requirements for Swaps can be pretty lax. Particularly if shifted offshore to avoid US regulation. Also for a fund that wants to gain exposure to a synthetic short asset the LIBOR fees have become ridiculously cheap since Covid. FED goes *brrrrrrrrr*: + +&#x200B; + +[1-Year LIBOR Rates](https://preview.redd.it/8bbb0dhz1jj71.jpg?width=2035&format=pjpg&auto=webp&s=efdbb600c874ac6ef8eaed5c0d857c893f5d6a7a) + +The fee to hold a Swaps contract with a broker is usually based off of the LIBOR rate plus an additional 'spread' rate to cover the prime broker admin costs. Over the last couple of years the LIBOR rate has collapsed from around 3% in 2019 to just 0.2% today in Aug 2021. No wonder the share borrow fees we see are so low when hedgefunds can get synthetic short exposure for next to nothing from their prime broker buddies. + +*But what happens when their bets go bad and they're over leveraged to shit?* + +***Prime Brokers bend over backwards to help them out.*** + +From the Credit Suisse report on the Archegos fiasco - [https://www.credit-suisse.com/media/assets/corporate/docs/about-us/investor-relations/financial-disclosures/results/csg-special-committee-bod-report-archegos.pdf](https://www.credit-suisse.com/media/assets/corporate/docs/about-us/investor-relations/financial-disclosures/results/csg-special-committee-bod-report-archegos.pdf): + +&#x200B; + +https://preview.redd.it/yvtd621y4jj71.png?width=1317&format=png&auto=webp&s=8d55434cd91f619949e53db42d90d910b484888b + +The report is long and dense with a ton of useful info. The above is a caption I picked out almost at random, there are many other passages like this. It shows that ***Archegos was breaching internal risk assessment checks consistently since July 2020 until they collapsed in March 2021 yet Credit Suisse simply gave them chance after chance***. + +*But how does a Total Return Swap work in practice?* + +I don't exactly know but I found some useful info and examples while searching. It's all rather opaque. That's probably by design. These financial instruments are meant to be so complicated the real world never bothers to stop and look at the greed and criminality. And *avoiding post 2008 regulation to get back to the same game that ended up destroying millions of lives around the world should be criminal*. + +Here's a technical example for those that are interested but the details don't mater so much: + +https://preview.redd.it/eyymdx526jj71.jpg?width=1079&format=pjpg&auto=webp&s=5f01e421f732a3354846385fbbd8e4c33ffb0b70 + +What's interesting in this example is ***the reset dates are*** ***stated as being quarterly***. From what I can find this is most common. This means that Swaps only need to have intermediate settlements every quarter despite often being agreed for a minimum of 6 months up to 5 years or more. ***Quarterly swaps reset dates could be what is driving the cyclical GME price movements irrespective of any futures trading deadlines***. + +This seems relevant to me because linking GME trading to futures contracts is not so easy. Futures trading is usually for commodities, currencies or sometimes ETFs. Futures contracts for single equities don't really exist as far as I can tell. Swaps deals or even options contracts are the equivalent of trading futures for equities like GME. Correct me in the comments if I'm wrong here. + +# 2. Portfolio Swaps: why hold anything real when it can all be synthetic! + +In the previous section we discussed the basics of Total Return Swaps and how they can be used as hidden short positions with increased leverage. An extension of this idea is the Portfolio Swap as described here: + +https://preview.redd.it/opb37spx9jj71.png?width=1598&format=png&auto=webp&s=39b575902e3a1ebc518c946785fbd01675571de4 + +So Portfolio Swaps are simply wrappers around multiple Total Return Swap agreements that can be held by a prime broker. In this way multiple synthetic short positions can be packaged up into a single Portfolio Swap and held on a prime broker's books. + +*What if multiple oversized synthetic short positions are packaged up into a Portfolio Swap and then hedged by a prime broker under the same contract reset deadlines?* + +***Obvious meme-stock fuckery.*** + +https://preview.redd.it/1ubrs98jbjj71.jpg?width=1079&format=pjpg&auto=webp&s=4c059946baba01ea6a9ce7dc1ccd368e55022c8a + +*No group of stock market tickers from varying sectors should correlate with each other consistently for 8 months.* + +And this is an interesting nugget I found while researching. It comes from [https://www.lawinsider.com/dictionary/portfolio-swap](https://www.lawinsider.com/dictionary/portfolio-swap) where they discuss some example legalese around the term Portfolio Swap: + +[\\"\[...\] does not reflect the leverage inherent in the Portfolio Strategy and Put Option exposure inherent in the Portfolio Swap\\"?!??](https://preview.redd.it/fcy4fo7edjj71.png?width=1926&format=png&auto=webp&s=659c77b4c7a2b6c6d3f0947d4a20d27c4c63ea3e) + +What does a Put Option have to do with Portfolio Swaps? Why is Put Option exposure inherent to a Portfolio Swap? ***Is this what the deep out the money puts were for??*** + +I don't know about this. But it's interesting to me that in just a few examples of how lawyers might need to discuss portfolio swaps, mentioning that *"Put Option exposure \[is\] inherent in the Portfolio Swap"* stood out to me. Could be something, could be nothing. + +[Edit: I added this figure to show the Archegos exposure double spike during the Jan GME sneeze and then another huge spike in the March run up. Shortly after the March run up they imploded in the largest ever recorded trading loss - over 10 Billion dolars https:\/\/en.wikipedia.org\/wiki\/List\_of\_trading\_losses](https://preview.redd.it/hhnoqi3zuoj71.png?width=1456&format=png&auto=webp&s=fba5b3b0572eddf86885874f6d12013b5e86d1e6) + +Given that it's been confirmed that Archegos collapsed in part due to GME Swaps exposure. And that we see these quarterly price moves across a bunch of meme-stocks. It seems likely to me that they were packaged up together at some point in a Portfolio Swap to hold bad debt for the shorts. But can we work out when this started happening? + +# 3. The start of the SWAPs + +Many of us know that GME and a bunch of meme stocks have been extremely highly correlated (moving together) throughout 2021. Here I set out to look into this more closely and try to work out when exactly it began. + +First let's take a look at how highly correlated the different meme stocks are: + +[Correlations between different meme stocks in 2021](https://preview.redd.it/kgqex8kyhjj71.png?width=1800&format=png&auto=webp&s=ec7fd3b70644c5ecda69d24c28f51ecf58397b8d) + +Here I performed correlations of GME and 5 other meme stocks using daily close data from Jan 15 2021 until Aug 15 2021. Any correlation above 0.5-0.6 is large and means that the stocks have been moving together consistently for more than 6 months. + +I won't mention the other meme stocks directly to avoid the wrath of automod. But GME is most closely linked with movie stock, headphone stock and the express-thingy. + +Now we can run another analysis called a rolling-correlation to see when the correlations began. All this means is that we look at 28-day windows of stock price data and see how much each meme stock correlates with GME. We then slide this 28-day window forward over time to see if the stocks were moving together more or less over different 28-day periods. + +[Rolling correlation GME and other meme stocks since June 2020. Note: in the bottom plot all lines are rolling correlations between GME and the indicated meme stock.](https://preview.redd.it/k12y1yxomjj71.png?width=4503&format=png&auto=webp&s=a71d022d84c6d3e2600632f853afb58185e74215) + +We see that before the start of 2021 GME did not correlate consistently with any of the other meme stocks. You can see this on the left side of the bottom plot with the wiggly lines that seem to move randomly with one another. Almost as soon as 2020 moved into 2021 all of these meme stocks started to move closely with GME (increasing correlation lines for all colors in early Jan). Since then GME has had consistently strong correlations with all the meme stocks for more than 6-months. + +*This should not happen in a free market place with independent price movements.* + +Sometimes the correlation drops for a brief period for one of the stocks but then gets back in sync with GME and the others. + +So this data shows that all these selected meme stocks are moving together and have the same quarterly cycle. The major differences are in the extent of big price moves and some slightly delayed timings. + +*Now we've seen that all the meme stocks move together could we do something ridiculous like predicting GME price purely from what has happened in the other meme stocks??* + +***Yes. Yes we can.*** + +Here I built a linear model to predict GME price movements based on the other meme stock price movements. I don't want to bore everyone with all the details here. I'll give full details in the comments if anyone is interested. + +https://preview.redd.it/m3np5kgrojj71.png?width=1800&format=png&auto=webp&s=7b3dc7c2bc3680b0c208a58d989e87c2cdcfdaf2 + +In blue is the model prediction on more recent data that it had never seen before. We can see that the model actually predicts GME price pretty damn well! And the model is only using other meme stock price data to estimate GME price. + +Let's zoom in to take a closer look: + +https://preview.redd.it/pl5noko3pjj71.png?width=1800&format=png&auto=webp&s=9b01da80ba37906d80caa3ab94d654ef8ae7af39 + +The major difference in the model prediction is that we are over estimating the share price. But the actual trend and fluctuations are very similar. This might suggest that GME price was being suppressed even more than it previously was since the June run up, possibly due to the share offering around this time. Alternatively it could be that the other meme stocks got a bigger bounce than earlier in the year. + +After accounting for the model estimating a higher price (mean centring the data) we get a model score of: + +R\^2 = 0.73 + +73% of GME price fluctuations (variance) can be predicted just by looking at the other meme stock prices!!! + +This is not something that should happen in normal circumstances. + +https://preview.redd.it/di7t5tn0qjj71.png?width=1800&format=png&auto=webp&s=4d847f9b48c869f84c6e1677b2f195a2ccc5e5a3 + +And the above plot converts the data back from log units to dollars. The model predicts that at the June run up GME should've spiked to $400 based on what happened to the other meme-stocks. + +This could just be a modelling error. Or perhaps the price reached such danger levels with GME it was suppressed hard while the other stocks were allowed to ride higher. + +https://preview.redd.it/xpj1hfyvpjj71.png?width=1800&format=png&auto=webp&s=36e768e4807080fafffeac1724d53f6c8b20fac1 + +Finally this scatter plot shows how well we can predict GME data just by looking at the other meme stocks. + +In summary of this section: + +* GME and other 'meme' stocks begin to ***correlate together consistently at the very start of 2021*** +* It's possible that these stocks were ***packaged up in Portfolio Swaps***, either one huge toxic bundle or multiple bundles that most commonly contain these meme stocks +* The meme stocks move so consistently together that ***you can predict GME simply by looking at the others - this should not be possible!!*** + +# Conclusion / TL;DR + +To start we took a brief look at Swaps. Archegos was confirmed to have blown up in part due to GME swap exposure. Wall Street has been side stepping regulations setup to protect us after 2008 by moving swaps offshore and out of reach of US regulators. Portfolio swaps could be used to package up a bunch of bad short positions in the meme stocks. + +To test the hypothesis that meme stocks were packaged up into swaps at some previous date I ran a correlation analysis. All meme stocks tested started moving with GME at the exact same time - very early 2021. Did a new rule come into effect or some other event on Jan 1st 2021? Perhaps they were all squeezing in Jan and then shifted into SWAPS at the same time we saw the options fuckery? Are the price movements of the last 6 months driven by prime broker hedging of Portfolio Swaps and contract reset dates? + +Shorts are fukd. The *death-spiral-swaps-cycle* might've begun in early Jan but there's no way out for them. Apes hold. I like the stock. +Ethical issues aside, the first rule of value is DON'T LOSE MONEY. If you invest in a warmongering dictatorship in the middle of international sanctions because of a perceived future turnaround...MAYBE you will make fantastic money, or maybe you will lose your shirt, but one thing it isn't is value investing. +1. Financial independence is being what to do what you want with your time, when you want it and how you want it. it’s not about getting rich +2. Saving does not require any reason or objective. Do it mindlessly - you’ll thank yourself later +3. As your income grows don’t upgrade your lifestyle proportionately. +4. Aggressive saving is more rewarding than aggressive investing/trading. It has way better risk/reward payoff +5. Black swans will occur no matter how ignorant you are of them. + +I think it’s a simple book that everyone must read. Even if you don’t agree to everything it says (for example, I save aggressively AND invest aggressively) it will still give you a good perspective +I'm purchasing a condo in Puerto Vallarta and I think I've been scammed. I'm hoping someone can advise me. + +I sent 10% of the purchase price to the escrow company. I negotiated that the seller would make some repairs to the unit before the sale was finalized. + +Two days before I flew down to sign papers and close the deal, my real estate agent called me and advised I wire the rest of the money to the escrow account so that the funds would be in place when I arrived. My gut told me not to do that. He informed me that by refusing to do what he advised, I was opening myself to potentially forfeit my deposit and have the seller walk away from the deal, since we wouldn't close on the date the contract stated. On this call, the agent assured me that the repairs were in progress. + +Fast forward to my arrival and NOTHING had been done to the unit. At this point, I've been in Mexico 5 days and still no repairs have been made. I asked my agent why he lied about progress regarding the repairs and he explained that he was told they had been made. He also deleted the texts from our Whats App chat where he told me the repairs were made. + +At this point, I'm being told that if I walk away from the deal that I would be forfeiting my 10% deposit. I want to buy this condo, but I fear that it's all a scam. + +Any advise? +If you're just starting out, remember that it took your parents decades to collect all the furniture, decorations, appliances, etc you are used to having around. It's easy to forget this because you started remembering things a long while after they started out together, so it feels like that's how a house should always be. + +It's impossible for most people starting out to get to that level of settled in without burying themselves in debt. So relax, take your time, and embrace the emptiness! You'll enjoy the house much more if you're not worried about how to pay for everything all the time. + + +Cost of everything skyrocketing, no end in sight, wealth gap growing drastically.. We’ve been reading all these depressing headlines for the past 2 years straight. Is there any optimistic news or predictions whatsoever for the next 2, 3, 5, 10 years? Any glimmer of hope? Or is Bezos/someone similar going to own us and everything around us in the next decade or two? TIA. +The Royal Swedish Academy of Sciences has decided to award the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2021 to David Card “for his empirical contributions to labour economics”, and to Joshua D. Angrist and Guido W. Imbens “for their methodological contributions to the analysis of causal relationships”. + +#### Nobel Prize Committee + +* [Video announcement](https://www.youtube.com/watch?v=nUTRasDkXK0) +* [Summary](https://www.nobelprize.org/prizes/economic-sciences/2021/summary/) +* [Press release](https://www.nobelprize.org/prizes/economic-sciences/2021/press-release/) +* [Popular science background: Natural experiments help answer important questions](https://www.nobelprize.org/uploads/2021/10/popular-economicsciencesprize2021.pdf) +* [Scientific Background: Answering causal questions using observational data](https://www.nobelprize.org/uploads/2021/10/advanced-economicsciencesprize2021.pdf) + +#### Press coverage + +* [NYT: Nobel in economics goes to David Card, Joshua Angrist and Guido Imbens.](https://www.nytimes.com/2021/10/11/business/nobel-economics-prize-david-card-joshua-angrist-guido-imbens.html) +* [CNN: Nobel Prize in economics awarded to David Card, Joshua D. Angrist and Guido W. Imbens](https://edition.cnn.com/2021/10/11/business/nobel-prize-economics-winner-2021-intl/index.html) +* [CNBC: Nobel Prize in economics awarded to David Card, Joshua D. Angrist and Guido W. Imbens](https://www.cnbc.com/2021/10/11/nobel-prize-in-economics-awarded-to-david-card-joshua-d-angrist-and-guido-w-imbens.html) +* [AP: 3 US-based economists win Nobel for research on wages, jobs](https://apnews.com/article/nobel-prizes-business-europe-3cbc672f994ae6f4f486a68b52c2bb32) + +This page will be expanded with additional news coverage and commentary as the day progresses. Please direct all Nobel discussion here. +A friend of mine FIRED after very successful investments and inheritance. He was completely out of the corporate rat race for almost 5 years but then decided he wanted to return to his previous career. + +No one would touch him. He was not marketable in today's workplace. Employers wanted current work experience and professional references. They wanted someone who was hungry to move ahead and is highly ambitious. They did not believe someone so young should be out of the workforce for almost five years and assumed he was hiding a job he failed at. + +Do you think this is a common experience for someone who has FatFired and then tried to get back into the rat race? +From what I understand, working conditions such as work-life balance will be better for labor in a labor market where the supply of labor is low compared to the demand for labor. Meaning they are in-demand. Therefore you see better work conditions for engineers and IT people who have a higher skillset. + +Doctors and nurses clearly have a very high skillset. There is a large barrier to entry: you need to study for years and years and you need to have a very high talent in order to become a doctor or nurse. Not many people can become one. The occupation is held in high regard in society as well. There is a shortage of doctors and nurses all over the world and therefore you see these occupations in the immigration list. + +So why do they have such a horrible work-life balance and work-life conditions? Shouldn't market forces mean that they would be able to bargain for and get the best work-life balance out of all the occupations there is in an economy? +Surely this achieves all of the benefits of bailing the companies out, without the disadvantage of effectively just handing over millions of pounds to private investors and still allowing them to reap the benefits. +I keep seeing suggestions that there should be a cap on this things. Usually when people suggest this, they don't really care or think about the economical implications, say for example price caps. + +What exactly would be the implications for this? And would it be necessary negative? +This one has been very helpful for me. On more than one occasion I was able to spot fraudulent charges on my debit card immediately. It has helped me in making faster debt repayments and start building an emergency fund. My spending behavior has also change as a result of this, everything now costs at least $10. + + +Edit: + + +* It doesn't have to be $10. You can round down to the nearest $5, $1 or $0.50. (Sorry for sounding like the rich asshole with more than $10 in my account.) + + +* If you have a checking and savings account with the same bank transfer should be free. + + +* There are apps that do this automatically for you, but checking manually everyday makes it easier to spot charges you didn't make, subscriptions you forgot you were paying and keeping you aware of your financial standing. +We (wife and I) toured a duplex that has been on the market for more than 30 days. The Listing Agent (not our agent) stated that they have one other offer but the seller is not satisfied with it so we made a full price offer. But now the Realtor is giving us a hard time because we are prequalified with a commercial loan to purchase. It seems that the Realtor does not understand why we are looking to purchase with a commercial loan since the property is not commercial and is afraid that the loan will not close because of it. Are Realtors REALY this ignorant? We have other properties (SFR) under this same financing. It seems like Realtors (in general) are not very educated. It is getting very frustrating to deal with them. I am not sure how to handle this if the offer is rejected due to a lack of knowledge on the Listing Agents part. +A close friends sister used credit card to transfer cash to the tune of appx Rs.50,000 by setting up a dummy seller account on Paytm Market. This was during COVID times when there was cash crunch during job loss and all. + +Unfortunately they are just normal middle class people who tried to explore this loop hole to get cash from credit card. Now they got a show cause notice from ED. FIR has been filed accusing them to collude with Chinese nationals to setup fake accounts to launder money.The family is scared about consequences seeing all the data. Their bank accounts are frozen by ED and the notice too is a genuine one. + +They are from a small village in Maharashtra where they do not have any PMLA practicing lawyers. They are basically scared to death now & finding it very difficult to get a proper PMLA lawyer to help them out. Even if they do get one, it's going to get a lot expensive & bail is very tough to come on this case from what I have read online. So next time some YouTuber gives a crazy trick to get cash from credit card to bank account stay the hell away from it 😞 + +I have already posted this in r\india and r\legaladviceindia but if you still have any suggestions on how can they tackle this situation please do let me know. +I've been in the stock market for a year now. Around this time last year I pledged that if after 1 year I had gained money from my initial investment I would donate money to a charity that works to end female genital mutilation [original post](https://www.reddit.com/r/ASX_Bets/comments/my2mw8/making_a_pledge_for_all_the_mutated_cunts_out/) + +Unfortunately I am shit at trading and shit at investing. I did not make any money, instead I am down ~12.5%. I bought all the dogs, and missed all the rockets. I made so many dumb decisions. I learned a lot, and part of what I learned was just how fucking stupid I really am. What a humbling year it has been. + +It hasn't all been bad though. I still have some gains as I have made friends along the way, and I cherish these degenerates. Although I can't put a monetary value on these gains, I will donate a dollar for every upvote and two dollars for every comment on this post to [share the dignity](https://www.sharethedignity.org.au). Because I am not rich this will be up to a maximum of $100. + +I have emailed the charity about the 10% refund but am yet to hear back [email](https://imgur.com/a/t87PGSU) + +EDIT: DONATION COMPLETE https://imgur.com/a/1vNckkH +I must start this post by complimenting u/criand. The events of the past week seem to have confirmed his [theory of the FTD loop missing link: the coupling of T+21 for Market Makers with T+35 for Clearing agencies to cover positions](https://www.reddit.com/r/Superstonk/comments/nf22qz/theory_on_the_ftd_loop_missing_link_a_t35_surge/). As he so clearly explained: [this feels eerily similar to the February and March run-ups](https://www.reddit.com/r/Superstonk/comments/nqbera/things_are_shockingly_similar_to_the_february/). + +&#x200B; + +HOWEVER, what happened after those run-ups? The price dropped. To higher support levels than previously, but it did drop. **This is a clear indicator that they're running out of their protection layers and that we are closer and closer to cracking them to get our well-deserved tendies.** + +**Shitadel, Susquehanna, Point 72 and even the clearing corporations are hoping that apes will paper hand now in June. They're trying TO SURVIVE THROUGH JUNE RELYING ON APES SELLING BEFORE THE NEXT TIME THAT T+21 AND T+35 CONVERGE.** + +If the rocket does not ignite after the shareholder meeting, something that might happen considering that it is a significant catalyst, or if Ryan Cohen does not ignite it with some measure **then we MUST HODL for a few more months.** + +**Remember that our opponents always relied on one thing to win:** **that they will outlast the attention span of the retail investor.** All these rules that provide them extra time to cover their positions were tailored with their input precisely for that: this is a classic rent-seeking strategy - change the rules of the game to benefit the dominant players. + +This is why Buffet says **that the market is a way to transfer wealth from impatient to the patient**. In a quite literal sense, the rules are written to benefit the players that can afford to wait longer for their plays to come to fruition. **You want to make life changing money. HODL. Don't settle for less than insane gains.** + +The pressure for us to sell after the shareholder meeting will be insane. You might see another mini-squeeze up to the thousands. But do you guys want MILLIONS per share? Then resist the temptation to settle for less. + +PS - I would like to ask u/criand: when is the next time that T+21 and T+35 will converge? If the MOASS does not start in the next couple of weeks, then it has the highest likelihood to happen then. + +&#x200B; + +Edit. The mention of September in the title refers to when I estimated the T+21 and T+35 would align again. I did not intend to establish a deadline "by September". If there's no MOASS in June, and they manage to avoid it in September we MUST HODL. Our best weapon is buying and holding as long as necessary because that is the only strategy that the hedge fucks couldn't twist in their favour. + +&#x200B; + +Edit2. I can't change the title to clarify that. Just remember: the MOASS WILL happen. Don't be disappointed if it does not happen soon. It might happen with Ryan Cohen triggering it. It might happen in one of the next T+21/T+35 alignments. It might happen with Kenny slipping on a banana peel any day now. :) + +Thank you all for the great replies. You guys truly make this a great community. +I don’t really get why it’s going down? I’m not panicking since it’s one of my longterm investments, but I want to understand and learn why this is happening. Is this a good moment to buy? Or should I switch to a different ETF focused on clean energy? +Evergrande defaulted, inflation is up in record high numbers past 20 years, markets keep hitting all time highs, GME is crashing, and we are all sitting here waiting + +Just like the end of The Big Short, where they start getting frustrated why NOTHING IS HAPPENING. + +Well, history repeats itself, we've been here before, we're here again, we know how the game will play out + +It will happen my dudes and dudettes, the market will collapse. We will become millionaires. But we will not dance + +Be zen, hodl and drs +[Last week I posted that I paid off my house because of crypto](http://np.reddit.com/r/ethtrader/comments/6vglme/paid_off_my_house/) + +As my luck would have it a few days later Hurricane Harvey rolled on through. Fortunately my house and general neighborhood are currently doing pretty well. We're not completely out of the woods yet, but it's my understanding that that the worst is behind us. Another benefit to paying off my house is that it led to me re-evaluating my insurance policy before the storm, and I made some changes to get better coverage. + +Considering that crypto (mainly eth) allowed me to pay off my house, and my house survived Hurricane Harvey, I feel compelled to share that the [Texas Habitat for Humanity is currently accepting eth donations for Hurricane Harvey victims.](https://twitter.com/HabitatTexas/status/901989318792794112) + +I think it's awesome for crypto to be used towards disaster relief efforts. I hope this sub can spare a small amount of change. I got my dream house because of my investment in eth, and I hope an eth donation can go towards rebuilding that dream for someone else. +China could hardly be called a developing country, the 2nd highest in GDP, but is pretty [poor](https://ourworldindata.org/grapher/distribution-of-population-poverty-thresholds?stackMode=relative). Same with India even [after economic liberalization](https://ourworldindata.org/grapher/distribution-of-population-poverty-thresholds?stackMode=relative&country=~IND). Switzerland has a lower GDP than both of these countries [yet poverty is pretty much close to non-existent] (https://ourworldindata.org/grapher/distribution-of-population-poverty-thresholds?stackMode=relative&country=~CHE). + +I'm starting to see a pattern where countries that should be rich have an impoverished population and are pretty [corrupt](https://en.wikipedia.org/wiki/Corruption_Perceptions_Index#Rankings) and [authoritarian](https://freedomhouse.org/countries/freedom-world/scores?sort=desc&order=Total%20Score%20and%20Status). While the less richer countries, while less rich, have a less impoverished population. +I was thinking this morning about habits I developed a bit later than I should have, even when I knew I should have been doing them. These are a few things I thought I'd share and interested if others who are out of their 20s now have anything additional to add. + +Edit 1: This is not a everyone must follow this list, but rather one philosophy and how I look back on things. + +Edit 2: I had NO idea this musing would blow up like this. I'm at work now but will do my best to respond to all the questions/comments I can later today. + + +1. Take full advantage of 401K match. When I first started my career I didn't always do this. I wasn't making a lot of money and prioritized fun over free money. Honestly I could have had just as much fun and made some better financial choices elsewhere, like not leasing a car. +2. Invest in a Roth IRA. Once I did start putting money into a 401K I was often going past the match amount and not funding a Roth instead. If I could go back that's what I'd do. I'm not in a place where I max out my 401K and my with and I both max out Roth IRAs. +3. Don't get new cars. I was originally going to say don't lease as that's what I did but a better rule is no new cars. One exception here is if you are fully funding your retirement and just make a boatload of money and choose to treat yourself in this way go for it. I still think it's better to get a 2 year old car than a new one even then but I'll try not to get too preachy. +4. Buy cars you can afford with cash. I've decided that for me I now buy cars cash and don't finance them, but I understand why some people prefer to take out very low interest loans on cars. If you are going to take a loan make sure you have the full amount in cash and invest it at a higher rate of return, if it's just sitting in a bank account you are losing money. We've been conditioned for years that we all deserve shiny new things. We don't deserve them these are wants not needs. + + + +Those are my big ones. I was good with a lot of other stuff. I've never carried a balance on a credit card. I always paid my bills on time. I had an emergency fund saved up quite early in my career. The items above are where I look back and see easy room for improvement that now at 37 would have paid off quite well for me with little to no real impact on my lifestyle back then aside from driving around less fancy cars. +This is about their unprofessional, possibly fraudulent, handling of Brexit. + +They asked me to transfer my account from the UK entity to the Hungarian entity. Obviously, I declined - I don't store my life's savings in chaotic lawless countries. + +I asked their customer support and they assured me back in December that I would keep my account with limited functionality (closing my positions, withdrawing the money, transferring out). Fair enough, that's all I need for now. + +In January they sent out a few unsolicited emails warning that if I don't transfer to the autocracy of their choosing, I will lose some of my account's functionality. Fair enough. + +All of a sudden, yesterday they decided that if I don't comply with their desire to have my account in a jurisdiction with no law, they are going to close it (no specific dates given). They claim that this is a regulatory requirement but that's BS - somehow my other British brokers are able to keep my accounts (with limited functionality). Also, I doubt that this "regulatory requirement" has been introduced between January 16th (when they were fine with keeping my account with restrictions) and January 28th (when they decided "LOL, we changed our mind"). + +EDIT: I'm not British. Not sure why so many people assume that if you call out a corrupt EU country for being a corrupt country, you must be a disgruntled brexiteer. +Robinhood may seem like the quick and easy way to buy stocks but they are against you! + +On January 28th, they did not allow people to buy more shares; they only allowed people to sell. They were about to default so they turned off the buy button and shorted the stock in order to drop the price. Go back and look at the ticker for January-February: $483 > $43. The law enforcement agency of the stock market, the SEC, has gone on record stating this as fact. + +When Dog Crypto had its run up in April, they did this same tactic 3 more times. They will do it again! + +The best companies are Fidelity or Computershare. Yes, they take a couple days to get an account but it’s okay, we’ll wait. We’re saving you a seat. We’ve waited 9+ months already. The squeeze won’t happen all in one day. But don’t wait too long because we’re in ~90 day cycle and the price is going to start rising again over the next couple weeks. + +This is for CYA purposes only—>I am not a financial advisor and this is all my own opinion. + +EDIT: For people transferring from Robinhood to another broker, I'm quoting u/AMKoochie "Keep record of your cost basis. RH has not been purchasing shares. So they end up stuck purchasing share now for whatever price they are forced to buy at now. + +Once those shares make their way over, keep an eye on your cost basis. It most likely won't show up for a week or 2, but when it eventually does show up you may see a difference of hundreds or even thousands of dollars. Many many people have. + +It's helpful for tax purposes as well as evidence of fraud." + +ALSO EDIT: You are loved and I want the best for you. + +EDIT III: A lot of questions on how to transfer out of RH to a new broker. When I did it months ago, I setup an account with Fidelity then called them. They are so used to this request that it's super easy for them to do. They handle the rest for you by putting in a request to your old broker. I think there used to be a DD for this with phone numbers. I can't seem to find it so if someone does, I will add it to this edit. +My girlfriend found a lady who claimed she works for a company called The Young America Mutual Insurance Company, and their whole shtick is they take insurance deposits of people that have passed away, and donate those to the younger people of America who are struggling with debt and making ends meet. The person at the company told her that she would transfer money to our account, my girlfriend would then transfer back about 70% of it, and the other 30% would be ours to keep. + +She needed to know our bank acct info before doing the transfer, so we emptied out the account just to be safe, and did the double transfer like she said. And then we did it the next day. And the whole time this is going on she is keeping in *constant* communication. Like messaging everyday constantly, just to make sure everything is going perfectly. + +My girlfriend is now getting just as skeptical as I am, because the woman told us to withdraw the money and send snaps of it to her. We withdrew as much as the ATM would allow, but just want to sit on it for awhile, because we know people have gotten in trouble for spending money that isn't theirs. Is this money ours, or are we getting scammed or used as a way to launder money or something? +I've heard this statement brought up in some debates I've had over taxation policy, particularly coupled as evidence for the statement "if you tax the rich, they will leave" and so I ask where this happens or happened to be the case despite reliable evidence to the contrary (such as [here](https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3389850) and [here](http://www.peri.umass.edu/fileadmin/pdf/published_study/Migration_PERI_April13.pdf)). + + +In one particular discussion I had over this, the other side cited a rather sketchy documentary about Sweden that only vaguely alluded to "many people leaving the country \[of Sweden\]" due to "the high taxes" and only mentioned the founder of IKEA in particular ([this one](https://www.youtube.com/watch?v=jq3vVbdgMuQ), I wouldn't recommend watching it since it gives no reliable sources throughout and only relies on the testimony of some individuals), but this discussion got me thinking about where exactly the evidence is for this. + +So my first question is the one in the title: Are high taxation policies in Scandinavian countries such as Sweden (or just Sweden) causing rich people to leave Scandinavia, if they are leaving? If so, is there any reliable academic research that gives evidence for this? + +And my second question is: Is there any reliable academic research that gives evidence to the idea that countries that impose high taxes on the rich causes rich people to leave said country? + +I hope to not spark a flame war here nor is "taxing the rich causes them to leave" a view that I hold. I'm only asking if there's any reliable academic research that confirms these ideas despite much of the other reliable academic research on the topic suggesting the contrary. +What made the industrial revolution happen in the west? Could Ancient Rome have had a sufficiently developed economy and inventor class to allow the forces of industrialization to work in the same way that it did in 19th century Britain? In particular there doesn't seem to be any reason why Ancient Rome couldn't have invented the steam engine or railroad, but would Ancient Rome have had a sufficiently developed economy to make an industrial revolution happen? +Hi, my mom passed away and I’m going to come into some money. I don’t trust myself with the money and want to put it away somewhere so in 15-20 years or so I can retire. I’d appreciate everyone’s thoughts. + +I am 45 y.o. btw, I make about $70,000.00 a year practicing law. I have no retirement at all atm. + +Thanks for the advice. +I noticed that GME (Gamestop) has been making small gains again over the last week but today it is up 103% !!! Is this the billionaires again trying their tactics to make money or is this the Reddit investor push or has something magical happened and GME is a great investment? (New to investing so trying to make sense of this huge gain) +How does printing more money impact the average person? As far as I understand it may increase inflation, and I assume this will encourage spending as holding money will decrease its value. + +Is this opposed to introducing negative interest rates? Is it intended to encourage spending at banking, commercial level rather than the population at large? + +https://news.sky.com/story/bank-of-england-expected-to-launch-100bn-of-qe-as-lockdown-2-0-begins-12124074 +I just want my lifetime back. I'm 27 and the clock ticks so fucking fast. Before investing in crypto I had no hope of financial freedom. Now I do! I hope we all gonna make it.. +Serious question. How come we aren’t addressing the problem when housing affordability is worse than it’s ever been before? + +Edit: thanks guys but keep your awards and put it towards your deposits. + +ITT there’s some concerning individuals getting a bit vile and defensive. Jeez. +From supply demand standpoint, increasing overall global population and mobility increases supply of people, and automation and machinery replacing human labour decreases the demand for people. + +Ultimately that reduces the value/price of a person to establish a new equilibrium. Does this explain why wages stagnate? +I started trading at the end of the bull run Jan-Fab, had a great run as beginner, +I had a initial investment of 37k took that up to 52k roughly, when we had that pullback in late Feb things started go sideways with me, took a major loss then my emotions got the best of me, I traded with oversize "weak risk management I'd say" very weak. I went heavy in trades and most of them ended up with a big L, tried to make up for my previous losses one after another till my account is now at 2.6k CRAZY. I can't express how I really feel it's beyond me, now I spend all my day thinking about wtf I did, depressed and feel heavy pressure that I don't know how to get back up, zero confidence. I took this fuck up to the next level of failures. This is really gotten to me mentally and I'm 22yo I feel beaten down and hiding my pain from everyone. I just want your advice how to get through this mentally. Please don't rub it in I'm already down bad. :( +Doing this just seems to make sense: you help fill the gap that the drop in consumer spending has created and you produce something useful that would likely improve efficiency and the productive capacity of the economy. This seems especially suited to the US due to some of the country’s antiquated infrastructure. + + +This is why I can’t work out why the US wouldn’t try and stimulate the economy in this way. China has been investing heavily in infrastructure so much so that some believe the massive increase in the price of iron is because of this. Why isn’t the US doing the same? + +EDIT: [here](https://www.documentcloud.org/documents/3409546-Emergency-NatSec50Projects-121416-1-Reduced.html) is a lost of vital nationally significant infrastructure projects where it would make sense for the federal budget to be used to fund them. +For any of you familiar with Charlie Mungers Lollapalooza effect I think this is exactly what we are seeing right now in the market. With the market at all time highs and the extreme rapid recovery and now extension past that it looks like we are primed for a significant pullback or correction very soon. The timing or cause is obviously hard to pinpoint but with the extreme activity lately like with Crypto currencies , GME & Short Squeezes , sheer increase in SPACS and IPO’s I think these all paint a pretty dangerous picture. How much cash are you guys holding and what do you think about current levels and what do you expect in the future? +**EDIT:** I'm absolutely blown away by the kindness and support I've received on this post--I've teared up multiple times in the last 24 hours. Thank you so much to everyone for the kind words and thoughtful advice, I wasn't sure what I was expecting by posting here, but I now realize 1. I have a lot of time and space to figure things out and don't need to rush into a job just because being unemployed makes me uncomfortable and 2. I'm allowed to expand my imagination wayyy beyond the confines of a 9-5 type role. Also, to the many people who recommended it, I've been in therapy for years with a great therapist and I'm happy to help others find providers in their area. Finally, I'm not going to continue using this throwaway much longer but may occasionally check my messages--if ANYONE is in a similar situation and wants to talk to someone who *gets it,* or wants a compatriot in some void-screaming, please reach out. Much love to you all <3 + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +Using a throwaway for obvious reasons. + +I'm a 27 year old male with a lib arts degree from a top American uni and 5+ years experience in big tech (was making \~$150k/yr). Everything went to shit a year ago when I lost both of my parents in a highly publicized tragedy; we were extremely close and, in all honesty, a lot of the last year is a blur to me. I was the sole heir of their estate, worth \~$25-30M, and the ensuing wrongful death suits settled at about $20M. I have great financial advisors + lawyers handling the money and any remaining legal matters, as well as friends of my parents who have stepped up and are advising me every step of the way. I also have a very strong+big support network of friends, thank god. + +For a while after my parents' deaths, I wanted to "leave society" and hide out in the woods for the rest of my quiet-but-peaceful life. I fantasized daily about running away and entering a Buddhist monastery. The compounded grief and whiplash caused by the drastic change in my financial situation was overwhelming; at this point I had recently left my job to attend a social science graduate program full-time, but quickly found that, given my new circumstances and perspective on life, my heart was no longer in that pursuit--not unreasonable IMO. I withdrew last spring and took the summer off to read+write and spend time with loved ones at the beach. It was an excellent call, and I feel ready to pick up the pieces and re-enter The World. + +I also feel duty-bound to other people. While I did not ask for any of this, I've realized that I'm now in a position to do some real good in the world, to honor my parents' memories to the fullest of my abilities, and to even have a little fun while doing it. I'm not interested in the money beyond the freedom it affords me. I'm a really studious guy who's fascinated by just about everything (mainly philosophy, science, and languages + cultures), and I toyed with the idea of applying to PhD programs, but the academic career rat-race sounds miserable, and the idea of writing for an audience of one for the rest of my life is a non-starter. + +I suppose my question is something like: if you were in my situation and wanted to make the biggest positive impact possible, what would you do next? I definitely don't want to go back to tech, but am very happy to have the skillset. I had worked in a law office in undergrad and really wanted to go to law school but chose not to due to the ensuing debt, which would have precluded me from going into public interest work. Now that's back on the table. Most attorneys are pretty miserable though, and I question whether working client-by-client is "enough" in the grand scheme of things. A new train of thought involves diving deep into finance/business in order to get a seat at the table in impact investing, philanthropy, NGO management, or even international development. I'm weighing all my options and will only proceed once I feel confident in my choices. + +I'm happy to verify this post if requested. Many thanks in advance for any and all advice! +Welcome to the second **/r/EthTrader** Daily Discussion Unlimited thread. Clearly AutoMod is starting to make this a occasional habit and our service is once again required. + +The thread guidelines are as follows: +*** + +* Follow the golden rule. + +* General discussion topics include, but are not limited to, events of the day, technical analysis, alternative Ethereum projects, or minor questions. + +* Breaking news or other important content should be submitted as a separate post. + +* In-depth altcoin discussions should be referred to the /r/CryptoCurrency discussion thread. To view the thread, follow this link and choose the latest entry on the search page. + +* Pumping, venting, trolling, or any other similar behavior should be redirected to the /r/CryptoMarkets trollbox thread. To view the thread, [follow this link] (https://www.reddit.com/r/CryptoMarkets/search?q=Trollbox+Thread&sort=new&restrict_sr=on&t=all) and choose the latest entry on the search page.` + +*** +Thank you in advance for your participation. Enjoy! + +Best Regards + +Daily Discussion Unlimited Team +This is a comment I made in another post, and I would like to share for anyone who's interested in refining their strategy with Crypto trading. + +After 1+ years of trading crypto, I've learned a lot about investing and trading. I started like many of us have--going with whatever was being shilled or mooning. Of course, I lost a LOT of money that way, and slowly my investment strategy has developed. I've learned a few key things. I sleep soundly at night, and rarely check prices/news because of the strategy. + +1. The number one thing I'm looking for is a technology with an actual, practical use in the future. I just saw a post about "OilCoin"--supposedly it will be a coin that will be SEC-compliant and match the price of a barrel of oil. WHO CARES? There is almost no point to that coin, except that it might be stable, and it has team members that worked for the government. This leads to my next criteria... + +2. A good *business-savvy* team. I don't care if you have the top software engineer from Stanford and a 20-year Wall Street veteran. In fact, seeing people from Wall Street on the team gives me automatic thoughts of a pnd scheme run by someone who knows how to pnd. I want someone leading the business that has a long past of successful sales and business partnership experience--and not a "serial entrepreneur" either. I'm talking about someone who has closed deals, brought products to market, and made a company or two better than they ever were or ever have been. + +3. A tech that, if it doesn't bring something completely new and useful to the table (such as ETH smart contracts vs. Bitcoin's value transfer way back when, or IOTA with DAG vs. all blockchain coins recently), completely blows its competition out of the water. For example, RaiBlocks is the hot new value-transfer crypto (competition to Bitcoin, many others) that completely puts blockchain-based techs to shame due to its use of DAG. With almost-free transactions, instant transactions, and potential quantum-attack immunity, there's no way to view it as a no-brainer right now. That's just an example of this criteria of mine. + +4. My final criteria is a history of stability, and current wide adoption of the tech--even if I think it may have flaws down the road. These are the "safe bets" such as LTC and XRP that you can generally assume will slowly rise in value, and not crash/be manipulated by pnd's any time soon. + +5. When I follow the above 4 criteria, this final point is the most important--I never panic when there is a dip. I know from my time trading that the great techs with great teams and great potential will always end up rising in value over the long-haul, and I don't need to worry about, "Will it crash? Should I chase a shitcoin for short-term gains?" (Which, I've learned, is the best way to lose a lot of money). + +Everyone has different strategies, and I firmly believe the only way to feel comfortable and not panic trade during dips and moons is to learn your own strategy the hard way, and learn from your losses. Good luck! +One guy just quit paying rent. The other guy got used to getting further and further behind. + +Everyone is now evicted or moved out. Of course the place was trashed and needed new new carpet where the dogs peed. Took us 5 full days to fix everything and clean it back to a respectable level. + +As for the money, the courts have given their judgement. After court fees, late fees, unpaid rent, me paying the final tab for utilities, applying security deposits to the tally... I have $4,370 owed to me. This may not be a ton to some of you big cats, but the gross income on this property was only 16,000. That's a pretty heft loss to just eat. + +I'm mostly venting, but who else has big tabs they're waiting to get paid back? Any luck? Or is that money good as gone? +A little while ago the son of a family friend of mine had just accepted an offer to join a management consulting firm fresh out of college. He asked me, *“what’s the best way to position myself to make partner?”* + +I’ve spent almost the entirety of my career in the consulting industry in one capacity or another, and (having had few drinks that night) rather rudely replied *“those who make partner don’t ask these sorts of questions as an analyst”*. + +A couple days later I reached back out and apologized for the glib nature of my comment, which really was said with good intent but poor delivery. I tried to explain to him that the best way to get promoted in consulting is to put your head down and do good work. He seemed satisfied with the answer, but truth be told, I was not. I’ve been mulling over this concept lately in an attempt to find a way to better articulate my point, if not for future mentees than as my own form of career therapy. I thought I’d share my musings with the community for feedback and your own experiences. + +# Careers are step-functions rather than linear progressions + +**What I wish I said:** Your professional growth will come in spurts, and the best way to climb a mountain is not to stare at the peak but rather focus on getting over the next hill. I could tell you that directors that get invited into the partnership are the ones best able to expand upon or develop new service lines to generate revenue, but that wouldn’t mean anything to you right now. Rather, I should tell you that the analysts that get promoted to consultants have mastered the technical aspects of excel / PPT and are able to independently make progress on the tasks assigned to them. + +**Additional musings:** Setting aside the philosophical question of what it means to live a good life for a second, even if we are to focus purely on maximizing career returns, I would still say the majority of people I know (myself included!) spend too much time “thinking” and not enough time “doing”. As trite as it sounds, we now live in an era of constant distraction. The process of doing deep, focused, uninterrupted work has become almost anachronistic, but (in my humble opinion) the relative value of such work has never been higher. Do good work, and you will get rewarded. You don't get to choose when or by whom, but trust that it will happen in time. + +# You are worth (financially) what the market deems you are worth + +**What I wish I said:** Think of yourself as a product (because in professional services, that’s exactly what you are). You will be rewarded if you are able to consistently solve the problems your bosses and clients want you to solve. This does not mean you should not advocate for yourself (quite the opposite actually); it simply means you must create value to capture value. + +Recognize this may not always be 100% aligned with your personal values. Also recognize that part of being an adult is understanding how to navigate trade-offs. + +**Additional musings:** There comes a time in everyone’s career where we stop being judged by our perceived potential, and start being judged by our results. It’s almost impossible to pinpoint when this begins to happen, even in hindsight. But as important as it is to be cognizant and confident in your unique God-given potential, it is equally important to cultivate it and bring its fruits to society. I was too idealistic for my own good in my youth; I realize this goes very much against the grain of conventional wisdom, but I wish I spent less time early in my career thinking about what I wanted and more time thinking about what my bosses / clients wanted. Paradoxically, once I was able to provide value to my stakeholders, society rewarded me, and in turn I am now able to better cultivate what I personally value. + +# 10% luck, 20% skill, but most of it really is concentrated power of will + +**What I wish I said:** However the meta-skill that sits above focus and productivity is good judgement. This encompasses not only the ability to choose which projects and partners to attach yourself to, but also which battles to fight and which hills to die on (hint: very few of them). Invest in your mental health; your ability to keep your head while others around you are losing theirs will distinguish you not only in your career but in life. The consulting career is a marathon. To make it to the top, you will not only need to produce excellent work, but do so for over a sustained period of time. + +**Additional musings:** This idea probably deserves its own deep dive, but it probably is the most important point of this post. Again, even setting aside all the philosophical benefits, I find having a clear mind to be the most important tool (and most consistent trait) demonstrated by those I consider having had successful careers. In informal discussions with consulting / banking partners and corporate executives, rather than intelligence or work ethic, they overwhelmingly credit their success to being able to push through low points in their career better than their peers at the time. One of them brought up a poker analogy that has stuck with me to this day: “The mark of a true pro isn’t necessarily how much you win with a good hand, but rather how little you lose with a bad one”. + +Thanks for reading. +The FED keeps saying that inflation is below 3%. Maybe it is, but it doesn’t feel like it. + +The housing market is insane. Houses are being sold for way more than they’re worth. I paid 460k for my house 18 months ago and it just appraised for 587. + +Used cars are way over priced. Want to spend 20k on a SUV? Here’s a 10 year old suburban ltz with 150k miles on it. The most recent car I bought was a lightly used Camaro Convertible 4 years ago. The KBB is more now than I paid for it then and it has 40k more miles. My 20 year old boat has gone up in value 10k in the past year. My 10 year old beater explorer with 150k miles has gone up 4K in the past year. + +My retirement investments are averaging 20+% returns being wholly invested in mutual funds and index funds. + +Gas prices are up about 10%. + +There have certainly been the winners and losers of Covid and fortunately I’ve been one of the winners. But the vast majority of people haven’t. So, why is everything going up in value if everyone is broke and there’s reduced demand? What are the odds that material values are largely just staying constant and the dollar is going down in value at a higher than reported rate? Seems likely enough to me. If you’re properly hedged against inflation, I don’t suppose it matters, but 2-3% doesn’t seem real. +This question is inspired by Adam Something's video [City Review - Prague: Beautiful and Disappointing](https://www.youtube.com/watch?v=EnVvlhhqWtw) + +In it, he repeats the common argument that a city centre became unaffordable to live in because people who intend to rent them out for Airbnb snap up all the properties and rent them out to tourists. But does that mean that tourism is the real driver of the unaffordability problem? + +If so, why does Airbnb get the blame, and not other tourist infrastructure like hotels? Just like Airbnb, if land in a city centre is purchased to build a hotel on, it would increase demand for land and therefore increase prices. +Welcome to the **/r/EthTrader** Daily Discussion thread. The thread guidelines are as follows: + +*** + +- Follow the Golden Rule. All other rules apply as well. Follow [this link](https://www.reddit.com/r/ethtrader/about/rules) to view the rest of them. The rules page is also linked in the announcement bar above. +- General discussion topics include, but are not limited to, events of the day, technical analysis, alternative Ethereum projects, or minor questions. +- Breaking news or other important content should be submitted as a separate post. +- In-depth altcoin discussions should be referred to the /r/CryptoCurrency discussion thread. To view the thread, [follow this link](https://www.reddit.com/r/CryptoCurrency/search?q=%5BMonthly+General+Discussion%5D&restrict_sr=on&sort=new&t=all) and choose the latest entry on the search page. +- Pumping, venting, trolling, or any other similar behavior should be redirected to the /r/CryptoMarkets trollbox thread. To view the thread, [follow this link](https://www.reddit.com/r/CryptoMarkets/search?q=Trollbox+Thread&sort=new&restrict_sr=on&t=all) and choose the latest entry on the search page. + +*** + +Thank you in advance for your participation. Enjoy! + +Lots of people have PM'd me asking me the same questions on where to find information and how to put together their portfolio so I decided to put a guide for crypto investors, especially those who have only been in a few months and are still confused. + +Many people entered recently at a time when the market was rewarding the very worst type of investment behavior. Unfortunately there aren't many guides and a lot of people end up looking at things like Twitter or the trending Youtube crypto videos, which is dominated by "How to make $1,00,000 by daytrading crypto" and influencers like CryptoNick. + +So I'll try to put together a guide from what I've learned and some tips, on how to invest in this asset class. This is going to be Part 1, in another post later I'll post a systematic approach to valuation and picking individual assets. + +#Getting started: Tools and resources +--------------------------- + +You don't have to be a programmer or techie to invest in crypto, but you should first learn the basics of how it functions. I find that [this video by 3Blue1Brown is the best introduction to what a blockchain actually is and how it functions](https://www.youtube.com/watch?v=bBC-nXj3Ng4), because it explains it clearly and simply with visuals while not dumbing it down too much. If you want a more ELI5 version with cute cartoons, then [Upfolio](http://www.upfolio.com) has a nice beginner's intro to the blockchain concept and [quick descriptions of top 100 cryptocurrencies](https://www.upfolio.com/100-coins-explained). I also recommend simply going to Wikipedia and reading the blockchain and cryptocurrency page and clicking onto a few links in, read about POS vs POW...etc. Later on you'll need this information to understand why a specific use case may or may not benefit from a blockchain structure. Here is a [quick summary of the common terms](http://cryptocurrencyfacts.com/a-quick-guide-to-cryptocurrency-terms) you should know. + +Next you should arm yourself with some informational resources. I compiled a convenient list of useful tools and sites that I've used and find to be worthy of bookmarking: + +**Market information** + +* http://coinmarketcal.com - Keeping tabs of everything going on in crypto is tough, wouldn't it be great if there was some sort of calendar? Well this is a calendar of upcoming crypto events, whether its conferences, product releases, burns, exchange listings...etc. You can also filter by types of events, coins and month. + +* http://coin.fyi - Great for following the news related to a specific cryptocurrencies + +* http://cryptopanic.com - An aggregator of various crypto sites and news, filterable. + +* http://coinspectator.com - Another aggregator from over a 100 different sources of crypto news. + +* https://www.ccowl.com/news - News from major sites (CoinDesk, Cointelegram, Bloomberg...etc) on one page + +* http://cci30.com - Kind of like the S&P500 for crypto, its an index of the 30 biggest cryptocurrencies + +* http://eveningstar.io - this is basicall trying to be the Morning Star for cryptos + +* http://icotracker.net - I like this site for looking at what ICO are coming up + +* http://www.icoalert.com - Another good site for upcoming ICO tracking + +* http://icodrops.com - More ICO listings and they have a "hype" rating + +* http://bitcointalk.org - Probably the biggest crypto community, lots of Bitcoin old timers who have seen it all + +* Both [Medium](http://medium.com/topic/cryptocurrency) and [Steemit](http://steemit.com/trending/cryptocurrency) have plenty of blogs to follow depending on what interests you within crypto + +* Telegram is the preferred chat platform, just stay away from PnD groups (same for Discord PnD groups) + + + +**Analysis tools** + + +* http://cryptowat.ch - Great charting tool owned by Kraken that gives you a pretty wide look at various cryptos across most major exchanges. + +* http://coinmonsta.io/metrics - Want to see what the most shilled coins are on Twitter? This ranking multiplies the number of tweets vs. sentiment estimate to arrive at a score. + +* http://onchainfx.com - A better version of coin market cap, has all sort of columns and you can add flags. Also I like their market segmentation filters. + +* http://www.sifrdata.com/ - Great visualizations of various metrics. I find their correlations to be very useful. + +* http://www.coingecko.com - includes useful information about crypto like the breakdown volume by fiat currency, social media stats, code repository stats..etc + +* http://www.tradingview.com/chart/ - the best charting site that I use for stocks, however it has plenty of major cryptos + +* http://www.iconomi.net/dashboard - basically forms different ETFs out of cryptos. Not a bad place to get ideas for your portfolio. + +* http://cointrading.ninja/correlation - See a matrix of price movement correlatiosn between various cryptocurrencies over various periods. + +* http://coinmarketcap.com - Useful for scanning the market, and finding the blockchain explorer and official website for each individual crypto. Their API is also quite useful for Excel based analysis. + +* http://icobench.com - Another ICO tracker which does nice summaries, shows teams, milestones, financials and gives a rating for each IC + +* http://cryptomaps.org - Visualization of price across different segments, primarily hashing functions and ICO release dates + +* http://solume.io - compares the number of Twitter mention increase decrease to price + +* http://www.badbitcoin.org - a list of all the known scam sites. Check this list before joining something. + + +**Portfolio Tracking** + +* Delta and Blockfolio are the major mobile apps, I personally recommend Delta. + +* For desktop [I prefer to use a CoinMarketCap API Excel tracker](http://np.reddit.com/r/CryptoCurrency/comments/7m3nvy/ive_created_an_excel_crypto_portfolio_tracker/) that automatically draws live data from CoinMarketCap. Customize it to your own liking. There are also plenty of online tracking sites like AltPocket but I've never used them so can't recommend one. + +**Youtube** + + +I generally don't follow much on Youtube because it's dominated by idiocy like Trevon James and CryptoNick, but there are some that I think are worthy of following: + +* Crypto Investor - A background in finance gives Crypto Investor a much more nuanced approach, and he is very insightful in terms of investor behavioral psychology. Listening to his negativity and criticism of parabolic price action in a sea of lambo chasing is refreshing. + +* CoinMastery - Carter Thomas takes on a rational mid-term to long term approach to investing in crypto, and has been a voice of reason many times. + +* DataDash - He's more focused on trading, but I still like him for his news summaries and overall decent content. + +* IvanOnTech - Brings a programmers perspective, goes through the Github and explains many programming issues with blockchains. + + + +#Constructing a Investment Strategy +--------------------------- + +I can't stress enough how important it is to construct an actual investment strategy. Organize what your goals are, what your risk tolerance is and how you plan to construct a portfolio to achieve those goals rather than just chasing the flavor of the week. + +Why? Because it will force you to slow down and make decisions based on rational thinking rather than emotion, and will also inevitably lead you to think long term. + +#Setting ROI targets +--------------------------- + +Bluntly put, a lot of young investors who are in crypto have really unrealistic expectations about returns and risk. + +A lot of them have never invested in any other type of financial asset, and hence many seem to consider a 10% ROI in a month to be unexciting, even though that is roughly what they should be aiming for. + +I see a ton of people now on this sub and on other sites making their decisions with the expectation to double their money every month. This has lead a worrying amount of newbies putting in way too much money way too quickly into anything on the front page of CoinMarketCap with a low dollar value per coin hoping that crypto get them out of their debt or a life of drudgery in a cubicle. And all in the next year or two! + +But its important to temper your hype about returns and realize why we had this exponential growth in the last year. The only reason we saw so much upward price action is because of fiat monetary base expansion from people FOMO-ing in due to media coverage. People are hoping to ride the bubble and sell to a greater fool in a few months, it is classic Greater Fool Theory. That's it. Its not because we are seeing any mass increase in adoption or actual widespread utility with cryptocurrency. We passed the $1,000 psychological marker again for Bitcoin which we hadn't seen since right before the Mt.Gox disaster, and it just snowballed the positivity as headline after headline came out about the price growth. However those unexciting returns of 10% a month are not only the norm, but much more healthy for an alternative investment class. Here are the annual returns for Bitcoin for the last few years: + +Year | BTC Return +------|------- +2017 | 1,300% +2016 | 120% +2015 | 35% +2014 | -60% +2013 | 5300% +2012 | 150 % + +Keep in mind that a 10% monthly increase when compounded equals a 313% annual return, or over 3x your money. That may not sound exciting to those who entered recently and saw their money go 20x in a month on something like Tron before it crashed back down, but that 3X annual return is better than Bitcoin's return every year except the year right before the last market meltdown and 2017. I have been saying for a while now that we are due for a major correction and every investor now should be planning for that possibility through proper allocation and setting return expectations that are reasonable. + +**How to set a realistic ROI target** + +How do I set my own personal return target? + +Basically I aim to achieve a portfolio return of roughly 385% annually (3.85X increase per year) or about 11.89% monthly return when compounded. How did I come up with that target? I base it on the average compounded annual growth return (CAGR) over the last 3 years on the entire market: + +Year | Total Crypto Market Cap +-------|------ +Jan 1, 2014:| $10.73 billion +Jan 1, 2017: | $615 billion + +>Compounded annual growth return (CAGR): (615/10.73)^(1/3) = 385% + +My personal strategy is to sell my portfolio every December then buy back into the market at around the beginning of February and I intend to hold on average for 3 years, so this works for me but you may choose to do it a different way for your own reasons. I think this is a good average to aim for as a general guideline because it includes both the good years (2017) and the bad (2014). Once you have a target you can construct your risk profile (low risk vs. high risk category coins) in your portfolio. If you want to try for a higher CAGR than about 385% then you will likely need to go into more highly speculative picks. I can't tell you what return target you should set for yourself, but just make sure its not depended on you needing to achieve continual near vertical parabolic price action in small cap shillcoins because that isn't sustainable. + +As the recent January dip showed while the core cryptos like Bitcoin and Ethereum would dip an X percentage, the altcoins would often drop double or triple that amount. Its a very fragile market, and the type of dumb behavior that people were engaging in that was profitable in a bull market (chasing pumps, going all in on a microcap shillcoin, having an attention span of a squirrel...etc) will lead to consequences. Just like they jumped on the crypto bandwagon without thinking about risk adjusted returns, they will just as quickly jump on whatever bandwagon will be used to blame for the deflation of the bubble, whether the blame is assigned to Wall Steet and Bitcoin futures or Asians or some government. + +Nobody who pumped money into garbage without any use case or utility will accept that they themselves and their own unreasonable expectations for returns were the reason for the gross mispricing of most cryptocurrencies. + +#Risk Management +--------------------------- + +Quanitifying risk in crypto is surprisingly difficult because the historical returns aren't normally distributed, meaning that tools like Sharpe Ratio and other risk metrics can't really be used as intended. Instead you'll have to think of your own risk tolerance and qualitatively evaluate how risky each crypto is based on the team, the use case prospects, the amount of competition and the general market risk. + +You can think of each crypto having a risk factor that is the summation of the general crypto market risk (Rm) as ultimately everything is tied to how Bitcoin does, but also its own inherent risk specific to its own goals (Ri). + +Rt = Rm +Ri + +The market risk is something you cannot avoid, if some China FUD comes out about regulations on Bitcoin then your investment in solid altcoin picks will go down too along with Bitcoin. This (Rm) return is essentially what risk you undertake to have a market ROI of 385% I talked about above. What you can minimize though is the Ri, the aset specific risks with the team, the likelihood they will actually deliver, the likelihood that their solution will be adopted. Unfortunately there is no one way to do this, you simply have to take the time to research and form your own opinion on how risky it really is before allocating a certain percentage to it. Consider the individual risk of each crypto and start looking for red flags: + +* guaranteed promises of large returns (protip: that's a Ponzi) + +* float allocations that give way too much to the founder + +* vague whitepapers + +* vague timelines + +* no clear use case + +* Github with no useful code and sparse activity + +* a team that is difficult to find information on or even worse anonymous + +While all cryptocurrencies are a risky investments but generally you can break down cryptos into "low" risk core, medium risk speculative and high risk speculative + +* Low Risk Core - This is the exchange pairing cryptos and those that are well established. These are almost sure to be around in 5 years, and will recover after any bear market. Bitcoin, Litecoin and Ethereum are in this class of risk, and I would also argue Monero. + +* Medium Risk Speculative - These would be cryptos which generally have at least some product and are reasonably established, but higher risk than Core. Things like ZCash, Ripple, NEO..etc. + +* High Risk Speculative - This is anything created within the last few months, low caps, shillcoins, ICOs...etc. Most cryptos are in this category, most of them will be essentially worthless in 5 years. + +How much risk should you take on? That depends on your own life situation but also it should be proportional to how much expertise you have in both financial analysis and technology. If you're a newbie who doesn't understand the tech and has no idea how to value assets, your risk tolerance should be lower than a programmer who understand the tech or a financial analyst who is experienced in valuation metrics. + +Right now the trio of BTC-ETH-LTC account for 55% of the market cap, so between 50-70% of your portfolio in low Risk Core for newbies is a great starting point. Then you can go down to 25-30% as you gain confidence and experience. But always try to keep about 1/3rd in safe core positions. Don't go all in on speculative picks. + +**Core principles to minimize risk** + +* Have the majority of your holdings in things you feel good holding for at least 2 years. Don't use the majority of your investment for day trading or short term investing. + +* Consider using dollar cost averaging to enter a position. This generally means investing a X amount over several periods, instead of at once. You can also use downward biased dollar cost averaging to mitigate against downward risk. For example instead of investing $1000 at once in a position at market price, you can buy $500 at the market price today then set several limit orders at slightly lower intervals (for example $250 at 5% lower than market price, $250 at 10% lower than market price). This way your average cost of acquisition will be lower if the crypto happens to decline over the short term. + +* Never chase a pump. Its simply too risky as its such an inefficient and unregulated market. If you continue to do it, most of your money losing decisions will be because you emotionally FOMO-ed into gambling on a symbol. + +* Invest what you can afford to lose. Don't have more than 5-10% of your net worth in crypto. + +* Consider what level of loss you can't accept in a position with a high risk factor, and use stop-limit orders to hedge against sudden crashes. Set you stop price at about 5-10% above your lowest limit. Stop-limit orders aren't perfect but they're better than having no hedging strategy for a risky microcap in case of some meltdown. Only you can determine what bags you are unwilling to hold. + +* Diversify across sectors and rebalance your allocations periodically. Keep about 1/3rd in low risk core holdings. + +* Have some fiat in reserve at a FDIC-insured exchange (ex. Gemini), and be ready to add to your winning positions on a pullback. + +* Remember you didn't actually make any money until you take some profits, so take do some profits when everyone else is at peak FOMO-ing bubble mode. You will also sleep much more comfortably once you take out the equivalent of your principal. + + + +#Portfolio Allocation +--------------------------------------------- + +Along with thinking about your portfolio in terms of risk categories described above, I really find it helpful to think about the segments you are in. [OnChainFX](http://onchainfx.com/) has some segment categorization but I generally like to bring it down to: + +* Core holdings - essentially the Low Risk Core segment + +* Platform segment + +* Privacy segment + +* Finance/Bank settlement segment + +* Enterprise Blockchain solutions segment + +* Promising/Innovative Tech segment + +This is merely what I use, but I'm sure you can think of your own. The key point I have is to try to invest your medium and high risk picks in a segment you understand well, and in which you can relatively accurately judge risk. If you don't understand anything about how banking works or SWIFT or international settlement layers, don't invest in Stellar. If you have no idea how a supply chain functions, avoid investing in VeChain (even if it's being shilled to death on Reddit at the moment just like XRB was last month). + +What's interesting is that often we see like-coin movement, for example when a coin from one segment pumps we will frequently see another similar coin in the same segment go up (think Stellar following after Ripple). + +Consider the [historic correlations between your holdings](https://cointrading.ninja/correlation). Generally when Bitcoin pumps, altcoins dump but at what rate depends on the coin. When Bitcoin goes sideways we tend to see pumping in altcoins, while when Bitcoin goes down, everything goes down. + +You should set price targets for each of your holdings, which is a whole separate discussion I'll go in Part 2 of the guide. + +#Summing it up +------------------------------------- + +This was meant to get you think about what return targets you should set for your portfolio and how much risk you are willing to take and what strategies you can follow to mitigate that risk. + +Returns around 385% (average crypto market CAGR over the last 3 years) would be a good target to aim for while remaining realistic, you can tweak it a bit based on your own risk tolerance. What category of risk your individual crypto picks should be will be determined by how much more greed you have for above average market return. A portfolio of 50% core holdings, 30% medium risk in a sector you understand well and 20% in high risk speculative is probably what the average portfolio should look like, with newbies going more towards 70% core and only 5% high risk speculative. + +Just by thinking about these things you'll likely do better than most crypto investors, because most don't think about this stuff, to their own detriment. + + +This truly may be wallstreetbets’ darkest hour. We don’t really know how long the hedges could keep up the restrictions. But what we do know is that all we can do is hold, and I know we’ll do exactly that. + +We really pushed the corrupt funds to the breaking point and made them show their true colors. I believe this is just the beginning of a huge shift away from the firms and towards the average-Joe. + +I’ve never been more proud to call myself a retard. Remember during this dark time, if you ever feel like it’s hopeless, there are a bunch of retards around the world just like you and just like me standing right beside you holding this stock, because we like the fucking stock. +In this stupid world, where stupid people become rich by buying a stupid Coin why the fuck do i have to work hard and study and do things to become rich in order to help my fucking family and all i see around me, is stupid people posting on Twitter Instagram or wherever “doge Coin is so incredible i just made 10k” what the fuck is wrong? + +EDIT I’m not angry about others gains, the main problem here is the fact that a coin with no absolute utility gets in 4th position of the most capitalized coins in the world + +EDIT 2 everyone under this post is writing: “you are just jealous, bla blabla” I don’t care about who is earning with doge, I got my crypto and my earnings too, I made a 700+ in less than 2 months. This is not the point. +Hi gang. + +&#x200B; + +We have seen a volatile market this week on the back of the [EverGrande](https://en.wikipedia.org/wiki/Evergrande_Group) saga. + +&#x200B; + +It's actually not a new issue, it was reported in the [Financial Times](https://www.ft.com/content/f655ba5f-7a69-4927-b2b0-355dfb666398) that there was speculation regarding them seeking financial assistance back in September **2020**, but I guess you could say it had a spike this week and as a result our little backwater **ASX** has been impacted. + +&#x200B; + +There has been a huge volume of questions in the daily about it, some [great discussion](https://www.reddit.com/r/ASX_Bets/comments/prhkkn/comment/hdiq4nm/?utm_source=share&utm_medium=web2x&context=3) in a few different posts too. + +&#x200B; + +This post comes off the back of a [comment](https://www.reddit.com/r/ASX_Bets/comments/pt2r4n/comment/hdtn2va/?utm_source=share&utm_medium=web2x&context=3) in the Daily by u/biggunzmcgee, which I'll copy below as a reference to the core statement we are going to discuss. + +&#x200B; + + "*Can someone who's a genuinely experienced trader/investor give their sentiment on future market movements/fallout from the China debacle? I know a few of yous on here are actually very market savvy, more so than most of us. Would like to hear what your plans are''* + +&#x200B; + +The purpose here is to air and debate your views and opinions on the following statements: + +&#x200B; + +\- How does the current Evergrande situation **impact the Market** + +&#x200B; + +\- What is your view on the broader situation in China that Evergrande has highlighted and how does that **impact Market sentiment** + +&#x200B; + +\- What is your view on the future impacts of this or other catalysts to invoke the fabled [Bear Market](https://www.investopedia.com/terms/b/bearmarket.asp)? + +&#x200B; + +&#x200B; + +Alternatively, if you have a question and it runs something along the lines of: + +''*What the fuck does a Development Group in China have to do with my speccie African miner/My highly speculative bio tech in wherever/My dildo producing exploration company*'' + + then the discussion below will hopefully go some way towards explaining that. + +&#x200B; + +**Read the Flair.** + +&#x200B; + +This is a Legitimate Discussion on an issue that impacts anyone invested in the Markets. + +&#x200B; + +We welcome conflicting views as the more context placed into the situation, the better holistic grasp you are able to develop. + +&#x200B; + +Here at r/ASX_Bets, we love YOLO's, shit-posts and dank memes. + +&#x200B; + +Occasionally though, we enjoy a good debate and a chance to provide a glimpse into the types of intellect that have more than a singular wrinkle in that ocean of smoothness.... +I was reading an article making fun of millennials (of course) for underestimating how much they needed for retirement. The article said you should have around 75% of your current yearly income for every year of retirement…ok. + +But how can I save 75% of my annual income every year other than by putting 75% of my check in the bank? I have an IRA account at work but it doesn’t appreciate *that* much to account for that much of an increase I don’t think. I’ve been putting in it, with my employer matching up to a certain amount, for almost 4 years now (first job that had this benefit and first job after graduating college) and it has a little less than $9K in it….at that rate it will definitely not be enough to retire on at the recommended sum. Not even close. I make around $50K…which is pretty typical in my area and career, it’s not going to change that much except with a gradual “cost of living” rise. + +Am I missing something here? I also try to save $500 a month…which I think is pretty good, but that gets dipped into now and then…like recently when I bought my first house. Down to $3K in savings…and the house expenses are creeping up. And I want to go on vacations and stuff…I don’t live lavishly, I’ve never even seen the ocean. My last vacation was to a cabin in Arkansas…I do eventually want to go overseas on vacations, but I’m just trying to say I’m not buying like 3 lavish trips a year and then wondering how I can ever retire. I saved very well to raise $10K to buy a house and am proud of it. I’m just saying that when I save $500 a month, it’s not just going untouched…I have to dip into it now and then and *want* to as well, because what’s the point of life if I can’t go on trips now and then? I don’t want to wait until I’m 65-70 to see Italy or China and that’s a common sentiment I believe. + +What am I missing here? How do I save for retirement properly? Thank you. + +UPDATE: thanks everyone. I did understand the article meant that I would likely want 75% of my current annual income for every year of retirement to live comfortably…as in it will probably cost 75% of $50K for me to live similarly when I’m retired. I just didn’t know how I could get that much *without* literally putting that much away, which would be impossible for me. I think it’s sad that no one in high school or college (I obv didn’t major in finance) taught anything about retirement, investment accounts, etc. Imo that’s way more useful than college algebra (for a non math major), which is a required course regardless of major. + +So now my thing is that should I just put more in my IRA account (which they tell me will be taxed when I cash it in) or should I open a separate account? Like the people I have my IRA account with told me I could start an IRA Roth account and that it would be taxed when putting in, but not taxed when I cashed it out….so that seems like I should open the Roth and put the additional funds in there, and just keep the IRA for the amount my boss will match up to. Does that sound good? Or should I just have some other kind of investment account? Thank you. +I’ve lurked here a while but posting this with a burner account. Please be gentle. 42F single. Current NW is ~$4.5mm. I’m preparing to exit a company I started and built and estimated buyout will be ~$30mm which I’ll split with one partner. I live in a MCOL city in the South and other than my home mortgage, I have no debt. + +I’m healthy, in good shape, am down to earth, fun and considered conventionally attractive. +Now that I’m in a new income bracket, it’s become very hard to date. I’m from a blue collar family and have a strong work ethic. I’ve spent years focusing on my business which has been socially isolating but has made me “rich,” which I’m grateful for. I had one long term relationship that ended due to infidelity (on his part). I tried online dating and the guy I met did some research on me and became really intimidated when he found out about my career and money. It became a constant complaint from him that he wouldn’t be able to provide for me and just made me feel horrible. Another guy I suspected was just looking to be taken care of. + +So my question is, where should I look for a life partner? Are there particular social groups I should join where I’ll meet men who are in the same income brackets? Should I consider a matchmaker? There are a lot of men in this sub so I thought there might be good suggestions here. + +How do you suggest I handle men feeling insecure about differences in income? I’ve tried to hide what I do for a living but then I’m accused of being secretive and aloof. When I share too soon I’m viewed as out of their league or they “have nothing to offer me.” + +EDIT: Wow! Wasn’t expecting this to get noticed. I appreciate the helpful, kind comments and even the few unkind ones. + +EDIT 2: I’ve gotten criticism for not stating in my post that I’m a “single mom.” I think this top is very relevant to fatFIRE and deserves its own post but I didn’t mention it because 1) I’m a package deal so I’m not considering any man who wouldn’t date a woman with a child. 2) dating at my age is different. I rarely meet men who don’t have children and expect that the woman not have any at all 3) THIS IS MOST IMPORTANT: I feel uncomfortable saying I’m a “single mom” at my income level. Why? Because I can hire a nanny and generally get help with my child to the point where I realize I’m not having the experience that most truly single mothers are having. I came from a less privileged background and am lucky to have made it out of my town not being a teen mom, which happened to a lot of the girls I grew up with. I recognize that and acknowledge how difficult it has to be for women making even $75k to raise one child alone in America. So I don’t really call myself a single mom for that reason. +I have a low milage vehicle that fits my family of 4 perfectly. However, I want a truck. I've always wanted a truck. I know financially anyway I add it up it makes more sense to keep my current vehicle. However, I want a truck. For a few days I'll talk myself out of it, and then I find myself browsing around looking at trucks again in a few days. This has been going on for years. + + +So when you WANT something and don't NEED it, what tricks do you use to get the idea to stay out of your head for more than a few days? +I'm still so salty about this. + +Last night I went out with 3 friends to celebrate one of their birthdays. After we ate 2 of them wanted to take pictures near the view where we ate and the other one had to use the restroom. They all bailed before the check came and I didn't think much of it when it happened. They didn't come back. I had one of them text me that they ran into other friends while taking pictures and the one in the bathroom left in a rush apparently because of babysitter emergency. I was dumbfounded at the audacity. + +I budgeted for 20-30 dollars for myself. Quite reasonable, I didn't drink or have any extras. They were all wasted from a series of drinks. + +175 was the total. It was my entire weekly budget. I didn't want to stiff on a tip because I've been there before and it sucks. + +I texted them the receipt for them to cashapp me or something. Only 1 of them did it (babysitter emergency) so I feel that her situation was geniune. The other two got really offended. The birthday girl said I should be willing to spot her for her birthday. Nah, not when you drink 60 dollars in drinks and order a 30 dollars freaking steak. (All of which when we were dining I thought I could make better at home but that's a different pet peve). + +I don't go out to eat. This was supposed to be a treat. My first girls night out. Now I'm sitting here trying to figure out how to make my existing groceries last longer because I'm out 100 I didn't expect to be. + +Just to be petty I texted her mom the receipt (we've known each other since we were in middle school). I told her mom that we didn't agree to me paying and her daughter just bailed. I asked if she'd be willing to pay for her daughter because 100 dollars is taking away from my family. I haven't even bought my daughter her holloween outfit.. she's only 1 but still I wanted to do something for the holiday. + +Sorry for the rant. I'm a mix of disappointment and just anguish. I didn't even enjoy my dinner because I kept thinking the food was mediocre for the price. +I see posts where people my age or even younger are making big money and have savings and their own house, etc. + +I graduated last year, only have 7K in my savings and make 59K a year on the basis of if my contract gets extended each time. And then I see people out there who have their own house, or have thousands in savings. And I feel like crap. I try to save 1,200 a month based on taking out my bills and other expenses (food). And it feels like I won’t even get my own place until several years down the road. + +Not so much advice. But I do see people say not to compare but it can be hard. Apology if this isn’t an appropriate post. + +Edit: Monthly saving, not fortnightly. + +Just wanted to say thank you for the comments. I’d like to clarify that I know I am better off than some people and I try not let myself get down at where I am. I am grateful for being alive and having a job in these times - just sometimes wish I didn’t stuff around years ago because I would like to have a house rather than rent. I hope everyone is doing well. +I'll try to keep this short and would appreciate candid thoughts. I live in SF making $400k/year in finance. Invested a lot of my cash in crypto over the pandemic, now left with $1M in NW (post tax). Have been moving into safer assets over time, closed on a rental property last month as an inflation hedge. I like my job but it comes with a serious grind (working 50+ hours a week, often much more). The pandemic taught me that life is precious and I should be thinking about living life vs always working / grinding. I'm 26, and feel like there's a lot of potential in my job if I stick it out but some mornings I wake up not wanting to do another day of it. + +As you can tell I am somewhat burnt out / having real savings at $1M makes me so much less motivated to do this job vs when I had nothing a few years ago. I considered switching jobs but my only skill is finance and I think any other role will pay less or be even more annoying (current role, while extremely demanding, provides a lot of autonomy and you can argue its intellectually interesting). + +What would you do in my shoes / how can I motivate myself to get to say $3-5M range? I flip between thinking I want to find a way to fire and live off that forever, to wanting to become a partner at my firm. + +edit: some great advice on the comments below, really appreciate it! looking forward to this journey of fatfire +I'm an unmarried 36 year old American with a low paying job. I'm stuck renting and living with roommates. I don't qualify for a home mortgage loan because of my low paying job and subpar credit score. With the current price of bitcoin, I could sell all of my bitcoin and afford to buy a nice small house where I live, and I like the area where I live. + +If you were in my position, would you sell your bitcoin to buy a house right now? Or would you wait 4 more years? + +I believe that the price of bitcoin will be a lot higher in 4 years. So if I wait 4 more years, I believe I will be able to afford a nicer house and still have some bitcoin left over to save, but then I will be 40 years old, and I would also be stuck renting and living with roommates until 2026... I'd hate to sell most of my bitcoin. But I'd love to own a house. + +I'm so conflicted. I hate living with roommates and I've always wanted to own a house, but I'd hate to sell most of my bitcoin for only $62,000 each. I feel like they should be worth more and I think they will be worth a lot more in the future. Please give me advice and help me make a decision. What do you think I should do? What would you do? + +Edit: I forgot to mention that I was convicted of felony drug possession a long while back. Being a convicted felon has really limited my potential job prospects and made it a lot more difficult for me when trying to find a place to rent. + +Thank you for your input everyone. I've decided to keep waiting. But if the price happens to reach $150k this bull run, I will go ahead and sell 1.5 BTC to buy a small condo, and then I probably will wait 8+ years before selling my condo and upgrading to a house. Otherwise I will wait 4 more years before selling some of my bitcoin to buy a house. +I recently became a millionaire this past month at the age of 29, but realized that my life has not materially changed in any way. I still have to continue going to my day job as I can't afford to live off my investments in my HCOL area. I've done some calculations and my fatFIRE number is 7-8M. I would be able to live very comfortably on that number and could splurge here and there but I would still need to budget. With inflation, that number could be 10M when I turn 40 in a decade. This is also assuming that I stay single and/or have no kids in the future. + +Growing up, being a millionaire was always viewed as extraordinary accomplishment and it still is, but today a million dollars doesn't take you very far. The term millionaire was created in the 1700s or 1800s. Adjusted for inflation, a million dollars in 1900 would be worth around 30M today. I don't think you need 30M to be considered rich, but a millionaire is not what it once used to be. +If you've paid any attention to the financial news over the last 2 years, you've seen the questions and critiques about Warren Buffett's cash position. In almost every interview he's asked why is he stacking cash or why Berkshire isn't outperforming the S&P 500. The majority of questions aren't as brazen, but rewatch some of his interviews and you'll see that 1 or 2 questions along those lines comes up. + +Take this article by CNBC from November of last year: + +*Being in the enviable position of having that much cash to spend seems unenviable at the moment, as far as Berkshire shareholders, and maybe even Buffett, are concerned. Buffett’s company is currently on pace for its worst annual stock performance since 2009.* + +*“He pinned himself into a corner a few years ago, saying I can’t have $150 billion in cash in three to four years and say that’s alright,” said Greggory Warren, a Morningstar analyst who covers Berkshire Hathaway.* + +*Underperformance versus the index, deals that have not worked out well, such as Kraft Heinz (thought it showed signs of life in its most recent earnings), and increasing willingness on Buffett’s part to consider share buybacks, all point to the the importance of moving that cash into investments that generate a return."* + +https://www.cnbc.com/2019/11/01/even-obvious-way-for-buffett-to-solve-big-cash-problem-is-a-puzzle.html + +I can spend all day finding each and every article from the past 2-3 years but you understand my point. + +As stocks soared to all time highs, people wondered just as they did during the tech boom whether Buffett had lost his touch. Now Buffett is sitting on a 125+ Billion dollar mountain of cash just biding his time. He's poised more favorably than he could ever ask for, and prices are just getting more reasonable by the day. + +TLDR: When you see Buffett stacking cash, he's not an idiot. He's waiting for prices to become reasonable again, which only happens after a significant market decline. + +I'm not saying he's an oracle, but he's rarely wrong. If history is any indicator, Berkshire is going to reap some mighty rewards. +I’m 28 and looking for a little inspiration. Currently make 180k and should see significant increases over the next decade (private practice health care) and we save about 20-30% depending on the year. I love what I do so no plans to RE but I like the idea of working as much or as little as I want to. Just curious when people first hit the 5M+ milestone +Curious as to what all the trolls think ethereum is worth longterm. Please provide some insight as to why you're bullish or why your bearish. +TROLL AWAY +Hi AskEconomics, + +I'm wondering why people and the media in general love to criticize billionaires for their wealth. From what I understand, their wealth is measured by how much they own a public company and the share prices of said company. This means that their net worth is actually the worth of the company itself, not to mention this "worth" is the projected/expected valuation of the company (because the stock prices thus the company's worth may change), not how much actual wealth the billionaires own. + +Not to mention these wealthy people probably don't have piles of cash sitting around and their true wealth is not in liquid assets. We don't have public information (not that I know of) on how much these "billionaires" net incomes or true net worth are, for all we know they may actually not have billions, even millions. + +As much as I want to criticize billionaires and tell them to share the wealth, I'm confused when we criticize billionaires because what do we expect them to do? Instead of criticizing the individual billionaires, shouldn't the corporations and its board of directors be held accountable to pay living wages, give benefits, etc? Even then these corporations don't have liquid assets either, their profits are probably re-invested somewhere else like properties. I also read in an old Bloomberg article that there are royalties who's worth is actually much more than these billionaires have, and we wouldn't know to what extent since their wealth is not public. + +Is my understanding flawed here? + +My knowledge of economics and business is basic and I am **definitely not trying to defend the upper class** here but I am trying to understand this concept better. +I’m in a relationship and will likely be getting engaged this year and was curious how you folks do gifts for your SO especially if your finances are shared. + +I’m talking birthdays, Xmas, anniversaries, etc. Is there a rule of thumb on how much each should spend? When you’re rich I mean you can hypothetically treat every day as your birthday. How do you keep the specialness of a birthday when money isn’t important? + +What if they aren’t so much into gifts? Do you recommend more trips instead? + +EDIT: Well, this blew up! Some really solid advice in here, thanks so much guys!! + +EDIT 2: Woops, I did not mean to write I'm single. I'm in a relationship. Edited that. +Context: + +* Introduction ([https://www.reddit.com/r/fatFIRE/comments/pyqf2a/confessions\_of\_a\_hectomillionaire\_part\_1/](https://www.reddit.com/r/fatFIRE/comments/pyqf2a/confessions_of_a_hectomillionaire_part_1/)) +* Investments and Portfolio Management ([https://www.reddit.com/r/fatFIRE/comments/q2p32j/confessions\_of\_a\_hectomillionaire\_part\_2/](https://www.reddit.com/r/fatFIRE/comments/q2p32j/confessions_of_a_hectomillionaire_part_2/)) + +\-------------- + +I want to set a serious tone for this post by sharing this WSJ article: [Zappos CEO Tony Hsieh Bankrolled His Followers. In Return, They Enabled His Risky Lifestyle.](https://www.wsj.com/articles/tony-hsieh-zappos-death-entourage-11616761915) This is a really sad story. I don’t know him. But if you read through the article, I believe what really happened is that his money, not his followers, enabled his risky lifestyle. Everyone around Tony Hsieh was on his payroll and whoever was trying to talk him out of his self-destructive behavior would get marginalized or fired. Intervention is kinda impossible for an addict with a lot of money if (s)he uses the money to be in control. This post focuses on expenses and lifestyle. But instead of talking primarily about how I spend my money. I want to focus on what I do to (hopefully) avoid getting into big trouble. + +First, let’s get past this “guilt” or “moral high ground” of wanting to stay frugal once you hit it big. It isn’t really about “spending money is bad and saving money is good”. It’s also not this false dichotomy of “Experiences are good. Material things are bad.” Money is a tool. With money, you have options. Some options are good, some options are bad and some options are complicated. Super rich people can live a life with no financial constraints, But there are always other life constraints or consequences to consider. It’s important to think of the consequences before throwing money at various problems. + +Let’s start with my favorite topic: watches. I like buying expensive watches. It’s an inconsequential expense. It takes very little space to store, there’s virtually no maintenance issues and it lasts forever. The catch is I don’t really wear them in public and I definitely don’t wear them in front of old friends with different life circumstances. It satisfies my vanity without inciting envy and it doesn’t involve PEOPLE. The watches are so nicely designed with amazing craftsmanship and have great resale value. I limit myself to 1-2 watches per year though because after all, I only have two wrists and I don’t want overconsumption kills my appetite for them. + +On the other hand, I don’t have a personal assistant or full-time household staff. On paper, they could make my life easier by taking mundane things off my plates like booking travel or scheduling a plumber. But I would have to trust this person enough to give him/her enough work to make this arrangement productive. In other words, it's a very consequential expense. One time an acquaintance who was a PA to a prominent venture capitalist told me that she helped the family book a private flight to Europe and the cost was more than her annual salary. She sounded a bit bitter. I was not shocked by the cost but I was wary of the relationship between her and her employer. I don’t want a PA to talk behind my back and to be judgy of my purchases. Frankly, I don’t want to get into a complicated relationship like this. But I don’t think it’s easy to make this kind of relationship entirely transactional. + +Here is another depressing story. I know a self-made super rich couple who got divorced. The guy told me they hardly have their private space and time together. Their household employees were everywhere. They did try to carve out time and space to be with each other alone but that’s extra work. In the end, they grew apart and divorced. I always wonder if they would have still been together if they led a simpler life. + +Back to the Tony Hsieh story, just think about what could happen to a good person when everyone around him is on his payroll? It’s probably fine for a short period of time. But imagine if almost everyone you interact with on a regular basis for the past 10-15 years is on your payroll, what would that do to you? People around you will tell you that your ideas are so amazing, your heart is so big, your below-average art is the best and you are such a visionary/genius. I have seen good people become out-of-touch. I imagine only when they log into reddit and post/comment on something, people might call them idiots. Or if they do venture out into the wild, they probably would realize that whoa people do their own laundry, cook their own food and stand in line for hours to get into a buffet in Vegas???!!! If they live in their bubble, keep the money flowing and don’t get toxic people into their life, they will probably be fine. But if they have other problems like addiction or a severe mental illness, they could get into big trouble down the road. + +The main point I am trying to make here is that at a certain point, it’s not about how much money you can afford to spend anymore . It’s about the consequence of life choices. Hiring household staff is an option money enables but people need to think about if they want to pay for the price beyond money. Same for owning giant mansions, having paid \*companions\*, keeping multiple residences, owning a private jet or a big boat. It requires maintenance and manpower to own these nice things. But is it really worth all the effort and does it actually bring you joy? + +Also, I have kids. I would probably spend more lavishly on travel and experiences if I didn’t have kids. But I don’t want them to become Rich Kids of Instagram so I have to cut back on my excess. They already live in a bubble of safety and comfort. What will they become if they are used to a jet set lifestyle? + +In summary, being able to do something doesn’t mean you should do it or you actually want to do it. Here is a list of question we ask ourselves every time we are considering a significant expense($5K+): + +* What are the benefits? +* What’s the initial financial cost? Does the cost justify the benefits? +* Is there an ongoing financial cost like taxes, maintenance, membership dues, etc? +* Does it require me to spend extra time and energy on it? If so, how much? +* Does it affect our existing relationships, in particular kids, family and friends? If so, how? +* Does it require me to cultivate new relationships? + +If the answers to the last 3 questions are yes and significant, I generally avoid the expense. If the expense only involves primarily the first 3 questions, it’s a trade-off analysis. I am willing to pay for conveniences and experiences. I will also pay for house improvements that we can enjoy for a long time after it’s done. I bite the bullet and pay for all the digital subscriptions so I don’t get locked out of Bloomberg or WSJ. I have a country club membership and a wework all access membership. Here is the rough breakdown of our budget (not including investments and charitable donations): + +* Day-to-Day Basics (Food/Grocery/Trinkets/Utility/Insurance/Subscriptions/Memberships): $180K +* Kids Related (Babysitter, Enrichment Classes, etc): $70K +* Travel & Luxury Purchases & Gifts: $100K +* Home Improvement: $100K +* Services (Cleaning, Gardening, Accounting, Legal, etc): $50K +* Property Taxes on Primary/Secondary Homes: $100K (covered by rents from rental properties.) + +The above is the budget. In reality, we underspent on the basics, travel and home improvement categories by at least $100K in total. So our total budget is $600K but actual spending is a bit less than $500K. We kind of just run out of things to buy since we don’t spend much on consequential stuff. The biggest unnecessary consequential expense is our second home. We use it about 30-45 days a year. It’s nice but requires all the upkeep of owning a home. If we get rid of it, we will save at least $60K a year. We are keeping it because it lets us get closer to nature. But if I were to do it again, I probably wouldn’t buy it because the upkeep takes too much of my mental space. + +Going forward, we do expect to pay parents’ long term care expenses so we might add a couple hundred thousand a year in expenses for a few years and we will be happy to cover all that. We don’t give extended families money in general. They are all doing fine financially and have good professional careers. I don’t think it’s a good idea to give them money to remind them how rich we are. We do invite the family to trips for which we cover the expenses and sometimes we get turned down due to schedule conflict or awkwardness. We don’t talk about money with friends and family. If people try to bring it up, I just don’t say anything. I don’t like to mix money and relationships. I do like to spend time together with friends and family. We can talk about anything but money. If they want any financial advice, they can check out /r/financialindependence or /r/fatfire. A lot of good advice is available there. (Note: I do talk about the struggles with friends in the same situation. But our conversations are usually not about managing money but more about “what do we do with our life?”) + +I hope this post is not too disappointing because it’s not like I am having an amazing time spending money on luxuries all day long. Money is a tool to run our life smoothly. We eat healthy food, have nice gadgets, live comfortably in nice homes in nice neighborhoods, travel well, enjoy all the conveniences money can buy (, avoid inconveniences money can cause) and most importantly, have control of how I spend my time. We can cover any expenses should there be an emergency. IMO, the Godilocks FatFire number is $20M ($10M if you live outside VHCOL areas). Beyond that, there’s really very little marginal utility unless you enjoy living like royalty with employees gossiping behind your back. + +\------- + +Next week, I am going to write the infamous piece “I am NOT a superman”. It’s a post about philanthropy and I think it’s crucial to have it out first to provide context for the work and purpose post. +The genesis of this post is that we were recently at a very high end hotel abroad. It was one of those - middle of nowhere, immersive places, so you saw the same people every day. + +We had a conversation with this older couple and I basically realized that the guy was likely with a NW in the hundreds of millions. (Founder of something I won’t mention). + +So here we were with this couple that was many multiples our net worth and we were eating same food, staying at same hotel, doing similar activities. We both flew there Business Class. And I didn’t feel like I was splurging at all. We actually live well below our means. + +So it got me thinking - what is it that UHNW people can afford that you can’t with several million NW. But the wrinkle I added it is to look at it from an actual % of time spent on those activities. So really looking at it from a practical standpoint. + +So the obvious ones are Yachts, Mansions, jets, politicians, stuff like that. Which likely occupy a tiny portion of practical leisure time. + +But once you get past the ridiculously obvious and unnecessary things that are just status symbols, there really isn’t a big difference in lifestyle. + +Good restaurants - check +Comfortable travel - check +Top hotels/resorts - check +Nice home - check +Good wineries - check +Fun activities - skiing, water sports etc. check + +These things likely account for 90% of your leisure time. + +The one thing that comes to mind really is children - generational wealth, free spending on education, buying them a place in a VHCOL place, something like that. But we are gay and don’t have kids so not really relevant. + +Curious about your thoughts. What are the practical differences of being UHNW vs. poorest rich man at $5 mn as Succession says. What are some things that you would do frequently but could’t afford with $5 mn that you could with $100 mn? + +EDIT: good discussion. Thanks for input. Lots of good points +There's going to be a lot of text here, so all you smooth brain apes who are on reddit, a text based website, yet are still to retarded to read, can skip to the end where there will be a very short summary, a bottle of milk from your mother, and a blankie. + +First, lets talk about the part of the real estate market that's gonna go bust that everyone knows about (or at least that people who pay attention to this shit or read my previous DDs know about): CMBS. This is the Commercial Mortgage Backed Securities Market. These are loans on commercial buildings that have been securitized, bundled, and sold to investors. The following is an explanation of the CMBS issues I wrote for another DD over six months ago: + +*The CMBS (Commercial Mortgage Backed Securities) Bomb* + +*This one is a bit different from the mess we had in 2008 with MBS (mortgage backed securities) because it's a different market with different rules, and it's a smaller total market than MBS.* + +*That said, the problems here might actually be worse. There is a company called Ladder Capital, formed out of the remnants of the Bear Stearns bond department, that has struck an unusual deal with Dollar Store, and they have a LOT of properties that are very, very much coasting on made up mortgages. I could easily write like three pages on this one partnership alone, but I'll just summarize instead and say these people learned absolutely nothing from 2008 except that it was a profitable scam that carried no jail time.* + +*To understand just how bad the CMBS mess is, you need to understand how CMBS' work. At first glance, they're similar to regular MBS, it's a bundle of tens or hundreds of mortgages for commercial properties, they're divided into tranches (usually six) and the lowest tranches pay out the highest yields but also fail first. And now things get a little complex, so I'm going to simplify like crazy here, but this is the most important part to understand why this is all going to blow up.* + +*A commercial building is an income generating property, it's market value is derived from how much income it generates. The bank lending you the money will want you to put up some amount of collateral for the loan. If rents go up, the amount of collateral you have to post goes down. If rent goes down, the amount of collateral you have to post goes UP. Now the weird thing about CMBS loans is that if only half your building is rented, you can just pay half your mortgage and whatever you owe for the other half of the building just gets added to the end of the loan. Now, say you can't rent out the empty half of your building, and you want to renegotiate the terms of your loan rather than just keep adding debt to the back of your loan. Well, this is where the CMBS comes into play, because all those different tranches? The investors behind them have different incentives, the guys at the lowest tranches don't want you to modify the loan, because that means losses, and they take those losses first, while the guys in the highest tranche want to modify the loan because it generates more income for them and they're not eating any losses. Unfortunately for you, in most CMBS agreements you need a supermajority of 70-80% of the votes to get a loan modification.* + +*So, to lower rents to market rates and get the building rented out, since you can't get a loan modification, you, the landlord, have to write a check to the bank to make up the difference between the value of the building at the old, higher rental rate and the value of the building at the new, lower rate. Or you can just do nothing, get an extra write off for your taxes, and hope some sucker comes in and rents at the higher price or a different sucker comes along and buys the place from you, making it their problem. This is why you'll see so many empty storefronts with ridiculous asking prices that the landlords won't budge on - it's because they can't.* + +*I really, really skimmed just the teeniest top of the surface on this subject, but basically all those CMBS notes that are super toxic start coming due in March of 2022, and they're going to absolutely detonate the commercial property market. Many banks and investment groups will be destroyed when these go bad, just like in 2008.* + +[Video of Empty Stores in NYC](https://www.youtube.com/watch?v=OqSUhVjS77o) + +*This is a video from a guy who just walked around downtown NYC showing all the empty stores and how the place basically looks like a dead mall now.* + +*TIMEFRAME: March 2022* + +Well, I said March 2022 was when these shit CMBS notes were going to start detonating/causing problems. Let's check shall we? + +&#x200B; + +https://preview.redd.it/rr2ls6wavqw81.png?width=1620&format=png&auto=webp&s=a1109256f0e0c44408af3a08c624b9c5317409b3 + +You see that little spike at the end of the head and shoulders before it really dives to new all time lows? Yeah, that's the last day of February, 2022. + +Ok, so that's 1/3 of the US real estate market, what about the 2/3rds of the market that's residential? Well, this is where it gets weird, and how everyone (including me) kept missing it. I've written before about the issues with the US housing market - housing units relative to population has actually increased over the last decade+, while homeownership rates have dropped and prices have skyrocketed. + +Everyone who looks at the residential market thinks its being bought by residents, and that all the people buying today are actually qualified buyers with good credit scores and jobs and such. And that is true for all the people buying houses. There is not a repeat of the 2008 sub-prime debacle with NINJA (No Income, No Job, no Assets) loans. What is new - and whenever you get a financial crisis it's always, ALWAYS driven in large part by a "new" type of financial instrument (read debt) - is the sheer number of homes being bought up by with cash, and it's inferred these are all institutions and foreigners. For example, about $90 billion in US real estate was bought by foreigners in 2021. Wall Street however, blew that away, hitting as high as 1-in-7 of all homes and 1-in-2 of all apartments. + +Now, people look at that record institutional/foreigner buying and think it's the explanation, but the truth is, even with those crazy numbers, 6-in-7 homes and 1-in-2 apartments are still being bought by regular people, often with, again, "cash". + +These purchases are frequently referred to as "cash buys" because the buyer just pays the seller cash. However, they don't actually have piles of cash lying around in freighters to pay for this stuff. They take out loans. Specifically, they take out loans on their equity assets. Now this is where it starts getting sticky, because institutions are not buying these houses and apartments as residences, they're buying them as income generating properties. + +In traditional home mortgage loans, there are two things assessed: the value of the house, which acts as collateral for the loan, and the borrower's ability to pay back said loan via wages or assets. It's a relatively simple two-factor risk analysis. + +Now, let's look at what risks the Wall Street owned rental homes are subject to: income generated/rental rates, housing values, stock/derivative values, interest rates, urban planning, crime rates, and overall market returns. So basically, the money being loaned is getting assessed on a one-factor risk analysis: value of assets under management (AUM) of the borrower. But then that money is getting used to buy a whole bunch of houses/apartments, and all of a sudden it's subject to a whole horde of other risks, and the original risk profile is more useless than you are with your compensated evening companionship after a couple drinks. + +There's one other thing I haven't mentioned yet, that's huge, and the reason Wall Street never really messed around with buying up everyone's house before the 2008 crash. And it's a big one: Liquidity. More specifically: Liquidity of Assets. Lemme say that one more time for the folks in the back recovering from barnyard animal sex gone wrong hearing loss: + +# Liquidity of Assets + +Wut mean? Glad you asked 'tard. Liquidity of Assets (LoA) basically means how easy or hard it is to sell an asset. Now, one of the reasons wall street hedge funds and investment banks can do things like leverage up at 37.5-1 (the theoretical max level they use) or, say, 200-1 (the level Goldman is at according to the last 13F filing I read) is because the money is backed by securities and derivatives and other financial instruments which are extremely liquid. So if things go tits up like the Titanic, the lender can force a sell off of this stuff very quickly to get their money back. Now in reality this isn't true, or Credit Suisse and Nomura wouldn't still be dragging around Archegos bags from last year, and Bill Hwang couldn't have pulled a Reddit meme and avoided margin calls by not answering the phone (yes, that really, actually, in real life, happened). But in theory, it is. + +Now, housing? Housing is illiquid as fuck. It takes a lot of time and effort to sell a house. Or to buy one. There are special rules and whatnot from the federal government about what kind of collateral and stuff you need for a residential house. 2008 was so bad because the banks basically ignored all of those. After 2008 one of the few things the government sort-of did fix was tightening up lending standards for retail (regular people), so everyone who's looking at the last crash sees that retail borrowers aren't overleveraged with bad loans and sub-prime and thinks it can't happen again. But all those rules and whatnot get ignored if the buyer is paying "cash". This is the financial equivalent of the military expression "Generals always fight the last war". + +**The massive use of margin/equity backed loans by both retail and institutions to buy property has taken two separate markets, the liquid/volatile equity market, and the illiquid/stable housing market, and stitched them together like a human centipede with dogshit wrapped in catshit debt passing back and forth into one market that is unequally liquid and extremely price volatile.** + +If you need proof that this is what's happening, lemme help you out with some charts that illustrate my point: + +This is US Margin debt over the last few years + +https://preview.redd.it/cqutmemevqw81.png?width=502&format=png&auto=webp&s=7a477a5d11f6771327f9a103b8c1bc00a79b6457 + +Now lets compare it to US home prices over the same period + +https://preview.redd.it/blfo3arfvqw81.png?width=1168&format=png&auto=webp&s=458999d7f6b2dc2510d3343f8ec1a63e0d27b74f + +So basically, we've got loans on inflated assets fueling loans on other inflated assets. This is feedback loop that goes parabolic.. then crashes, hard. You can see the margin debt coming down and forming the first valley before it goes back up a little to complete the Head and Shoulders pattern, then drills down into the center of the earth. Because housing is illiquid, it's going to lag that drop, but as you can see from the price curve leveling off, it's getting ready to do the same thing. + +Now, we know that there are a ton of loans using inflated, volatile collateral on illiquid, inflated assets. And this is a certified bad thing. But the coming death spiral of equity/asset sales isn't the only giant elephant in the room everyone is ignoring. I'm talking of course, about Evergrande in specific and Chinese property bonds in general. + +The list of Chinese real estate developers that aren't paying their employees, debts, bonds, or suppliers is actually longer than you pretend your wang is, so we'll just use Evergrande as a proxy for the whole lot of them. + +Evergrande hasn't made hundreds of millions of dollars of interest payment on bonds since September. A couple weeks ago they failed to pay the principal payment on a maturing bond to the tune of $2.1 Billion. So, you'd think that means their debt is junk and they've defaulted, right? + +Not so fast. Let's check what the big 3 ratings agencies have to say about it: + +Fitch: RD - Restricted Default + +S&P: SD - Selective Default + +Moody's: Caa1- Rated as Poor Quality and Very High Credit Risk + +You notice what's missing from all of those? "D" - Default. Evergrande has missed everything they can possibly miss, and they're still not rated D. Hell, those brazen cockchuffers at Moody's actually have 4 separate ratings lower than what they're slapping on EG bonds. Here, let me take a second to speak in the meme language you smooth brained retards actually might understand: + +https://preview.redd.it/k23fb7zjvqw81.jpg?width=849&format=pjpg&auto=webp&s=72a7e52def1ee96018fbc2a4d59a324b794a0587 + +The reason that none of these agencies will put the "D" on Evergrande bonds is twofold - + +1: they don't want to piss off the Chinese government + +2: the banks and hedge funds that are their primary clients are balls deep in this debt and can't get it off their books because shockingly people haven't forgotten how those same banks and hedge funds fucked, saddled, and rode them with garbage debt in 2008. + +Why is this relevant to US housing, equities, and the margin loans financing the spiraling prices of both? Easy. The same people who hold the worthless Chinese debt also hold trillions of dollars of equities that they've taken margin loans against to buy trillions of dollars of US Housing. After Amazon's Q4 earngings, everyone who looked into them said "Holy crap! The only thing holding up their ER is this $110 Billion Rivian valuation!" Some people even made memes about it on Reddit pointing out that it was the only thing holding up the entire US market. Now, what happened when AMZN's Q1 ER came out and the RIVN valuation had dropped to more realistic levels? Right, a -189% miss on earnings and a huge bear run on SPY and QQQ. + +>!Quick shout out to those of you who like to play options on stock lockup expiries - RIVN's lockup ends on May 8th, and AMZN and F have a ton of shares with a cost basis of $10 they can sell on or after that date. The price is currently $30. You do the math on if they want to hold onto that garbage once they can dump it at a profit.!< + +That's a huge drop in the collateral backing all that margin debt. Is it enough to cause the Mother of all Margin Calls (MMC) and set off the worst crash since 1929? Nope. Not yet. But it's coming. Remember how people pointed out on AMZN's last ER how they were actually super fuk? Yeah, you know who had a supposedly positive ER but is actually super-mega-fuk and just lied through their teeth about it? Apple. AAPL doesn't have a single factory working right now, and their by far #1 market - China - is in the midst of complete economic collapse. >!(the politburo doesn't have emergency meetings about giant spending packages because things are going well)!< They gave zero guidance on either of these things, which makes me think that it's even worse than I think it is, and I think it's fucking horrible. But back to the bad Chinese debt. The reason Wall Street can survive a hit to something like AMZN and the indexes is that they're hedged to the balls for stuff like that. Know what they're not hedged for? Chinese property bonds universally going to zero. + +So what happens when the collateral for those margin loans goes down? I'm sure you retards behind Wendy's have all heard this one before - you get a margin call. First, you (or more likely your broker) sells equities. But if equities are all dropping, they comin' for that money, and they're looking at your assets to get it. Guess what? Housing and commercial real estate are both assets they can force sales on. So that same self-reinforcing spiral that drove up both equity and real estate prices? It's going to go into reverse, but here's the thing, when everyone is selling at the same time, prices go down really, really, really, really, really, really fast. + +We learned this last time in 2008. This time, because the housing market is directly tied to the crashing stocks, instead of indirectly through people who will default over time as they lose their jobs or balloon payments come due or rates adjust, it's going to happen all at once, faster and more violently. We actually got a brief preview of what this is going to look like thanks to the wild incompetence and greed at Zillow - Z. Their stock crashed 40% in five days when it was revealed they'd bought too many houses they couldn't rent or flip and had to sell them at a loss. And that was just a couple of neighborhoods in Arizona. When this hits nationwide, it's going to be exponentially worse. + +How much worse? Well, that depends on where you are. Here's some graphs explaining that while the US is fuk, somehow our Maple Swiling neighbors to the north are exponentially worse off - life lesson, don't tie yourself to China kids. + +This is bad, but it's kind of hiding how bad because the data cuts off too soon after the COVID crash. + +https://preview.redd.it/1a7gdtqnvqw81.jpg?width=390&format=pjpg&auto=webp&s=24ee392a123437c1faaa9e70f954a727a7ce384e + +Yeah, Canada.. I'm sorry maple's. It's gonna be rough. Good luck, and care with RBC, pretty sure that between a huge position in Chinese debt and an incredible number of soon to be bad mortgages and margin loans they're completely worthless. + +https://preview.redd.it/u1mjb2zovqw81.jpg?width=461&format=pjpg&auto=webp&s=ed1d0dac92c4298a91694cdd14465e021d834432 + +Look, I started writing DD's last fall saying we'd just gone into recession but nobody noticed and everyone laughed at me and said I was crazy. After that Q1 GDP miss it looks a bit different, ya? Last summer I wrote about how CMBS was fuk and it would start coming due in March 2022, and people pointed and laughed. See the chart earlier in this post. Now I'm telling you that the banks and the Fed and every fucking person has fucked up and missed that real estate and equities have gotten tied up in a gordian knot that's getting sucked into a black hole of failure. I'd like to be wrong. I've been wrong before (see my terrible takes on corporate hedging of HYG for an example), but I don't think I'm wrong here. + +The market and housing and everything is going down like Anne Robbins trying to get off the Hollywood black list. I've never given dates before because I didn't have a good enough idea of when things would finally hit a critical mass. If we keep following the 2008 chart (thanks for being predictable algorithms!) we're going to go up for a couple of weeks then crash sometime between the end of May and the middle/end of July. Summer collapses are historically rather rare, so I like this fall myself, but I wouldn't be surprised by either outcome. + +&#x200B; + +https://preview.redd.it/qtag3s1rvqw81.jpg?width=275&format=pjpg&auto=webp&s=64dac76a22724d4653409897716b31fbc58600a5 + +**TL;DR:** **In 2008, the unknown weapons of financial mass destruction were sub-prime loans, MBS, CDS, and CDOs. In 2022 they're margin loans, asset backed loans, Chinese bonds, and "cash" purchased assets.** + +This is how inflation leaked into the real economy from the assets it was supposed to be segregated in. Fed printer goes brrrrr --> assets inflate --> margin loans against assets drive up real estate --> owners of real estate suddenly have lots of extra money --> inflation. + +As of November of '21, the Fed had printed $13 Trillion since the start of COVID. $1 Trillion was stimmies. The rest? The rest went to the rich via inflated asset prices and debt purchases. Don't believe them when they try to blame this shitshow on stimmies and the just now conveniently-mentioned-in-the-media "return of sub-prime loans" bit. They just want a chance to blame this on poor people and immigrants to avoid having anyone look at them. And don't think JPow's greedy ass can save you this time, to match the financial impact of what the Fed did during COVID they'd have to print nearly $60 Trillion. That's Weimar Republic territory, if we're not headed there already. + +\*Sources include but not limited to: FRED, Statista, CoreLogic, FINRA +[https://www.marketwatch.com/story/investors-are-ignoring-the-parallels-between-stocks-today-and-heady-years-of-1929-1999-and-2007-do-this-next-says-strategist-11631013007?siteid=yhoof2](https://www.marketwatch.com/story/investors-are-ignoring-the-parallels-between-stocks-today-and-heady-years-of-1929-1999-and-2007-do-this-next-says-strategist-11631013007?siteid=yhoof2) + +&#x200B; + +1. The S&P 500 is trading at a lofty 22.5 times forward earnings and its price-to-sales ratio of 3.1 times is far costlier than in 2000. The Nasdaq-100 tracking QQQ exchange-traded fund [**QQQ,** **0.14%**](https://www.marketwatch.com/investing/fund/QQQ?mod=MW_story_quote) is trading at a 70% premium to its 200-week moving average, the biggest since 1999/2000. +2. “Blank-check” or special-purpose acquisition companies where investors have no idea what the investment will be. “The last time SPACs were as big as they are today? That’s right [1928/1929](http://marketwatch.com/articles/spacs-are-red-hot-why-that-could-spell-trouble-51614995100?mod=article_inline),” said the strategist. +3. Leverage highs. Similar to 1920 and 2000, margin debt has shot to new highs, which is fine until it starts heading the other way. It has recently started to unwind and if that keeps going, markets have a problem +4. 4. Cryptocurrencies. Maley said he’s bullish longer-term on cryptos, but is concerned about “froth,” given a 1,000% gain for bitcoin since the Federal Reserve’s massive quantitative easing program began in 2020, with Ethereum up 3,400%. +5. 5. Individual investors make up 20% of average daily volume for stocks, twice the level of two years ago. Many big market tops of the past — 1929, 1999/2000 — were marked by big jumps in investor activity. +6. 6. From 1998 to 2000, lots of companies with zero earnings saw shares shoot higher and investors pile in, and Maley sees parallels with \`so-called [“meme” stocks of today.](https://www.marketwatch.com/story/the-meme-stock-moment-turns-unofficially-one-welcomes-new-class-of-tickers-11630417851?mod=thornton-mcenery&mod=article_inline) +The most important post of this week is IMHO: [SR-NSCC-2022-801 is the new SR-NSCC-2021-010💡](https://www.reddit.com/r/Superstonk/comments/u7bwvf/srnscc2022801_is_the_new_srnscc2021010/), because MOASS is threatened again by bad actors. + +I won’t go into detail which posts I consider forum sliding, but let’s just say we need to comment on this new proposition to prevent it. +Hi everyone, + +I would like you to consider this part DD and part thought-gathering. It's quite long, but I can't imagine I captured everything and I would appreciate any constructive feedback. **It is predominantly forward looking**. Though certain financial elements have been considered and noted in places, it has not been the primary objective to assess the current financial health or strength of the companies listed. + +&nbsp; + +^***Disclaimer:*** *^This ^post ^has ^been ^produced ^based ^on ^my ^own ^interpretation ^of ^the ^UK ^government’s ^energy ^white ^paper, ^which ^is ^available ^[here](https://www.gov.uk/government/publications/energy-white-paper-powering-our-net-zero-future). ^I ^am ^not ^a ^professional ^investor, ^nor ^am ^I ^qualified ^to ^give ^financial ^advice. ^It ^reflects ^my ^personal ^opinion ^and ^is ^for ^informational ^purposes ^only; ^it ^should ^not ^be ^construed ^as ^being ^in ^any ^way ^instructional. ^If ^you ^trade ^based ^solely ^on ^what ^I ^have ^written, ^you ^do ^so ^having ^accepted ^fully ^all ^of ^the ^associated ^risk ^and ^liability ^of ^financial ^investment. ^You ^are ^reminded ^and ^urged ^not ^to ^act ^upon ^the ^opinion ^of ^either ^myself ^nor ^that ^of ^others ^without ^performing ^your ^own ^due ^diligence. ^Sources ^are ^provided ^throughout ^but ^not ^exhaustively. ^.* + +&nbsp; + +# **WIND** + +There will be a very heavy focus on building upon and further utilising wind power in the UK. The paper does mention that CfD auctions will be open to onshore wind, however the emphasis appears more heavily orientated towards offshore farms. The government are aiming to have an offshore wind energy capacity of 40GW by 2030 [p. 3]. As of right now, the capacity is 10.4GW [[1]](https://www.renewableuk.com/page/UKWEDhome). That's a four-fold increase in capacity which will require a lot of expansion and upgrade to the existing array of windfarms, including expanding upon floating windfarms and the integration of other technologies to compliment the infrastructure. One particular area of development will be floating offshore wind, as it allows turbines to be built in places traditional windfarms can't be. As there are no major UK manufacturing companies involved with building turbines, the approach I have taken is to look at who has been involved in the production and operation of the existing UK windfarms (both operational and planned). + +&nbsp; + +**PRODUCTION** + +Main pick: +## **Siemens Gamesa** +- There are 35 operational offshore windfarms around the UK, and 60% of the turbines are made by Siemens [[2]](https://en.m.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_Kingdom). It seems likely, though of course not certain, that they will have a role in building the turbines for the four offshore farms currently under construction as well as the further five farms proposed for 2023/25. +- Over 80% of shares owned by institutions, private companies and public companies. +- Price to book (4.6x) overvalued compared to industry average (3.3x). However, share price is still rising (36% in last Q). +- F-Score 3/7. + +&nbsp; + +Secondary pick: +## **Vestas Wind Systems** + + +- Vestas is the other most likely candidate for producing turbines for offshore UK windfarms, with 30% of currently operational offshore turbines having been produced by them [[3]](https://en.m.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_Kingdom). +- 40% institutional ownership including BlackRock, Vanguard and Invesco amongst others. +- Healthy Financials. +- Price to book (11.3x) overvalued compared to industry average (3.3x) but earnings are expected to grow significantly over the next three years. + +&nbsp; + +**OPERATION** + +Main pick: +## **SSE** +- SSE are surprisingly heavily involved in wind energy. They jointly operate 11% of the operational UK windfarms ~~and will be jointly operating one of four farms under construction currently (Neart Na Gaoithe, Scotland).~~ Disputed, and I'm inclined to agree. +- The white paper makes clear in chapter 6 that the government intends to provide opportunities to existing oil and gas companies to repurpose their operations away from unabated fossil fuels, and towards technologies such as carbon capture, utilisation and storage, or clean energy production from renewables and hydrogen. They are financially incentivising large companies to take up those clean technologies. With the well-established operations in the wind sector, as well as government incentives to invest in carbon capture, SSE appear well placed to survive the green transition and receive support from the government to expand further into renewable areas. +- It is also worth noting that Airtricity, who own six onshore wind farms, are a subsidiary of SSE; and that SSE themselves own other onshore wind farms as well. +- SSE are also a member of Catapult's Offshore Renewable Energy (ORE), the centre of excellence for floating offshore wind in particular. As this area off offshore wind expands, SSE are highly likely to be involved [[4]](https://ore.catapult.org.uk/what-we-do/innovation/floating-wind-centre-of-excellence-2/). +- SSE are exploring carbon capture. SSE Thermal is part of the Zero Carbon Humber project, a partnership of leading organisations leading a £75m bid to accelerate decarbonising the north of England by utilising carbon capture and hydrogen technologies [[5]](https://www.sse.com/news-and-views/2020/10/sse-thermal-backs-zero-carbon-humber-bid-to-bring-commercial-scale-ccs-one-step-closer/), [[6]](https://www.zerocarbonhumber.co.uk/). + +&nbsp; + +Secondary pick: +&nbsp; +## **Ørsted** + +- Orsted are one of the major windfarm operators in the industry. Of all the operational UK windfarms, Orsted own and operate either in whole or in part 37% of them. Further, they are the owner of HornseaProject3 which was just granted consent on 31st December [[7]](https://www.hornseaproject3.co.uk). +- Mentioned by name in the white paper as part of a case study in wind energy related the Grimsby port revival, but is also connected to the government's Department for Business, Energy and Industrial Strategy (BEIS) £505million Energy Innovation Programme [[8]](https://www.gov.uk/guidance/energy-innovation). This is in relation to ITM's plans to scale up their Proton Exchange Membrane clean hydrogen production to a 'Gigastack' system, which can then be integrated with offshore wind facilities. More on that to follow. + +&nbsp; + +Wildcard: +&nbsp; +## **Octopus Renewables Infrastructure Trust** + + +- ORIT is the publicly traded 'arm' (I'll show myself out) of Octopus Group, which has been around a while but only floated ORIT on the LSE in December 2019. It is currently trading at just under its ATH at ~114p. +- One of the largest renewable infrastructure groups in Europe, with over £3bn in assets under management [[9]](https://octopusrenewables.com/about-us/). +- Largest independent owner of onshore wind and solar assets in the UK [[10]](https://octopusrenewables.com/about-us/). +- Significant and consistent insider buying throughout 2020 and as recently as 31st December, with the chairman of the board and two board members making a combined purchase of 20,122 shares at market price on that date. The same two board members also bought thousands more shares at various points in 2020 [[11]](https://simplywall.st/stocks/gb/general/lse-orit/octopus-renewables-infrastructure-trust-shares#ownership). +- Octopus Investments, another arm, owns the Fraisthorpe windfarm in the East Riding of Yorkshire, an array of nine Vestas V112 wind turbines [[12]](https://www.powersystemsuk.co.uk/project/fraisthorpe-wind-farm-project/). +- Octopus Energy is a retail electricity and gas supplier with 1.35million domestic business customers as of December 2019. This company is mentioned by name in the white paper in reference to its smart utilisation and its cost saving 'time-of-use' energy tariff in particular, which gives users access to half-hourly energy prices updated daily. This means that when energy prices drop, so does cost to user. It can even go negative, meaning consumers would be paid [p. 23]. + +&nbsp; + +# **HYDROGEN** + + +The government is very interested in new hydrogen technologies and is working toward 5GW of low-carbon production by 2030, with views to scaling hydrogen neighbourhoods into hydrogen towns by the end of this decade [p. 12]. Hydrogen is a target (along with advanced nuclear) of a £1b energy innovation programme, and as alluded to previously, the government are looking at utilising synergies between wind and hydrogen. As well as that, hydrogen fuel cell technology has potential application for large vehicle power especially, like busses, HGVs and construction vehicles. The white paper indicates that in 2021, the government will invest £20mil in freight trials to pioneer hydrogen and other zero emission truck technologies, and £120mil in 2021/22 to start the delivery of 4000 zero emission busses, which will be a mix of battery electric busses and hydrogen busses [p. 94]. + +&nbsp; + +Main pick: +&nbsp; +## **ITM Power** + + +- As I mentioned, ITM are mentioned by name for their Gigastack project. This is a large-scale project involving ITM power, Orsted, Phillps 66 and Element Energy, aimed at demonstrating the efficacy (and carbon benefit) of developing synergies between wind and hydrogen power. The production of hydrogen power has traditionally been associated with high carbon emissions, and the purpose of this project is to produce hydrogen without the associated carbon emissions. Read more here [[13]](https://www.itm-power.com/news/industrial-scale-renewable-hydrogen-project-advances-to-next-phase). +- Given the government's focus on wind and hydrogen in the green industrial revolution, ITM appear uniquely placed to lead and capitalise upon the green development of the UK's energy infrastructure. +- Debt-free and has not had any debt for the last five years. +- Decent cash runaway. +- Recent insider buying by 7 individuals. +- 40% institutional ownership, including BlackRock, AJ Bell, HSBC, Barclays and Morgan Stanley amongst others. + +&nbsp; + +Secondary pick: +&nbsp; +## **Ceres Power Holdings** + + +Ceres are well placed for the green industrial revolution. Their core product is a unique type of solid oxide fuel cell they call the SteelCell, which they claim is not only cheaper to manufacture, more efficient, and more reliable than other fuel cells, but which can also produce power from hydrogen, natural gas, biogas and ethanol as well [[14]](https://www.ceres.tech/technology/why-is-it-unique/). The areas of application for this product are EVs, data centres, and distributed power generation. The only reason this isn’t the primary pick for me is that I am concerned about how much of the company’s growth potential may already be priced in. + + +- They have several big-name partnerships including Bosch and Doosan [[15]](https://www.proactiveinvestors.co.uk/companies/news/936171/ceres-power-partners-with-powertrain-specialist-avl-list-to-turbocharge-fuel-cell-adoption-936171.html). +- Overvalued price to book at 16.8x vs industry average of 2.8x. +- Very healthy financially, with no debt and cash runaway of 3+ years. Short and long term assets exceed short and long term liabilities. +- Insider sale in the last six months but no insider buying in last twelve months. +- 54.7% institutional ownership. +- Market cap: £2.27b. +- Shares outstanding: 172.1m. + +&nbsp; + +Tertiary pick: +&nbsp; +## **AFC Energy** + +If you've been keeping an eye on the electric vehicle (EV) market, you will likely have heard of American companies like Chargepoint, whose market is EV charging. AFC are doing the same in the UK. Their H-Power EV charging ports offer an EV charging solution designed to be modular, scalable, easily transportable, and independent of the grid. This could be especially convenient logistically for areas such as car parks, and companies that operate fleets of vehicles. + +- A global leader in alkaline hydrogen fuel cell technology focused on electric vehicle charging and distributed power generation. +- Announced in December a strategic partnership with ABB, a Swiss electrical systems giant with an established sales and distribution network of DC high power EV charge points, having sold 17,000 units in 80 countries [[16]](https://www.afcenergy.com/afc-energy-and-abb-partner-to-power-up-the-future-of-clean-ev-charging/). +- 34.9% institutional ownership. +- Market cap: £536.86m. +- Shares outstanding: 676.15m. + +&nbsp; + +Wildcard: +&nbsp; +## **Powerhouse Energy** + +Powerhouse Energy is in the business of recovering energy from unrecyclable plastics and end-of-life tyres to produce syngas and hydrogen through their 'Distributed Modular Generation' (DMG) process of gasification. The process involves the plastic being heated to a very high temperature where within a few seconds it melts and is vaporised into gases. Further heating within the chamber reforms the molecules into a syngas, comprising a mixture of largely methane, hydrogen and a smaller volume of carbon monoxide. The Thermal Conversion Chamber operates without oxygen, so there is no burning, however a non-combusting oxidising agent in the form of steam is added to control the process and the quality of the syngas. Once through the Conversion Chamber the syngas is cleaned, leaving behind a few inert harmless residues, which are typically less than 5% of the starting volume of waste plastics. These residues can then be reused for other purposes or safely disposed of. + +- Their product is their DMG system. Powerhouse Energy do not operate any plants of their own. However, the hydrogen their process produces can be used for fuel cells, micro-turbines or ultra-clean engines, meaning they could have plenty of potential clients going forward, especially with an uptake in EV and phase out of diesel. +- Given what the white paper outlines regarding hydrogen powered trucks and busses, as well as the green industrial revolution's emphasis on hydrogen more broadly, they are well placed to expand their business if managed correctly. +- 23.5% institutional ownership including Barclays, Fidelity, HSBC, AJ Bell and Deutsche Bank, amongst others. +- Currently trading at 10p. +- Market cap: £364m +- Shares outstanding: 3.72b. +- They have a lot to prove. Mid-high risk, high reward play. + +&nbsp; + +# **BIOMASS** + +Biomass will have a role in the green industrial revolution as the government consider it 'one of our most valuable tools for reaching net zero', but the extent of that role seems yet to be determined in any concrete sense. However, the government is aiming to deliver a preliminary position paper on this matter by summer 2021 [p. 53]. By 2022 the government intend to have established the role bioenergy with cabon capture, use and storage (BECCS) will play as part of a wider biomass strategy [p. 53]. +Biomass has been controversial due to an infamous loophole whereby the carbon debt of producing the wood pellets is not sufficiently factored in to the carbon cost of biomass energy production, because the pellets magically become carbon neutral in transit if enough trees have been planted to replace those cut down. The objection is that the newly planted trees take 50-100 years to mature, and so we ultimately run biomass at a deficit [[17]](https://greenguide.co.uk/uks-net-zero-emissions-2050-pledge-undermined-by-biomass-energy-loophole/). However, the government seems aware of the hidden carbon cost of biomass, and made it clear in the white paper that BECCS will be "critical to consideration" of biomass support [p 53]. Carbon capture is going to be a significant consideration in all areas of the economy going forward in the green industrial revolution as there is a real need for us to decarbonise. To that end, BECCS capable biomass power plants are appealing because they could potentially deliver negative carbon emissions. It seems unlikely that the Government will fund plants that do not utilise the technology, but that doesn't mean non-BECCS biomass won't be utilised at all, at least initially. + +&nbsp; + +Main pick: +&nbsp; +## **Drax** + +- Already trialling BECCS at Drax Power Station in North Yorkshire, aiming to capture up to a tonne of carbon every day [[18]](https://www.drax.com/press_release/drax-sets-world-first-ambition-to-become-carbon-negative-by-2030/#:~:text=Drax%20is%20already%20running%20a,zero%20carbon%20emissions%20by%202050). +- Aims to be a carbon negative company, not just neutral [[19]](https://www.drax.com/about-us/our-projects/bioenergy-carbon-capture-use-and-storage-beccs/). +- Significant insider buying this year. +- 96.5% institutional ownership including by big players Invesco, BlackRock, Vanguard, L&G and J.P. Morgan, amongst others. +- Healthy finances. +- Pays a dividend. +- Share price up 39% last three months. + +&nbsp; + +Secondary pick: +&nbsp; +## **Active Energy Group** + +- Recently granted US patents for their CoalSwitch and PeatSwitch biomass processes [[20]](https://www.bioenergy-news.com/news/active-energy-awarded-new-us-patent-for-coalswitch-process/). +- 33.9% institutional ownership including HSBC, AJ Bell, and Barclays. +- High debt but positive operational cash flow and decent cash runaway. +- Insider buying in last six months. +- Nb. Unclear if committing to BECCS and may be focusing primarily on US market. + +&nbsp; + +Wildcard: +&nbsp; +## **EQTEC** + +- Highly speculative. +- Specialises in gasification and working with third party plants to implement 'waste-to-value' solutions, but does own stakes in several energy producing plants such as Clay Cross Biomass in Derbyshire amongst others [[21]](https://www.hl.co.uk/shares/shares-search-results/e/eqtec-plc-ordinary-eur0.001/company-information). + +&nbsp; + +# **NUCLEAR** + +An unpopular sector, especially since Fukushima. Nevertheless, the government intends to invest into the next generation of nuclear technology - small modular reactors (SMR) and advanced modular reactors (AMR). With the exceptions of Sizewell B and the currently under construction Hinkely Point C, all 15 of the UK's operational nuclear plants are due to be decommissioned by 2030 [p. 41]. There do not appear to be a lot of nuclear investment opportunities in the UK, and the lead candidates in the government's AMR competition (Tokamak, Westinghouse, and Urenco) are private firms. However, opportunities remain. + +**Edit:** Westinghouse are owned by Brookfield Business Partners, which trades on the NYSE. + +&nbsp; + +Main pick: +&nbsp; +## **Rolls Royce** + +- Actively working on SMR technology. +- They were successful in both phase 2A and 2B of the government's nuclear innovation programme: advanced manufacturing and materials competition [[22]](https://www.gov.uk/government/publications/nuclear-innovation-programme-advanced-manufacturing-and-materials-competition-phase-2-successful-projects/advanced-manufacturing-materials-competition-phases-2a-and-2b-successful-projects). +- Leads the UK SMR Consortium, which aims to develop a Small Modular Reactor designed and manufactured in the UK capable of producing cost effective electricity. An initial £36 million joint public and private investment will enable the consortium to further develop their design. This is part of a greater bid into the Industrial Strategy Challenge Fund worth around £500 million (joint investment with the private sector), subject to future approvals and a final decision to make public investment. The consortium believes that a UK Small Modular Reactor programme can support up to 40,000 jobs at its peak with each Small Modular Reactor capable of powering 750,000 homes [[23]](https://www.gov.uk/government/publications/advanced-nuclear-technologies/advanced-nuclear-technologies). + +&nbsp; + +Secondary pick: +&nbsp; +## **Costain Group** + +Costain operates by delivering integrated, leading edge, smart infrastructure solutions to meet national needs across the UK’s energy, water, transportation and defence markets. They are one of the largest providers of engineering services to the UK nuclear market [[24]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/nuclear/). + +- Involved in new build, decommissioning, as well as nuclear waste management [[25]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/nuclear/). They are very well placed to handle the decommissioning of the currently operational nuclear plants, as well as assisting in the building of SMRs and AMRs down the line. +- Committed to clean energy and decarbonisation [[26]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/). +- Costain Group passed phase one of the BEIS SMR competition, and were listed as an eligible participant [[27]](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/665376/List_of_Eligible_Participants_in_Phase_One_of_the_SMR_Competition.pdf)(PDF). This is no guarantee that they will win the government funding, but it seems likely all the same that they will be involved in the government’s infrastructure plans in the end, even without funding. + +&nbsp; + +# **OIL AND GAS** + +When put together, those are two very dirty words in the clean energy sector, and quite understandably so. On ethical grounds, it is a respectable position to ignore existing industry giants. Some more than others. However, to write these companies off economically in the face of the green industrial revolution would be misguided. The fact of it is that these companies have sweeping infrastructure already in place, and it would be better to utilise it through modification than scrap it. +The government agrees, and in the first half of 2021 they aim to agree the North Sea Transitional Deal with the industry which has five key deliverables; + +- Cleaner energy production through rigorous emissions reductions. +- Supporting the delivery of carbon capture technologies +- Diversification of the oil and gas supply chain into new energies. +- Supporting the development of hydrogen production. +- Safeguarding existing jobs and establishing tens of thousands of new high-quality jobs across the sector in diversified energy technologies. + +I am sceptical about some of the oil and gas industry's sincerity in its efforts, believing certain players to be driven by legal obligation more than genuine desire to change or to capitalise on the progressive opportunity. But all the same, the existing industry merits at least a small position in a portfolio based upon the plan for a Green Industrial Revolution. + +&nbsp; + +Main pick: +&nbsp; +## **BP** + +- By far the most controversial pick on here. We're all aware of BP's disastrous oil spill, but there is a project BP are leading which is worth considering in relation to the government's plans. +- They are leading a very large carbon capture project called Net Zero Teesside together with Eni, Equinor, National Grid and Royal Dutch Shell, aiming at turning Teesside into the nation's first net zero industrial cluster [[28]](https://www.netzeroteesside.co.uk/). +Further, they are involved in another, related project called Zero Carbon Humber, which has similar plans. Of note, Drax and SSE are also involved in the ZCH project [[29]](https://www.zerocarbonhumber.co.uk/). +- Further, by 2026 the same group aims to capture and store 50% of the UKs industrial carbon emissions in saline acquifiers beneath the North Sea seabed [[30]](https://www.theguardian.com/environment/2020/oct/27/bp-leads-energy-companies-preparing-two-major-uk-carbon-capture-projects), [[31]](https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/news-and-insights/press-releases/energy-companies-form-development-partnership-for-carbon-emissions-in-uk-north-sea.pdf&ved=2ahUKEwit_-uEiIDuAhWCiFwKHSvXBJYQFjAAegQIBBAC&usg=AOvVaw35dCAqmNjbDqIK8f-eReDv&cshid=1609687319712)(PDF). +- Captured carbon has a multitude of possible uses in the production of cleaner concrete, bioplastics, and synthetic hydrocarbons that could be used to fuel planes [[32]](https://www.drax.com/technology/can-made-captured-carbon/). The capture and sale of carbon represents a significant opportunity for BP to capitalise on the green industrial revolution, and could form a significant part of their future business model, as well as that of other similar companies. + +&nbsp; + +# **AVIATION** + +Aviation is integral to our society. We can’t do without it, but it has to change if we are to reduce its carbon impact. Things like electric planes are a long way off, so in the interim we need to look at making the existing systems cleaner. + +&nbsp; + +Main pick: +&nbsp; +## **Velocys** + +- Velocys is a company involved in the production of sustainable aviation fuels. They use a fischer-tropsch process to produce a sustainable, drop-in aviation fuel from household, commercial, and forestry waste. Drop-in is key here, as it means that Velocys' fuel will not require any modification to the aircraft or their engines in order to be utilised. +- The government have established the Jet Zero Council; whose purpose is to accelerate the development of technologies to work towards net-zero aviation. Part of the plan is to offer a £15mil competition to support the production of sustainable aviation fuels. Velocys is well placed. +- Planning approval granted in June for a facility they are building in partnership with Shell and British Airways at Immingham. It will be the UK's first commercial waste-to-renewable-fuels plant and aims to take over half a million tonnes of waste per year and turn it in to 60 million litres of cleaner burning, sustainable jet fuel, for an estimated CO2 saving of over 80,000 tonnes per year [[33]](https://www.altalto.com/immingham/). +- Currently trading at only 10p. +- Market cap £108m. +- High number of shares outstanding: 1.06b. +- 22.4% institutional ownership including Barclays, Invesco and Fidelity. + +&nbsp; + +# **GRAPHENE** + +Graphene has been touted as the future for the last decade, but we may well be seeing some progress in this field in time for the green industrial revolution, especially in the field of battery technology. However, it is not mentioned in the white paper, and so I will leave this section as a direction for you to look into this area further. With a very significant need for energy storage and EV take-up, it is my opinion that battery technology developments are going to play a role in the green industrial revolution eventually. + +&nbsp; + +Main preliminary pick: +&nbsp; +## **Applied Graphene Materials** + +- Primarily involved in the production of graphene nanoplatelets. Although the company is so far mostly involved in graphene applications for things like paints, coatings and thermal adhesives, the large surface area, high levels of thermal and electrical conductivity, low density, mechanical strength and morphology of graphene nanoplatelets make them an ideal candidate for applications in electrochemical energy storage systems as well. Viewing their website, the company is clearly aware of this. As technology develops, graphene batteries are likely to play a substantial role in energy storage and EVs, as they are not only safer, but significantly more efficient than lithium-ion batteries [[34]](https://futurism.com/scientists-develop-better-battery-thanks-graphene). That makes graphene a good speculative mid-long term play in the green industrial revolution. +- Insider trading in October, with CFO picking up just north of 59,000 shares. +- 54.9% institutional ownership. +- Market cap: £20.4m. +- Shares outstanding: 49.7m. + +&nbsp; + +Secondary preliminary pick: +&nbsp; + +## **Haydale Graphene Industries** + +- Graphene and many other nanoparticles do not mix naturally with other materials. To ensure that its superior properties can be blended into products, nanomaterials may need to be ‘functionalised’, where compatible chemical groups are added to the material surface to enable effective dispersion of the nanomaterial. Haydale has developed a plasma treatment to that end - the functionalising of nanomaterials, especially graphene. +- Insider buying this year, but not since March. CFO purchased 275,000 shares on 12th March. +- 38.5% institutional ownership including Barclays, HSBC, AJ Bell. +- Market Cap: £18.5m. +- Shares outstanding: 425.28m. +On the Live Stream, in the excitement of trying to find the truth of what was said during the meeting, the mods almost showed a video of the meeting. As we know, GameStop's wishes were that it would not be livestreamed. But someone recorded it and put it up on Twitter...against the wishes of the company. In our enthusiasm and fervor, we ALMOST BROADCASTED it to the entire livestream audience. + +The mods ALMOST played it. But as they read the comments on the stream, there was an OVERWHELMING response saying NO DON'T SHOW IT. + +And then the mods listened. They didn't play it. And our search for the truth continues. + +The thing that got me jacked was how they listened to us. There wasn't a pushback. They just trusted us. And now we get a chance to find the truth *the right way, the fair way.* And that's what makes is powerful. We are winning by playing the rules and no one can claim that we cheated. + +We almost corrupted ourselves in that moment. But instead, I saw community and I saw leadership and I am FUCKING FULL ON LACTATING OUT OF THESE DAMN JACKED NIPS. + +I FUCKING LOVE YOU ALL 🤩🚀🌕🚀🌕🚀🌕🚀🌕🚀🌕 + +&#x200B; + +EDIT: pinkcats posted [Shareholder Meeting- I DID NOT DO ANY INTERVIEWS](https://www.reddit.com/r/Superstonk/comments/nw0i5u/shareholder_meeting_i_did_not_do_any_interviews/?utm_medium=android_app&utm_source=share) so that should clear up any FUD regarding that matter +>**DISCLAIMER:** What I post here is for educational purpose only and should not be construed as investment or trading advice. You are solely responsible for all decisions regarding your purchase and sale of securities. + +If anyone new to trading, ***do not short sell a down trending market.*** Even a bearish market has its corrections and secondary trends, and this mini corrections can catch the unwary trader. These secondary trends can last for days and leave you shorting (on margin) stocks that can be very costly. + +Instead, I recommend a few alternatives that are safer than short selling: + +1. Inverse ETFs with 1x or 2x Leverage - Inverse ETFs for the S&P 500 are the SH and SDS. A good inverse ETF for NASDAQ is the SQQQ. *These are not long term trades!* Rather, it's a way to seek profit from a sudden decline in the market within a short period of time (intraday). Do NOT trade ETFs without knowing its risk. +2. Covered Calls and Cash Secured Puts - If you are holding stocks for the long term, then use options and let those stocks generate cash while the market is in a correction. +3. Secondary Trends - Even in a downtrending market, there will be green and bullish days. These can lead to secondary trends that can last for days. You can trade the *trends in trends*. +4. Learn How To Day Trade - There are always top gainers and green stocks. It's not uncommon to see 100%+ gainers, when the overall market is red. All stocks have its reversals, even though it might end red for the day. You don't have to be a full time day trader to make profit from these intraday plays. +Hello reddit! Local college student here. + +I’m in a bit of a bind. A complete stranger has Zelled me a huge amount of money. Seeing this as strange, I called up Chase on the phone, to report the transaction. The girl over the phone was fumbling, acting strange, but eventually told me to go to the bank with two forms of ID. I went to my local branch, explained the situation, where me, a man working there helping me, and a woman on the phone all conversed. The man was extremely understanding, but while we were speaking, the person sent me another twenty dollars. I immediately showed them. I asked if all of this could be reversed as I don’t want to hold a strangers money, but by the time I was able to do anything, they filed a dispute saying the transaction was unauthorized. Chase has now frozen or temporarily restricted my account because of this, even though I had no idea what I had done wrong. The woman over the phone was talking over me, as I was trying to dig for an answer as to why this happened. Funnily enough the person only reported $500 being unauthorized, but I filed a dispute asking to give the other $520 be returned to the sender. I’m quite young, only 19 years of age, and I do receive financial aid for college, which comes in the form of a check. I feel sick to my stomach, and like I can’t explain it to anyone, my parents aren’t the most understanding folk, so my questions today are: + +Is there any way for me to cash my check while my account is frozen pending this investigation? + +Can I open up a temporary account to use while this investigation goes on with Chase? + +What would be the best course of action to get my account back to its regular status as fast as possible, so that I may use my debit card again? + +Thank you so much to anyone and everyone who reads this. + +Edit: Called today and they said they can’t do anything until the funds are removed. And that my account is frozen to protect me because the scammers might be going after my account next, (which makes sense.) Thank you everyone who’s been informing me on the issue, I’ll go heading to open up a new bank account soon, but firstly today I’ll be speaking to a branch manager about what I can do. +I've often wondered if there is something I'm missing about how wealth is understood at the billionaire level. Most of their value is not in cash so isn't what they are worth more of an appraisal? + +I understand scapegoating billionaires. But I wonder how could we expect them to pay for things when they don't have cash, or with value that isn't real but rather projected. + +How much of the 100 billion in Jeff's worth is translatable to increases in Amazon wages? How would that process work? + +I thank you in advance and am not looking for political answers but distinctly economic ones. +I’m in a microeconomic class right now and I feel like all of this would be so much easier/intuitive/effective if we used calculus. Elasticity, marginal benefit, everything. There’s no way this can be used in the real world without calculus right? Why isn’t the class taught with calculus in mind. + +[ Bot hates me so here is a link](http://www.bloomberg.com/news) + +In the late 90's we had a similar Tech/Digital stock rally (this is not nearly as bad though, so chill, companies are actually destroying the estimates and profits are strong). + +Back then it was web page development and internet providers, now it's mainly electric vehicles and some parts of tech. + +“St0nks” were only going up, up and up. You heard things like - Dude, its a new economy, this is the new normal. This is the future, you can't use old models to define value. Die all boomers and burn traditional stocks (ok I might be exaggerating on this one). + +Anyway, I was a finance major at a prominent university in London, UK. I was destined for greatness and a trainee spot at Deutsche Bank's analyst desk. My friend - let's call him Eli, because his name was actually Eli - was a stock genius. + +Everybody is a genious in a bull market, you put some money in to a company in IT and BAM, the new Buffett (or Cathie). + +Eli was good for about 350kUSD at one point, not bad for a student. Or I should say, 350kUSD nominal value in stocks. Because, its not money until you sell. Eli learned the hard way. + +The "dip" came. Eli figured "st0nks only go up" - I'm gonna "buy the dip". The dip became a slide, then a vortex and finally evolving in to a capital sucking black hole (not an anus ok). + +Eli bought and bought, he also had a debt position of about 25% of his portfolio. This increased to 50%. The bank called, Hey Eli - that collateral isn't so hot anymore, pay up dude. Eli paid up. One year later he had -13kUSD on his account for accrued interest rates and trading fees. + + + +So what's there to learn. Well, depends on how risk averse you are, but I see a lot of new investors that ask about when and how to take home profits. There is no rule or best practice, but here's at least an strategy that I'm using myself. + + +1. I usually don't let a stock grow beyond 20% of my portolio, if it does I start scaling back profits and weight to other, new opportunities. The riskier the stock the earlier and more I scale back. + +Compound that interest, bitch. + +2. I always keep a 10-15% cash position so I can take advantage on dips or other opportunities. This capital has had a ridiculous payback over the years. This is not money, this is capital. I have a savings account with 3 months salary. That’s money. Money pays bills, capital grows. + +3. For every 20% growth I take home for example 20% of the profit in riskier playa. So in G-ME for example I started buying early and by $90 I only had profits invested. By 300 I had sold about 2/3 and on the way down I dropped the last stocks at 115. + +So let’s say a stock grows from 100 to 120. I take back 4. Then it goes to 140, I take back another 8 so now I have taken 12 total. + +Obviously there is some flexibility here, but use it for inspiration. For more secure stocks you want to hold on more and longer, but for me it’s a lot about maintaining that cash position. + + +So what do I do with my profits? Well, I do a few things. + + +1. I reinvest them in to other stocks, so I make sure I have a short list of alternatives at all times. For example, my G-ME winnings (yes it was a casino) paid for 300 PayPal stocks at $231. They’re now up 15%. + +Compound that interest, bitch. + + +2. I put them in the cash position so I can be opportunistic (but still max 15%). Life saver in March, pure rocket fuel baby. + + +3. I buy my wife or kids presents, I get a nice Rolex or refurbish the house. I turn it in to money. I have money so I can spend it, use it. + + + +Moral of the story or TLDR; + +Make money, you probably won't see another opportunity like the one of the past 6-10 months. Its not coming back for a while. + +Don't step out of the market, pick your stocks wisely, keep some cash to pounce on some disappointing earning calls or dips and remember: IT IS NOT MONEY UNTIL YOU SELL. + +Disclaimer 2: I was a licensed financial advisor as in a securities analyst, but do your own research. This is not advice, it’s inspiration. + +PS Eli went on to be a very successful entrepreneur and has started a few companies. I believe one of them is going to IPO soon DS + +Edit: clarified advisor part + +Edit 2: this completely blew up, thanks for all the awards and upvotes but spend the money on stocks instead! +Stimulus checks were sent out in multiple rounds during the crisis. At least one of them (I think the first one) meant different things to different types of college students. + +Stimulus checks were available to college students who filed as independent, but not to college students who filed as dependent. As such, none of my college friends from the lower end of the economic spectrum received stimulus checks because their parents were reliant on child and education tax credits. However, these credits are only made available to parents below an income cap. Consequently, I had college friends whose parents made above this income cap tell their children to report themselves independent. They received no benefit from claiming dependents, so the best choice was for the children to file independent to receive stimulus checks. + +As a result, stimulus checks were more available to higher privileged students and less available to lower privileged students. + +Is there something I am missing with this? My evidence is anecdotal. +I’m 46. Net worth 5.5M with no debt and I hold crypto and real estate. I left my job last June. And I feel zero dread, existential issues or drive to find my next mental battle. I drive the kids to school. Look for new properties. I watch a movie or two weekly when the kids are in school. I take a 10-15 minute nap a day. I may buy a semi absentee franchise to keep me busy but I’m good. I can run this life until I’m dead. Why is everyone so messed up here? Take your wins and go home and be content. +My wife and I were at Panera eating breakfast and we noticed a lady be hind us talking on the phone very loudly. We couldn’t help over hearing her talk about a bill not being paid. We were a little annoyed but not a big deal because it was a public restaurant. We were not trying to listen but were shocked when she announced that she was about to read her card number. She then gave the card’s expiration date, security code, and her zip code. We clearly heard and if we were planning on stealing it she gave us plenty of notice to get a pen. + +Don’t read your personal information in public like this. You never know who is listening and who is writing stuff down. +**TL;DR**: Worked at FAANG company, went permanent remote in 2020 thanks to the pandemic, moved from Bay Area to Research Triangle, NC and as of recently I’ve resigned / FIREd (30s, $5M, engineering management). This Reddit group has been very helpful. There are plenty of posts on financial optimization of FIRE but in the spirit of giving back here are a few non-financial tips I’ve learned over the past few years in preparation for FIRE. + +**MINDFULNESS** + +Learn the basics of breathing exercises and use this as a way of managing stress and staying focused on what really matters (last thing you want to do is FIRE and then worry about your neighbors lawn as opposed to your life long dream). + +**Train yourself to not watch the market** + +Checking the market daily is an addiction and can inspire emotional decisions. Recognize watching the market daily lacks any merit as a long term investor. Uninstall stock market apps and make a point of checking the market once a week max and get back to focusing on your true purpose. + +**Stuff** + +Just because you can easily afford it doesn’t make it free. Eg A friend just bought a $80k car and on day two it got a dent. Now she’s worried about the dent and spending a substantial amount of mental energy on it. A used car would never require this mental focus. Be careful to not let stuff cost your time and focus. Time is now your largest commodity. + +Additionally, stuff is primarily for ego and when you have FIREd it’s rather easy and productive to be humble ( “fake it until you’ve made it.. But now you’ve made it so why are you still playing the part?”). If you are finding it difficult to make great friendships, it may be largely due to not being authentic and humble. Get rid of stuff and focus on experiences, hobbies and you will be far more inspiring for genuine friendships. + +**YOUR FINANCES SHOULD BE PRIVATE (with the exception of a public Reddit group apparently)** + +**No one cares** + +There seems to be an obsession in this group about what you will tell your neighbors. I’m the only Dad who is at the bus stop daily. I go to the gym at 10am with the college kids and retirees. Everyone is way too busy to care. People never ask about that. Just “how was your trip/weekend/hobby/kids?”. + +**What do you say when they say “what do you do for a living?”** + +Remote work is a great FIRE cover. I just say you work mostly remote in tech. 99% don’t ask any additional questions. For the 1%: In my spare time I happen to research science for personal goals so I just explain a little about my research and don’t get into business logistics. + +**Don’t talk about FIRE** + +If I was going to guess, though I’ve never tried, trying to explain FIRE to neighbors is received as well as selling them the newest MLM scam. Just don’t talk about money. When someone tells you they are doing amazing at job X, just lightly congratulate them and ask what they do for fun. You’ll appear humble and you’ll start a genuine friendship as opposed to a “what can I get from you” quest. + +**Family** + +I get that it’s harder to hide details from family. In my case, I’m taking an extended period off to do private research and focus on family. Presuming you’ve got to Chubby/Fatfire tiers they should respect that you can make reasonable decisions. The truth is none of us can predict the future and this is fair. Don’t talk about money/don’t explain it/it’s just your decision (there is never a right amount, you are either too rich and should help person X or too poor), now what side are they making for the holiday’s dinner? + +**SOCIAL LIFE** + +**Create new stories** + +We all know that guy who still talks about his high school days and how amazing he was. Don’t be that guy about your ex-job. No one cares that you were the CTO of some major corp. If you want genuine friendships, talk about what you did this week / future goals / current passions. + +**Get fit** + +Your health will likely run out before your money. Invest proportionally. Also sports (including hiking etc) are excellent social outlets. + +**Stop selling yourself** + +A big part of business is networking and selling yourself. In FIRE you don’t have to do this. Intentionally talk about hobbies, passions, personal goals and genuine friendships will follow. + +**Make sure you are retiring to something** + +As often quoted many people are retiring away from a job. Knowing what you are retiring to is key. This can be passive (enjoying national parks, music, art) and/or active (creating science, contributing to charities and beyond). Don’t pressure yourself to know the full story but have a plan for the first six months and be open to it morphing. + +**Final Thoughts** + +Read Man’s Search For Meaning by Viktor Frankl - ““Everything can be taken from a man but one thing: the last of the human freedoms — to choose one's attitude in any given set of circumstances, to choose one's own way.”” + +Original post: https://www.reddit.com/r/fatFIRE/comments/jzodth/moved\_from\_hcol\_to\_lcol\_during\_covid\_thanks\_to/ +[UPDATE: HOLY FUCKING SHIT, JPMORGAN IS PRIME BROKER TO MELVIN CAPITAL!!](https://m.imgur.com/PnxC5vh) + +Thanks to u/Longjumping_college for this find! + +TL;DR: Striking through the TD;LR not because it is incorrect, but because it doesn't give important details and some of the comments are still saying a fake squeeze could trigger margin calls. The strike through text remains if you understand why there won't be margin calls and just want the gist. If you are unclear about why margin calls are not feasible, please read the whole post. + + ~~The news of a squeeze over the holidays was put out by JPMorgan Chase, who, as a prime broker has every incentive to stop us from DRSing, and zero remaining incentive to issue margin calls.~~ + +------------------------------------‐-------------------------------------------- +EDIT: Fixed some of the math in my example. 20 million times 100k is 2 trillion, not 200 billion. + +EDIT 2: ~~I should note that even if by some miracle JP Morgan wasn't exposed on the prime brokerage side, they're still highly exposed as a DTCC member.~~ It appears JPMorgan Chase is no longer a DTCC member as of this year. I don't know how much that alleviates their exposure because I believe PB's are the first line, then DTCC. + +First, I want to explain prime brokerage for those of you unsure of what a prime broker is, it's generally a huge bank (Citigroup, Goldman Sachs, JPMorgan Chase, BoA, etc.) that offers prime brokerage services to hedge funds. + +Remember the scene in The Big Short where Jamie and Charlie get snubbed at that meeting in the lobby of JPMorgan Chase? They were trying to obtain a prime broker for their hedgefund, Brownfield Capital. (The IRL name was Cornwall Capital). + +Prime brokerages take orders from hedge funds and either place the orders on the market or fill them through their own inventory, or otherwise procure or create the assets requested by hedge funds. It's important to note that prime brokers have WAAAAYYYY more money than hedge funds. + +PB allows hedge funds to make special requests and saves them the time and labor of hunting down the investments they want on the market. But one of the most important things they do is allow HF's to buy on margin, so HF's don't have to move money around and put up the funds. + +Remember the scene where Michael Burry asks Goldman Sachs to write him a credit default swap to short the housing market? GS was his prime broker and they were able to sell him a tailor made financial product because he was their client. + +Now, the prime brokerage is responsible for covering any liabilities in the event the HF can't pay. So if they feel the HF is taking on too much risk, they can margin call them and ask them to post more collateral for their risk. If the HF fails the margin call, the PB can go after their assets. IIRC over this past year the DTCC made it easier to liquidate HF's that fail margin calls. But PB's still have to eat the difference, and with something as big as MOASS, it would be pretty stupid of them to margin call if they have to pay that difference. + +So prime brokers get paid by the hedgies for their services in several ways, which would be too time consuming right now and I'm too smooth brained to do a good job explaining it as I barely understand a lot of it myself. + +But here's the important takeaway: **Hedge funds that take on more risk provide much bigger profits and returns for their prime brokers.** + +This means the prime brokers had everyone incentive to play along with the shorting scheme over the past few years if they also believed the shorted companies would fail. And why would they margin call hedgies that are making them lots of money if they think the risks are overstated? It's a tale we see repeatedly now in finance. Big banks get greedy, take on foolish risks, get overleveraged, and regular people pay the price. + +------‐‐-------‐---------------------------------------------------------------- + +So I've read some comments saying a fake squeeze isn't possible because once the price gets to a certain point the shorts will lose control and have to close. And that *was* true before this got so big. But now, the people that would have asked them to cover their shorts have no incentive to do so and can try to just wait it out. They're not going to raise rates on borrowing the stock because that would blow up in their faces as well. + +And to get an idea of how fucked hedgies are and by extention the PB's, Citadel's hedge fund branch has $35 billion in AUM for example. Theyre obviously not the only SHF, but they're a big one. If the stock price hit 100k and only less than one third of the float (20 million shares) were sold, that's $2 trillion. That's more than **57** Citadels! But there aren't 57 Citadels, so Bank of America, Citadel's PB, would be responsible for the rest. Bank of America has Bank of America money, so this is good for apes. If MOASS were to drag BoA under, DTCC (whose members consists of banks that offer prime brokerage) would have to pay the rest. + +So this means the prime brokers would love a fake squeeze. That way they can sit back and not close, watch the price collapse afterwards, see retail leave, and then margin call their hedgies. Or not if the hedgies ended up making them lots of money. + +But if we DRS enough to make the fraudulently high number of synthetics obvious, then it becomes far too big for them to contain. The SEC and DOJ would have no choice but to act or watch all capital and IPO's evaporate from the US exchanges as they would be seen as being about as trustworthy as a North Korean stock exchange. And proving synthetics through DRS would entitle Gamestop and all its investors to all kinds of legal recourse. + +But now that the ball is rolling on DRS, the only way they can get people to stop registering and pull their shares out is if apes think MOASS is upon us. And after that it would nearly impossible to get everyone to put them back once the fake squeeze reduced retail's number of shares. + +Now, let's note that the news about an imminent squeeze was put out by JPMorgan Chase. As a PB we know they'll be holding the MOASS bag. So they need to stop us from DRSing ASAP or they're fucked! + +I also just want to note JPMorgan Chase's CEO, Jamie Dimon, is a comic book Wall Street villain. He makes Ken Griffin look like a quaint local businessman who owns the local Mom and Pop shop instead of a super-powered owner of a finance monopoly. Dimon's scumbaggery is worth a google. +Hi, please excuse me should this post be formatted badly. + +As the title states, I am on a relatively good salary but still struggle to save a meaningful amount. +I’ve been through all my expenses and just can’t work out how I could save more or even just break even regularly. Living on my own. + +**Expenses (mthly)** + +Rent: £750 +I’ve been looking to downsize but all flats in my area are £700 and up. Moving farther would possibly make that £600+ but I’d have to commute more too. One option would be getting a flat mate, as I have a small second bed room. + +Council Tax: £165 +Energy: £110 + +Car loan: £145 +Paying it off in one go wouldn’t save more money as I’d gave to go in my ISA savings, which would mean I’d lose more on my accumulated interest than I’d save on not paying those £145 anymore (12mths left on loan) +Petrol: £100-150 + +Mobile phone: £45 +Same situation as the car + +Pets incl. insurance: £100 + +ISA: £300 +Gym: £40 +Food: £320 + +Thats roughly £2125 of expenses every month, which leaves me with £175 left to spend freely (toiletries, clothes, social events) + + +Am I ridiculously stupid with money? What am I missing? + + +**UPDATE** + +Thanks everybody for your help. It turns out I am mildly stupid with money. + +- Car loan: I’ll take some of my ISA savings and pay off the loan. Of the monthly £145 I save I’ll put £100 extra on the ISA, making it £400 + +- Food: I’ll be more careful and reduce spending, opening up some room to get my 3 months emergency budget sorted. + +- Housing: Not feeling comfortable with the idea of having a flat mate at the moment. I’ll address the other issues first and see how things are + + +Thanks again! +Do not take these government payments for granted. Not saying that you all will, but there will be a percentage who believe they are entitled to them and will forget all of this when the virus settles and the economy is back on track. + +Remember that these payments are always necessary to segments of the community and try and imagine you were someone on the much lower newstart payments before all of this happened or how you would be surviving if it didn’t exist in the first place. Don’t forget they stimulate the economy in their own way and are purposed to allow vulnerable Australians have a reasonable standard of living. This counts for all of the government stimulus packages. + +Think twice before voting for people that want to demonise those on welfare, particularly when a large percent are not by choice. + +I have always backed government welfare programs for the less fortunate and continue to do so now for everyone even though I have safe employment. Even though my taxes are paying for this I’m proud that I can help in some way. + +There are a lot of people that never would have imagined themselves in this position and have previously questioned why their money should go to those who do not have jobs. Might be a bit of a reality check to some. + +Remember too there are a lot of countries that would allow their people to starve without any benefits so I am grateful. + +I wish you all the best and hopefully we can all get through this if we work together and treat each other with dignity and respect. + +EDIT: Didn’t imagine this post would blow up. + +I’d also like to remind those collecting benefits for the first time to factor in the toll losing your job/ the uncertainty takes on your mental health and compare that to the small few on welfare that have the same mental health issues and end up resorting to substance abuse as a result. + +Don’t judge those for complaining to the government about exorbitant house prices when some just want a stable home. + +Take into account essential services, ambos, doctors, firies, nurses, police, teachers, retail workers and don’t be judgemental when they ask for a pay rise or demonise them when they are at work just trying to do their job. + +We need a society with less judgement and more caring, moving forward from this disaster. +If you google “how does Renaissance Technologies’ Medallion Fund make +70% annually” you’ll mostly get a rehash of the same talking points: +- They hire mathematicians and computer scientists, not investment managers. +- Only their ~300 employees can invest in it. +- They cap the fund at 10B, disbursing all additional profits instead of reinvesting. +- They only win approximately 51% of trades. +- They have very high leverage. +- It’s all automated. +- They consume enormous amounts of data. + +But what exactly are they doing? I know of 3 good sources of detailed information: +1. [This Twitter thread](https://twitter.com/TrungTPhan/status/1424399014204637186) +2. [This Senate hearing document](https://www.hsgac.senate.gov/imo/media/doc/STMT%20-%20Renaissance%20(July%2022%202014)2.pdf), related to a tax dispute between RenTec and the IRS. +3. [This Quora answer](https://www.quora.com/What-are-the-investment-strategies-of-James-Simons-Renaissance-Technologies-I-understand-he-employs-complex-mathematical-models-along-with-statistical-analyses-to-predict-non-equilibrium-changes/answer/James-Baker-69?ch=15&oid=15556100&share=00bcc844&target_type=answer). This has the most technical details. + +I thought I’d put all this together in a somewhat easier form to digest. (Maybe this is all commonly known here, but it was new to me.) + +Suppose you went to the bank and asked for a loan for your investment business, whose strategy is entirely “invest in SPY”. SPY has volatility of 20% annualized, so the bank might charge you annual interest of 10%. Since SPY only does +10% on average per year, you’re left with net 0% profit on average. Bummer. + +For a margin loan like this, the interest rate is going to depend on the volatility of the instrument. Unfortunately, low volatility generally means low returns. So the only way you’ll get very low interest margin (i.e. high leverage) is to trade something that has very low returns, which sort of defeats the point. + +The light-bulb moment here is that if you can decrease volatility “further” than you decrease returns, the higher leverage via margin will compensate for the low returns. For example, suppose you crafted a basket of long and short positions in various stocks that had only a net return of +1% but an almost negligible volatility of 0.1%. On its own this isn’t very useful (it doesn’t come close to SPY’s 10% return) but that low volatility might allow you to arrange a whopping 70x margin. Suddenly you have a +70x return! + +But how to actually arrange such enormous margin? The bank is probably unwilling to hand you 700B in cash to trade with, no matter how low the volatility in your basket is. Instead you have the bank write you a hedged, cash-settled, European-style barrier option. The way it works is this: +- You tell the bank what positions go in the basket. +- The bank prices and sells you an option for some number of units of the basket at an agreed-upon strike. The bank also buys units of the basket to delta hedge. +- If, at expiration, the value of the basket has gone up the relatively small amount you predicted, you exercise and profit greatly from the leverage. The bank makes a profit too, from their delta-hedged holdings, but it’s capped at the difference between their mean buy-in price and the strike. +- If, at *any* time, the value of the basket drops below the agreed-upon barrier threshold, the option is terminated. You lose the premium you paid and the bank loses the difference between the buy-in price and the current price of the basket. + +This is what the Medallion Fund does. They consume all sorts of data sources and use a lot of mathematics and computer science to look for “tradable effects”: detectable, repeatable events that correlate to future movement of a stock, and then use those effects to produce a “reference portfolio” of long and short positions. The reference portfolio changes constantly from second-to-second as hundreds of tradable effects are fused together in real-time. They buy barrier options on the reference portfolio from Deutsche and Barclays and then stream changes to the reference portfolio back to them so they can stay hedged. (Deutsche and Barclays actually pay *RenTec* to handle the mechanics of hedging the reference portfolio for them! Talk about win-win!) + +This all works because the banks can *literally* create new money in the form of loans. (In fact, most money in the US is created by private banks.) So they can offer enormous margin in the form of options so long as they can clearly define their risk (via the barrier clause), necessary to ensure they meet government regs for holdings. + +It’s perfectly possible for any individual to find tradable effects just like RenTec does: find data (maybe weather reports), look for a relationship to future securities prices (how about agriculture company stock prices) and build a predicative model. Repeat until you find one that works. I’m no data scientist but I imagine with some effort I could find one or two of these per year. But to turn them from a +1% strategy into a +70% fund requires finding hundreds of these effects, fusing them all together into a model that predicts a reference portfolio with ultra-low volatility, establishing a relationship with investment banks and getting options written against the reference portfolio, providing real-time hedging on behalf of the banks, model those options and devise an exercising strategy, and then doing it year after year as the tradable effects and financial landscape evolves. + +As for keeping the fund at 10B and no outside money, it follows pretty logically from the high leverage. If they took on 10x the cash they’d need 10x the options and the underlying price action caused by the resulting hedging could swamp the tradable effects. They could scale themselves out of their own system. So they chose to make a limited number of people ultra-rich instead. And if you want to keep all your tradable effects and models and relationships secret, why not choose your *employees* to be those 300 people? + +That’s all I’ve been able to gather about the Medallion Fund. The details of how the reference portfolio is built, the strategies they use to find tradable effects, the tools and models they use to fuse them, and how the option strikes/dates are chosen is a mystery to me, but it doesn’t really matter in the sense that it’s not like I can replicate this in my garage. But just for knowledge sake I’d appreciate any insight anybody might have! +From 2-4%, rental yields are one of the lowest in the world. + +In USA, its usually 8-12%, that too with 2% home loan rates. + +if you are getting only 2-3% of the total property value's worth of rent in a year, it is far less than FDs (6%) and stock index funds(11-13%) + +add maintenance, taxes on rent, etc. you are basically loosing money. + +After 20 years, most apartments turn into pretty bad shape. their resale value drops and so does the rent (who would pay top rent for a 20 year old apartment) ? + +So why do IT sector folks keep buying apartments on EMI in bangalore if the EMI itself cannot be paid using rent (say EMI is 25k, rent is just 12k) + + +[https://www.99acres.com/articles/99acres-insite-5-best-localities-to-earn-high-rental-returns-in-bangalore.html](https://www.99acres.com/articles/99acres-insite-5-best-localities-to-earn-high-rental-returns-in-bangalore.html) +Hi, first post here. Long story short, DeKalb county (GA) recently contacted me to inform me that half an acre in a residential area that my father purchased in the 70’s is about to go up for auction in less than two weeks unless I/we’re willing to pay the property taxes that are past due. The total is less than $2k and it seems like a no brainer but I would like any advice before I cough up the cash I.e. the possibility of other leans against it, do I contact an attorney etc. I’ve never owned land before and am admitting to being a complete novice in this field in addition to being skeptical. Any and all advice is welcomed and appreciated. Thanks! +I’m dreaming of telling the corporate world to go to hell, and wondering how I can achieve this lofty goal. Seems like a boatload of money needed upfront to make 1k per week in dividend payout a reality. +I'm mostly interested in inequality economics, conductual economics, marketing, finance and game theory but I could read any good book about economics. +[3YR Performance](https://i.imgur.com/Dh7Uy8k.png) + +**Thetagang Proverbs We Have All Forgotten:** + +* The Wheel is for preserving wealth NOT building it (buy/hold outperforms) +* Stop saying "The Wheel" when you are actually writing naked puts (naked puts are NOT CSPs) +* Don't try and time the market with your "red days" (I'm talking to you, summer 2020 cash gang) +* Resist being delta neutral (markets go up) +* Don't buy back your CC for a loss +* Max out your tax advantaged accounts (401k/IRA/HSA) before adding to your taxable brokerage account + +\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\* + +**2021 Performance Details** + +* [NLV Chart (+126% YTD, +$714k)](https://i.imgur.com/LBjpED4.png) + * $60k withdrawal 5/3 (2020 taxes) + * $20k deposit 6/1 + * $150k withdrawal 11/24 (Xmas gifts) +* [Month, Quarter, and YTD Performance vs. SPY](https://i.imgur.com/bbATpWF.png) +* [Biggest Winning Tickers](https://i.imgur.com/rqiBoBf.png) +* [Biggest Losing Tickers](https://i.imgur.com/5O3D1r0.png) + +**2021 Account Details** + +* PM account w/ TOS +* $1.054M NLV + * $618k long SPY + * $472k cash + * \+232/-400 XLNX/AMD (merger play) + * $34k extrinsic options value +* $56k commissions and fees ($0.3/contract) + +**The 2021 Playbook** + +* **Strategy #1 - Long SPY (15% of 2021 Gains)** + * **Background**: I am a traditional 100% buy/hold SP500 investor so I always want to maintain good exposure to the market while using the collateral for option-based strategies. + * **The Trade**: Buy SPY equivalent to 70% of NLV. + * **Management**: Re-invest premiums from theta plays and/or cash deposits at the end of every month to maintain desired exposure. + * **Notes**: Don't try and time the market! +* **Strategy #2 - /ES Strangles (15% of 2021 Gains)** + * **Background**: I switched to /ES from SPX in July of 2021 (see comparison and reasoning [here](https://www.reddit.com/r/PMTraders/comments/old2e0/comment/h5en299/?utm_source=share&utm_medium=web2x&context=3)) and use a very similar strategy which is detailed in my [2020 Recap Post](https://www.reddit.com/r/thetagang/comments/kf9txl/2020_performance_and_strategy_recap/?utm_source=share&utm_medium=web2x&context=3). + * **The Trade**: Every week, write a /ES strangle 45DTE. Number of contracts and delta are determined by desired yield and account size. My target return is 12%/year with these. This is currently putting me at 4 contracts around 5 delta. + * **Management**: For the short puts, I will add another position if the original is >21DTE and >50% profit. The new position delta/size will be determined by the strangle delta, total /ES position delta, and total portfolio delta. I will close any short put for a loss if <-300% and re-open at similar delta/size if >21DTE. For the short calls, I will close for a loss if <-500% and re-open at similar delta/size if >21DTE. If these are getting tested near expiration, I will close for whatever gain/loss at the time to avoid gamma risk. Otherwise, I will let them expire worthless. + * **Notes**: [Spintwig](https://spintwig.com/spy-short-call-strategy-performance/) has taught us that SPY 45DTE short calls are not profitable. The 5 delta are almost breakeven. But I'm willing to live with that as this adds a little negative delta to my otherwise super positive portfolio delta. +* **Strategy #3 - Short Puts on Individual Equities (20% of 2021 Gains)** + * **Background**: This is just your basic CSP stuff here except naked (cash secured is not capital efficient and cannot beat buy/hold). I try to diversify amidst all the major sectors. + * **The Trade**: Write 45DTE, 20 delta short puts. Size the number of contracts to use no more than 1% BPR. + * **Management**: Pretty standard TW exit/rolling techniques here. Will look to start taking profits around 50%+ if the DTE trade-off is worth it. I'll also take profits if it's 30%+ in a few days and/or earnings are coming up. If ITM and decent extrinsic value left, I will wait to roll until expiration day upon which I will roll to the next monthly for a credit choosing a strike based upon my sentiment. If it's deep ITM, I will look for a high IV day to roll. Of course, I'll only roll if I'm still bullish on the underlying. I avoid taking assignment at all costs. + * **Notes**: The 1% position sizing is important. If 1 position goes bad (and it will), my whole portfolio isn't stuck in the mud. I also used to add short calls as defense (5-10 delta) when my short puts went -100% but I rarely do this anymore due to whipsaw. Also, regarding earnings, as long as the ER isn't within 2 weeks, I don't care. +* **Strategy #4 - Selling Lottos (50% of 2021 Gains)** + +I'm just going to copy/paste my detailed comment from the [lotto thread](https://www.reddit.com/r/PMTraders/comments/pr84cp/lets_talk_about_lottos/?utm_source=share&utm_medium=web2x&context=3) earlier this year: + +**DTE and strike** + +|DTE|Strike| +|:-|:-| +|0DTE|25%+ OTM| +|1-2DTE|35%+ OTM| +|3-4DTE|40%+ OTM| +|7-9DTE|50%+ OTM| + +**Exclusion list** + +* No earnings or binary events within DTE timeframe + * Note some underlyings are closely correlated with others so have to be careful when these others have ER (ie DKNG w/ PENN, ROKU w/ NFLX, etc.) +* Exclude biotech, memes, WSB faves (old and new), new IPOs, low market cap (<$10B), high short float (>10%), etc. +* Check for news within 2 weeks for red flags (buyout rumors, SP inclusion, etc.) +* Check the 1YR plot and verify it doesn't look like an EKG chart + +**Position sizing** + +* All of the below analysis is done in TOS via "Analyze" tab before sending any order and is what determines the max number of contracts + * Stress the position up/down to the strike and make sure the analyzed BPR would not cause a margin call + * Stress the position up/down to the strike and make sure that |PNR|>|EPR| + * Check other [TOS PM house rules](https://www.reddit.com/r/PMTraders/comments/q4phpl/td_ameritrade_additional_portfolio_margin_house/) (mainly SPX beta test and short unit test unless 0DTE) + +**Management** + +* Techniques to use when getting tested + * Buy/short shares + * Write puts/calls to delta hedge + * Convert into a spread (likely locks in a loss) + * Roll out to next week (only do this if strikes are high enough and IV is still elevated) +* Hard stop at -1000% + +**Hedging (new for 2022)** + +* As I have decided to go full blown into lotto short puts in addition to calls, I want 6-sigma hedges. So, every week I will buy SPY 30DTE 10%OTM puts using 10% of my farthest dated short put lotto premium (maybe just use 5% of total lotto premium for furthest lotto DTE to make the math easier). + +\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\* + +* **Leverage** + +|VIX|Max BPu|Max Delta Leverage (SPY Beta Weighted Delta / NLV x SPY)| +|:-|:-|:-| +|40+|50%|2.5X| +|30-40|40%|2.25X| +|20-30|35%|2X| +|15-20|30%|1.75X| +|10-15|25%|1.5X| + +Note that I don't include lottos in my BPu due to reasoning below: + +When I check and report my BPu, I will actually de-select all my lotto positions on TOS. Why? Because only a market crash down has the potential to margin call me. So all of my lotto naked calls (usually around 70%) are safe - BPu will shrink on these in such a scenario or I could close out for a penny if needed. The remaining lotto puts (30%), are potentially far enough OTM and short enough DTE that I can ride those out. But I’m fully willing to close these for big losses in such a black swan scenario. + +* **Black Swan Hedges** + * **Background**: I still have PTSD from 3/12/20. + * **The Trade**: When VIX > $20, buy 7DTE, 10% OTM puts every week for 0.04% of NLV. When VIX < $20, buy 30DTE, 20% OTM puts every week for 0.04% of NLV. Also, when VIX < $15, buy 120DTE, 10 delta VIX calls every month for 0.08% of net liq. Do the math and this is a total of 3%/year portfolio drag. + * **Management**: Hopefully these expire worthless until I'm dead. But if not, I'll only close these for profit if I'm closing other positions for loss. TBH, I'm not entirely sure how I'll manage these when the next 6-sigma event happens, but I know I'll be glad I had them. + * **Notes**: VIX hedge based on [Option Alpha YouTube Video](https://www.youtube.com/watch?v=-luY8MHgYW0). SPY long put hedge based on my own back-testing and stress-testing. + +**The 2022 Playbook** + +* **If 100% WFH (current status)** + * Strategy #1 - up to 90%+ long SPY + * Strategy #2 - look to put on 90DTE/10delta short puts for 1% APY only on those 30%+ VIX days + * Strategy #3 - remove completely (too much work, too easy to collect bags) + * Strategy #4 - FULL SEND +* **If Hybrid WFH (eventual status w/ current employer)** + * Strategy #1 - same as 2021 + * Strategy #2 - same as 2021 but up yield target to 18%-24%/year + * Strategy #3 - remove completely (too much work, too easy to collect bags) + * Strategy #4 - "lotto-lite" 😅 +* **If 100% WFO (hypothetical)** + * Strategy #1 - same as 2021 + * Strategy #2 - same as 2021 but up yield target to 24%/year, also look to put on 90DTE/10delta short puts for 1% APY on those 30%+ VIX days + * Strategy #3 - remove completely (too much work, too easy to collect bags) + * Strategy #4 - remove completely +Obligatory data: 45m married with four kids in LCOL Midwest. NW of 11m. Up from 6m 2.5 years ago when I exited my tech service company. No YOLO bets involved (Not that those are bad). + +There is always some level of curiosity on the journey each of us is on to (or already at) FATFire. So I thought I would share my story so far, hopefully to reiterate that the American Dream is alive and well for those willing to pursue it. I’ll do my best to share lessons learned at the end. I would love for the result of this to be for others to share their journey, and inspire those on a FATFire journey right now. + +Be warned…this is a long ass post. I enjoy reading long detailed posts…so those of you who also enjoy that…this is for you! + +TLDR: Started with nothing, worked hard, caught some lucky breaks, FATFI…still working on the RE part. + +***Childhood / Young Adult*** + +I grew up in a family of six, where I was the middle of three boys..with a younger sister coming along later. We relocated to the Midwest when I was 10…and some of my first memories after moving were jobs. I immediately wanted some spending money for baseball cards and ultimately a Nintendo. My family was not the kind that had money laying around, so anything I wanted I had to earn. By time I was 12 I had two paper routes, mowed lawns, and sold Current (stationary) door to door in the neighborhood. Working was something that came naturally. I worked a variety of jobs through high school and college…never working less than 20 hours a week and full time in the summers. + +I was an average student in high school and college. I loved my high school history classes, so I progressed to a History major in college, eventually choosing the route of History Teacher over going into Law School. In school I was always socially middle class. Combine that with my middle child syndrome of just wanting to be liked, and it was an interesting journey through school. I picked up a love of computers through high school (first computer was a C64) and college…at one point teaching computer classes to little kids and senior citizens. That became critical later. I graduated and off I went to my first job teaching. + +***Professional Wandering*** + +I was convinced I wanted to be a high school teacher…and proceeded to be just that. IT SUCKED. I was not prepared for the challenges that classroom control (behavior) would present. Lacking a high level of self-confidence at that point, and lack of mastery that a seasoned educator would have…I got ran over. Stuck with it for three years…and those were three very long years. Towards the end of year three, I saw an opportunity to transition into a Helpdesk IT job at a local company and jumped at it. + +My IT career spanned two years, as an in-house IT person for two local healthcare companies. I learned a TON about IT support, and really enjoyed making people’s day by fixing their issues. During those two years, I had my first two entrepreneurial experiences that would fuel my long term desire to make that my career calling. + +***Everquest*** + +So in college I got sucked into computer gaming, and that continued during my time teaching. Everquest was the first MMORPG that I really fell in love with, and I played that game WAY too much. Ultimately was in a big guild where everyone shared accounts, and had access to a lot of dormant accounts. I began to notice that there was a real economy in the game, and people bought a lot of virtual things with real money. My mind was always working to figure out ways to make money…and this one hit a sweet spot. + +My first time dipping my toes into selling things was when there was a particular NPC in the game (Lodizal) that took a group to kill, and no one could figure out how often it spawned. But the item it dropped 100% of the time was worth about $500 in the real world. Since I had access to dormant high powered accounts, I decided if I could figure out the spawn time, I could pop $500 each time. So I setup three computers side by side, and camped a character at the spawn point and started logging every spawn in an excel spreadsheet. Eventually, I figured out the timing and would literally be at my computer every potential spawn time. After a month or two of this (and making 3-5k), I got tired of getting up in the middle of the night, or running home from work to be there for a spawn. So I setup a log parser and had a super loud alarm go off every time the NPC spawned and said its specific text in the chat box. Bingo. + +As I learned more about the market, I realized that people quitting the game would sell their characters for about 30-40% of what I could sell everything individually for. While online auctions for virtual items in Everquest were banned on Ebay, they were alive and well on a site called Playerauctions. So as my first REAL business, I would buy people’s characters (typical purchase was between $500-1500), strip all the items off, sell them for in-game currency, then sell the currency for real money. Eventually even had a website ([www.lootpal.com](https://www.lootpal.com)). Over 18 months, sold 360k of virtual things, for a profit of 160k. Sadly…all good things come to an end, and the Chinese farming companies moved in and devalued the currency so much that it no longer made sense to do what I was doing. Sold off the last of my inventory and closed out that little entrepreneurial journey. + +***IT Support Company (Try 1)*** + +While in my second IT job (and at the tail end of my Everquest business), I really wanted to start my own IT Support business. I just had no real good idea on how to do it. So, I got a separate phone number, and put an ad in the newspaper! $25/hour IT support. I got one customer. Did his IT support for about a year…but never got more than that. Eventually, cancelled the ad and the phone number. #fail + +***Sales*** + +After doing IT support for two years, and having the successful Everquest business, I decided to try my hand at sales. So I got a job as a pharmaceutical sales rep. Little did I know that job was much more marketing and much less sales. About six months in I realized that hard work did not equal results in that industry and started looking for what was next. Here was one of the first BIG luck moments in my life. In that industry, you give physicians big “speaking grants” to come tell other doctors to write more of your medication. Its all one big circle jerk, but everyone got money out of it..and it wasn’t my money so whatever. I met this physician on Thursday who was doing a Dinner, then we were traveling to do a breakfast presentation and a lunch presentation the next day. We talked about technology in healthcare (which I had prior experience in), and had a great time. At the end of the last presentation, we sat down at a coffee shop…and before we know it he asked if I was interested in starting an IT Support company with him! BOOM! Within 60 days, I had quit my job and I was off on a wild entrepreneurial ride. + +***IT Support Company (2nd Try) – 28yo*** + +This worked a lot better than the first time. We had a built in customer (my business partner’s physician practice). We also had great timing / luck, as we started the business in 2003…the dawn of the Electronic Medical Record. Physician practices, which I had strong knowledge of, were transforming from companies that used technology sparingly to needing technology every. The government was ramping up requirements, and physician practices were a perfect customer…they had the money and they pretty much had to implement the technology. The IT Support company grew from just me, to me and two full time employees. The only problem was that I was always going to be a minority partner to the physician. The larger more stable the company, the better chance I had of being voted off the island in the future. I knew that long term this wasn’t going to work. + +Fortunately, I met a very entrepreneurial guy who ran his own solo IT company..and he also specialized in healthcare. Over the next 90 days, we decided we would make good business partners. I bought out my physician partner, and we started a new business with the combination of our two. Up until now…my total yearly income had never eclipsed 60k/year. + +***IT Support Company (3rd Try) – 31yo*** + +If at first you don’t succeed, try…try again. Third time was the charm. My business partner and I started this business with about 450k in revenue. Year one we grew to 1.5m, then 3m the next year, and 4.5m the next. The keys to growth were a combination of a phenomenal engineering / tech team, excellent tailwinds from a growing industry, and a strong sales team (my specialty). There is a glass ceiling in the IT support industry at about 3-5m in revenue…mostly because these companies are started by engineers who aren’t strong at sales. So they cap out due to a lack of being willing / knowing how to build a sales team. We blew through the glass ceiling because we committed to building a sales team…and got lucky with some really talented sales people early on. + +We also learned some important lessons about cash flow early on. We were so focused on top line revenue growth…and lacked the business sophistication to know better…that we neglected our bottom line. We convinced ourselves that investing in growth was why we weren’t making any Net Income…but it brought us close to death from indigestion. The year we booked 3m in revenue, we booked…$3,000 in net income. Whoops. Because of how we handled our invoicing and procurement…we ran dangerously close to running out of money, despite being a rapidly growing company. If it wasn’t for my business partner’s grandma (who lent us $50,000), and a community bank who eventually gave us a 300k LOC, we may have missed a payroll. Lesson learned. + +A key move for us during this time was getting involved in a peer group for IT companies. This was a HUGE factor that gave us access to companies that had the same challenges…and were where we wanted to be (larger). We soaked up every bit of information we could…and implemented countless things learned. Things really started to gain steam. Now we were one of the larger companies in the area…and the flywheel was really starting to turn (Jim Collins reference). + +We grew constantly, year over year, for the first 9 years in business. At one point we had a streak of 8 years in a row on the Inc5000 list of the fastest growing companies. That was pretty cool. There were always challenges, but we had a great team that was constantly up to the challenge. In 2013, someone recommended a book to me that included the concept of “start with the end in mind.” It made me think of what the “end” looked like for me. I knew 100% of my eggs were in one basket, and I had seen many a business owner go from dust to dust. What did my end look like? I decided that I needed to determine that, and came up with the three things that would signal the “end” for this entrepreneurial adventure. (1) The business had to have a leadership team in place so that it would be successful without me, (2) I wanted to sell my 50% internally either to my business partner, the leadership team, or ESOP, and finally (3) it had to be worth my number…mid seven figures. + +In 2018, I realized that I had hit all three of my factors that had signaled the end. But much like many of us on the FATFire journey…how much is enough? Can you really leave a company when things are going smoothly, and you are growing? Then I read this blog post. ([https://www.becomingminimalist.com/jump/](https://www.becomingminimalist.com/jump/)). I knew I had to jump. My wife was critical at this point in giving me the confident reassurance around that move. + +In July 2018 I sold my 50% to my business partner for 6m. + +Seeing the dollars hit the bank account was almost a little anticlimactic. Five minutes of euphoria, followed by “Well, what next?” LOL. One of the key things it DID do for me, was improve my overall stress. When 95% of your net worth is tied up in a business that could be broadsided by who knows what…that’s stressful! Removing that stress was incredible. Leading up to the sale, I had been researching investments…as I felt a strong desire to invest in SOMETHING so that I wasn’t negative cash flow until I figured out what was next. On one of the due diligence calls on a real estate deal…I met a guy who had sold a number of businesses, and he told me “The most important thing I can tell you, is to not make ANY big decisions for six months.” He went on to talk about how I would THINK I knew what I wanted to do…but give it six months and it is almost guaranteed to be different. Great advice…that I ignored at the time. + +***Consulting*** + +During the run at the IT Company #3, one of the key things we had done around 2015 was to implement a system called Traction (Book by Gino Wickman). We hired a professional who helped us implement it, and it had a profound impact on our continued growth and maturation as a company. As my wife and I considered what we were going to do next (she had left her job in public schools as a psychologist), we thought we may enjoy helping other leadership teams / companies implement Traction. So we did. We quickly clients…and still work with most of those today. That has been an incredibly rewarding pursuit, seeing each of these companies accomplish things they wanted to through the implementation of Traction. Highly recommend to any business with 10-250 employees. + +***Finding The Next Entrepreneurial Journey*** + +The consulting scratched our itch for something to do with our time…but not what to do with our money. I’ve always been horrible at passive investing. I like to invest where I feel like I can use my passion and skills to impact the investment. At first, we thought we would just purchase some commercial real estate and collect the checks. But the more we looked, the less we liked that. It was hard to find a return better than 10%, and I didn’t have any particular skills in that area. So by early 2019 we abandoned that idea. + +We took some time to analyze the combination of (1) what were we good at, (2) what were we passionate about, and (3) what could we make money doing. We emerged from that with the clarity that buying companies and working with their leadership teams to grow companies would be a great fit for our next entrepreneurial adventure. It also would contribute to being diversified, through owning multiple companies. So off we went. + +***Baby Private Equity*** + +So the best term for what we are doing is Private Equity…but we aren’t taking on other people’s money…and we’re smaller than typical Private Equity. But if I don’t call it that, its hard to explain quickly what we do. + +Since I had never bought a business (Only sold), I had a lot to learn. I started reading, and consumed a massive amount of information on acquiring a business. My background in running a number of businesses also gave me a good playbook for what to look for through a due diligence process, and there is a lot of information available on the interwebs. Ready to rock and roll, it was time to find business #1. + +***Business #1*** + +I started combing through online business listings looking for a company that would be a good fit. We knew what type of business we didn’t want (daycares, gyms, hospitality, automotive)…so that helped a bit. After reviewing hundreds of listings, I realized that in the size of businesses I was looking at (2-6m purchase price), replacing the active owner was the really hard part. So I switched gears and started looking for absentee owned businesses…and BINGO. Hit on a Flooring company based in the SW. Price was a bit high, but the company was well-run, good GM in place, and had consistently grown revenue year over year for their entire 12 year existence. The factors that I took into account to buy this business: + +* Critical Mass – Enough revenue, staff, customers that it wasn’t fragile or owner-centric +* Growth – Growing year over year top and bottom line revenue +* Market – Located in a city where we can 3-5x the company +* Team – Solid leadership team in place +* Transition – Almost no transition risk because the previous owner was absentee and completely disengaged from the business +* Industry – No real disruption on the horizon for that industr + +We closed on the purchase April 1, 2019 for a purchase price of 4.5m. For those of you who love details, revenue was 8.5m with EBTIDA of 950k in the previous year, so paid just over a 4.5x multiple. I put 1.5m down, did an owner carryback note for 20% of the purchase price, and financed the remaining 50% with a community bank I had a solid relationship with (and now is my primary financing partner). The day of the sale I injected an additional 150k into the business for cash flow purposes. + +Fast forward two years later, and this business is rocking and rolling. GM has really stepped up as a leader…and is focused on scaling the business the right way. Total debt paid down to approximately 2.3m from the initial 3m, and they are cash flowing significantly. Should finish this year around 11.5m in revenue with 1.2m in EBITDA. We have realized an approximate 35%+ ROI on our cash invested from post-tax cash flow and principal paydown, not including an increased valuation. The other major benefit of the transaction is the amount of the purchase price allocated to assets gives us the ability to take accelerated depreciation to drop our taxable income. Overall this is an ideal investment for us…over 35% YoY investment, with business value increase stacked on top. Looking forward to a long hold on this one + +***Business #2*** + +One year after adding business #1, it was time to start looking for a second investment. An early post-sale investment I had made in a REIT was redeemable (1.5m), and with the returns from business #1, I wanted to continue to buy businesses. Begun the search…and connected with a guy who was connected in a tier 2 market. He threw a bunch of things at me…but the first one to stick was a house painting franchise. It was operating smoothly, but the owner / operator was looking to move and needed to sell. I had a GM candidate who I knew personally that I believed would be an excellent GM…and this was a small / starter deal that would give him a chance to shine. So we pulled the trigger…likely without enough due diligence + +Closed the deal at the end of July, 2020. 350k purchase price, with 50k being an earn out tied to cooperation and the two employees staying. Business had done around 800k previous year with 100k NI. First week, existing sales guy quits. New GM starts after two weeks, and brings on another sales guy. So now three people…sales guy, ops, and GM. Team is in place. Just execute the franchise business plan right? + +Well…this one has been a struggle. We were staffed for the 8 great months out of the year…but Nov-Mar was a DUMPSTER FIRE. Tried doing interior work…got outbid. The work we did do wasn’t profitable. I injected 150k into the business because (1) we were overstaffed and (2) we were getting our asses handed to us in a variety of ways. Our Holding Company team (more on that later) has worked hard to make this one work…but feels like the franchisor fights us every move we make. + +I still think this one has the potential to get to 3m in revenue and 300k in NI…but they are a long ways off right now. Good news…its our smallest bet. + +***Business #3*** + +THIS is where it starts getting exciting. We now had around 1.5-2m in cash, and it was time to do another good sized investment. I had been searching myself for the past 3-5 months with limited success. However I had connected with a buy-side broker who I liked, and seemed like they may be a good fit to find us a lower multiple transaction than what I had paid the first time (4.5x EBITDA). So…we engaged to have them look for a business for us. + +Things got off to a quick start with the new buy-side broker. They threw 4-5 deals at us to look at, and we had a couple calls with owners…but within two weeks they had a large flooring company (we know a lot about those now, and loved the idea of another one) in north central US. The company was distressed, as they had gotten beat up by covid-related slowdown quite a bit. The owner was ready to get out after 22 years. They were doing around 14-15m in revenue with 800k ebitda pre-covid. They had a valuation of 3.6m….but as I mentioned they were not having a good 2020. Their plan was to try to break even. + +As we evaluated the deal, we were able to identify some core things they were doing functionally that we could quickly rectify post-purchase. We met with the two key leadership team members, and felt great about their ability to lead the company in the future. Looked at their stores and saw stores that just looked old / stale, and needed to be updated. We knew we would need to put time…and quite possibly money into this deal. So we wrote an offer. + +Slammed an offer in at 2m (basically 3.5x their 3 year average EBITDA including YTD 2020). I was sure they would tell us to F off…but they didn’t! Counter at 2.25 and we signed it as fast as we could. Due diligence was a little messy as we uncovered some more issues…but we realized that properly ran this company could be a 15m company at 1.1m EBITDA with the infrastructure (10+ locations) and upside to be a 30-50m company long term. Funny note…tried to renegotiate price down once I realized how much I would need to put into renovating the stores…and the owner almost walked away. Whoops. Finalized the deal and off we went. + +This deal has turned into a rocket ship (To The Moon #WSB). The leadership team took OFF once they understood they were empowered to make decisions. We implemented Traction (Book by Gino Wickman) that gave us a clear vision, responsibilities, and values for the company. Off they went. We set a budget of 17m in revenue, and they are currently on pace for closer to 20m in revenue with 1.5m NI. + +***Holding Company*** + +Through deals #1-3, my wife and I were the only ones at the holding company level. Our intention was to build out our holding company with a team that would work with our acquired companies to help them grow and be successful. Acquiring #3 allowed us to begin that process. We hired a rockstar marketing person who has amplified marketing across our three companies. Our second hire was a very fortunate one…a longtime acquaintance in my previous industry shook free from his company and was considering retiring. Fortunately he saw the fun / challenge in what we were doing (acquiring and building great companies), and he is the perfect partner for me to work with. He is a phenomenal coach, loves setting big goals and then working with teams to build structure to accomplish that. We have a CFO starting in a week that will work with the financial leaders in each of our companies…and help with overall financial management of the holding company. Together we can also be more thorough in our future acquisitions, instead of being a one-man-band. + +We set some big goals for the next 5-10 years, culminating with the goal of having 300m in revenue and 30m in net income. We will acquire one company a year to stay on pace to do that. Our biggest question right now is whether we want to continue to acquire flooring companies to create something really unique and strong in that industry. We already have some massive competitive advantages at our size, if we continue to add flooring we could really gain steam. On the downside of that…we are concentrated in one industry (scary). No decision on this yet. + +***Personal FATFIRE Journey – Where do we go from here*** + +Part of the goal of building out our team at the holding company, is to continue on a journey closer to the Retire part of FATFIRE. I’m working around 30 hours a week right now (by choice). As we build out the team, I can move out of those tactical areas and continue to focus more on vision / strategy, culture, and acquisitions…while decreasing my hours. + +We are dividing up the next 10 years of our life into two 5-year chunks. First 5 year chunk is with the kids still in the house. Youngest is 13, so 5 years until they are out of high school. During that time, we only travel a week or so at a time, and have significant parental responsibilities. So this is the time to continue doing what I love…building companies. We are getting a good team in place, and hopefully can continue to find good fit companies to buy. + +Second 5 year chunk is after the kids are out. The goal is to be non-essential to the holding company and subsidiaries…with all day to day at the holding companies being handled by a strong team. We want to travel more, and enjoy a kid-free (or atleast out of high school) situation a bit more. We have a second home in Phoenix, and likely will spend 2/3 our time there, and 1/3 our time in our current city. Coming back for family and friends. + +***Real FATFIRE*** + +Yeah…that probably happens 10 years from now. Its not really about the money to do it at that point (it isn’t now either)…its more about maximizing the RE part of FATFIRE that we hadn’t paid as much attention to previously. I’ll be 55 and my wife is similar age…so we want to go explore and continue to enjoy retirement while we still can. I don’t envision giving up the business…but minimizing my engagement to 2-5 hours a week that I can do from anywhere. I don’t ever see being full disengaged from growing things. + +***Keys to my FATFIRE journey:*** + +1. Always learning – It’s a strength of mine… and its returned dividends. This skill has been key to changing careers with minimal disruption (teacher -> IT person -> ecommerce -> sales -> start IT company -> private equity). +2. Take CALCULATED risks – Opportunity is all around us. Some good, some bad. I always do my best to calculate the risk, understand what happens if it all goes south…and compare the upside. I constantly look for high return, low risk deals. +3. Say NO to a lot of opportunities – This goes hand in hand with #2. Warren Buffet called Charlie Munger the “Abominable NO man.” Say no to everything that doesn’t check all the boxes. There are TONS of deals out there…be picky. +4. Don’t hire friends or family – It never works out. Ever. +5. Mentors – Constantly find people who are where you are going…their knowledge makes the road much more smooth +6. Believe in people – If you constantly share what you expect, and that you believe people can perform….they so many times will prove you right. Most professionals want to do great work…show them what it looks like and tell them they can do it. + +Top 5 Book Recommendations + +1. Traction by Gino Wickman – This is the operating system we run all of our businesses on. Gives us a clear vision, and the system to make it happen. Magical. +2. Great by Choice by Jim Collins – This book has concepts and principles that I believe wholeheartedly in. +3. Four Obsessions of an Extraordinary Executive by Patrick Lencioni – Great example of how you should spend your time +4. E-Myth by Michael Gerber – Taught me how to extricate myself from day to day operations of my company +5. Built to Sell by John Warrillow – Create a business that has value not intrinsically linked to you +6. Bonus – The Subtle Art of not giving a F\*ck by Mark Manson – Taught me to let go of the things I was not energized by…and gave me clarity as to what I love to do + +Alright, that’s it folks. If you’re still reading this, congratulations. You made it. + +I’m happy to answer questions. I look forward to updating this once a year as we progress on our FATFIRE journey. + +\-Nick +So, MA could have simply waited for the Biyani to completely default on everything and go bankrupt, to get the business at dirt cheap rate. But why he decided to spend 25,000 crores instead. Because of this, now even banks/financial institutes can also get their money back from Biyani, if the deal gets all the necessary approvals. + +So, again, when amazon, WIPRO and other players were simply waiting for Biyani to go bankrupt, why MA played like that and even agreed to buy minority stake in the subsequent FEL? All he had to do was to wait and watch. + +Any expert opinions are appreciated. +What's up, individual investors! + +&#x200B; + +Man, the MOAFF just hit the DTCC website. + +&#x200B; + +This is the most complex, in depth filing I've ever came across, and it will likely take me weeks to interpret this due to the significant amount of PROPOSALS included in this 369 (giggity) pages long rule filing. + +&#x200B; + +On TOP of that, the DTC-2021-014 filing goes hand in hand with this one, and many references found in DTC-2021-014 lead you straight back to NSCC-2021-803 (the Advanced Notice) and/or NSCC-2021-010, the Proposed Rule. That being said, it wouldn't be appropriate to try and decipher 014 until we can first comprehend the legacy filing of which is the MOAFF, The Mother of All Fucking Filings, which NSCC-2021-803, the topic of discussion in this post. + +&#x200B; + +Let's begin. (revvs up artism) + +&#x200B; + +\*NOTE: THIS WILL BE THE "MASTER POST" FOR THIS FILING AS FAR AS MY DUE DILLIGENCE. I'M HAPPY TO COLLABORATE WITH OTHERS, AND DIVVY UP THIS FILING. DM ME AND WE CAN DISCUSS. I WILL CONSTANTLY BE UPDATING MY PROGRESS, AND WILL MARK EACH EDIT APPROPRIATELY SO EVERYONE CAN FOLLOW ALONG AS I/WE DECIPHER THIS. + +I will provide TL;DRs for each edit, as they will likely be lengthy. + +\-------------------------------------------------------------------------------------------------------------------------------------- + +**THIS SECTION OF THE POST IS RESERVED FOR EDITS** + +*EDIT#1:* 07/25/2021 1:09 PM Central. Added definitions. Finished adding the entirety of **Proposed Rule 2C, Sponsoring Members and Sponsored Member**s . Definitions completed up to I. + +*EDIT#2:* 07/26/2021 1:56 PM Central. Added entire structure of the filing from start to finish, added all definitions under rule 56. Will now begin to go through sections one at a time and update accordingly. + +**NOTE: Important things discovered since last update: SFT account will be SEPARATE from Continuous Net Settlement Account.** + +*Edit#3:* + +\---------------------------------------------------------------------------------------------------------------------------------------------**THIS SECTION OF THE POST IS RESERVED FOR TIMELINE PROGRESSION** + +*FILED BY THE NSCC:* ***07/22/2021*** + +*DATE OF PUBLICATION ON FEDERAL REGISTER:* + +&#x200B; + +***\*NOTE: THIS FILING WILL LIKELY TAKE TIME TO BE IMPLEMENTED. WE WON'T KNOW ANYTHING UNTIL THE RULE FILING FIRST APPEARS ON THE FEDERAL REGISTER, AT WHICH POINT IT WOULD BE 45 DAYS FROM THEN UNTIL WE WOULD SEE ANY FURTHER PROGRESSION.*** + +\-------------------------------------------------------------------------------------------------------------------------------------- + +First, let's look at the scope of this filing: + +&#x200B; + +LENGTH: **369 PAGES LONG** + +NEW DEFINITIONS: **50+** + +TITS: **FUKT** + +***BEKKED: YES*** + +&#x200B; + +&#x200B; + +[A-R](https://preview.redd.it/3rso2nzod9d71.png?width=637&format=png&auto=webp&s=92387a1a11247c30fd6f9f0997a17d2888991c73) + +&#x200B; + +[R-V](https://preview.redd.it/65icq18td9d71.png?width=644&format=png&auto=webp&s=d0297e0f7f86326713b144a81615b7b33aa2c5ca) + +\-------------------------------------------------------------------------------------------------------------------------------------- + +**THIS SECTION IS RESERVED FOR DEFINITION EXPLANATIONS / REFERENCING UPDATES** + +I currently have completed A-I. **Keep in mind - many definitions reference the new rules listed above, so it's a task just to define the new terminology. This is in alphabetical order.** + +lmfao wasted like 45 minutes making 50 pictures, only to realize you cant put more than 20. + +DOH! + +**DEFINITIONS ALPHABETIZED:** + +***Edit for progress: A-I*** + +&#x200B; + +[https://preview.redd.it/otvwtjvqded71.png?width=1396&format=png&auto=webp&s=2dc6bf2fa008e5f563725b890b87577dcd935514](https://preview.redd.it/otvwtjvqded71.png?width=1396&format=png&auto=webp&s=2dc6bf2fa008e5f563725b890b87577dcd935514) + +&#x200B; + +[https://preview.redd.it/ay16qunwded71.png?width=1405&format=png&auto=webp&s=9ebcf496d9ece976ff92f65cf064252b82dfad61](https://preview.redd.it/ay16qunwded71.png?width=1405&format=png&auto=webp&s=9ebcf496d9ece976ff92f65cf064252b82dfad61) + +&#x200B; + +[https://preview.redd.it/1luz4uz3eed71.png?width=1394&format=png&auto=webp&s=dbebbd34ec5895bb0958c073ba30c63be864212a](https://preview.redd.it/1luz4uz3eed71.png?width=1394&format=png&auto=webp&s=dbebbd34ec5895bb0958c073ba30c63be864212a) + +&#x200B; + +[https://preview.redd.it/y84qqxg5eed71.png?width=1394&format=png&auto=webp&s=579ff5179afa998565d5e505c9b5c6bc4d7bde67](https://preview.redd.it/y84qqxg5eed71.png?width=1394&format=png&auto=webp&s=579ff5179afa998565d5e505c9b5c6bc4d7bde67) + +&#x200B; + +[https://preview.redd.it/vcwspkx9eed71.png?width=1402&format=png&auto=webp&s=3fd281ad9567e9e18401fd341c931b5b058a4577](https://preview.redd.it/vcwspkx9eed71.png?width=1402&format=png&auto=webp&s=3fd281ad9567e9e18401fd341c931b5b058a4577) + +&#x200B; + +&#x200B; + +[https://preview.redd.it/9mwdvmdbeed71.png?width=1388&format=png&auto=webp&s=b1a6ce26cda94e52483851ba5d9acb4aa9364c88](https://preview.redd.it/9mwdvmdbeed71.png?width=1388&format=png&auto=webp&s=b1a6ce26cda94e52483851ba5d9acb4aa9364c88) + +&#x200B; + +&#x200B; + +[https://preview.redd.it/lqque2gceed71.png?width=1397&format=png&auto=webp&s=ad6b763cf825dbd4ffa6f4f9c8841e55b772938b](https://preview.redd.it/lqque2gceed71.png?width=1397&format=png&auto=webp&s=ad6b763cf825dbd4ffa6f4f9c8841e55b772938b) + +&#x200B; + +[https://preview.redd.it/r6zjeawdeed71.png?width=1211&format=png&auto=webp&s=f0d79a10b0000e8591ad6576de032e9ee2f2fd89](https://preview.redd.it/r6zjeawdeed71.png?width=1211&format=png&auto=webp&s=f0d79a10b0000e8591ad6576de032e9ee2f2fd89) + +&#x200B; + +[https://preview.redd.it/3nt0ws8aged71.png?width=1347&format=png&auto=webp&s=b2c1333d3d0fb0532b44b4ac7c564521c2b42c0c](https://preview.redd.it/3nt0ws8aged71.png?width=1347&format=png&auto=webp&s=b2c1333d3d0fb0532b44b4ac7c564521c2b42c0c) + +&#x200B; + +[https://preview.redd.it/53a0jy4aged71.png?width=1357&format=png&auto=webp&s=8ca7b2f90839321fd9252c79eb74a66d2c7a03f0](https://preview.redd.it/53a0jy4aged71.png?width=1357&format=png&auto=webp&s=8ca7b2f90839321fd9252c79eb74a66d2c7a03f0) + +&#x200B; + +[https://preview.redd.it/or1hwa1aged71.png?width=1366&format=png&auto=webp&s=1c6d90506f55915105a5932d945f32c8d62a545b](https://preview.redd.it/or1hwa1aged71.png?width=1366&format=png&auto=webp&s=1c6d90506f55915105a5932d945f32c8d62a545b) + +&#x200B; + +[https://preview.redd.it/adtkyow9ged71.png?width=1401&format=png&auto=webp&s=b6fc13a09b4a2df0f003fcbf343fe316c5801d00](https://preview.redd.it/adtkyow9ged71.png?width=1401&format=png&auto=webp&s=b6fc13a09b4a2df0f003fcbf343fe316c5801d00) + +&#x200B; + +[https://preview.redd.it/f5thc8r9ged71.png?width=1387&format=png&auto=webp&s=85a751b0d8de413ae02260bba93ab7faf606bd79](https://preview.redd.it/f5thc8r9ged71.png?width=1387&format=png&auto=webp&s=85a751b0d8de413ae02260bba93ab7faf606bd79) + +&#x200B; + +[https://preview.redd.it/ft9p34m9ged71.png?width=1384&format=png&auto=webp&s=a67c5a633acf782f94245b48250a765d5192cb68](https://preview.redd.it/ft9p34m9ged71.png?width=1384&format=png&auto=webp&s=a67c5a633acf782f94245b48250a765d5192cb68) + +&#x200B; + +[https://preview.redd.it/8otk7rj9ged71.png?width=1387&format=png&auto=webp&s=9b08a550b059b31745e40e8fd8fe3ddc67fcf7ff](https://preview.redd.it/8otk7rj9ged71.png?width=1387&format=png&auto=webp&s=9b08a550b059b31745e40e8fd8fe3ddc67fcf7ff) + +**DEFINITIONS EASILY FOUND UNDER RULE 56** + +\*The term “\****Ineligibility Date”*** *would mean, with respect to an SFT, the date on which the SFT Security that is the subject of the SFT becomes an Ineligible SFT Security (as defined below and in the proposed rule change).* + +*The term* ***“Ineligible SFT”*** *would mean an SFT that has, as its subject, SFT Securities that have become Ineligible SFT Securities.* + +*The term* ***“Ineligible SFT Security”*** *would mean an SFT Security that is not eligible to be the subject of a novated SFT.* + +*The term* ***“Initial Settlement”*** *would mean the exchange of SFT Securities for SFT Cash described in clause (a) of the proposed definition of Securities Financing Transaction.* + +*The term* ***“Linked SFT”*** *would mean an SFT entered into by the pre-novation SFT Member parties to a Settling SFT that has the same Transferor, Transferee and subject SFT Securities (including CUSIP) as the Settling SFT. As proposed, a Linked SFT would include an SFT that has as its subject fewer SFT Securities than the corresponding Settling SFT but would not include an SFT that has as its subject more SFT Securities than the corresponding Settling SFT.* + +*The term* ***“Market Value SFT Cash”*** *would mean the portion of the SFT Cash for an SFT equal to the amount of the SFT Cash for such SFT minus the Independent Amount SFT Cash of such SFT.* + +*The term* ***“Price Differential”*** *would mean (a) for purposes of the discharge of offsetting Final Settlement and Initial Settlement obligations, (i) the SFT Cash for the Settling SFT (or if the Settling SFT has a greater quantity of SFT Securities as its subject than the corresponding Linked SFT, the Corresponding SFT Cash) minus (ii) the SFT Cash for the Linked SFT; and (b) for all other purposes, (i) the SFT Cash for the SFT minus (ii) the product of the Independent Amount Percentage, if any, and the Current Market Price of the SFT Securities.* + +*The term* ***“Rate Payment”*** *would mean an amount payable from one party to an SFT to the other party to the SFT at the Final Settlement expressed as a percentage of the amount of SFT Cash for the SFT. As an example, if the Rate Payment is specified as 0.02%, the amount payable would be the product 0.02% and the SFT Cash for the SFT.* + +*The term* ***“Recall Date”*** *would mean, in respect of a Recall Notice, the second Business Day following NSCC’s receipt of such Recall Notice.* + +*The term* ***“Recall Notice”*** *would mean a notice that triggers the provisions of Section 9(b) of proposed Rule 56, relating to a Buy-In in respect of an SFT and that is submitted by an Approved SFT Submitter on behalf of a Transferor in accordance with the communication links, formats, timeframes and deadlines established by NSCC for such purpose.* + +*The term* ***“Recalled SFT”*** *would mean an SFT that has been novated to NSCC in respect of which a Recall Notice has been submitted.* + +*The term* ***“Securities Financing Transaction” or “SFT”*** *would mean a transaction between two SFT Members pursuant to which (a) one SFT Member agrees to transfer specified SFT Securities to another SFT Member versus the SFT Cash; and (b) the Transferee agrees to retransfer such specified SFT Securities or equivalent SFT Securities (including quantity and CUSIP) to the Transferor versus the SFT Cash on the following Business Day.* + +*The term* ***“Settling SFT”*** *would mean, as of any Business Day, an SFT that has been novated to NSCC, the Final Settlement of which is scheduled to occur on that Business Day.* + +*The term* ***“SFT Account”*** *would mean a ledger maintained on the books and records of NSCC that reflects the outstanding SFTs that an SFT Member enters into and that have been novated to NSCC, the SFT Positions or SFT Cash associated with those transactions and any debits or credits of cash associated with such transactions effected pursuant to Rule 12 (Settlement). As proposed, the term “SFT Account” would include any Agent Clearing Member Customer Omnibus Account and any Sponsored Member Sub-Account.* + +*The term* ***“SFT Cash”*** *would mean the specified amount of U.S. dollars that the Transferee agrees to transfer to the Transferor at the Initial Settlement of an SFT, (i) plus any Price Differential paid by NSCC to the SFT Member as Transferor or by the SFT Member as Transferee to NSCC during the term of the SFT and (ii) less any Price Differential paid by NSCC to the SFT Member as Transferee or by the SFT Member as Transferor to NSCC during the term of the SFT.* + +*The term* ***“SFT Close-out Value”*** *would mean, with respect to an SFT Position of an SFT Member, an amount equal to: (i) if the SFT Member is the Transferor of the SFT Securities that are the subject of such SFT, (a) the CNS Market Value of the SFT Securities that are the subject of such SFT minus (b) the SFT Cash for such SFT; and (ii) if the SFT Member is a Transferee of the SFT Securities that are the subject of such SFT, (a) the SFT Cash for such SFT minus (b) the CNS Market Value of the SFT Securities that are the subject of such SFT.* + +*The term* ***“SFT Long Position”*** *would mean the number of units of an SFT Security which an SFT Member is entitled to receive from NSCC at Final Settlement of an SFT against payment of the SFT Cash.* + +*The term* ***“SFT Member”*** *would mean any Member, Sponsored Member acting in its principal capacity, Sponsoring Member acting in its principal capacity or Agent Clearing Member acting on behalf of a Customer, in each case that is a party to an SFT, permitted to participate in NSCC’s SFT Clearing Service.* + +*The term* ***“SFT Position”*** *would mean an SFT Member’s SFT Long Position or SFT Short Position (as defined below and in the proposed rule change) in an SFT Security that is the subject of an SFT that has been novated to NSCC.* + +*The term* ***“SFT Security”*** *would mean a security that is eligible to be the subject of an SFT novated to NSCC and is included in the list for which provision is made in proposed Section 1(g) of Rule 3 (Lists to be Maintained), as described below. As proposed, if any new or different security is exchanged for any SFT Security in connection with a recapitalization, merger, consolidation or other corporate action, such new or different security shall, effective upon such exchange, become an SFT Security in substitution for the former SFT Security for which such exchange is made.* + +*The term* ***“SFT Short Position”*** *would mean the number of units of an SFT Security that an SFT Member is obligated to deliver to NSCC at Final Settlement of an SFT against payment of the SFT Cash.* + +*The term* ***“Transferee”*** *would mean the SFT Member party to an SFT that agrees to receive SFT Securities from the other SFT Member party to the SFT in exchange for SFT Cash in connection with the Initial Settlement of the SFT.* + +*The term* ***“Transferor”*** *would mean the SFT Member party to an SFT that agrees to transfer SFT Securities to the other SFT Member party to the SFT in exchange for SFT Cash in connection with the Initial Settlement of the SFT.* + +\------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ + +&#x200B; + +" In connection with proposed Rules 2C, 2D and 56, NSCC is also proposing to make conforming and technical changes to the following Rules to accommodate the proposed introduction of the new membership categories and the proposed SFT Clearing Service. " + +&#x200B; + +\---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- + +**THE FILING** + +\---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- + +**Now that we have the terminology, rules, and everything organized above ( will update as I go ), this section will be for the actual filing. It's broken down into the following:** + +**(i) Background** + +1. *Capital Efficiency Opportunities* +2. *Fire Sale Risk Mitigation* +3. *Liquidity Drain Risk Mitigation* +4. *Addition of New Membership Categories for Institutional Firm SFT Activity* + +**(ii) Key Parameters of the Proposed SFT Clearing Service** + +1. *Overnight SFTs* +2. *SFT Counterparties* +3. *Approved SFT Submitters* +4. *Eligible Equity Securities and Per Share Price Minimum* +5. *Cash Collateral* +6. *RVP/DVP Settlement at DTC* +7. *Buy-In, Recall and Accelerated Settlemen*t +8. *Risk Management of SFT Positions* + + **(iii) Sponsoring Members and Sponsored Members** + +1. *Sponsoring Members* +2. *Sponsored Members* + + **(iv) Agent Clearing Members and Customers** + + **(v) Sponsoring Member/Sponsored Member vs. Agent Clearing Member/Customers** + + **(vi) Proposed Rule Changes** + +1. **(A) Proposed Rule 2C – Sponsoring Members and Sponsored Members** + +[PROPOSED RULE 2C, SECTION 1](https://preview.redd.it/v5r12u83h9d71.png?width=827&format=png&auto=webp&s=3154bc97daecb9f574115a68dcaae0911b59ab55) + +[PROPOSED RULE 2C, SECTION 2, PARAGRAPHS (a) - (c)](https://preview.redd.it/tie9olqbh9d71.png?width=822&format=png&auto=webp&s=58d3c3b937603fc72c68c5ce3bff691dca2f4707) + +[PROPOSED RULE 2C, SECTION 2, PARAGRAPHS (d) - (g)](https://preview.redd.it/yshfqiueh9d71.png?width=767&format=png&auto=webp&s=47d9903970d9bb56e2484bf51c20c13b5d6fbbf6) + +[PROPOSED RULE 2C, SECTION 2, PARAGRAPHS (h) - (j)](https://preview.redd.it/irbwd98hh9d71.png?width=784&format=png&auto=webp&s=aac18cf24e419ba87f35038250f13b0fdf5f27da) + +[PROPOSED RULE 2C, SECTION 2, PARAGRAPHS (k) - (l)](https://preview.redd.it/n1s50y7mh9d71.png?width=784&format=png&auto=webp&s=7862062017b52e59c2beb0fdac3789e1e20f11f8) + +[PROPOSED RULE 2C, SECTION 2, PARAGRAPHS (m) - (n)](https://preview.redd.it/qeji7n3ph9d71.png?width=728&format=png&auto=webp&s=c939271068971cd0dab4136f9f85e72e6c04e6b3) + +[PROPOSED RULE 2C, SECTION 3, PARAGRAPHS (a) - (c)](https://preview.redd.it/8864b55il9d71.png?width=761&format=png&auto=webp&s=d80f6e0c0318d15ed1f8260b515c29accc3ec2c1) + +[(PROPOSED RULE 2C, SECTION 3, PARAGRAPHS (d) - (f)](https://preview.redd.it/o7uapizhl9d71.png?width=746&format=png&auto=webp&s=8fabf1c4421c959d64b7dcd0ce8b971417599e6e) + +[PROPOSED RULE 2C, SECTION 4 (COMPLIANCE WITH LAWS)](https://preview.redd.it/eytwv0gm8dd71.png?width=632&format=png&auto=webp&s=0ccc9461d078747b3633c1daea8613e635fb5896) + +[PROPOSED RULE 2C, SECTION 5 (SPONSORED MEMBER TRANSACTIONS)](https://preview.redd.it/8t0tzejq8dd71.png?width=655&format=png&auto=webp&s=96628045502084b5e1c4aedc1156eaa4a0e4a922) + +[PROPOSED RULE 2C, SECTION 6 (SPONSORING MEMBER AGENT OBLIGATIONS)](https://preview.redd.it/8gqn1m1v8dd71.png?width=693&format=png&auto=webp&s=1f63a6c92bc7df12ab207b274b2dc8e93358e322) + +[PROPOSED RULE 2C, SECTION 7, PARAGRAPHS (a) - (b) (CLEARING FUND OBLIGATIONS)](https://preview.redd.it/me4sgghy8dd71.png?width=777&format=png&auto=webp&s=66c2188f34a57cc583d0dca4c2a324634714d58e) + +[PROPOSED RULE 2C, SECTION 7, PARAGRAPHS (c) - (e) (CLEARING FUND OBLIGATIONS)](https://preview.redd.it/v89q9z659dd71.png?width=707&format=png&auto=webp&s=cb9acdc73cc5397565f53a52587cf274c4f0915a) + +[PROPOSED RULE 2C, SECTION 8 (RIGHT TO OFFSET)](https://preview.redd.it/ilxdemf89dd71.png?width=677&format=png&auto=webp&s=5109b4430e24372578a6dce76701200599306820) + +[PROPOSED RULE 2C, SECTION 9 (LOSS ALLOCATION OBLIGATIONS)](https://preview.redd.it/0sanna5d9dd71.png?width=781&format=png&auto=webp&s=ff717cbeb5fa5f83f244e4639fd0ca8c23b597ec) + +[PROPOSED RULE 2C, SECTION 10 (RESTRICTIONS ON ACCESS TO SERVICES BY A SPONSORING MEMBER](https://preview.redd.it/mqt4shyf9dd71.png?width=671&format=png&auto=webp&s=1a3e6a95e1bdd7e26197e71f69e26654f87e99cd) + +[PROPOSED RULE 2C, SECTION 11 (RESTRICTIONS ON ACCESS TO SERVICES BY A SPONSORED MEMBER)](https://preview.redd.it/5ms07mwi9dd71.png?width=703&format=png&auto=webp&s=e4f863c7d73ac7655eb4982b3bfc801d04f8cfbb) + +[PROPOSED RULE 2C, SECTION 12 (INSOLVENCY OF A SPONSORED MEMBER)](https://preview.redd.it/n6do9y7m9dd71.png?width=680&format=png&auto=webp&s=7a24a5ece8ee4f17416829238132058b15e07b11) + +[PROPOSED RULE 2C, SECTION 13 (INSOLVENCY OF A SPONSORED MEMBER)](https://preview.redd.it/85dlv8rq9dd71.png?width=731&format=png&auto=webp&s=18c8bf17b9a421898085cec5dc0539fce05e1c94) + +[PROPOSED RULE 2C, SECTION 14, PARAGRAPHS (a) - (b) ( LIQUIDATION OF SPONSORED MEMBER AND RELATED SPONSORING MEMBER POSITIONS)](https://preview.redd.it/524us5gw9dd71.png?width=691&format=png&auto=webp&s=283b4657db118c297e83b9c189cca83121fe5bcf) + +[PROPOSED RULE 2C, SECTION 14, PARAGRAPHS (c) ( LIQUIDATION OF SPONSORED MEMBER AND RELATED SPONSORING MEMBER POSITIONS)](https://preview.redd.it/7mjjqlw3add71.png?width=700&format=png&auto=webp&s=6d06b3bceefe6e61053a598f15581bb7b07413dc) + +[PROPOSED RULE 2C, SECTION 14, PARAGRAPHS (c - continued) ( LIQUIDATION OF SPONSORED MEMBER AND RELATED SPONSORING MEMBER POSITIONS)](https://preview.redd.it/3nv8ooe7add71.png?width=688&format=png&auto=webp&s=f414439c1b06c49771148a2d6fc68707a58f9615) + +[PROPOSED RULE 2C, SECTION 14, PARAGRAPHS (c - continued) ( LIQUIDATION OF SPONSORED MEMBER AND RELATED SPONSORING MEMBER POSITIONS)](https://preview.redd.it/o6w2d9kaadd71.png?width=689&format=png&auto=webp&s=8238ebf13fe684233fd15ea6b59dace1bb87d76c) + +[PROPOSED RULE 2C, SECTION 14, PARAGRAPHS (d) - (e) ( LIQUIDATION OF SPONSORED MEMBER AND RELATED SPONSORING MEMBER POSITIONS)](https://preview.redd.it/zb2pwyzbadd71.png?width=700&format=png&auto=webp&s=cd13b9f3e20766968b771e0724824da238aedf21) + +**(B) Proposed Rule 2D – Agent Clearing Members** + +1. *Proposed Rule 2D, Section 1 (General)* +2. *Proposed Rule 2D, Section 2 (Qualifications of Agent Clearing Members, the Application Process and Continuance Standards)* +3. *Proposed Rule 2D, Section 3 (Compliance with Laws)* +4. *Proposed Rule 2D, Section 4 (Agent Clearing Member Transactions)* +5. *Proposed Rule 2D, Section 5 (Agent Clearing Member Agent Obligations)* +6. *Proposed Rule 2D, Section 6 (Clearing Fund Obligations)* +7. *Proposed Rule 2D, Section 7 (Right of Offset)* +8. *Proposed Rule 2D, Section 8 (Loss Allocation Obligations)* +9. *Proposed Rule 2D, Section 9 (Restrictions on Access to Services by an Agent Clearing Member)* +10. *Proposed Rule 2D, Section 10 (Insolvency of an Agent Clearing Member)* +11. *Proposed Rule 2D, Section 11 (Transfer of Agent Clearing Member Transactions in Agent Clearing Member Customer Omnibus Accounts)* +12. *Proposed Rule 2D, Section 12 (Customer Acknowledgments)* + +**(C) Proposed Rule 56 – Securities Financing Transaction Clearing Service** + +1. *Proposed Rule 56, Section 1 (General)* +2. *Proposed Rule 56, Section 2 (Eligibility for SFT Clearing Service: SFT Member)* +3. *Proposed Rule 56, Section 3 (Membership Documents)* +4. *Proposed Rule 56, Section 4 (Securities Financing Transaction Data Submission)* +5. *Proposed Rule 56, Section 5 (Novation of Securities Financing Transactions)* +6. *Proposed Rule 56, Section 6 (Rate and Distributions)* +7. *Proposed Rule 56, Section 7 (Final Settlement of Securities Financing Transactions)* +8. *Proposed Rule 56, Section 8 (Discharge of Offsetting Final Settlement and Initial Settlement Obligations)* +9. *Proposed Rule 56, Section 9 (Non-Returned Securities Financing Transactions and Recalls)* +10. *Proposed Rule 56, Section 10 (Cancellation, Modification and Termination of Securities Financing Transactions)* +11. *Proposed Rule 56, Section 11 (Accelerated Final Settlement)* +12. *Proposed Rule 56, Section 12 (Clearing Fund Requirements)* +13. *Proposed Rule 56, Section 13 (Ineligible SFT Securities and Supported Corporate Actions)* +14. *Proposed Rule 56, Section 14 (Cease to Act Procedures for SFT Members with Open Securities Financing Transactions)* +15. *Proposed Rule 56, Section 15 (Sponsored Member SFT Clearing)* +16. *Proposed Rule 56, Section 16 (Customer SFT Clearing)* +17. *Proposed Rule 56, Section 17 (Corporation Default)* +18. *Proposed Rule 56, Section 18 (Other Applicable Rules, Procedures, and Addendums)* + +**(D) Other Rule Changes** + +1. *Rule 1 (Definitions and Descriptions)* +2. *Rule 2 (Members and Limited Members)* +3. *Rule 3 (Lists to be Maintained)* +4. *Rule 4 (Clearing Fund)* +5. *Rule 5 (General Provisions)* +6. *Rule 24 (Charges for Services Rendered)* +7. *Rule 26 (Bills Rendered)* +8. *Rule 39 (Reliance on Instructions* +9. *Rule 42 (Wind-Down of the Corporation)* +10. *Rule 49 (Release of Clearing Data and Clearing Fund Data)* +11. *Rule 58 (Limitations on Liability)* +12. *Rule 64 (DTCC Shareholders Agreement)* +13. *Procedure XV (Clearing Fund Formula and Other Matters)* +14. *Addendum B (Qualifications and Standards of Financial Responsibility, Operational Capability and Business History)* +15. *Addendum P (Fine Schedule)* + + **(vii) Impact of the Proposed SFT Clearing Service on Various Persons** + +1. *Expected Effect on, and Management of, Risks to the Clearing Agency, Its Participants and the Market* +2. *Market Risk* +3. *Liquidity Risk* +4. *Credit Risk* +5. *Operational Risk* +6. *Consistency with the Clearing Supervision Act* + +\----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------THIS SECTION NEEDS REORGANIZING (Discusses Liquidity Drain and Fire Sale Risk Mitigations) + +[Basically, they are fully aware that fire sale risk comes primarily from the rehypothecation of securities, which is why pledged collateral CANNOT be re-pledged. (thanks 005)](https://preview.redd.it/yz7cshkkj9d71.png?width=1397&format=png&auto=webp&s=0d2f62e9a313b6b804f166749f64eaba312b2d5f) + +[https://preview.redd.it/i58lli7rj9d71.png?width=1397&format=png&auto=webp&s=4a7b758b8bab684be00634cbf8d6d484ae23b9aa](https://preview.redd.it/i58lli7rj9d71.png?width=1397&format=png&auto=webp&s=4a7b758b8bab684be00634cbf8d6d484ae23b9aa) + +&#x200B; + +If these mofos get caught with the "hot potato", or the "fuckloads of shit collateral", NSCC can liquidate their gross positions. (thanks 002). See how it all is coming together? + +LIQUIDIY DRAIN:(sounds like a Warlock DOT) + +[https://preview.redd.it/dwkj1fnhl9d71.png?width=1391&format=png&auto=webp&s=382efa451092793de75289b2ad5be7bdd402effd](https://preview.redd.it/dwkj1fnhl9d71.png?width=1391&format=png&auto=webp&s=382efa451092793de75289b2ad5be7bdd402effd) + +\---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- + +TL;DR + +This filing is bigger than my wife's boyfriend's D\*ck. + +I'll provide continuous updates as I move through this. + +Community help is welcomed and appreciated. + +Basically, they're creating a service for securities lending, where the NSCC is assuming all risk, therefore making significant regulatory, capital, and other requirements in order to **receive the netting benefits** that come with the service. The NSCC is fully aware of the risks involved with re-hypothecating collateral, or re-pledging collateral, and have designed this service to prevent that from occurring. + +The real TL;DR? One sentence, directly from the filing: + +&#x200B; + +[https://preview.redd.it/fhv2ur8hl9d71.png?width=663&format=png&auto=webp&s=ef1b2c989b4455805e631f7826f9663cf4d69c53](https://preview.redd.it/fhv2ur8hl9d71.png?width=663&format=png&auto=webp&s=ef1b2c989b4455805e631f7826f9663cf4d69c53) + +Keep in mind, this likely won't see approval for sometime. + +Hopefully it gets enacted before MOASS, as this really leads me to believe that if it isn't, MOASS truly will destroy this market, in my dumbass opinion of course. We'll see! + +&#x200B; + +Until then, I hodl. + +I just sobered up.. I'm scared to scroll up. + +Cya on the next update! + +\---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- +I feel the need to dump some of my thoughts. It's apparent that lot of ETH investors don't understand what they own, and are just acting based on speculation of market cycles. By the end of this post I hope to help a few of you know a little more about what you own (or what you are thinking about owning) and why the current bull market is just a cherry on top of something much larger. + +Here are a truckload of hugely positive things that *have not yet altered* the price of ETH*:* + +* [EIP 1559](https://notes.ethereum.org/@vbuterin/eip-1559-faq), **THIS UPCOMING SUMMER:** + * Slashes mining profits and therefore cuts new ETH entering the economy. Miners are the most consistent sellers of ETH. Less new ETH entering the market means less ETH available to buy. This means the cost of ETH goes up significantly relative to current prices. + * Fee burning - destroying a portion of the ETH used in transaction fees. ETH actively leaving the market means even less ETH available to buy. ETH goes up even more. + * Both of these effects will take months to ripple through the exchanges, but their effects will be huge. Look at the regular [Bitcoin Halving](https://www.investopedia.com/bitcoin-halving-4843769) event for reference, and be patient. Supply/demand shifts take months to hit prices. +* [The Merge](https://ethmerge.com/), **THIS UPCOMING WINTER**: + * Mining ETH will be a thing of the past. Instead, all new ETH will be given to wallets that stake the ETH they already own. Basically, for putting the ETH you hold into a staking pool, you will be given more ETH at a rate of about 7% of what you own per year. That's a really generous interest rate, making ETH a competitive investment for the wealthy *even if the price of ETH stagnates.* + * BUT - this will happen while ETH also continues to grow in value. Your existing ETH goes up, and owning ETH also gives you more ETH. In fact, this will be the *only way* new ETH is minted from then on. This is a *massive* incentive to sit on a pile of ETH, and only sell what you need to pay bills. Again, less selling means more expensive ETH. + * This will also take months to ripple through exchanges as it's a supply/demand shift. Be patient. +* [Sharding](https://ethereum.org/en/eth2/shard-chains/) in **2022:** + * This is a big one because a lot of seasoned crypto traders expect a bear market to start in 2022. I do too, but 2022 will be the year that Ethereum's adoption as technology takes off in a real way. With the implementation of sharding, and [eWASM](https://medium.com/chainsafe-systems/ethereum-2-0-a-complete-guide-ewasm-394cac756baf), Ethereum is going to change the world. That doesn't mean the bear market won't hit us, but it means one of two things: either the bear market's impact on ETH will be dramatically reduced, *or*, we're about to experience the buying opportunity of a lifetime before ETH goes wildly parabolic at the end of the bear market. + * When ETH 2.0 is fully deployed, the network will have gone from processing just over a dozen transactions per second (as it does today), to about 100,000. A speed increase of 10,000x, and an equivalent gas fee reduction. I'll let you decide whether or not you think that will make more developers, governments, institutions, and even just regular people want to use the Ethereum network. +* Public opinion and knowledge: + * [**The flippening**](https://www.blockchaincenter.net/flippening/) **is coming. It's not an if. It's a when.** It may literally even be this year. When this happens the average joe news media is going to erupt. Public opinion will shift. Ethereum will be a household name. In a few years, family will be *approaching you* to ask about staking ETH, instead of you just talking their ears off about how you've doubled your net worth in a single month. + * **Look at that graph in the flippening link -** The flip was on its way to happening before the crypto crash. ETH 2.0 is coming. This is not a question of "if". I don't know how anyone can look at that graph in the context of ETH 2.0 and deny that the flippening is coming very soon. +* Tech adoption: + * NFTs are going to be an enormous part of the future. Everything about the technology just makes sense and solves so many problems. We will see house deeds, permits, digital assets, bonds, video game property, wills, maybe even voting systems... all take place on-chain. Many of these will be *side chains running on Ethereum*. NFTs also allow something really cool - physical and digital assets tying together. Imagine buying a concert ticket and later receiving an NFT of the band taking a crowd-facing selfie *at that concert*. Incredibly cool stuff. This is the future we are about to live in, and *very* soon. + * After the ETH 2.0 merge, the Ethereum network will be world-changing technology, in fact, it is getting there already and we've not even taken off yet. People who aren't familiar with terms like "L2 scaling" and "settlement layer" won't be able to follow, but you'll have to believe the nerdy folks. This is big. Bigger than big. This will be the quiet superhighway beneath the world, and the profits it generates will go directly to those staking and hodling their ETH... that's *you.* + +All of the coming benefits above are multiplicative with one another. + +Multiplicative benefits are what cause parabolic growth. + +**Some of my fun predictions as of 5/9/21:** + +* Bitcoin is about to go on a Summer tear. I expect within a few months it will run up over 100%, and it may leave 5 digits for the last time. It will outperform ETH for a short period, but ETH will still dramatically outperform it over the next 8 months overall. +* Sometime in the next few weeks ETH will see a significant but temporary pullback or an extended stagnation. We really need to shake out some paper hands. My guess is that this happens between $4800 and $6000. +* By January 1st 2023, Eth will have spent a significant amount of time around $50,000. I'm making this claim assuming no catastrophic USD inflation. To make the point, I will also claim it will hit 12x its current value (as of 5/9/2021) relative to every fiat currency. +* By 2025 you will be able to use a wallet containing either [gwei](https://www.investopedia.com/terms/g/gwei-ethereum.asp) or [satoshis](https://www.investopedia.com/terms/s/satoshi.asp) to purchase almost *anything* that you can purchase with a debit card in 2021. Your house and car deeds will exist on a blockchain if you so desire. You will personally own NFTs, even if you currently think they are silly. + +To conclude, it is my belief that the $10K ETH claim is made based on market cycle analysis alone. It doesn't even consider ETH 2.0, technology adoption, deflationary indicators, or market actualization. $10K is a joke, $10k will happen below the flippening. I believe those that permanently leave ETH at $10k will be haunted by that decision for the rest of their lives. + +How many times have you heard "is that another Bitcoin? I don't get involved in that crypto stuff." The people saying this to you today will be putting ETH in their IRAs and 401Ks in a few years. You are not just early, you are *insanely* early. **Nobody outside the crypto community even knows what Ethereum is. Let me repeat that -** ***Ethereum is worth $400 billion, and the vast majority of all investors still don't even know what it is.*** + +$5K is a great price. $10k is a great price. + +Your Lambo, your custom house, your pool.. they don't exist yet, but they are coming. + +This is not a drill. + +HODL. + + I'm not a financial advisor, I'm a network engineer. These are my personal beliefs. This is not official investment or financial advice in any capacity. +Here is the [jpost article](https://www.jpost.com/israel-news/israeli-home-prices-rose-346-percent-in-a-decade-fastest-in-the-world-678028) about the rise of real estate in the last decade in Israel. And this year T[el Aviv is the world's most expensive city](https://www.weforum.org/agenda/2021/12/tel-aviv-most-expensive-city-index/#:~:text=Tel%20Aviv%20has%20the%20highest%20cost%20of%20living%20of%20any%20city.&text=As%20a%20result%2C%20this%20year,costly%20cities%20to%20live%20in). + +Why? Israel may be small, but so are many other countries that are not as expensive. A lot of rich high tech people live in Tel Aviv, but not nearly at the level of wealth NYC, LA or London has. How can it that the most expensive country in the most affluent continent in the world which is Switzerland, has had less than half the growth in real estate prices than Tel Aviv? + +And it's not just the real estate. Everything is more expensive here. Cars are 2x to 5x their cost in Germany. Some grocery purchases are 10x their American price. One pineapple will cost you 15USD, while Greece next door sells them for 1-2 Euros. And we grow them here! Clothes are so pricey, it's actually economic to fly to Europe and buy them there, while staying in a hotel, than buying a new wardrobe here. + +Almost every third story on the news is about cost of living. Is there any reason for this situation? Have any economists studied Israel and know why it's one of the most expensive places on Earth? +[Why some Americans struggle even with higher incomes](https://www.npr.org/2020/12/16/941292021/paycheck-to-paycheck-nation-how-life-in-america-adds-up) \- NPR + +This is a great article about people who are making a decent income but still struggle to pay bills. My question is this: + +Can everyone, or at least most people, live within their means? Or is the cost of living just too high no matter if you're lower income or middle income? + +Survey after survey shows that most Americans live paycheck to paycheck, which always astonished me given America is supposedly one of the wealthiest nations in the world. + +In the linked article, there are actual people's budgets. They have a solid income, but still struggle. Of course they need a phone, but do they need to pay for the new iPhone? Would financial literacy help more people to make more informed decisions about budgeting? Or do we live in such a consumer society that keeping up with the Jones's is worth it to plunge into unnecessary debt? + + I'm really curious to know what some people think. +# 0. Preface + +I'm not a financial advisor - and I am not providing you financial advice! This is all my interpretation of what is going on. + +Anyways, I wanted to ask... + +https://preview.redd.it/2dwpksdkv6071.png?width=1009&format=png&auto=webp&s=1c382f5643f751cc18844d2af7a33bac21f504d9 + +I'm hype. Are you pretty hype? I keep coming back because I love you guys, and I love the fact that there has been so much research freely accessible to teach millions of people all the nooks and crannies of the market. I'll just say - once this is all over, I'll miss you apes. Thank you all. ❤️ + +**TL;DR: The market is an overleveraged and rehypothecated bomb. The banks have been fighting a collateral crisis since the end of March due to the government emergency liquidity programs ending and inflation kicking in. The repo market could blow up at any moment from a lack of collateral and short squeeze the US Treasury market itself. The entire market is hanging by a thread and the DTC, ICC, and OCC are prepared for the fallout. The moment GME surges again, they can cascade defaults to members in all clearing corps and end it in one fell swoop.** + +# 1. The DTC, ICC, and OCC + +Let's clear up some confusion! Lots of apes are posting rule numbers with no prefix, so it's going to be a problem understanding one another. Let's forge some wrinkles! 🧠🔨🦍 + +These are all major clearing corps of the market. They all are their own beasts in and of themselves. For simplicity, we'll label them as such: + +**DTC** = stocks + +**ICC** = default swaps + +**OCC** = options + +Each of them operate independently, so they're all filing their own rules that affect them **individually**. Important distinction. The DTC rules don't apply to the ICC, and vice-versa. That is why we see the rule prefixes. These prefixes can help you distinguish between each of the entities. + +* Example 1: SR-DTC-2021-004 is a rule for the DTC +* Example 2: SR-ICC-2021-005 is a rule for the ICC +* Example 3: SR-OCC-2021-004 is a rule for the OCC + +It helps a lot to add the prefix before the rule number since we're now seeing multiple 003/004/005 rules. Less confused ape = happy ape! + +# 2. Almost Everyone Is Ready For Member Defaults + +You've probably heard the term **defaulting member** being thrown around a lot lately. You can think of that as being equivalent to a margin call. The member defaulted on something - making them go negative in net capital - and thus they're in debt. Bye bye! + +The DTC, ICC, and OCC all pretty much share the same members. Market Makers and Banks. Except of course the ICC which only has Banks as members. **You might think that all these rules being passed have nothing to do with GME, but it deals with the market itself blowing up, which in turn effects GME. All three of them passing similar rules is spooky and not a good sign for the market.** + +If a member defaults in the ICC, they most likely default in the DTC and OCC as well. The DTC, ICC, and OCC do **not** want to be left paying up for the defaulting member's debts in the event of a default. They also want to contain the nuke as much as possible so that it doesn't completely obliterate the market. + +**To prepare for the market nuke, the DTC, ICC, and OCC have passed rules/plans to deal with defaulting members.** + +We won't go into super detail here. Just a brief summary of the infinity stones which the DTC, ICC, and OCC have collected: + +* **DTC-004:** Wind-down and auction plan. **In effect.** +* **ICC-005:** Wind-down and auction plan. **In effect**. +* **OCC-004:** Auction plan. Allows third parties to join in (E.g. Blackrock). **In effect**. +* **OCC-003**: Shielding plan. Protects the OCC from paying up too badly by having extra liquidity. **Will be in effect on June 1.** **~~Not in effect, but the OCC deposit of \~$600m that was due the morning of May 19th could have supplemented for this~~**~~.~~ **~~If not, can go into effect any day between now and May 31st.~~** + +Every single one of them now has some form of rule which allows the defaulting members assets to be auctioned off. This allows other members to buy the defaulters assets at a discount while funding the defaulting member's positions. Say someone defaults from GME short positions and has, oh, I don't know, 500 million shares short. The money used to pay for the covering of the GME short position will be funded partially by this auction. + +In the end, this transfers assets to other entities while also pushing the damage to those entities as much as possible - a way to contain the nuke. It's a win-win situation. Other members get securities/assets on the cheap, while the DTC, ICC, and OCC worry less about payout, and the market **might** be able to prop itself up. + +Now the case with the OCC, third-party members can join in on the fun. E.g. Blackrock. There's some theories that Blackrock will delete Citadel from existence and press the MOASS button. I don't think so. I think they've just been waiting this out to gather enough cash to bid on as many assets as possible. They're not going to waste their money on igniting the MOASS, they're going to spend it to feast on the defaulters remains. + +**The key takeaway is that** **all three of them, the DTC, ICC, and OCC are ready to pull the plug.** + +**Any one of the DTC, ICC, or OCC can margin call a member and cause a default.** + +**The moment a member defaults in the DTC, ICC, or OCC, it will cascade to the other clearing corps and cause them to default over there as well. In one fell swoop, all the stocks, options, and swaps of defaulting members are up for auction.** + +# 3. Do We Need The Other Rules? + +You're probably thinking about **DTC-005, NSCC-002/801,** and others. And no, from my understanding GME does NOT need them to squeeze. + +GME doesn't even really need a catalyst. The T+21 and T+35 crossover event is probably enough to push it over the edge (discussed later). The market is literally hanging by a thread right now and a big move in GME can push it into margin call territory, causing the cascading defaults. + +The DTC-005 and NSCC-002/801 rules are to protect the future market. The guys in charge might have finally learned to impose more restrictions, and hopefully they stick to it. + +**DTC-005** will help avoid another stock from becoming over-shorted again. No more naked shorting. No more adding to your short pile with malicious options practices. It prevents another group of absolute retarded hedgefunds from doing this again. The T+21 and T+35 loop will cause the price floor to increase regardless of this rule and eventually cause margin calls. Remember, liquidity bomb is a growing issue, so the margin call price is most likely dropping as well. + +**NSCC-002/801** will speed up margin calls for extreme volatile movements like we saw in the January and March squeezes. They will make sure that if someone enters margin call city territory, they'll issue it with a one-hour timeframe. Pay up within **one hour** or you're toast. This ensures that volatility will kill off shorters who get caught with their pants down. + +Those rules help the future market avoid this bullshit again. They are not necessary for the MOASS. + +The ICC itself has introduced a wild rule **ICC-008,** which is in effect, that performs hypothetical margin calculations based on market movements. So again, the ICC could trigger a margin call to its bank members based on their new margin model rather than the DTC. Boom, the defaulting bank cascades through the banks members and eventually to GME. + +After all is said and done, the DTC will ensure that these rules are in place so that nobody can cause a GameStop situation again. + +**The most important rules are the wind-down and auction plans. They cover the DTC, ICC, and OCC's asses and try to protect the market as much as possible. These wind-down and auction plans are the OK** 👍 **to initiate launch when the time is right.** + +# 4. Shit Is Close To Hitting The Fan + +The whole market is an overleveraged bomb. GME isn't the only problem here. + +I'm sure you guys remember Archegos. Those guys abused what, 5x leverage? And you all saw what effect they had on the market. + +Imagine how bad leverage must have been abused by all the large firms which are STILL standing today. Imagine what will happen if a very large firm with equivalent or larger margin goes bust. How about a handful of them going bust? Bad, bad things, my fellow ape. Bad things. + +I'm sure you guys have seen this posted a million times today. This screams liquidity crisis in the banks because they've been really fucking stupid for the past couple of years, even more so since 2020 by allowing firms to abuse the pandemic. + +https://preview.redd.it/9crnr1z707071.png?width=637&format=png&auto=webp&s=34c47d7b115f699d9d29c481e0e31e7c27be0700 + +When did these reverse repos start showing up? + +**January 29th**. + +**February 25th**. + +**March 11th.** + +Woah what? Liquidity problems around the dates GME surged? It's not necessarily connected but hey, nice coincidence - right? 😉 + +The reverse repos started coming at ever-increasing frequency towards the end of March. Hmmm. Wonder why? [Could it be that the fed ended their liquidity programs](https://www.reuters.com/article/us-usa-fed-facilities/fed-says-extending-four-emergency-liquidity-programs-to-march-31-2021-idUSKBN28A1YG)? + +https://preview.redd.it/ryip19nz07071.png?width=848&format=png&auto=webp&s=a4b56e2f18aab8af2073247c017a8845cc9fc4e8 + +Yup. Those programs dried up on March 31, 2021. This suddenly put much more liabilities on the Banks balance sheets, where they need to obtain assets to counteract their liabilities. + +Ever since then, banks have been STRUGGLING with their balance sheets, and the potential of a short squeeze on the US Treasury Bond Market (See "[Everything Short](https://www.reddit.com/r/GME/comments/mgucv2/the_everything_short/)" by /u/atobitt): + +1. Banks have a "balance sheet" of assets and liabilities. Liabilities? Could be cash they owe to people/entities. Assets? Some form of collateral, such as treasury bonds +2. Banks have ever-increasing liabilities every day due to over-leveraged borrowers. +3. In order to not default, banks need to maintain balance on their sheets by obtaining assets/collateral. +4. Banks will go to Fed and to get their collateral in order to avoid defaulting (Reverse Repo). +5. When the banks borrow collateral they might even 'short' sell those borrowed bonds into the treasury market, hoping to flip a profit **due to inflation**. +6. Repeat #2 -> #5 and you get your ever increasing reverse repo amount. +7. Not only this, the Fed is sucking out $80Billion in treasuries (collateral) each month. Reducing the supply in the market. +8. As the reverse repo amount continues to increase, demand continues to go up for collateral. +9. As the fed continues to suck out collateral, the supply of collateral drops. +10. Eventually you hit a critical point where the supply is too low, and the treasury value shoots up. Banks who are short might now be forced to buy back up the treasuries on the market and cause a short squeeze in the US Treasury Market itself. +11. Banks default. Members default. Everything collapses except some Banks/HFs/Financial Institutions which weren't completely stupid. + +At any moment, the collateral bomb can pop and drag the whole system down. Definitely recommend [George Gammon's Summary](https://www.youtube.com/watch?v=fttA-rNRYG4). + +# 5. The T+35 and T+21 Crossover Event of Meme Stocks + +I've posted a theory about us getting close to another February 24th repeat where massive amounts of volume and buy pressure could surge GME. You can find the post here: + +[FTD Loop Missing Link T+35 and T+21](https://www.reddit.com/r/Superstonk/comments/nf22qz/theory_on_the_ftd_loop_missing_link_a_t35_surge/) + +The actual **why** to the mechanics behind these loops might not actually be FTDs. But instead Net Capital, which operates on a similar timeframe. T+7, T+14, T+21, T+28. They're forced to buy up shares, causing buy pressure, in order to return neutral and deliver. You can find that post here: + +[Net Capital Bomb](https://www.reddit.com/r/Superstonk/comments/n4h832/major_deep_itm_call_option_dates_a_massive_net/) + +In quick summary of T+35 and T+21, we seem to be in **multiple** price spike loops. And a new one is about to pop up. Where did these originate from? So far, it looks like three main dates: + +* **January 15th:** Major option date. One of the only 2021 option dates available in early 2020. Shorters must have piled in here. +* ~~February 5th~~\*\*~~:~~\*\* ~~The date Robinhood and other brokers fully lifted restrictions. Most likely reset the clock from another options date or some other factor. \[Trying to pin this down\]~~ Edit: I think we can ignore this. The only option expirations that matter are Jan 15 and April 16 due to them being two of the major option dates that were available in 2020. +* **April 16th**: Major option date. One of the only 2021 option dates available in early 2020. Once again, shorters must have piled in here. I'm pretty sure Melvin's PUTs expired on this date, FYI. 😉 + +Each date coincides with the following loop: + +1. Option Expire date. T+35 days later a price spike occurs. (January 15 -> February 24th) +2. An endless cycle of price spikes T+21 days later starts. (February 24th -> March 25th -> April 26th -> May 25th) + +The first T+35 spike is more significant than the T+21 spikes. Check it out. **I've also plotted the hypothetical next price spikes which occur on May 24 (T+35) and May 25 (T+21)**. + +**Please note: T+35 is CALENDAR days. T+21 is BUSINESS days. Take a look at the above DD for the walkthrough of this timing.** + +[GME T+35 and T+21 Loop](https://preview.redd.it/nmg3oj2nn7071.png?width=1436&format=png&auto=webp&s=589a978f5c90d3ff1ad5d71e7ea40d92e89eeae5) + +Guess what? This happens in AMC too. You can apply this to KOSS as well, and find the same exact patterns. Anyone want to have fun and check more meme stocks? Be my guest! + +[AMC T+35 and T+21 Loop](https://preview.redd.it/ukts9ax547071.png?width=1432&format=png&auto=webp&s=8bbb4512b90d99eec4530ca76dc5198779a4b050) + +See that shit? We're lining up for not just a T+35 spike, but a T+21 spike **one day after another next week**. This is going to effect **all** meme stocks if the cycle continues and April 16th actually triggers another loop. + +The timing of all of the wind-down and auction plans being in effect along with the increasing collateral issue of the banks with reverse repos means there's a massive collateral bomb being juggled, which could blow up with another volatile movement in GME or the market itself. When that happens, anyone could default. And what happens when a member defaults in DTC, ICC, or OCC? It cascades to the other two clearing corps. The margin calls start blasting out to all of the way overleveraged firms who get screwed by this volatility, and down goes the house of cards. + +**Call me a tinfoil hat wearer, but it sure as hell feels like the SEC, DTC, ICC, OCC, everyone high up, planned this all out. The flash crashes, everything, in order to get their nuke fallout plans in place.** **They probably always knew the timer was going to tick, tick, tick, run out, and boom the week of May 24th due to April 16th options expiration.** + +**So the SEC, DTC, ICC, OCC, all the higher-ups shut things down in January. They shut things down on March 10th. They crash the price on March 15th to avoid a pre-emptive margin-call. They pull many strings to buy time, pump all their wind-down plans in place at the last minute, wait for the next surge of GME, and then...** + +https://preview.redd.it/62pndywok7071.png?width=702&format=png&auto=webp&s=298ffb0386b18492962652f7a748a725bec01bb2 +1. Okay, at least with passing time, we are seeing less of useless forks. Why? I truly believe by next bull run, most useless forks will fail to gain traction, and original ideas will dominate the top 10. + +2. Bye bye shitcoin. If this market continues for next 3 months, I can bet it will spell doom for a lot of shitcoins. Lets say, like bitcoin gold, diamond, platinum etc. + +3. Less of btc vs bch feud. Lets face it. The well being of the crypto space does depend on original ideas. While btc is an original idea. Bch isn't + +4. No more lambo people till next bull. How many lambo or moon posts do we see in reddit? Nope. Not really. Vitalik must be damn happy, that there's at least some serious investors (or hodlers or gamblers) with some skin in the game + +5. More FUD resistance. Well consider this just like a vaccination. Yeah, we all take Vaccines. We all have that Fever that follows vaccines. The bit of illness, weakness, but then it does protect us from a terrible infection. + +6. Opportunity to be a real Millionaire. Yes. The bubble hasn't even started. How will it pop. If a 800 billion market with almost 40 to 60 projects that have got products is a bubble, well I dunno what the debt Bubble is. Maybe it's a superbubble. + +7. Mass adoption. Technology will advance. I don't think people like vitalik, charlie, charles hoskinson, colin lemahieu, da hongfei, Cz of binance are doing it just to be a millionaire. With tech advance we will see adoption rates going up. After using nano, I seriously question, why should I use Visa Cards! + +8. More btc alt decoupling. I would like this to happen at the soonest. Why? A lot of pump and dumps happen just to farm satoshis. Also a lot of alts get a fake dollar valuation due to the BTC value. So coins like XP or Pac continue to have valuations based on that. + +9. Killer dApps, interoperability and more. platforms and payments solutions products are my pick for the next bull run. Yours? +45 years old. Worked my ass off early. Still working my ass off. Built NW to $13mm. Unlike many on this sub, there was never a windfall payout. No home run. Just hitting singles over and over. Putting into index funds. And building my business. Overall I feel lucky. But.... I’m torn how to RE. Now that I’m FI I see more opportunities to grow business all the time. I have more risk tolerance. It’s less effort to get bigger. So I keep going. It seems disruptive to retire. I have kids in school and they are on a routine. I’m desperately trying to move to a more passive role but I can’t stop wanting to pursue ways to grow. I think it’s just what I’ve known. I’m afraid I will get old and never take advantage of the lucky situation I’ve achieved. Anyone else? +Firstly, to all the newbies that have just arrived in our slightly insane neck of the woods, welcome. + +Please note that you are not in charge here. + +Don't hassle the old timers, they've seen things you people wouldn't believe. Melvins **BRN**ing off the shoulder formations of the ASX. + +&#x200B; + +Secondly, before you ask anything or do anything, [have you read the Welcome post?](https://www.reddit.com/r/ASX_Bets/comments/iqpmfe/welcome_to_rasx_bets/) It has a lot of stuff which you shouldn't do. Including literally a list of stupid questions to not post. + +&#x200B; + +Third, did you read the [FAQ](https://www.reddit.com/r/ASX_Bets/wiki/faq) and [the wiki](https://www.reddit.com/r/ASX_Bets/wiki/index). They have a lot of stuff. + +If you read it and know more, then maybe add more to the wiki. + +Be the hero we need. + +&#x200B; + +Fourth, did you try just reading the existing posts. The query on how to trade on **US markets** has been asked dozens upon dozens of times. We don't delete them all. + +The daily thread (or weekend) updates daily and is generally much less moderated than the normal posts. People ask or say stupid stuff there. + +&#x200B; + +Finally, you may have noticed you can't post with your brand new reddit account. Our friendly robot mod /u/automoderator will delete your stuff very rapidly. Historically, we didn't auto-moderate comments, but the recent flood has made it a requirement. + +You just need to be totally **not** new to be allowed to comment. + +&#x200B; + +But today is your lucky day, this thread will be ignored by /u/Automoderator. So brand new questions can be asked. + +You see the upvote button. If someone answered a question you had, or they **ALREADY ASKED** the question you had, don't repost it to see your name in lights, upvote the comment. + +&#x200B; + +Remember, this subreddit is not about US markets. It is fine to ask how to access US markets as a person living in Australia, but this isn't **GME** central. + +&#x200B; + +PS. [The previously indicated warning to not post jokes about the Reddit survey question is still in effect. I believe we are up to 128 day bans for asking.](https://www.reddit.com/r/ASX_Bets/comments/l0l9et/the_does_asx_bets_effect_your_finances_emotions/) +The market taking a tumble makes me want to go all in on dividends because my div portfolio is pretty much all in the green lol. + +I’m young so I want to be in growth stocks too, but I’m wondering if you guys have a split for investing in growth and dividend stocks? + +Im thinking 60% growth / 40% dividend +**TL:DR - Here's the proof... we were lied to.... the numbers don't add up.. shorts did not cover during January and I still don't see how they could have. Read this FULLY and tell me I'm wrong** + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + + My fellow Apes, + +Lately I've been thinking about the short-interest publication by S3 last year when Ihor (yeah, remember him?) tried to explain how the short-interest reached 140%. This was a central topic to our conversations on previous subreddits and it seems to have been forgotten. We kind of glazed over it during the hype and I don't think we ever documented the process or properly defined WTF happened. + +I'm putting this DD together to analyze the timeline of events. Just so there are no doubts about the actual SI %, I grabbed this screenshot directly from the [SEC's report](https://www.sec.gov/files/staff-report-equity-options-market-struction-conditions-early-2021.pdf) last October. + +[page 21 of the PDF](https://preview.redd.it/kdmui3s8llm81.png?width=891&format=png&auto=webp&s=7bc018c0bc88d2eefe65706e21110323806ca31e) + +When everyone found out the SI% was this high, there were suddenly SOOOOOO many questions asking how it can even happen. Without a way to accurately determine the SI% using public info, several of us used S3 and Ihor because they had been relatively objective in the past. + +Anyway, prior to January no one really paid enough attention to actually give a sh\*t about these figures. Or better yet, there weren't enough eyes on the issue to dig into it. That obviously changed after January and people like Ihor were suddenly faced with some serious questions, primarily *"HOW THE F\*CK DO THESE PEOPLE SELL MORE SHARES THAN EXIST"* + +...I remember it like yesterday.... + +There was a *very* quick narrative change from the S3 team.. Ihor quickly went from supporting the traditional (and more objective) equation ...to Frankenstein's monster of a formula.... + +[https:\/\/twitter.com\/ihors3\/status\/1354856088907210754](https://preview.redd.it/pbe5f56yglm81.png?width=597&format=png&auto=webp&s=54e87f206b1eaf2a27530dbd97f584adfd8e4eb7) + +&#x200B; + +Let's dissect this sh\*t one step at a time because there's A LOT going on in this post... \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +**Step 1: WTF is a synthetic long?** + +Ihor states that every short sale CREATES a synthetic long.. + +Whenever you short sell a stock, the obligation to repurchase that share at a later date is created. Therefore, what Ihor is saying is that each obligation to purchase a FUTURE share should be treated as an ADDITIONAL share to those that already exist.. + +His own words..... **"the traditional float number in the SI % Float calc is** **WRONG"**... Keep in mind this was literally during the peak of the event in January... convenient timing, right? + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +**Step 2: Redefine the SI % calculation to include synthetic longs** + +Get ready because sh\*t is about to throw you for a f\*cking loop... Ihor is literally suggesting that the SI% should include the short positions IN THE DENOMINATOR of the calculation, AS WELL AS THE NUMERATOR.... If you keep the same figures I reported above (70m / 50m) and recalculate SI% the way that Ihor suggests, here's the result: **70m shorts / (50m float + 70m SYNTHETIC shares) = 70m shorts / 120m TOTAL SHARES = 58.3%** + +Surely to GOD we haven't been reduced to this level of desperation... but here's his post from the **VERY NEXT DAY**. + +[https:\/\/twitter.com\/ihors3\/status\/1355194252674953219?lang=en](https://preview.redd.it/k5miphuhylm81.png?width=590&format=png&auto=webp&s=bd434d0f02026369b5339f801336fbb3b0d6401a) + +Now I'm no genius, but it REAAAAAAAAALLY looks like Ihor reported the actual SI% using the new figures after 1/28/2021 **AND reported his new S3 calculation using the synthetic longs in the denominator....** + +Want more evidence? Take the 57.83m shares that Ihor reported as sold short, add those to the number of shares that were in the float (50m or so), then divide that total by the 57.83m..... + +**57.83m / (50m float + 57.83 synthetic shares) = 53.63%....** f\*cking WHAT!? + +Ihor reports 53.12% and I calculated 53.63% by shooting from the hip?! GTFO.. + +Based on the SEC's report, we know there was a small amount of covering during this time and I'm not doubting that the short interest dropped to 113%, but if the ACTUAL short interest was still 113% after we hit our peak, then when the f\*ck did they cover? (I'll come back to this, later) + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +**Step 3: You can't get 5 quarts of milk out of a gallon jug!** + +Apparently, this guy is appealing to the common sense of the average investor by playing dumb.. Why do I think he's 'playing' dumb? + +**HODL my f\*cking beer and watch this..** + +If you haven't read the HOC series and don't know about the ways that companies fail to mark the short sale indicator on their shares, then I would suggest you go back and do that. It's the most obvious way for a company to conceal short positions. It can go on for years without people knowing and it creates millions of phantom shares, which I'm pretty sure everyone knows about at this point. When phantom shares are lent multiple times because they are never documented to begin with, you most definitely have a 5th quart of milk, dumbass. + +But let's assume you DON'T know about that... Check out this FINRA violation from Barclays: + +[https:\/\/files.brokercheck.finra.org\/firm\/firm\_19714.pdf](https://preview.redd.it/zbl73bat0mm81.png?width=771&format=png&auto=webp&s=cf52a95aa0846ea699aead4bb8ba81dece62c459) + +So people like Ihor use numbers that are provided from a source, which is usually these f\*ckheads. The biggest issue that most of us have been talking about is the ACCURACY of those reports. When Ihor gets his report, there's no way to validate the numbers because it's not his calculation to validate. + +Instead, someone like Barclays (listed above) uses their own "methods" to determine if they are long or short on a given stock (or derivative). Therefore, if they include a number that is calculated erroneously, people like Ihor have to use that faulty information. + +Here in lies the problem and this is why I think Ihor is full of sh\*t. For someone that's a "Managing Director of Predictive Analytics" at a Financial Analytics Firm, you can't assert that you are unaware of these errors within your source information.... I have half a wrinkle and I can put this sh\*t together so there's no way in Hell that you can't. + +Anyway, Barclay's over-tendered 270,000 shares in a company because it miscalculated it's long position. They manually calculated their long position using multiple systems which **ultimately excluded a short position** that was housed in (yet) another system... + +Now we know this isn't a major f\*ck up compared to the crimes I listed in the HoC, but it's plenty of ammunition to blow more holes in Ihor's milk jug theory. If Ihor's source report excludes these shares, it means that all of the shares which SHOULD have been included in his report, WEREN'T... + +Furthermore, I pulled this from the SEC's report: + +https://preview.redd.it/0n3tjjobdmm81.png?width=868&format=png&auto=webp&s=09944a1fe016271800b4af7b21cae070d95d79f1 + +So not only does the 5th quart **exist**, but you never **included** the 4th quart, either... + +Huh.... 'magine that.... + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +Now then... where was I? + +Aside from Ihor's proprietary SI formula and his blatant gaslighting, what actually happened to the shorts during January? + +*....Well HODL on to your f\*cking hats...* + +Let's get back to the timeline... on 1/29/2021 Ihor comes out with a new SI figure which shows the new S3 calculation. I truly believe this was the beginning of the media campaign to pump FUD into retail investors. At this time, many people were referring to the run-up as the short squeeze, or even a gamma / delta squeeze. We had no idea what it was because there was no financial information about it... HOWEVER.... It LOOKED a lot like a short squeeze.. + +As we moved into the first week of February, it's as if all of the news outlets were trying to shout the same story: **the rally has GameStopped and the shorts have covered**. Here's just ONE from CNBC.. + +[https:\/\/www.cnbc.com\/2021\/01\/29\/gamestop-short-sellers-are-still-not-surrendering-despite-nearly-20-billion-in-losses-this-year.html](https://preview.redd.it/74hewsm5bmm81.png?width=1014&format=png&auto=webp&s=20003b4273059b977f7590b4766eaa25e4366bd9) + +&#x200B; + +We all saw how many tactics that were used to simultaneously promote the same story in favor of corporate interests. They acknowledged that Redditors had caused some damage to the hedgies, but ultimately it was over and **"MOST OF THE SHORT COVERING OCCURRED ON THURSDAY, WHEN THE STOCK FELL FOR THE FIRST TIME IN SIX DAYS."** + +Note the comments regarding other short sellers holding and / or taking new positions against the stock.. Anyway, this was also published on 1/29/2021 and includes quotes directly from S3... right after S3 publishes new figures which indicate declining short interest.. + +Several of us thought they would cover once the buy button was blocked by certain brokers.. It was the perfect opportunity to do so because supply went WAAAAAAAAAAAYYYYY up... + +...and yet, the total amount of SI on 1/29/2021 was still over 100% and covering would have meant financial suicide... these f\*ckers have been shorting meme stonks for literally a decade.... back when the price was like $4 - $5 a share.... imagine still paying $100 or even $50 a share to get out of that bet.. + +So what's a better thing to do..... nuke your long positions and cover, or spend the cash to pump media FUD and make it look like it's game over? + +&#x200B; + +IDK.... you tell me... + +\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ + +Yet again, I reference the SEC's official report.. + +https://preview.redd.it/646h1fmmdmm81.png?width=857&format=png&auto=webp&s=46ab1a42ad2f7bd44f430566bb6edc3b39f16b28 + +It's nothing new... we know the SEC reported that most of the buying was from retail and not shorts... but look at that last line..... ".. sustained the WEEKS-long price appreciation...." + +..Well tickle-my-balls.... so what exactly happened to the shorts? + +[Figure 6 from the SEC's report](https://preview.redd.it/wc0j36uxdmm81.png?width=847&format=png&auto=webp&s=7496333e1c4142088fa82a2650efeae72dd823b5) + +The blue bars are total buy volume and the red bars are buying from short sellers.. + +Look at all of the dates between 1/19/2021 and 1/29/2021... remember what Ihor said about this time frame? + +...we dropped from around **140% to 113%**... as of 1/29/2021, Ihor said the ACTUAL short interest was 113%.... that's BEFORE using S3's new SI% calculation..... + +Now go back to the red bars...... assuming 140% was the high... you mean to tell me that ALL of that buying was only a 27% reduction... (let me double check my maff.... 140 - 113... yup... 27%) in the outstanding short interest?.... + +Did they cover after the price dropped while the buy button was disabled? + +IDFK, you tell me... does it look like there was much activity from short sellers covering after 1/29/2021? To me, it looks like these mother f\*ckers spent money trying to gaslight the population and hope we washed our hands of it.... + +There is NO F\*CKING WAY short interest dropped below 100% after all of this... + +Not to mention this PROVES the media lied to us for MONTHS about shorts covering because the SEC determined that was a HUGE F\*CKING NO. + +&#x200B; + +&#x200B; + +We weren't wrong: we were gaslighted and lied to. + +Here's the smoking gun. + +&#x200B; + +Someone's not telling the truth. + +&#x200B; + +DIAMOND.F\*CKING.HANDS + +\#GMEtotheMOON +I'm a physician in a high earning specialty and ever since discovering this sub I've had more profits than I have ever had before. I am selling CSPs on stocks I wouldn't mind owning with roughly $100k of cash. + +My corporate account has around $800k cash lying around from the profit of the sale of my property that I was going to dump in SPY for 6% a year. I am wondering if there's anyone out there who is selling option premiums or spinning the wheel with an account nearly as large as this? + +I've been profiting 3-5% a month for the last 3 months and if I start using more then I can potentially work less and spend more time with family. + +Would appreciate thoughts and experiences so far. +Russia has kept their stock exchange closed through all of last week, and has announced it will be kept closed today and tomorrow at the very least too. + +How long can Russia seriously keep their exchange closed before they have no choice but to open it? And what are the consiqences for the country for keeping it closed indefinately? +I have always enjoyed playing the piano. I just bought a $100K piano (Haessler 210 Grand Piano) last year and it is a beauty to play. 1 of my girlfriends is a singer and often we'll drink champagne, get tipsy and just re-create songs and sing together. She'll lie on the top of the grand piano and it's super sexy. Just like in the movies. + +Have any of you splurged on a major instrument. Which type, and how has it positively benefited your life? +Hi all, I just wanted to see if anyone else has had an experience like this. I've posted a property for rent on zillow and marketplace, etc etc, but most of my inquiries come through marketplace. I get several per week they almost always start out with is this available. so I've come up with a canned response about the requirements. + +" Yes it's still available. I'm looking for 2.5 times the rent in income, proof required, clear background and eviction history. You're welcome to go walk around it also if you would like. If you have any other questions let me know! " + +I had a contact this morning who started right off stating he probably makes more money than I do and wanted my phone number rather than to communicate via messenger. So I gave it to him. + +He called within a couple of minutes and started asking a lot of questions about whether I was the owner or a representative of the owner. I honestly thought he was going to pitch me on some sort of rent to own thing. I'm not interested in that so I challenged him a bit as to why he was asking all of these questions. He immediately suggested that I was being discriminatory based on the sound of his voice. So I explained how I receive a lot of calls about selling the place, and that I'm just looking to rent it out. He again told me how he probably makes more money than "you or your white friends". I never asked about race, nor do I care, but clearly he has made a judgement on mine based on my voice. + +I told him I have friends of all colors and that I'm not interested in discriminating against anyone. I explained that all interested parties will go through the same process which ensures that no one should feel discriminated against. And that I'm just looking for someone who will take care of the place and be consistent about paying the rent. + +Anyway we set up a plan for him to see the house next week, but honestly the whole interaction made me worry that I'm being setup some how. + +I'm just a little taken back by the whole thing. Why would someone care if I'm the owner or not? I'm in FL if that makes any difference at all. + +Thoughts? How do I navigate this without violating his rights, and yet making sure I don't get taken advantage of? + +&#x200B; + +Update: just wanted to thank everyone for taking the time to reply, luckily he never called back, so that made it easy. Additionally I have it rented tentatively, so all is right with the world... for the moment. Thanks again +Speaking with Optus about them letting my personal data and ID be stolen. I asked them what steps they were implementing to ensure this doesn't happen again, and said I was considering cancelling my services with them because I don't feel like I can trust them with my data anymore. This is the response I got. + +Has anyone else had any luck getting out of the contract with out cancellation fees? + +I’m aware device repayment may be non negotiable, but surely they’ve broken their end of the bargain by not having adequate security for sensitive personal information. +I actually can’t believe what I’m seeing. + +&#x200B; + +Last Friday I submitted two buy orders of GME. A 50 stock order in the morning and a 20 stock order in the afternoon; both at market price. + +&#x200B; + +https://preview.redd.it/ysgor6pva6s81.png?width=1978&format=png&auto=webp&s=d634ab88c89994862516e103cd686c45df1c89d1 + +&#x200B; + +I thought I would see if I could find my orders on the time and sale sheet. I found them. Here they are. + +&#x200B; + +https://preview.redd.it/gdquusuxa6s81.png?width=2838&format=png&auto=webp&s=d74e67fb17e4fd8799e13347808a73e085607101 + +https://preview.redd.it/ityjiguya6s81.png?width=2918&format=png&auto=webp&s=3d7a64c85b071f843a49d0ab9c8874c80caddc2a + +&#x200B; + +The times are noticeably behind what my broker is telling me, but it’s less than a second and the price matches. They are undoubtably my orders. + +&#x200B; + +The column next to the price is the exchange. NQNX is the Nasdaq Trade Reporting Facility. I had no idea either. I know it’s off-exchange, but what really is it? + +&#x200B; + +>The Nasdaq TRF electronically facilitates trade reporting, trade comparison and clearing of trades for all U.S. equities. The TRF handles transactions negotiated broker-to-broker, or internalized within a firm. + +\- NasdaqTrader + +&#x200B; + +Ok, so my broker got my order and either shipped it directly to another broker or settled it internally and pocketed the difference. It never saw an exchange. + +&#x200B; + +Yesterday I submitted an order to sell 4 shares at market price. + +&#x200B; + +https://preview.redd.it/mr8tk6y5b6s81.png?width=1864&format=png&auto=webp&s=7caf0c9655424d2a886572d69b878c8ec582541c + +&#x200B; + +I’ll give you one guess which exchange my order was on. Yessir, right to the NYSE. + +&#x200B; + +https://preview.redd.it/llvoxp57b6s81.png?width=2814&format=png&auto=webp&s=79547baf96d83b26d5bea543bc6c7bd7b893a808 + +&#x200B; + +So buy orders get handled behind the scenes but sell orders go straight to the NYSE? Cool. + +&#x200B; + +tl;dr I submitted 3 orders of GME over the last 7 days. Two buy orders were routed off-exchange and the sell order was routed to the NYSE. +Paying around £600 in debt per month while earning £1500 + +49 very +69 aqua +50 118 +30 gym +50 phone +150 Loan +32 insurance + +I’m currently living at home, it feels like moving out is almost an impossibility for me and I feel so far behind everyone else I want to cry. + +Any advice guys? +Look at the price chart for Walmart, Costco and Kroger, then compare them to the price chart of Tesco, Sainsbury's and Morrisons. + +One can't help but notice the extreme difference in how the stock has performed. The 3 US supermarkets price has been climbing nonstop basically for the last decade. The UK counterparts on the other hand have been stagnant as hell for the last decade, trading sideways or in some cases straight down (Sainsbury's), so why is this? + +Why can Walmart, Costco and Kroger' stock price continue to grow but our similar stores are dead as fuck? You can't use the population as as argument because that's relative, the UK population is growing too so if the price is somehow related to population growth then our stores should also be going up, but they're not. + +What is it that those 3 US stores do better that we don't? Its not like Tesco is doing amazing but Morrisons is doing poorly because of some reason... All three of them are doing terribly, equally (OK Sainsbury's is a bit worse). + +And the reason I used those 3 is because those are our only publicly listed supermarkets, if you exclude spin offs like Marks and Spencer which is doing terrible as well by the way. + +This is a serious post, I want to know what our supermarkets are doing so wrong and what US supermarkets are doing so right. +Someone asked me this question the other day and I thought long and hard about it. + +For me I would have to say reading and the ability to say no to friends or anything else I truely don’t want to do. Both such simple concepts but they have exponentially increased my performance and speed. + +Anyways, now I am asking you, what’s the one habit that changed your life? +I know that “being rich” might not be the philosophy of successful and consistent traders, but the ones that are successful seem to get great financial reward. + +So my question is, why doesn’t everyone do it? +I'm not 100% sure how well this fits here (it is financial), but I wanted to warn as many people as possible. + +Last week on Tuesday morning I was sitting at my desk and suddenly started getting emails. Lots, and lots, and lots of them. 30-40 every minute. They were clearly spam. Many of them had russian or chinese words, but random. + +I called one of our IT guys and he confirmed it was just me. And the traffic was putting a strain on our mail server so they disabled my account. By that point I have over 700 emails in my inbox. They were bypassing the spam filter (more on that later). After a different situation that happened a few months ago, I've learned that things like this aren't random. + +So I googled "suddenly getting lots of spam". Turns out, scammers do this to bury legitimate emails from you, most often to hide purchases. I started going through the 700+ emails one by one until I found an email from [Amazon.com](https://Amazon.com) confirming my purchase of 5 PC graphics cards (over $1000). + +I logged into my Amazon account, but didn't see an order. Then I checked - sure enough those cheeky bastards had archived the order too. I immediately changed my password and called Amazon.. + +I still haven't heard from their security team HOW the breach happened (If they got into my amazon account by password, or did a "one time login" through my email.) The spam made it through our spam filter because the way this spam bomb was conducted, they use bots to go out to "legitimate" websites and sign your email up for subscription etc. So then I'd get an email from a random russian travel site, and our filters let it through. + +Either way - we got the order cancelled before it shipped, and my email is back to normal - albeit different passwords. + +And I honestly thought about shipping a box of dog crap to that address (probably a vacant house) but I decided against mailing bio-hazardous waste. + +Either way - if you see something suspicious - investigate! + +Edit: Thanks for all the great input everyone. Just finished putting 2FA on every account that allows it. Hopefully keep this from happening again! +My portfolio is down so much I can't even cash out if I wanted to at this point. My 15k is now worth 5.5k! I believe in the projects I am in so much but when is everyone going to stop trying to put these new techs down? + +What's keeping you from selling? +If DFV wanted to raise money for a hedge fund could he or would people just say, "oh he just got lucky on GME"? + +If someone became a self-made multi-millionaire like DFV from their own investments do you think they would be able to attract capital? Or can you only raise money for a fund now if you meet the below requirements?: + +* Went to Ivy League school +* Underperform the S&P 500 over the long-run +Democratic Rep. Kathy Manning, D-N.C., scooped up thousands of dollars in semiconductor company stock just one day before voting to pass a bill providing massive subsidies to the sector, new disclosures show. One of the companies is already planning large-scale investments made possible due to the legislation. + +Manning and her husband purchased up to $30,000 in Micron Technology stocks and up to $95,000 in Nvidia stocks on July 27, the new disclosures show. The next day, Manning voted to pass the CHIPS Act, which will help expand semiconductor manufacturing facilities in the United States while providing the industry tens of billions of dollars in subsidies. + +The legislation received plenty of media attention prior to the vote, particularly concerning stock investments made by Speaker of the House Nancy Pelosi's husband. + +"I'm proud of my vote to pass this historic investment in American CHIP manufacturing, lower costs, and creating good-paying jobs," Manning tweeted after the vote. + +Manning's congressional office told Fox Business the investments "are in accounts entirely controlled by third party managers" and that she and her husband "have no discretion or control over the underlying assets held in the accounts." + +"Neither Congresswoman Manning nor her husband exercised, or attempted to exercise, any control or direction over any transactions executed within the accounts," the office said. + +"Congresswoman Manning supported the CHIPS Act to maintain semiconductor chip manufacturing in the United States because it creates good-paying American jobs and protects national security," they added. + +Source: [https://www.foxbusiness.com/politics/dem-rep-kathy-manning-scooped-thousands-chip-company-stock-one-day-voting-pass-chips-act](https://www.foxbusiness.com/politics/dem-rep-kathy-manning-scooped-thousands-chip-company-stock-one-day-voting-pass-chips-act) + +Kathy Manning bought Micron Technology MU & Nvidia NVDA on July 27, one day before voting to pass the CHIPS Plus Act in the House. Non-politicians would get convicted for insider trading if they trade on non-public info. Do you think this should be made illegal? +Lately I've noticed a bit of a trend around here of people who are particularly bitter that index fund investing seems to be the standard, go-to investment advice, and their personal favorite type of investment doesn't get the attention they want it to. + +Often times these comments get phrased in sort of a self fulfilling way like + +> The VTSAX cult around here will just bury any investment advice that doesn't toe the party line. + +Which makes them difficult to respond to in a constructive way in the moment. So I thought I'd write up some thoughts on the matter outside of that framing. + +Here's a list of all the "alternative" investment advice I see around here with an explanation for why I pretty much downvote them on site every time: + +1. **Crypto** - Crypto is a speculative commodity, not a value generating asset. The fact that you, or someone you know, got lucky and made a bunch of money off of it doesn't change that. [edit] The fact that the underlying technology has potential value generating applications *outside* of cryptocurrencies doesn't change that. You're not investing. You're gambling. Crypto has no place in a serious long term portfolio beyond some trivially small amount you keep on the side to play around with for fun (the same goes for any other speculative commodity as well). + +2. **Individual stocks** - Yes, Warren Buffet can pick stocks. *You* can't. This isn't even an argument. The research on the topic is overwhelming. The average return for individual investors who pick their own stocks is something like 1-2%. The fact that you managed to outperform the market for a year or two isn't evidence to the contrary, it's [survivorship bias](https://en.wikipedia.org/wiki/Survivorship_bias). + +3. **Managed funds** - This one gets more complicated. Yes, there are good fund managers out there who can outperform the market. But for you, the individual investor, the challenge is not in knowing that these people exist. The challenge is in being able to identify them from a) bad fund managers who match or underperform the market (the easy one), b) *bad* fund managers who *outperform* the market just due to luck, and c) good fund managers who outperform the market, but charge so much in fees that it doesn't matter. This is not necessarily an impossible task. But anyone who's done enough of their research to be able to successfully do that, is someone who knows enough that they don't need investment advice from random anonymous strangers on the internet. So it's still bad investment advice to go around doling out to random anonymous strangers on the internet. + +4. **Entrepreneurship** - This seems to be the topic du jour for some reason. And though I've already mentioned it, I have to once again stress the topic of survivorship bias. *80%* of small businesses fail within the first year. The fact that *you* were successful does not mean someone else will be. Not only that, but your success is not repeatable. Someone can go out and do *exactly* the same thing you did and lose everything they had. Entrepreneurship is at the very upper end of the risk/reward scale. Furthermore, running a business is most definitely not for everyone. It takes a very specific kind of person working in exactly the right field for them. Running around telling people, who've given no hint of any inclination to start a business, that the really ought to consider doing so just because it will lead to riches beyond their dreams is just bad advice. + +5. **Rental properties** - I hesitate to include this one, because compared to the rest of this list, it's actually not a bad investment strategy. However, there is a specific, and very common, type of person who likes to pump rental properties that I will pretty much always downvote. And that's the type of person who likes to claim how much better their rental returns are relative to market returns while simultaneously glossing over things like the fact that they're: comparing leveraged returns to non-leveraged returns, not counting expenses like property taxes or maintenance, not counting risk factors like vacancy months, not counting the amount of sweat equity they put into their properties, or any combination of the above. Even taking all that into account, you like still have some small ROR premium, but it's often offset by the fact that your investment isn't liquid and isn't very diversified. Again, *not a bad investment choice* for a lot of people. But if you're one of the people who go around talking about how it's so much clearly better than equities and anyone who puts money into the market instead of rentals is an idiot, you're gonna get a downvote. + +Edit: Just to clarify, I don't think the last two in particular are bad investments for a specific group of people. I do think they're often bad investment *advice* though. Particularly if you go around pumping them to people who've shown no interest whatsoever in those areas or random people you know next to nothing about. If you're responding to someone who's specifically showing interest in starting their own business or buying rentals, and if you're being honest about both the pros and cons of that investment, I have no problem. +Finance should be a mandatory curriculum in school with emphasis on budgeting, concept of debt, saving for retirement and investing long term. I hear of so many horror stories of individuals in their 50’s, and much worse, 60’s and 70’s with no retirement, debt and having to work in their later years. Get these kids on track on the the importance of finance and retirement savings to save their self a life of being financially in despair and having to rely on social security if it is still around. So many kids are lost in finance with the mind frame of “I’m young I have enough time”. No! Time is not on anyone’s side because in a blink of any eye your already in your 40s with 0 saves. Time is on someone’s side when they invest early then I agree. I was at one time that young person. Now I’m 52 trying to catch up although I was savings during my years I start several years late and I didn’t put in enough time to be financially where I should be. Finance is an absolute must In this day and age for everyone but especially young kids! +For myself being 23 and of course looking a house purchase over the next 2 to 3 years (as is a fairly standard goal), I am told not to invest money that you'll need in the near future, because if a market downturn happens you could very well delay your house downpayment a few years. + +Is there a real reason that so many younger people with this huge purchase looming are investing/risking so much? + +I found myself coming to the realization during this downturn that it is quite important for those of us that are younger or in a house buying situation to only invest a smaller amount that wouldn't be devastating to lose, so I ended up trimming down a large percentage of my portfolio to sit on the sidelines. I.E I had up to 50% of my cash worth in my investing account, and trimmed that to about 25% + +I understand that "Not all young people need to buy a house" but what is your goal otherwise +HOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLYHOLYMOLY +The New Wage Code says you need to have basic pay as atleast 50% of CTC. Which means more contribution to PF and all. Now when they introduced new tax slabs, FM said we can't force all to invest in social security schemes, we are going to give them choice of spending. And they also said India will eventually move to new tax slabs. + +Now both these combined ( new tax slabs + new wage code ) means only one thing : you'll have less in hand salary and there is no way you can claim tax benefits on your contributions, you'll end up paying more tax!!!! Am I missing here something, because no where I have seen someone talking about + +TL;DR : if new tax slabs are made compulsory, then people end up paying more tax because of no deductions and low in hand salary, thanks to new wage code. + +Edit : this link, [the link](https://www.livemint.com/budget/news/no-timeline-to-remove-i-t-exemptions-nirmala-sitharaman-11581862140185.html) posted here in this [comment](https://www.reddit.com/r/IndiaInvestments/comments/kh9mga/why_no_one_is_talking_about_this/ggketji?utm_medium=android_app&utm_source=share&context=3) hints about the possibility of moving away from all IT exemptions +Im new to economics so cut me some some slack here with the simplicity of this question. + +I recently saw a post that said with a wealth tax jeff bezos would owe 5.7B, elon musk 4.6 B, and Bill Gates 3.6 B. which would leave them respectively with 185B, 149B and 116B. + +The top comment was "they dont actually have that much money. That's how much stock they own in the company. That's not cash or expandable resources." The comment went on to essentially say that all of these billionaires wealth was hypothetical and non existent in the effect that they don't actually have that much money to spend, and if they did pull out that much money it would cripple the companies. (wouldn't other people just buy that sold stock though? If a billionaire actually did decide to pay himself a billionaires salary, would there actually be enough money to give to them or at this point is the money more abstract? Could taxing the wealthy become feasible by creating laws against paying yourself in stock? You often hear liberals say things like, "If jeff bezos got rid of a fourth of his worth he could fix homelessness" economically is that not actually possible? Could good ol Jeff get 100B in his pocket today if he so choose? + +Regardless of your political belief, is that post an academically sound assessment of the situation? Is it not possible to tax the ultra rich worth since they all have such low salaries? What is a realistic option to effectively tax the wealthy? Are caps on how much wealthy can make the only realistic option considering how difficult it is to tax them? + +Sorry for all of these questions! Just answering some or all of them would be tremendous. I'm in highschool and often try to have these conversations with friends, family or teachers, but they'll annoy me by giving simple answers that "I don't understand how money works" when in reality I think they aren't necessarily understanding how abstract money is at that level. Or maybe I just dont understand lol +So I have heard that at least 20% of the existing money supply was printed from 2020 to now, which leads me to ask, did President Biden drive inflation by signing coronavirus relief/stimulus packages into law? to what extent is the Federal Reserve to blame for inflation (due to the maintenance of low rates to artificially keep the economy going). +Former penny stock trader, current long term investor with retirement money, now turned active day trader when I got laid off first of the year. + +The first month I started trading mid-large cap companies, 1-2 companies a day, scalping 100 shares at a time, 10-15 times a day. I was profiting about $150 a day, and holding overnight. + +February rolled around, and I figure, I’m doing good...time for margin. Started the same thing, bigger share purchases, and maxing out margin. First couple weeks went well, never trading “risky” stocks. (Although I did get into the GME, AMC train) + +Success blinded me a little, and I changed strategies again, going from 2-4 companies a day, to 8-10. Unfortunately, I got caught in some, bought more to average down, and watched my overnight holds get bigger and bigger. 2 weekends ago I was maxed out on cash/and margin over the weekend. Not only paying interest, but holding 28k in positions that wasn’t my money. (I do have available cash to cover if I got called). + +I was up about 5k on the year going into last week. I made the decision last week to get out of my holds, clean up my account, no matter what the cost. Over the course of this past week, I lost about 2k off that. + +As this weekend starts, I currently hold zero positions (I do have some options), have all my cash and margin available, and I feel free, with a profit of 3k since 1/1/21. + +I may not be getting rich, but I have learned a shit ton in the last two months, and I’m still green in the profit column. + +I’m not giving advice to anyone, but my personal changes going forward are: + +-Never hold overnight. I have no interest in stressing on what kind news may or may not affect my holdings + +-Dont chase a trade down. No more averaging down. If I make a bad trade, I will get out and accept the loss. + +-Green is green. If your trade is successful, take the profit. I’ve gotten caught multiple times hoping for more reward, then losing my initial profits. + +-FOMO can kill your account, if you missed the boat, look for something else + + +I’m not looking for tips or tricks, writing this to help me make sure I follow my own rules moving forward. + + +TL:DR. Laid off, put 28k into day trading account, made money, lost money, learned a shit ton. +IMO this sub has a major crab mentality where many people without property constantly spread bearish news in the hope that property prices drop and they get to pick up the pieces. + +However the people affected by a price drop are mostly new buyers and not the entrenched wealth that these people seem to want to be against - it's just another example of the poor fighting amongst themselves while the rich just hold through drops and buy up more. + +Many (not all) people in this sub who keep hoping for bear markets have selfish aspirations because they want to snap up houses from other people lower-middle class people and don't care about their ethics as long as they get theirs, but mask it by pretending they care about the economy and others around them. +Title says it all. I think we have a giant lurking behemoth of silent retail investors lurking here, often not even subscribed. I mostly read the comments, the DD and the posts to always have a feeling for the group dynamic and the health status of the people involved here. + +I can sense harder and easier times but the resilience I see is beautiful. + +I'll get back to the shadows but I am always with you! +This is a question for the older guys, like 30 years + investing, who beat the s and p 500 long-term average (9% I think, depending on when you start counting). + +How did you do it? Was it loads of work, or just self control? On my side is my nature of being the opposite of trigger happy. I will sit on a decision for months and usually do nothing unless the draw/reasoning stays incredible for months. I don't feel any pressures and I'm constantly watching for my biases. + +What I don't have going for me is time. I've done some good reading on investing and know more than the basics, but now I don't have time for more than 1-2h a week (MAX). I am cringingly aware of how much I don't know. To compare one company with 7 others, means knowing them all, and also knowing the industry they're in. Across 5-6 industries, it's just a mountain of work. + +Secondly, identifying a truly unshakable competitive advantage is actually very difficult. Most of the Dow Jones companies have been booted over the index's lifetime. Companies do not last forever, and big guys flop too, even when they were kings. So my current strategy is to stay within the safest, obvious blue chips, and to only buy when there is obscene value. I don't like predicting the future, and identifying a moat is begging for stretched assumptions. Nike will NOT be around forever. Neither will Walmart. Titans fall. How many juggarnauts are still here from 1900? Almost none. With a severe margin of error you can correct for that, somewhat, but I put no stock (lol) in expecting competitive advantages to hold. + +So - what was your strategy? Did you go growth as well? Did you focus on cheap dividend stocks? + +Thanks! +We've all seen the fake bank emails, various ways trying to scare us into giving them money or our passwords. To be honest they're usually quite shit. + +However today a friend of mine recieved an email, from his bank, warning him about scams. It detailed some of the more common scams and was a newsletter of sorts to highlight the risks people face when banking online. It was definitely aimed at the older savers, with a cute picture of two elderly people in a stock photo. + +At the bottom, their bank offered a totally free video on how to prevent scams and keep your money safe. You click into it, log into your online banking and you get a nice video highlighting scams. + +However, the email was not from his bank. The helpful tips were true, but when clicking to log in to get the helpful video you're actually visiting a super close imitation of the banks login portal, which upon putting in any details and clicking submit loads the professional video highlighting other scams. + +Unfortunately, while you're sat watching that video. Your account will be drained, and you wont even think you've risked your password anywhere until you next log in and see it empty. + +Luckily my friend is an idiot, and said he only realised when he input the wrong password and it still logged him in. He sent it on to me, and it was easily the best well executed scam I've seen. I'd imagine for the less tech savvy savers, maybe who are a little older, this is one to watch out for. +Jio's dream run continues. + +[https://www.ndtv.com/business/reliance-industries-agm-2020-google-to-invest-rs-33-737-crore-for-7-7-stake-in-jio-platforms-reliance-industries-chairman-mukesh-ambani-2263164?pfrom=home-topscroll](https://www.ndtv.com/business/reliance-industries-agm-2020-google-to-invest-rs-33-737-crore-for-7-7-stake-in-jio-platforms-reliance-industries-chairman-mukesh-ambani-2263164?pfrom=home-topscroll) +Welcome to the Daily General Discussion thread of /r/EthTrader. + +*** + +Thread guidelines: + +- Please refrain from discussing non-Ethereum related tokens here. You are welcome to discuss altcoins in the Daily Altcoin Discussion thread. +- All [sub rules](https://www.reddit.com/r/ethtrader/about/rules/) apply here so please be familiar with them. + +*** + + Resources and other information: + +* Newcomers who have basic questions about Ethereum can find answers by visiting /r/EthereumNoobies or our Ethereum Education wiki page, [see here](https://www.reddit.com/r/ethtrader/wiki/education). + +* To view live streaming comments for this thread, [click here](https://reddit-stream.com/comments/auto). Account permissions are required to post comments through Reddit-Stream.com. + +*** + +Enjoy! + +Ugh I'm so frustrated. I thought we were doing a good thing for ourselves but now I think we are trapped. + +Full backstory: A friend recommended their "financial advisor" to us. We thought "Great! We've been meaning to meet with someone... we have a kid on the way and husband isn't putting away anything towards retirement since starting his new job in August". + +So we set up phone meeting with his friend from Northwestern Mutual. She gives us a call, and we end up speaking with her for over an hour. She asks us lots of questions- what we are looking for (we tell her we want to set up retirement stuff for husband and explore maybe putting some of our 17k in savings into CD's or mutual funds). She asks us questions about when we see ourselves retiring, how "aggressive" we are, etc. All good stuff. We hang up and agree to talk again in a week when she will give us a plan. + +Cut to a week later, we are having a phone meeting with her and she emails me THE PLAN. It's many many pages basically explaining what we have vs. what we will need if we want to retire. But she mostly just talks about how we need more life insurance. "Sure" we think. Maybe we do need more life insurance. She explains that husband needs at least $1mill in life insurance and I need $500k (we both already have $150k policies through work on ourselves). This is news to us but we hear her out. She also spends a ton of time explaining how we need to have disability insurance. Again, we think "maybe we do". So we spend the greater part of an hour and a half talking about life insurance and long term disability insurance. She briefly mentions we should be maxing out my Roth IRA and we could perhaps start one for husband. So we hang up, with plans to talk again in a week and sign some paperwork. + +Over the next week, husband and I really realize that we don't want disability insurance (she quoted us paying like $170/month) and we didn't really feel we needed more life insurance at this time (she had us paying $340/month in permanent and $125/month in term). But we were ok maxing out my Roth at $450/month. We also wanted to explore stocks/bonds/CD's/mutual funds more (like we initially told her). So I sent this all to her in an email before our next meeting. She sends back "OK, great! Sounds good.. talk soon". + +Cut to another phone meeting, where she would talk with us about our updated PLAN. She emails us the NEW PLAN while we are on the phone. LITERALLY NOTHING IS CHANGED. She proceeds to spend the next hour convincing us why we need life insurance and disability insurance. Husband and I are both pushovers and listen to the whole schpeel again. Every time we bring up a reason why we don't feel like we need it, she tells us how we are wrong. I mean, she's the professional, we thought. I still expressed my disinterest in disability insurance but wasn't completely closing the door on life insurance. She kept giving me the guilt trip on "what will your kids have if one of you dies!". By the end of the conversation, I hadn't agreed to anything except to roll over my Roth to Northwestern. She had me give her my bank routing info to get "the paperwork started". She also said she was going to be sending me a bunch of stuff to sign in the next few weeks, but it was just to apply for things... nothing was set in stone. We could just see what the insurance company was going to quote us at, and we still aren't committed to anything. "Ugh fine" I think. She says a small amount might be taken out of my checking, but its just to make sure "the charges are able to go through when we start moving more money to my Roth". + +SO a week or two goes by. And I see a ~$30 charge go through for "disability insurance". WHICH I TOLD HER I DIDN'T WANT!! And I just realize... this doesn't feel good. It doesn't seem right. She's not listening to what we want. She still hasn't addressed out interest in CD/mutual funds/stocks that we initially came to her for. I spend the weekend doing my due diligence- spending a few hours on r/personalfinance, NerdWallet, just googling in general about what husband and I should really be doing. I decide to call the whole thing off with Northwestern. + +It's been a nightmare trying to cut off ties with her. I was kind and courteous through the first couple emails and subsequent texts "We really appreciate your time but have decided to pull out. Again, thank you". + +She is being evasive and manipulative. Telling us we are completely wrong and we still need to work with her. At this point I have just ignored any further communication. It has just been a really bad experience. + + +But THE REAL REASON I still feel like I can't completely ignore her, is that I asked her several times when I should expect to see a refund for the disability insurance THAT I DID NOT WANT AND DID NOT AGREE TO. She just dances around the question. I'm also worried because I have gotten a "bill" (no charges yet) in the mail for the $340/month in permanent and $125/month in term and $170 in short term disability. + +Is there anything I can do to make sure I don't get charged this? If I communicate with her any farther, she just tries to talk to us about why we need to invest with her, etc. + +WHAT DO WE DO. She is being shady AF. +If you google “how does Renaissance Technologies’ Medallion Fund make +70% annually” you’ll mostly get a rehash of the same talking points: +- They hire mathematicians and computer scientists, not investment managers. +- Only their ~300 employees can invest in it. +- They cap the fund at 10B, disbursing all additional profits instead of reinvesting. +- They only win approximately 51% of trades. +- They have very high leverage. +- It’s all automated. +- They consume enormous amounts of data. + +But what exactly are they doing? I know of 3 good sources of detailed information: +1. [This Twitter thread](https://twitter.com/TrungTPhan/status/1424399014204637186) +2. [This Senate hearing document](https://www.hsgac.senate.gov/imo/media/doc/STMT%20-%20Renaissance%20(July%2022%202014)2.pdf), related to a tax dispute between RenTec and the IRS. +3. [This Quora answer](https://www.quora.com/What-are-the-investment-strategies-of-James-Simons-Renaissance-Technologies-I-understand-he-employs-complex-mathematical-models-along-with-statistical-analyses-to-predict-non-equilibrium-changes/answer/James-Baker-69?ch=15&oid=15556100&share=00bcc844&target_type=answer). This has the most technical details. + +I thought I’d put all this together in a somewhat easier form to digest. (Maybe this is all commonly known here, but it was new to me.) + +Suppose you went to the bank and asked for a loan for your investment business, whose strategy is entirely “invest in SPY”. SPY has volatility of 20% annualized, so the bank might charge you annual interest of 10%. Since SPY only does +10% on average per year, you’re left with net 0% profit on average. Bummer. + +For a margin loan like this, the interest rate is going to depend on the volatility of the instrument. Unfortunately, low volatility generally means low returns. So the only way you’ll get very low interest margin (i.e. high leverage) is to trade something that has very low returns, which sort of defeats the point. + +The light-bulb moment here is that if you can decrease volatility “further” than you decrease returns, the higher leverage via margin will compensate for the low returns. For example, suppose you crafted a basket of long and short positions in various stocks that had only a net return of +1% but an almost negligible volatility of 0.1%. On its own this isn’t very useful (it doesn’t come close to SPY’s 10% return) but that low volatility might allow you to arrange a whopping 70x margin. Suddenly you have a +70x return! + +But how to actually arrange such enormous margin? The bank is probably unwilling to hand you 700B in cash to trade with, no matter how low the volatility in your basket is. Instead you have the bank write you a hedged, cash-settled, European-style barrier option. The way it works is this: +- You tell the bank what positions go in the basket. +- The bank prices and sells you an option for some number of units of the basket at an agreed-upon strike. The bank also buys units of the basket to delta hedge. +- If, at expiration, the value of the basket has gone up the relatively small amount you predicted, you exercise and profit greatly from the leverage. The bank makes a profit too, from their delta-hedged holdings, but it’s capped at the difference between their mean buy-in price and the strike. +- If, at *any* time, the value of the basket drops below the agreed-upon barrier threshold, the option is terminated. You lose the premium you paid and the bank loses the difference between the buy-in price and the current price of the basket. + +This is what the Medallion Fund does. They consume all sorts of data sources and use a lot of mathematics and computer science to look for “tradable effects”: detectable, repeatable events that correlate to future movement of a stock, and then use those effects to produce a “reference portfolio” of long and short positions. The reference portfolio changes constantly from second-to-second as hundreds of tradable effects are fused together in real-time. They buy barrier options on the reference portfolio from Deutsche and Barclays and then stream changes to the reference portfolio back to them so they can stay hedged. (Deutsche and Barclays actually pay *RenTec* to handle the mechanics of hedging the reference portfolio for them! Talk about win-win!) + +This all works because the banks can *literally* create new money in the form of loans. (In fact, most money in the US is created by private banks.) So they can offer enormous margin in the form of options so long as they can clearly define their risk (via the barrier clause), necessary to ensure they meet government regs for holdings. + +It’s perfectly possible for any individual to find tradable effects just like RenTec does: find data (maybe weather reports), look for a relationship to future securities prices (how about agriculture company stock prices) and build a predicative model. Repeat until you find one that works. I’m no data scientist but I imagine with some effort I could find one or two of these per year. But to turn them from a +1% strategy into a +70% fund requires finding hundreds of these effects, fusing them all together into a model that predicts a reference portfolio with ultra-low volatility, establishing a relationship with investment banks and getting options written against the reference portfolio, providing real-time hedging on behalf of the banks, model those options and devise an exercising strategy, and then doing it year after year as the tradable effects and financial landscape evolves. + +As for keeping the fund at 10B and no outside money, it follows pretty logically from the high leverage. If they took on 10x the cash they’d need 10x the options and the underlying price action caused by the resulting hedging could swamp the tradable effects. They could scale themselves out of their own system. So they chose to make a limited number of people ultra-rich instead. And if you want to keep all your tradable effects and models and relationships secret, why not choose your *employees* to be those 300 people? + +That’s all I’ve been able to gather about the Medallion Fund. The details of how the reference portfolio is built, the strategies they use to find tradable effects, the tools and models they use to fuse them, and how the option strikes/dates are chosen is a mystery to me, but it doesn’t really matter in the sense that it’s not like I can replicate this in my garage. But just for knowledge sake I’d appreciate any insight anybody might have! +I would assume that the stock market is just going to plummet worse than it already has. Pretty much every report I've seen says it will too. But are they necessarily tied together? +This might be a concern to some people who have bought shares of stuff like GME and AMC. I'm a bit new, but my understanding is some brokers will lend the share you own out to someone using it to short the stock. I contacted them because a post in WSB claimed WS was one that lends shares out. + +So that was part of their response to me. +Coca-Cola Co. has been a fantastic stock for decades upon decades and I still love it. However, I sold my shares a few weeks ago at $64 per share. My cost basis was below $60 and I decided that I would sell into strength and wait for a better opportunity to buy back in. This qualifies as timing the market, but I feel justified in waiting for better valuations in a world of higher interest rates and Fed tightening. Plus, I had losses to offset before year end. + +The current yield is just 2.8%, below its 10 year average of approximately 3.1%. Also, its dividend growth is far less impressive than similar stocks with a 5 year dividend growth rate of only 3.5%. Pepsi, for example, has a 5 year growth rate of over 7%. I would much prefer a yield above 3% or a growth rate above 5% before I consider entering a new position. Does anyone have any analysis to support re-entering $KO at the current price? + +Full disclosure: I am short a Cash Secured Put in order to try and get a lower cost entry and intend to roll that position over until the price reaches a more desirable entry. Therefore, I am technically long $KO, but in a manner consistent with my overall thesis (at a lower price). +IIAC, stock markets are some sort of central places where we can see for each stock : + +\- its price evolving over time + +\- all its buy and sell orders + +Is there something equivalent for raw resources ? I.e. : A central place where we could see for each resource : + +\- all its buy orders and sell orders + +\- the list of sellers and buyers and all data about them (quantity produced, bought, sold, etc...) + +If not, how raw resources trading work ? And where to see all data about it (quantity bought, sold, by who, etc...) ? + +Thanks ! +1. Avoid jewellery at all cost , when you go to sell expect 20 percent of its value to disappear + +2. Avoid buying coins from reputed jewellers online or from banks . Buy only .995 purity coins of the highest weight you can afford. That too from a primary dealer . You save a lot on making charges and margins . + +3. Sovereign gold bonds beat all gold etf’s. +Three instances I came across recently when someone looking for a home loan was sold some other stuff they didn't need. Only one of the stories has a happy ending! + +1. Santosh applied for a home loan in 2015, and was cross-sold a premium credit card with annual fee Rs. 5000, and a Rs. 5000 welcome voucher. Santosh was not interested in either of the products, but Bank claimed that having credit card will ease his home loan process. He had to get the credit card. + +1 month after card was issued, the bank sent a statement for Rs. 5000, which Santosh ignored saying that he didn't want the card anyway. He never used the card or the voucher. + +Since then, the bank has sent a message to him to clear the balance every month, which Santosh has happily ignored. He felt that since he's never used the card, he can get away with not paying the amount. + +The good news is that the bank has not applied any interest on this outstanding, so even after 6 years the outstanding is only Rs. 5000. + +The bad news is that Santosh's credit score is 611, even though he has paid back the home loan installments on time across the same period from 2015. + +update: Santosh paid the 5000 due on his card today. Bank has promised to inform credit rating agency that account is no longer NPA, and to close the account. However, I expect atleast 2-3 years for his credit score to improve. + +&#x200B; + +2) Rajesh was getting a home loan, and was cross-sold a critical illness policy. This policy pays a lumpsum if you are diagnosed with any of 9 pre-defined critical illnesses, with a hefty one time premium of Rs. 2.26L. Unfortunately Rajesh did not take the time to understand what the policy covered, and the bank was least interested in explaining it to him. + +In 2021, Rajesh passed away due to Covid19 + other complications. Insurance company declined the claim, since he did not pass away to any of the nine listed illnesses. Family was under the impression that Rajesh had a pure term insurance, and had a rude shock when they realized it was a very different policy. + +I suggested family to go to Insurance ombudsman, but they may not have great odds. Ombudsman is likely to say the insured person should have understood the policy, and insurer is perfectly within their rights to deny the claim. To my knowledge, family has not approached ombudsman so far. + +&#x200B; + +3) Ashwini was applying for a home loan, and bank was pressuring her to take a term insurance policy. Ashwini did not want to since she already had sufficient term cover, but bank claimed having a term policy will ease the loan process. After some arguing, they offered to cancel the policy and refund the premium after the loan is sanctioned. But they still insisted on her getting the policy. + +Her husband is a MFD, and he made sure to get this in writing from the bank before going ahead with the loan process. He was successful in getting the amount refunded after 6 months and lots of follow up. Being from the industry makes you aware of dirty tricks in the business! ;-) + +&#x200B; + +Learning: make it a point to see each and every document that your bank makes you sign. If you are being cross-sold any product, make sure you understand what the product is, and what are the costs on you. + +(names changed to protect privacy) + +&#x200B; + +edit: thank you for 300+ upvotes! +Since the advent of outsource-globalization starting sometime in the 70’s, wages have stagnated. All the while the cost of living has sky rocketed. + +Are we really better off because our Adidas shoes are now cheaper, also making it more disposable for some playing into environmental consequences accordingly? +Switched my focus from purely growth to incorporating dividends in November of 2019. Since Nov, and all of 2020, I heavily focused on dividends stocks except Tesla, ARK, and a few IPOs like PLTR, SNOW, SUMO, U, etc.. + +Was able to keep track of passive income in 2020 and total amount of dividends received was $1137.04 across taxable and non taxable accounts. So for this new year, my goal is to receive $100 a month in passive income, or ideally at least $1500 total for 2021. + +Came a little short this month, but pleased with January’s results. + +Here’s a quick breakdown. + +M1 +Total value : ~$14K +January dividends : $24.16 + +Largest dividends came from Iron Mountain. $5.69 from 14.46 shares. +- - - - + +Fidelity (Rollover IRA + HSA) +Total value : ~$27K +January dividends : $24.97 + +Largest dividends came from Verizon. $12.57 from 20.254 shares. + +- - - - + +Ally (Roth IRA) +Total value : ~$27K +January dividends : $ + +Largest dividends came from Reality Income. $6.43 from 27.545 shares. + +- - - - + +Robinhood (will most likely move account to Fidelity or Charles Schwab) +Total value : ~$8K +January dividends : $8.69 + +Largest dividends came from National Grid. $4.47 from 9.07 shares. + +- - - - + +Wife’s Roth IRA +Total value : ~$15K +January dividends : $21.76 + +Largest dividends came from SPHD $12.79. Forgot to ask how many shares she owns.. + +- - - - + +Also, got less than a dollar in my Charles Schwab account, so didn’t add that info. + +Wanted to share my progress and provide some info before all the questions asking how much I have invested. Hope this helps motivate some of you! +If I was a bad actor I would be loving the front page currently. A bunch of speculation with no relation to GME. On the week of the most hype announcement so far in this saga. People always say we should be welcoming new people and questions. Shouldn't we be making the front page look appealing to new comers as well. + +Don't get me wrong I agree that the warehouse fire is 100% sus. But not enough to literally take over the front page since it happened. Especially on the week of the NFT marketplace announcement. I imagine people coming to this sub after the announcement and instead of finding hype and info they see a warehouse fire everywhere. I did see the NFT announcement on a lot of different subs. But this is the only one I've seen the warehouse fire on. + +Edit: Since this post gained traction someone pointed out to link the announcement so here it is. + +[https://www.youtube.com/watch?v=fne4XMhtVf4](https://www.youtube.com/watch?v=fne4XMhtVf4) + +u/ButtFarm69 his cut of the interview that is shorter [https://www.reddit.com/r/Superstonk/comments/skhdv9/know\_your\_investment\_highlights\_of\_the\_fantastic/](https://www.reddit.com/r/Superstonk/comments/skhdv9/know_your_investment_highlights_of_the_fantastic/) + +Also the proposed SEC rule change that is being drowned out as well. It's important to comment if you can contribute. If someone can provide a link I will add it as well. + +Found the link to the sec thread:[https://www.reddit.com/r/Superstonk/comments/sjqz7h/sec\_open\_for\_comment\_prohibition\_against\_fraud/](https://www.reddit.com/r/Superstonk/comments/sjqz7h/sec_open_for_comment_prohibition_against_fraud/) + +Edit 2: Since I currently have peoples attention, look at the top post on this sub right now. Literally a meme accusing a fire official of being corrupt without proof. There are comments in the thread debunking and showing that it's shills making those types of post. + +[https://www.reddit.com/r/Superstonk/comments/slxbvo/how\_did\_fire\_chief\_gabrenya\_know\_the\_cause\_of\_the/](https://www.reddit.com/r/Superstonk/comments/slxbvo/how_did_fire_chief_gabrenya_know_the_cause_of_the/) + +Edit 3: NFT marketplace dd that got drowned out as well + +[https://www.reddit.com/r/Superstonk/comments/skrm0s/nft\_market\_dd\_update/](https://www.reddit.com/r/Superstonk/comments/skrm0s/nft_market_dd_update/) +I am about the pull the ripcord on my career on Monday--I am about 50. + +After the 1-year notice period, assuming no other arrangements are made that alter the timeline, I will go from making about $2.5M+ per year to living off of my accumulated investments which, obviously, generate far less per year. But, they are enough. + +I phrase the question above because I think the concept of **time** relative to wealth is sadly missing in most of the threads on FatFIRE. I think part of being FatFIRE is actually enjoying wealth when you're young enough to do so (that's the RE in FIRE) and not merely accumulating as much as possible and dying at your desk. + +This message is for those who are on their way up, in aggressive accumulation mode. Give this concept some thought, and feel free to tell me that I am wrong. But think about it. + +EDIT: To those doing the math trying to figure out which choice is mathematically superior, you’re missing the point (the answer is $10 million, BTW). Instead, make the second choice $500 million rather than $50 million, or $1 billion even; but the nub of the issue is whether—once you’re clearly FAT—it makes sense to trade time/youth for even more money assuming you’d like to do something else with your life than make money/work. + +If working and accumulating more is really your jam—and you’re not just doing it because you’re scared, unsure of yourself, lost, etc—then fine. But, if you think there may be more to life than your career, perhaps this is worth some thought. + +Walking away from $2.5M+ per year isn’t easy and I’ve lost count of all the messages I’m getting asking me what I do to make that money. Those people understandably envy that kind of earning potential, but the answer really won’t help them and it distracts from what I’m saying. +Hi everyone! This is Ran Abramitzky from Stanford and Leah Boustan from Princeton. We are economics professors and economic historians. We recently published a book [Streets of Gold: America’s Untold Story of Immigrant Success](https://www.publicaffairsbooks.com/titles/ran-abramitzky/streets-of-gold/9781541797826/). [Proof](https://twitter.com/leah_boustan/status/1549397846247489536?s=20&t=57u_XPvV9-TBP_uQyip-oQ). + +Immigration is one of the most fraught, and possibly most misunderstood, topics in American public life. [Streets of Gold](https://www.publicaffairsbooks.com/titles/ran-abramitzky/streets-of-gold/9781541797826/) uses big data and ten years of pioneering research to provide new evidence about the past and present of the American Dream. + +Turning to the data provides a new take on American history with surprising results: + +* **Upward Mobility**: Children of immigrants from nearly every country, especially those of poor immigrants, do better economically than children of U.S.-born residents – a pattern that has held for more than a century. +* **Rapid Assimilation**: Immigrants accused of lack of assimilation (such as Mexicans today and the Irish in the past) actually assimilate fastest. +* **Helps U.S. Born**: Closing the door to immigrants harms the economic prospects of the U.S.-born—the people politicians are trying to protect. + +[Streets of Gold](https://www.publicaffairsbooks.com/titles/ran-abramitzky/streets-of-gold/9781541797826/) weaves together the data with powerful stories of immigrants from a century ago and today. In building historical data on immigrant lives, we acted like dedicated family genealogists – but millions of times over. + +Happy to answer questions about immigration, past and present, or about our earlier work on the Israeli kibbutz (Ran) or the Great Black Migration (Leah). Also interested in your thoughts about US economic history more broadly, or about academia and career advice for younger scholars. + +Ask Us Anything! We'll be collecting questions this morning and then start responding at 1pm Eastern/10am Pacific. + +**Edit**: Ran and I have to log off at 3pm Eastern for another meeting. But we can come back later to check on any questions that are posted after we leave. Thanks for the great chat! +"She evaluated the performance of the Mensa investment club (Mensa is the organization for people with IQs in the top 2% of the population) during the 15-year period from 1986 to 2001. During that time, the S&P 500’s average annual return was 15.3%, while the Mensa club managed to eke out just 2.5% annually—some 84% worse than the index " + +Forbes Article: [https://www.forbes.com/sites/greatspeculations/2012/08/16/smart-people-can-make-stupid-investing-decisions/?sh=5fbb909415d5](https://www.forbes.com/sites/greatspeculations/2012/08/16/smart-people-can-make-stupid-investing-decisions/?sh=5fbb909415d5) +Despite all of the NIMBY-ism that's rampant in the Bay Area... Oakland has outdone itself. + +It might be illegal to conduct background checks on potential tenants. This isn't good for tenants or landlords alike. + +[https://www.mercurynews.com/2020/01/21/oakland-may-ban-tenant-criminal-background-checks/](https://www.mercurynews.com/2020/01/21/oakland-may-ban-tenant-criminal-background-checks/) +I have to imagine that many many customers are going to think about switching providers. This is the second nation-wide outage in two years. But investors aren’t panicking at all. +I'm a manager at a HVAC contracting company and am absolutely struggling to find new employees. The ad has been on seek for months and the quality of the applicants has been abysmal. + +Is this across all industries atm or just trades? I don't know what to do to remedy this situation, the pay and conditions being offered are very favourable. + +Edit: for those asking the role is paying $45 to $60 an hour dependingon experience, with OT and allowances, the company also offers flexible work arrangements + + +MicroDoge Token (Stealth Launching) Join Telegram and get us 50 members! Awesome tokenomics and plan created for success of the BSC token! Amazing redistribution on every buy & sell transaction. Every buy & sell generates more liquidity and also helps fund the tokens marketing plan. + +This is an amazing token that has crazy moonshot potential. Lp will be burned at launch , the ownership is renounced this token will be unruggable. An amazing community token with telegram hype Rn, diamond hands will prevail in this. + +Feel free to join our community and see the proof of the liquidity is locked and ownership renounced. + +🔥🔥🐕Micro Doge 🐕 🔥🔥 + +VERY UNIQUE TOKENOMICS + +Micro Machines Fork with updated tokenomics: + +🏁 Max Supply: 1000 + +💵 Max buy per Txn '1 Micro Doge' + +💰 Max per wallet is '10 Micro Doges' + +🔥 4% burn / 4% to LP / 2% To Holders + +⚠️ 1 token MAX TXID + +💵 1 BNB starting liq + +✅: Verified contract + +💥: DX Sale Liq Lock + +💯: SAFU + +✔️: Anti-Bot/Sniper measures taken + +🛡: Ownership Renounced + +👯‍♀️: 100% COMMUNITY COIN + +This is taking off Fast! 🚀 + +100% SAFU + +Telegram: MicroDogeBSC + +Contract: 0xd7dbc3a15a3c374031d4be5e4ed2ac6eb3629b4a +Hey there everyone. + +One thing I see often on this subreddit is about how extremely young people start to invest into a dividend portfolio, and continue to save every dollar they can. Just the other day I saw a 16 year old on this sub starting his portfolio. + +The best thing I always tell all my friends about finances, is the sooner you start, the better off you will be due to compounded interest. If you are especially more aggressive your first couple of years, it will even reap the benefits more. + +However, I also tell them to enjoy their youth, and don't nickel & dime everything you do. Your most precious time of your life is going to be your youth (especially college and 20s to Mid 30s) + +Seriously, enjoy your youth. Statistically speaking, the average person that is a super aggressive saver is not going to FIRE or Live off dividends until their 40s. Your youth is gone. + +I believe the best approach to it is like this: + +**Post College -** Get new job, pay down debt from school (if the loan has high % low percentage not really), aggressively save into 401k/dividend portfolio until mid-20s + +**Mid 20s-Early 30s -** Focus on your career, save, but not too aggressively. Focus on house/property and checking out different things in life. + +**Mid 30s to 40s -** Try saving more to live off the dividends before 50. + +TLDR: Enjoy your life. Trying to live off your dividend portfolio is great, but don't forget you only get one shot at life. Enjoy it. +Let me know if this isn’t the right sub and I’ll move the post. + +I read that only about 2 million people in the UK have a stocks and shares ISA. I found that to be extremely low. + +I imagine that a big chunk of people will have money in the stock market through their workplace pensions but that decision is automatically made for them by their employer unless they opt out. + +So when there is the ability to personally opt in to investing by contributing to a S&S ISA why do so few do it? + +How did you get into investing? +Links first, details later. + +Proposal from the SEC regarding short-selling data and transparency: [https://www.sec.gov/rules/proposed/2022/34-94313.pdf](https://www.sec.gov/rules/proposed/2022/34-94313.pdf) + +Comment submission form: [https://www.sec.gov/cgi-bin/ruling-comments](https://www.sec.gov/cgi-bin/ruling-comments + +Edit: another ape has a good diagram of where to comment: https://www.reddit.com/r/Superstonk/comments/tcj5v5/looking_to_comment_start_here/?utm_medium=android_app&utm_source=share + +# Why is this important? + +The SEC is asking for public input on VERY specific questions to which it seems like the SEC has not yet made its mind. As someone who writes regulations for a federal agency (not in finance) **this is something I have never seen before**. Some of this due to stylistic choices that heads of agencies like to change, but the wording of the questions seems specifically aimed at DD that has been performed here on r/Superstonk Generally a solicitation for comment is a hoop jumping activity that can wiggle a policy or 10, but it doesn't change the general shape of the policy. ***We get to have actual input on this stuff***. + +# When is this open? When does this close? + +This opened on February 25, 2022, and it will close on March 27, 2022. The closing time will probably be 5PM EDT. + +# What is the SEC asking for? + +On pages pages 48-57, 59, 62, 71-72, 97-100, and 190-200 the SEC is asking for the answers to some very specific questions. It is a good idea to read the related statements, but I'm going to pick out a few that almost everyone here can answer pretty easily. + +# Why are you giving this the education flair? + +Funny story. I have an area of expertise on a professional level (writing regulations), so I wanted to bring this to everyone's attention as something that is truly critical for apes to respond to. Additionally, I feel like this is an opportunity for apes to educate the SEC on why EFTs and call-put spreads should be regulated as potential market manipulation... never mind swaps. + +So here's the skinny on comment and response: if you submit a non-unique comment they will generally get classified by an AI as being non-unique. Additionally, you **must** address the questions or policies being mentioned. If you can worm something that isn't being addressed into that rubric you must be an experienced commenter or a lawyer, because that's some creative writing. If you do not address questions or policies being proposed, your comment will be rejected as out-of-scope. The more detail and analysis you can submit, the harder you are to ignore. + +# Selected questions that just about any ape should be able to answer: + + Q6: Securities Covered: Under Proposed Rule 13f-2, Managers would be required to report to the Commission certain short sale related data, as described above, for equity securities consistent with the Commission’s short sale regulations (i.e., Regulation SHO). + +o Should reporting Managers be required to report short sale related data for a different universe of securities than equity securities consistent with Regulation SHO? If so, please explain why and describe the universe of securities that would be more appropriate. + +o Should fixed income securities be included under Proposed Rule 13f-2? If yes, explain why and describe what costs and benefits might be associated with such reporting. + +o Should other securities be included under Proposed Rule 13f-2? If yes, identify such securities, explain why, and describe what costs and benefits might be associated with such reporting. + +o Should certain securities be excluded from Proposed Rule 13f-2 reporting? If yes, identify the securities in question, and explain why. + +o ETFs would be included under Proposed Rule 13f-2. Should ETFs be excluded from Proposed Rule 13f-2? If yes, describe why. If no, explain why not. + +Q7: Economic Short Positions: Proposed Rule 13f-2 requires that a Manager calculate its gross short position in the equity security in determining whether it meets the Reporting Thresholds. + +o Should a Manager also be required to include short positions resulting from derivatives in determining whether it meets the Reporting Thresholds? If so, explain why, and describe any associated costs and benefits to doing so. If not, explain why not. + + Should only certain derivative positions be included? If so, which ones and why? + + Should certain derivative positions not be included? If so, which ones and why? + + Does excluding derivative positions create opportunities to avoid triggering the Reporting Thresholds through other economically equivalent instruments? If so, please explain. + +Q8: Short Position Information: Under Proposed Rule 13f-2, Managers that meet a Reporting Threshold are required to report their end of month gross short position in the equity security. + +o Should a Manager also be required to separately report its end of month gross short position in derivatives, including, for example, options? Please explain. + +o If yes, should only certain derivatives be reported? Please explain. + +o If yes, should certain derivatives not be reported? Please explain. + +o Please describe any views related to the pros or cons associated with reporting end of month gross short positions in derivatives. + + Q9: Short Sale “Activity” Information Reported by Managers: Under Proposed Rule 13f-2, Managers would be required to report on Proposed Form SHO all activity in the equity security on each settlement date during the calendar month. + +o Please describe any views related to the “categories” of activity data that a Manager would be required to report as described in Information Table 2 of Proposed Form SHO. + +o With regard to the reporting of “other” activity, are there certain types of “other” activity that should be reported? If yes, describe the other activity and describe why it should be reported. + +o ETF creations and redemptions would be included under Proposed Rule 13f-2. Should ETF creations and redemptions be excluded from Proposed Rule 13f-2? If yes, describe why. If no, explain why not. + +o Should other activity be included or excluded from Proposed Rule 13f-2? If yes, describe the other activity and describe why it should be included or excluded. + +Q10: Indirect Short Positions or Short Activities: Managers meeting a Reporting Threshold would be required to report a gross short position in an ETF, but would not be required to consider short positions that the ETF holds in individual underlying equity securities that are part of the ETF basket in determining whether the Manager meets a Reporting Threshold for such underlying equity securities that are part of the ETF basket. + +o Should Managers be required to consider short positions that the ETF holds in individual underlying equity securities that are part of the ETF basket in determining whether the Manager meets a Reporting Threshold for such underlying equity securities that are part of the ETF basket? If yes, explain why. If no, explain why not. + +o Are there other diversified portfolio products in addition to ETFs that should be included? If yes, describe the product. Describe why, or why not, a Manager should be required to consider short positions in individual underlying equity securities of the product’s basket of assets. + +Q11: Frequency of Reporting: Under Proposed Rule 13f-2, a Manager that meets a Reporting Threshold must file Proposed Form SHO with the Commission within 14 calendar days after the end of each calendar month. + +o Is monthly reporting by Managers appropriate? If so, explain why. If no, explain why not and describe an alternative frequency of reporting that is more appropriate. + +o Does reporting within 14 calendar days of the end of the calendar month provide reporting Managers sufficient time to accurately report the short sale related information as described in Proposed Rule 13f-2? If no, please explain why not and describe any suggested alternative timeline(s). Alternatively, is the 14 calendar days after the end of the calendar month reporting period for Managers too much time? If so, please explain why and describe any suggested alternative. + +Q28: Is the Commission’s estimation that, over the course of a year, for every short position created by a “short” or “short exempt” sale order, there will be an equal and opposite number of “buy to cover” purchase orders placed in order to cover, and ultimately close out, those short positions, an accurate projection of how frequently “buy to cover” order marks will be used? If there is a more accurate means of estimating the volume of anticipated annual “buy to cover” order marks, please describe its structure and why it is more accurate. + +Edit: Tl;dr: The SEC needs an excuse to finalize these proposals, eliminate them, or make them more strict. You aren't supposed to be telling them anything they don't know. You're supposed to be telling them what is or isn't a shit proposal and why or why not. Being smooth-brained and yourself is better than being a copypasta genius. + +Edit: I made my comment. +We've been getting submissions about the candidates economic policies. They're worthy of discussion, but we also don't want political content displacing other economics content. So we're trying two sticky megaposts. One for Clinton's plan, one for Trump's plan. This way we can have a discussion on candidates policies without overrunning the sub, like we did with [the economic analysis of Bernie's plan](https://www.reddit.com/r/Economics/comments/46sx5a/bernie_sanders_economic_proposals_megathread/). + +## Clinton's policy platform: + +* [Generally](https://www.hillaryclinton.com/issues/) and on [taxes](https://www.hillaryclinton.com/issues/a-fair-tax-system/), [labor and worker's rights](https://www.hillaryclinton.com/issues/labor/), [college costs](https://www.hillaryclinton.com/issues/college/), [social security & medicare](https://www.hillaryclinton.com/issues/social-security-and-medicare/), [wall street reform](https://www.hillaryclinton.com/issues/wall-street/), [workforce skills & job training](https://www.hillaryclinton.com/issues/workforce-and-skills/), [jobs and wages](https://www.hillaryclinton.com/issues/jobs/), and [more](https://www.hillaryclinton.com/issues/). + +## Analysis of Tax Plan + +* [Tax Policy Center](http://www.taxpolicycenter.org/publications/analysis-hillary-clintons-tax-proposals/full) on the progressive tax policy and reduction of incentives to work, save, invest, and further complicating the tax code. +* Committee for Responsible Federal Budget [Analysis of both candidates](http://crfb.org/sites/default/files/CRFB_Promises_and_Price_Tags.pdf), [Executive Summary](http://www.crfb.org/papers/promises-and-price-tags-fiscal-guide-2016-election), and [Update](http://crfb.org/blogs/analyzing-clintons-health-and-education-expansions). Covering debt as a percent of GDP, growth assumptions or tax increases, and a policy cost scorecard. +* [Tax Foundation Analysis](http://taxfoundation.org/sites/default/files/docs/TaxFoundation-FF496.pdf) on tax revenue, incidence, and economic impact + +## Other Analysis +* [Moody's Analysis](https://www.economy.com/mark-zandi/documents/2016-07-28-The-Macroeconomic-Consequences-of-Secretary-Clintons-Economic-Policies.pdf) of the impact on GDP, employment, median household income, and more under current law, full implementation of policy platform, or partial implementation + +## Fact Checking + +* [WSJ fact checks Michigan speech](http://blogs.wsj.com/economics/2016/08/11/fact-checking-hillary-clintons-speech-on-the-economy/) +* [NPR fact checks Michigan speech](http://www.npr.org/2016/08/11/489563362/clinton-to-lay-out-economic-plan-in-contrast-to-trump) +* [Annenberg Public Policy Center fact checks the Michigan speech](http://www.factcheck.org/2016/08/clintons-economic-speech/) + + +## Other +* [NPR Comparison of Plans](http://www.npr.org/2016/08/13/489761605/how-did-trumps-and-clintons-economic-policy-speeches-compare) + + +## Resource Recommendations + +If you have any other articles on Clinton's economic plan, please post here or [PM me](https://www.reddit.com/message/compose?to=jambarama&subject=Clinton%20Megathread%20Suggestion) and I'll get it into the body. Articles must be written by an economist, rely heavily on analysis by an economist, or include simple fact checking of economic claims. +Maybe it’s a better question for r/nostupidquestions, but this feels like a fitting sub. If a company makes its shareholders Xthousand dollars this year, why do they need to make 10% more the next year? This growth, in many well established companies/industries is not organic and is predatory, unsustainable, and often downright cruel. So why is it such a standard outlook on business operation? +Ok guys, I've officially capitulated. Apparently I misread my /CL trade I was putting on as only requiring $11,000 to be cash-secured, but that was not the case, it needs $110,000 to be cash-secured. I sold a put at the $115 strike that has exploded in BP. Coupled with some NET cash-secured puts sitting at the $110 strike, I have officially lost 58% of my account today and have bought to close everything and am never trading again, finding this subreddit was one of the worst things that has happened to me, financially. +Since 2000 the federal debt has increased at an incredible rate. I see lots of people arguing that the federal debt isn't important so long as it's issued in fiat currency. + +If this is the case, and the size of the national debt isn't important, then why do we tax people and businesses? We could stop taxing and just allow the debt to increase faster. +I know a lot of us are ridiculed by our family/peers that think we are just following a cult-like meme promising fake riches in a dying company. + +The reality is we all know what’s really coming and put in the hours of research day after day. + +Some of us put our life savings into this, some weekly paychecks, others every little penny scrounged up til they could just buy that one share. + +We do it because we have a conviction and belief based on sound judgement, hard facts, and scientific method by the many wrinkle brained among us. + +So, when you finally cash those shares in and set a new course of history with the rest of us, remember you didn’t get here by luck. + +Luck didn’t make you read hours and hours of posts and data. + +Luck didn’t put all your hard earned money on the line. + +Luck didn’t make you hold out everytime the stock price crashed from hedge fuckery. + +The only luck involved was discovering this community and accidentally pulling back the curtain to reveal the world with clear eyes. + +Forget the haters and doubters. + +Apes strong together. + +It wasn’t luck, but we are lucky. + + +🚀🚀🚀🚀🚀🚀🚀🚀🚀 + + +Edit: thanks for all the love and awards friends. Glad I seem to have struck a positive chord with the community. + +I see it as an antI-FUD post. Sometimes we just need that reminder of what we’ve done, what we are doing and what will soon be if we are successful. +🍿 Post to be updated with links to the earnings report as soon as they're released. 🍿 + +#🙏🥑🙏🥑🙏🥑🙏🥑🙏🥑🙏🥑🙏🥑🙏🥑🙏🥑 + +[Earnings Call Webcast](https://viavid.webcasts.com/starthere.jsp?ei=1424794&tp_key=d5ec83cadf) ~~<--- ENTER BEFORE IT FILLS UP~~ - STARTS AT 5PM EST + +~~[Earnings Call is FULL, use this link for a backup stream](https://www.youtube.com/watch?v=cvh0nX08nRw)~~ Backup link is full + +#[EARNINGS REPORT](https://investor.gamestop.com/news-releases/news-release-details/gamestop-reports-fourth-quarter-and-fiscal-2020-results) +This question is inspired by this article: [Jacinda Ardern flags four-day working week as way to rebuild New Zealand after Covid-19](https://www.theguardian.com/world/2020/may/20/jacinda-ardern-flags-four-day-working-week-as-way-to-rebuild-new-zealand-after-covid-19) + +Considering that the concept of a [5 day workweek and 2 day weekend](https://en.wikipedia.org/wiki/Workweek_and_weekend) isn't actually that old (it was standardised by [Henry Ford](https://en.wikipedia.org/wiki/Henry_Ford) ), what really is the best workweek/weekend balance, taking into account: + +* Giving workers the opportunity to spend + +* Giving workers the opportunity to make money + +* Giving the employers the opportunity to make business + +* Allowing employers to remain competitive + +* Maximising worker productivity +This question is inspired by this article: [Jacinda Ardern flags four-day working week as way to rebuild New Zealand after Covid-19](https://www.theguardian.com/world/2020/may/20/jacinda-ardern-flags-four-day-working-week-as-way-to-rebuild-new-zealand-after-covid-19) + +Considering that the concept of a [5 day workweek and 2 day weekend](https://en.wikipedia.org/wiki/Workweek_and_weekend) isn't actually that old (it was standardised by [Henry Ford](https://en.wikipedia.org/wiki/Henry_Ford) ), what really is the best workweek/weekend balance, taking into account: + +* Giving workers the opportunity to spend + +* Giving workers the opportunity to make money + +* Giving the employers the opportunity to make business + +* Allowing employers to remain competitive + +* Maximising worker productivity +Shopify had a crazy stock-price movement in the last 2 years, went from roughly $350 prior to the pandemic, to almost $1,800 (almost 5x) at its peak, and is now down to $364 (80% down). + +The goal of this post is to share my fundamental analysis and valuation of this highly volatile company. Feel free to provide your feedback and disagree with me :) + +At the peak, the market cap was over $220b, let's keep that number in mind. Today, it's around $46b. Let's get started! + + Link to the video for those who prefer to watch: [https://youtu.be/gMji2hQCg1I](https://youtu.be/gMji2hQCg1I) + +&#x200B; + +**What is Shopify?** + +In one sentence, it is an eCommerce website builder that takes care of the infrastructure and provides additional services/solutions (payment processing, marketing, analytics, inventory & fulfillment, etc.). It allows setting up and operating a business online easier. + +&#x200B; + +**How does Shopify make money?** + +The revenue is split into two groups: + +1. Subscription revenue - This is self-explanatory, and refers to the monthly recurring revenue that Shopify gets from the individuals/businesses that use their platform. This stream of revenue doesn't depend on the success of the users. Regardless if a company sells 1 product or a million, the subscription revenue is fixed. In my view, this is the less-risky stream as they'd only lose customers if they switch to another platform (not that likely) or a business goes bankrupt. Historically, this stream grew 50% year-over-year, now almost $1.4b for the last twelve months (ending Q1/2022). This is also a high-margin business, with a gross margin of 80%. + +&#x200B; + +2. Merchant solutions - This is the segment that takes all of the other revenue and is highly dependent on the success of the individuals and businesses that use the platform. Payment processing fees, currency conversion, referrals, advertising, etc, all of that is included here. If there's a slowdown in the economy and the eCommerce business decreases, this stream of Shopify would be harmed. In the last years, it grew roughly 75% year-over-year to almost $3.5b in the last twelve months. The gross margin in this segment is lower (43%). + +&#x200B; + +The overall gross margin has been decreasing and if we only look at that in isolation, the conclusion would be that something bad is going on and Shopify cannot keep its margins at the same level. This is not correct. The reason for the margin decline is only due to the fact that the lower-margin revenue stream (Merchant solutions) is growing faster than the higher-margin revenue stream (Subscription-based). Hence, the gross margin naturally moves closer to the stream that contributes more. + +So, the total revenue is close to $5b. If we put this next to the market cap at its peak of $220b, it seems quite unreasonable for anyone to pay such a huge premium. Yes, the company has been growing at high rates, but the growth cannot continue at that pace forever. The moment the growth declines, that's where the problems start and a correction comes in, so it's always wise to incorporate this growth decline in the model and not assume growth of 50-60% for a very long period of time. + +The overall gross margin is at 53% for the last 12 months and it is expected to drop even further. Let's keep it simple and assume that it will decrease to 50%. + +&#x200B; + +**Operating expenses** + +With the remaining 50%, Shopify needs to cover 3 main expenses to get to the operating result. + +1. Sales & marketing - Decreased from 34% of revenue (2017) to 21% in LTM. + +2. R&D - Remains stable at around 20% of revenue in the last 5 years + +3. G&A - Remains stable at around 10% of revenue in the last 5 years + +&#x200B; + +By subtracting these 3 costs, we get to an operating profit of 1%. So, a company with revenue below $5b and no operating profit, was selling for $220b. That sound quite irrational. Of course, there are a couple of other factors to consider. + +Every growth company puts as much effort as possible into growing quickly. For Shopify, that's mainly in Sales & Marketing and R&D. The more potential customers they can reach, the faster they can grow. The more they can innovate, the more services they can provide. However, as the growth slows down, these costs as % of revenue decrease. The marketing won't yield the same returns as before, simply because the # of potential customers decreases. All of this will lead to margin expansion. + +&#x200B; + +**Balance sheet** + +There are a couple of main points to mention: + +1. Shopify is a capital-light business that doesn't need to invest in tangible assets in significant amounts. + +2. They have a strong cash position ($7.2b in cash & short term investments + $2.9b in long-term investments) + +3. The debt is at a very low level, roughly $1.2b (insignificant compared to their $10b cash/investments). It could be argued that they didn't use the low-interest rates to increase their financial leverage. + +&#x200B; + +Recently, Shopify announced the acquisition of Deliverr for $2.1b, a company that will add value in their process of inventory inbounding and distribution. The aim is to offer delivery to the customer within 2 days of ordering (Competitive with Amazon Prime). This is not yet paid, so needs to be deducted when valuing Shopify as a company) + +&#x200B; + +**DCF model** + +Key assumptions: + +1. Revenue growth: 25% for the next 5 years, then slowly decrease to the risk-free rate of almost 3%. + +2. Operating profit: Slowly improve to 25% (Basically, the 3 types of expenses mentioned above, combined, should decrease to 25% of revenue over the next 10 years) + +3. Discount rate - 11.7% (Based on WACC) + +Outcome: **Value per share - $276/share (current market price - $364)** + +My assumptions are based on what I think Shopify can deliver with high probability. Could be I be wrong? Absolutely! + +&#x200B; + +**What if I'm wrong?** + +Based on my assumptions, the revenue will grow by 426% in 10 years and the operating margin is estimated at 25%. However, I could be significantly wrong. Therefore, the table below provides a valuation of the company based on assumptions different than mine related to the revenue 10 years from now and the operating margin. + +&#x200B; + +|Revenue / Op. margin|20%|25%|30%| +|:-|:-|:-|:-| +|300% ($19.0b)|$190.1|$229.3|$269.1| +|426% ($24.4b)|$226.8|$275.8|$326.4| +|1000% ($51.0b)|$400.3|$500.5|$601.0| +|3350% (159.9b)|$1,089.9|$1,388.4|$1,687.0| + +Based on your assumptions about the revenue growth and margin expansion of Shopify, you can decide whether the company is expensive or not at this price. + +The last row is only for illustration of how irrational the market was in the last year when the price went up to almost $1800. Basically, to justify that valuation, the company would need to grow the revenue by around 50% every year for the next decade and at the same time improve its operating margin to 30%. So, starting with the gross profit being around 50%, the Sales & Marketing, R&D, and G&A together, should be 20% of sales. + +Feel free to add your insights into Shopify and add value to the analysis. Feedback (both positive and negative) is always welcomed :) + + +The pharmacist job market just makes no sense to me. In the US, median pay is $128,000, whereas in other countries it is MUCH lower. The UK for example has a median pharmacist salary less than $50,000. Why don't pharmacists from other countries come to the US and take jobs here? There's a huge gap in pay between US pharmacists and most other countries, it seems ripe for arbitrage. +Hi guys, hoping to pick your brains here. + +Last year I sold a bunch of ARKK CSPs and got assigned 60k worth of shares. Was waiting for a good time to wheel it and long story short, I’m not down 50% from my entry. + +I know it’s dumb to hold it up to now, but my question is what do I do now? Wait for the price to recover a little from Putin and sell? Sell now and eat the 30k loss and quit theta? Sell calls in the current climate? + +Also, how do I avoid this in the future? Without the benefit of retrospect, I’m not sure what I would have done differently. + +Thanks! +My wife and I just offered 30% OVER asking on a house and got turned down because we didn't waive our right to an inspection. We just can't seem to make a house happen, and we're pretty well off in a low demand area. This society saddens me in ways I can't express. Our governance has failed us. I wouldn't participate, but I won't even be that sad or surprised when the pitchforks come out. I know people desperate enough to be talking about it. It's just sad. Rant done. + +Edit: We also got turned down because I'm a disabled veteran wanting to use my VA loan instead of a conventional loan. Our real estate agent has been hammering us with the message that we need to switch to conventional and I just refuse to let go of a benefit I've earned. + +Edit 2: my reply to the comment that this is just a free market in action. "If you think governance, lobbying and private equity law has nothing to do with what's happening in the housing market right now, you need to do more research. Shelter is an essential human need, and families looking for shelter have to compete with massive corporations and PE firms (domestic and international) who buy up massive inventory and drive up rents to make a profit on the investment. Well governed Capitalism is a good system. Poorly governed capitalism is a nightmare for people like us. What about a law limiting the purchase of certain single family residences to single families who are going to live in them so disabled American veterans and other hard working Americans aren't priced out by Wall Street and Chinese investors? + +Edit 3: My reply to further comments that I'm against a free market: I'm for a well governed free market. Yes. The constitution sought to secure "THE BLESSINGS of liberty", not the blessings and evils. +Original post here: https://np.reddit.com/r/ethtrader/comments/6c673h/thank_you_to_everyone_eth_has_given_me_the_money/ + +He submits a very heartfelt sob story about his father being sent to the ER, and with the family's poor insurance, /u/sharpshaaman would be able to help since he threw all his money into 100 ETH a few months ago (originally $1100, this morning ~$11,240. He was so happy about the payoff he: + +> I told my mom for the first time about the extra funds I had and the relief I saw on her face was completely worth the dumb gamble I made without doing any research + +**Only problem is his mom supposedly [died ~8 months ago](https://np.reddit.com/r/personalfinance/comments/52ii32/college_student_and_i_need_to_turn_1600_into_4500/).** Does this sob story sound familiar? + +>I want to say thanks first of all if you're reading this, it's been a real rough couple of months. I'm 18 and just started college for Mechanical Engineering, my mother managed to pay my first semester of tuition, $4500, but she recently passed. My dad took ownership of the house, put it up for sale and moved to Seattle. I work at Dominos and working as much as I can am able to make about $600 a month, my rent is $700/month and that's not including gas or my food expense (I don't have a meal plan). As for my assets, I have a car that I could sell for about $2000 and $1647 in my savings. My phone bill is also $40/month, I have an iPhone 6 that I could sell for maybe $300 as well. I've been trying a lot of things, penny stock investing, attempting to sell out websites (search engine optimization), making an app, I'm even desperately trying to make a booty page on Instagram to get a bunch of followers and advertise other people's accounts (Dumb but whatever it takes, I dont really care). I've seen a little bit of success in the stock market by day trading penny stock through ustocktrade, however I don't currently have the knowledge and therefore the confidence to risk all my assets on unpredictable over the counter stocks. And advice is appreciated, as much as I hate my position I'm excited to see how it all turns out. + +8 days before that post, [another sob story about his friend throwing his wallet into a lake and having no cash and no gas in his tank](https://np.reddit.com/r/personalfinance/comments/514wfi/stranded_with_35_in_my_paypal_what_can_i_do/). + +Here's a lovely post about [shoplifting 2 Fitbits from a Kohl's and a Walmart](https://np.reddit.com/r/Shoplifting/comments/5er9ac/fitbit_haul/). + +And a final one from 7 days ago (same father to ER story) where he was [locked out of his car and left his credit card at the hospital](https://np.reddit.com/r/MGTOW/comments/6awxma/always_pay_it_forward_to_your_fellow_men/). + +He also has some very interesting anti-feminist and anti-women comments in his history. + +I love the generosity of this sub, but I hate to see its users taken advantage of. Anyone who has frequented the daily discussion thread the past few days knows that, after the creation of the tip jar bot, we've seen a bit of an explosion of "please tip me" or other kinds of comments. Yes, each tip is a small amount of money, but posts like /u/sharpshaaman's, when they really get mainstream, have the potential of yielding substantial amounts of money. I mean hell the top comment is from a Kraken employee offering him a *real-world* internship. I'm sure /u/kraken-colin would love to know about his shoplifting history before offering the internship. + +It sounds like this guy probably is a broke college student who's trying multiple avenues of scrounging up as much cash as he can in as short a time period as possible to get rich quick, whether that means shoplifting or posting sob stories on /r/ethtrader, /r/personalfinance, or /r/MGTOW (basically /r/MensRights, anti-feminist). In the grand scheme of things, a $5 donation isn't going to break the bank. But please be sure about the reason you're donating so this sub doesn't turn into people abusing the tip bot for extra cash. + +Edit: wording +There are times when we all might feel that we could be doing better, achieving higher and higher gains. I’ve set my weekly profit goal at $600. If I can do that consistently, it’ll be like working a 2nd job while hardly working at all. The wheel has enabled me to do that for the most part. Thanks Theta Gang. Good luck out there +Because he is just wrong. Nothing has intrinsic value. Value is subjective and marginal. The price of gold is what it is because of the equilibrium of supply and demand *just like everything else.* For most of you, this is a no brainer. However, Ron Paul seems to have a lot of supporters, and I just want to make sure that nobody here is one of them, at least on this issue, anyway. + +EDIT: Wow, there are a lot of people on /r/economics that really don't understand even the basics of economics. How sad. +https://www.politico.com/news/2021/07/31/eviction-moratorium-rental-assistance-biden-501917 + + +I was wondering if any of you are starting the eviction process now that the Moratorium is over. +**TA;DR:** The January MOASS is delayed because Citadel took hostages. They figured out how to ensure that others would be squeezed before they were. January 28th is the day Robinhood was required to deliver some of the GME shares Citadel owed to its customers, so they halted trading. They halted trading because their relationship with Citadel turned them into a hostage. The MOASS waits until new regulations ensure the hostages are safe... + +**TL;DR:** Citadel wasn’t going to be squeezed in January, Robinhood was. Citadel took hostages and figured out how to ensure that others were squeezed before they were. Robinhood halted trading after GME was on the threshold list for 35 days. After 35 days of failures to deliver, a broker becomes responsible for delivering the security to their customer. The MOASS is taking so long because Citadel managed to figure out how to make their short position other people's problem. This is why Citadel seems to have so many people protecting it and willing to lie for it: they’ve spent six months figuring out how to ensure it’s actually Citadel that gets squeezed. This is why there is an unusual cooperation between parties we wouldn’t expect to be able to keep this secret for this long. Not even the SEC can address this directly, Citadel figured out how to take everyone hostage. The past six months have been a negotiation to figure out how to deliver our tendies. + +**Theory: Robinhood halted trading the day they became liable for delivery of the GME shares Citadel sold to their customers** + +I think Robinhood halted trading because they were required to purchase GME shares to deliver their customers' past orders. Look at this requirement from [SHO § 242.203 (b2)](https://www.law.cornell.edu/cfr/text/17/242.203): + +https://preview.redd.it/el9inu75kq971.png?width=1066&format=png&auto=webp&s=950d9158e1ede602b68c834ec9da9552e464e3a3 + +If a Robinhood customer buys shares that are cleared by Citadel Securities, their delivery is not a problem for Robinhood *unless it takes longer than 35 days*. Once a security has taken longer than 35 days to be delivered, Robinhood is responsible for delivering it to their customer. Citadel still has to deliver the security too, but they deliver to Robinhood. So, the chain of obligation goes like this: + +1. Your broker/dealer owes you the security they sold you +2. The market maker owes your broker the security they sold to the broker +3. The seller of the security owes the market maker the security they sold to the market maker + +The key point is that *your broker is the one who owes you the shares you buy.* If someone else fails to deliver those shares, it’s your broker's problem (although they have some ability to make this into your problem, there were too many GME shares owed to avoid their SHO obligations). + +***(Expanded explanation, boring - you should skip)*** + +So, if I want to sell a share on the market (strictly hypothetical, I’ve never actually tried selling), then I do not owe the sold share directly to the buyer of that share. I send my sell order into the market via my broker and they send that off to the market center where the order is executed by a market maker. I sell my share to the market maker executing the trade. The market maker then sells that share to the broker of whichever ape has brought it and the broker then sells that share to the buyer. Assuming this goes smoothly, my share ends up in the account of the buyer. However, technically speaking, I do not owe the security to the buyer. I owe the security to the market maker, who owes it to the broker, who owes it to the buyer. So, if something goes wrong, and I fail to deliver that share, I have not defaulted on my sale to the buyer, I have defaulted on my sale to the market maker executing the trade. That market maker still owes the share to the buyer's broker, regardless of my failure. + +***(End of skippable content)*** + +I suspect that Citadel had been failing to deliver GME shares to Robinhood for an extended period, which is why Robinhood halted buying. Their primary motive was not to help Citadel, but to protect themselves *from* Citadel. After 35 days of failure, Robinhood has to buy the shares they expected Citadel to deliver for their customers. Effectively, due to Citadel’s failures to deliver, Robinhood had inherited Citadel’s short position. Citadel owed Robinhood and Robinhood owed their customers. I should clarify that, in this scenario, Citadel still owes Robinhood the shares at some point, but Robinhood has to deliver them to their customers *now*. At first, Robinhood didn’t care that Citadel owed shares to their customers, until it went on for too long and Robinhood was on the hook to deliver. + +**Proof: the timing lines up** + +For this to be true, you would expect there to be a relationship between when Robinhood halted trading and the 35 day threshold. If you look at my recent [post on the relationship between the threshold security list and the January price spike](https://www.reddit.com/r/Superstonk/comments/oao9oo/the_nyse_threshold_list_collapsing_shorts_and/?utm_source=share&utm_medium=web2x&context=3) you’ll see that GME was on the threshold list for 39 consecutive settlement days, from early December to early February. Robinhood halted trading on January 28, which is ***day 35*** of this 39 day streak. The trading halt aligns with when the obligation for Robinhood to deliver kicks in. As soon as the undelivered shares became Robinhood’s problem, trading was halted. Frankly, I would have expected them to halt trading earlier than the final moment, day 35, but perhaps waiting until the last moment will allow them some legal defense in the court cases to come? + +**Proof: the weird cost basis after transfer** + +A number of users pointed out that their [purchase prices and dates were incorrectly reported when transferring from Robinhood to other brokers](https://www.reddit.com/r/Superstonk/comments/ncezct/so_robinhood_finally_sent_over_my_cost_basis_from/?utm_source=share&utm_medium=web2x&context=3). I suspect this is because Robinhood initially sold their users the shares based on delivery promises made by Citadel that Citadel then failed to fulfil. So, after 35 days, Robinhood had to fulfil them instead. My guess is that this process was an absolute mess because it required Robinhood to at least appear to be purchasing GME shares from someone *other* than Citadel, which is rather awkward when Citadel is a designated market maker for GME on all major exchanges. The transaction dates and prices are wrong because the trade that was eventually settled for your GME shares *was not the same trade you sent to your broker* \- that trade failed and Robinhood had to redo it after 35+ days. + +This might help explain why [my analysis of the 605 data](https://www.reddit.com/r/Superstonk/comments/nc1h4o/findings_from_my_analysis_of_605_data_huge_short/?utm_source=share&utm_medium=web2x&context=3) found that the proportion of GME order executions done through NASDAQ spikes in February, despite being almost non-existent prior to Feb 2021. If Robinhood needs to buy-up GME without going *directly* through Citadel, they’ll need to get inventive and perhaps even use over the counter purchases. So, go to a market center that has very little history of executing GME orders - NASDAQ. It’s possible that Robinhood borrowed/brought GME from a variety of places to cover for the clusterfuck Citadel dumped them with, and then allocated those GME shares that actually got delivered to customers that transferred. If you had a massive shambles of shares like this, it might manifest in an inaccurate and messy purchase history for your customers. + +**Proof: others halted trading too** + +Robinhood wasn’t the only one that halted trading. It’s difficult, but not impossible, for Citadel to have orchestrated this behind the scenes. It’s much easier to explain this seemingly organized trading halt by pointing out that the brokers who halted trading *only halted trading when they themselves became obligated to deliver the shares in question.* This is why they halted trading *after* the price had already been spiking - my guess is that Citadel was putting on pressure behind the scenes too, but I don’t think it’s a coincidence that trading didn’t actually halt until the time arrived that the brokers themselves were threatened with delivery obligations. + +**Context and discussion: saving Citadel** + +Notice that my theory does not do Robinhood any favors - this is not a defense of them or their actions. I suspect, as was claimed during the congressional hearings, the trading halt was the main reason the January spike ended. If my theory is correct, it’s likely that the ending of the January spike saved Citadel. This claim is nothing new. What I think my theory adds to the discussion is a better explanation of why Robinhood and others did this. Remember, the buying halt was a disaster for Robinhood! They were dragged in front of congress, their reputation is in tatters, and they’re bleeding customers. Halting buying was *not* a good play. My guess is that they knew it would be a disaster and did it anyway. I think that this is why they waited right up until day 35 of GME’s run on the threshold list - they didn’t help Citadel until the only other option was delivering the undeliverable. In January, those who halted trading were slated to be the first victims of the MOASS. + +**Further implications: MOASS is so slow because Citadel has hostages** + +I suspect that the implications of what almost happened to Robinhood in January are why we’re seeing some of the recent regulation changes (‘clarifications’). I think that it was *Robinhood and not Citadel that was squeezed in the January spike*. Citadel is a market maker with its own market center, it has privileges and exemptions that make it quite resilient (as we’ve found out over the past six months). Robinhood does not have the same level of protection from its exposures, once the 35 day settlement mark passed, they had to deliver shares. It was the brokers that needed to buy shares from the 28th onwards: Citadel’s failures to deliver were, in the short term at least, the brokers' problem. For all we know, Citadel didn’t cover any of the deliveries that finally got GME off the threshold list at the beginning of February and managed to force the brokers to do it for them. If they were willing to abuse the market enough, perhaps via abuse of NASDAQ in February as my previously linked post discusses, Citadel might have even used the brokers need to deliver as a way of *expanding* their short position substantially while ‘technically’ resolving the failures to deliver (kicking the can down the road to another day). I guess there is no better ally than one who has to pay your debt if you go under… + +So, if my theory is correct, January almost saw Citadel’s failures result in *someone else* getting squeezed! Perhaps this is why the trading halt became the focus of the congressional hearings. Maybe this is why the DTCC has focused so many of their new regulations on clarifying what happens if positions need to be forcibly closed. January might have demonstrated that a market center, such as Citadel Securities, could contrive a scenario where they force *someone else to be squeezed by their short position!* + +In [my post examining the February gamma](https://www.reddit.com/r/Superstonk/comments/mvvuhp/feb_2426_failed_launch_attempt_and_proof_the_dtcc/?utm_source=share&utm_medium=web2x&context=3), I argue that the bizarre market activity near the end of February was a failed attempt to begin the MOASS. If my theory that Robinhood, not Citadel, was being forced to deliver in January is correct, I don’t think it’s any surprise that attempts to begin the MOASS have been prevented since January. The regulations required updating to prevent Citadel from forcing others to be squeezed before they were. If I am correct, Citadel was holding everyone hostage. The embodiment of too big to fail: not just because of the havoc their sudden demise would cause, but because *they wouldn’t be squeezed until after the squeezing of all the smaller parties caught in the impossibly convoluted web of failures to deliver and rehypothecation that Citadel shat into the market.* Lots of entities were exposed to the squeeze, and Citadel was setup to be hit last. + +The MOASS can’t launch until the hostages are safe. It needs to be Citadel that’s squeezed. Otherwise, the squeeze might wreak havoc on the market with no guarantee that the one responsible dies too. There was no choice but to wait. Meanwhile, Citadel is a huge market center with substantial political clout and presence in the regulators themselves. So, setting up the regulations for the MOASS took time. It was urgent, but those involved were regulating against one of their own. + +I think this offers a compelling explanation for what we’ve been living through over the last six months because it attributes a strong motive to the parties involved to remain silent. Explaining why this debacle has lasted six months is very difficult. It’s an absolute disaster and we haven't even heard anything from the SEC. What could justify this level of cooperation to keep lips tight, just to delay the inevitable? Why such slow action as the problem gets bigger? My guess is that Citadel has hostages and it’s taking a lot of careful work behind the scenes to figure out how to be sure that Citadel is the one that takes the fall. With everyone's hands tied and the need for secrecy so high, the job takes time. + +As a disgusting parting thought, I should mention that, if I’m right, my theory predicts that those responsible will suffer only minimal punishment. I suspect it’s taken six months because they’ve needed at least some cooperation from Citadel to sort this out. If this is true, my guess is that Citadel spent February trying to get out of their predicament and refused to cooperate with attempts to arrange the MOASS that will kill them. The February gamma might have been other parties preventing Citadel’s efforts to make the situation worse and forcing Citadel to come to the negotiating table. During the early months we saw market activity that indicated whales were fighting each other. I think this was Citadel trying to escape their own trap and whales preventing them, knowing it was too dangerous to let Citadel make things worse while it held the system hostage. Notice that this explains why, relatively speaking, the GME activity calmed slightly as this dragged on: Citadel was forced to the negotiating table and has been helping plan and regulate its own destruction. I suspect the payment for this cooperation will be those involved getting off lightly, because the alternative would be to have the MOASS without them releasing the hostages. Unfortunately, if I’m right, we’ll see those responsible living in Florida after this is over. Bankrupt and embarrassed, but more comfortable than the plebs. + +**Obvious but crucial disclaimer: I am a random on the internet spinning yarns about a conspiracy theory. As I was posting this thread, I decided to literally wear a tinfoil hat. Anyone reading this should understand my tinfoil attire to mean that I am not competent enough to be offering any advice or taken seriously. Readers must carefully examine any claims made here independently and not regard my words as authoritative.** + +Thank you to u/RoutineYesterday267 for a post that led to me writing this +I am amazed to see it below $30 now. What has people so nervous about the company over the last month or two? This is unusually low for the company's valuation. +So over the past month I've cashed out IOU at 23c a day before it went to the moon + +I also cashed out CI1 at 3c and look at it now + +Cashed out 9sp at 2.3c and she's rocketing today + +Cashed on out IHL at 18c shortly before it's recent results + +Sold CRO at 7c two days before it hit 21c + +Sold 3DP only to have it go up another 30c within a week + +Sold RLT at $1.25 and it hit $2.5 a few days later + + +Which stock shall I sell next? For the low low price of a $20 PayPal donation you can buy a ticket to the next rocket 🚀🚀🚀🚀 enquire within + + +Edit: I actually got some DMs so to be clear this is a joke post and I don't want your PayPal money +I am listening to Eric Weinstein and he argues that a long term labor shortage should not exist and that a long term shortage in academics is artificial. The idea is that transformational change that would push more URM and women into STEM has been avoided due to over reliance on immigration. Also, many universities operate as businesses with the salaries of a large number of admins that count on large number of low paid TAs and RAs to make financial sense. For grad students, many domestic students do not choose to get a PhD simply because it does not make economic sense unless immigration esp from a poorer country is also included. + +However, the other side of the argument is simply that US and European schools are able to attract international talent where as China or Japan cannot. Now if we ignore the T100 or even T200 research universities in the US, the rest that have PhD programs are still full of international students. Can this argument that any Western school has a bit of of a cachet? Is this cachet the chance for immigration? +By this I mean a situation similar to the existing pandemic situation or worse, where black swan events like the sudden unemployment of tens of millions of people happen, and the follow on consequences of widespread consumer debt default. + +I'm specifically interested to know about if there is a "tipping point" where the traditional means of dealing with debt default, such as foreclosures and repossession of assets, become marginally useful. Either because so many assets need to be repossessed that the processes of administration become overwhelmed or because the market for the assets has shrunk so much that the asset values make the assets difficult for creditors to resell. + +I know that during the mortgage crisis, there was some media focus on banks which ran into problems trying to document ownership of mortgages and some faced rejection of their foreclosure claims. This was probably less related to the volume of foreclosures than to simply poor record keeping. + +One of my examples would be recreational boats. The loans are often for much longer terms than automobiles, and as anyone who has ever had to sell a boat will tell you, even in good economic times it can be difficult. What happens if suddenly there's a 25% default rate on marine loans? Repossessing a boat is expensive, they don't have a great "shelf life" even if prepped well for long term storage, and they're not nearly as essential as cars or homes. + The rush to crowd into cities to be closer to tech jobs could be a thing of the past in the wake of the COVID-19 pandemic as more people embrace remote work and flee close quarters. And Seattle-based real estate company Redfin is “preparing for a seismic demographic shift toward smaller cities.” + + [https://www.geekwire.com/2020/boise-bozeman-bound-redfin-ceo-predicts-big-shift-smaller-cities-remote-work-takes-hold/](https://www.geekwire.com/2020/boise-bozeman-bound-redfin-ceo-predicts-big-shift-smaller-cities-remote-work-takes-hold/) + +&#x200B; + +I can certainly see this happening for the next few years, but hard to see this as a long term trend +I apologize in advance for how morbid this post is. I am in no way supporting this, I'm merely curious. + +Let's hypothetically say that when covid-19 first started, the U.S. decided to do nothing and simply let the disease run it's course and kill anyone that was vulnerable. In March, the Imperial College of London estimated that without intervention, as many as 2.2 million Americans would die. The Insurance Institute for Highway Safety places the value of a human life at around $10 million dollars. By this calculation the 2 million excess deaths would cost the economy $20 trillion. + +However, most of the deaths would be senior citizens who are at the end of their working life and have no more earning potential. Their remaining assets would likely be transferred to their families after death. Covid-19 has already cost the US $16 trillion; from a strictly economic standpoint, would it have made more sense to not address the virus and let it run rampant? +April 9 update: This piece has been heavily edited from its original presentation. I've had plenty of shit talk about this post. I get it. Some of y'all think I'm fucking r*tarded for even posting this. But NOT ALL APES HAVE BEEN HERE SINCE JANUARY. I'm just trying to help in my limited capacity. And it seems to have helped thousands of apes get their affairs in order before liftoff, so I stand by this post. To be so smart as to correct me (rudely), you rude ones sure don't know how to read my disclaimers scattered all over this post 🧐 plus we figured out a record date in real time. Winning. + +**UPDATE: I CAN'T EDIT THE TITLE BUT HOLY SHIT GUYS ITS LOOKING LIKE [4/15](http://imgur.com/a/QJqwTfw) RECORD DATE NOT 4/20 I THINK WE FIGURED IT OUT GOOD JOB APES** + +WE NOW HAVE [PROOF](http://imgur.com/q99378Y) OF TDA SAYING RECORD DATE APRIL 15, 2021 + +ETRADE [NOW REPORTING](https://www.reddit.com/r/Superstonk/comments/mmyh72/etrade_support_on_gme_voting_must_recall_by_415/?utm_medium=android_app&utm_source=share) 4/15/21 RECORD DATE + +WEALTH SIMPLE CANADA [CHECKING IN ](https://m.imgur.com/ai6Duju) WITH A 4/15 RECORD DATE + +1st Update: [A comment worth reading!!!!](https://www.reddit.com/r/Superstonk/comments/mmt5rq/420_share_recall_explained_why_its_important_that/gttv4u8?utm_medium=android_app&utm_source=share&context=3) Looks like Vanguard is reporting a deadline of April 15!! + +TO ANSWER MY OWN QUESTION IDFK THE CATALYST NONE OF US DO. I'M NOT SAYING 4/20 IS ANYTHING BESIDES A (SUSPECTED) DEADLINE FOR RECALLING SHARES + +The more shares recalled, the more the shorts need to cover!! + +And [lenders are responsible for recalling shares, not Gamestop!!!](https://www.reddit.com/r/GME/comments/m9eqv9/clarifying_share_recall_what_is_it_and_how_does/?utm_medium=android_app&utm_source=share) + +Comments are reporting that cash users with TDA and Fidelity do NOT lend out their shares. You will be notified more about voting through their platform when it's time. More brokerage updates from users in comments, but I would suggest you contact your broker yourself. Stay vigilant! Many brokers are automatic margin!! + +Posting this before us 🦧 breed confusion... I know the [memes](http://imgur.com/gallery/gHBIpHq) are exciting, but they open lots of questions. I’m here to open my limited knowledge as well as start a discussion on what this means. Directly quoting u/Obvious_Shake_5012 here also. + +So a [post ](https://www.reddit.com/r/Superstonk/comments/mmcgb6/got_this_email_back_from_rh_about_gme_shareholder/?utm_medium=android_app&utm_source=share) on here shows a letter from Robinhood acknowledging a Gamestop Share Record date of 4/20. I contacted my main broker (I use several cuz I don’t trust a bitch) TD Ameritrade by phone and they confirmed this deadline for me. + +What does it mean, Pink?! + +The date of record, in this case ~~4/20~~ 4/15, is the deadline for shorts to return their shares. So a recall would be BEFORE 4/15 because 4/15 is the RECORD DATE . I.E Recall is NOW! + +Did you read that, apes? THE DATE THE SHARES MUST BE RETURNED TO LENDERS BY SHORTS, VERIFIED AND ACCOUNTED FOR TO RECORD **YOUR** SHARES IN ORDER TO BE ABLE TO VOTE IN THE SHAREHOLDER MEETING. + +**YOUR SHARES**. This is UP TO US! + +⚠️ **Contact your brokers and RECALL YOUR SHARES!! Tell them you want to exercise your shareholder rights in the upcoming shareholder meeting.** ⚠️ + +*Do not fear the shills in the comments saying this is market manipulation or planned movement. None of that shit flies here, and all I'm saying is that you need to recall your shares before a certain deadline to exercise your shareholder right to vote. Nothing illegal about that!* + +Keep in mind, Gamestop would need to have the 69.75 Mil shares accounted for (or however many are recalled) before shareholders can vote for anything important. + +No this isn't a guarantee that anything will happen. But from a marketing standpoint, I sure as hell wouldn't be sending out PR without knowing for a fact things will be kosher enough to conduct business by the meeting date on **6/9 ( ͡° ͜ʖ ͡°)** + +Inb4 naysayers say institutional whales don’t historically recall their shares and/or participate as voting shareholders in the annual meeting. WELL THIS YEAR IS FUCKING DIFFERENT HAS ANY OTHER YEAR BEEN THIS HISTORICALLY FUCKED?! + +But just in case it *does* go according to historical trend... + +Share recalls like to spark gamma squeezes. + +If shares are required for a shareholder vote, Gamestop will send public notice this Friday or Monday as this is 60 days before the meeting date. Who knows what will come of this. + +**These dates are factual and documented as far as I can tell, I am not making up my own target date or claiming anything here. Stay vigilant and do your own research!** + +**4/20 BLAZE IT BITCHES**🔥🌬💨💨💨🌳🌳🌳🌳 + +Note: + +1. Yes you can still sell your shares if they are recalled. This simply means nobody is being "loaned" your shares. (To then take to the pawn shop like our boy Kenny G does.) +2. You must be a current shareholder as of the record date to vote. +3. We don't know what we're voting on yet, but im exercising my right to vote. +4. TDAmeritrade confirmed my shares are not leant out and I will be able to participate in the annual shareholders meeting. + +Copied from a comment cuz I couldn't remember: + +The notification will be through TDAmeritrade and will show up under "My Account --> Shareholder Library" + +[A great post on share recall](https://www.reddit.com/r/GME/comments/m9eqv9/clarifying_share_recall_what_is_it_and_how_does/?utm_medium=android_app&utm_source=share) + +The majority of these awards were anonymous if that tells you anything 😉🚀🚀🚀🚀🚀🚀🚀 +Perhaps I just don't understand the rational basis for this, but I cannot understand how companies, and in the macro sense, economies are expected to grow, by ever increasing margins, without limit. The planet can only sustain so much life and only has so few resources. As economies continue to grow, isn't the world just accelerating rapidly to a point where all resources have been exhausted and all markets are saturated? And what then? + +What drives the model for perpetual growth? And what makes economists and politicians think it makes sense? + +The relentless pursuit of profit growth does not always provide value. I would argue it drives responses such as decreased quality, cheap labor, and planned obsolesce as companies continually seek new ways to "grow" their profits once market saturation has been achieved. +I (25F) got a $4/hr pay increase over 6 months. I am up to $22/hr now. I did some rough calculations (my paydays x4, plus $225 insurance bonus). I'm only up $200 monthly than I was before those $4. Now I only make $1k more for yearly salary which is $33k. Is this some sick joke? + +My company is forcing everyone to put up to 10% of their salary into their retirement (25% match). And next year I will have to get my own health insurance. I won't see any of that increase. + +But in my paystub, it looks like I am projected to make $10k more yearly ($55k from $43k). Am I missing something here? Where is that money going? + +EDIT: I will post my paystubs (before and after) once I get home, I don't have them with me at work. + +I think the $43k-$55k yearly is before taxes. I work 40hrs a week with a couple hours overtime each week. The $200 increase per month is only from $2/hr. I looked at my finances after the first $2/hr raise in January this year. So essentially double that for $4/hr as of end of July. + +The 10% retirement contribution has not fully kicked in for me yet. I am contributing $64/w currently. Every year they will bump up the percentage by 2% until I max at 10% + +Sorry I don't have much time to answer replies at work on my breaks. I hope this clarifies some things. +Hi guys, I’m a former WSB member who grew disenchanted with the sub after the GME fiasco and the irrational pump and dump and siege mentality that developed over there. I’ve decided to rotate away from the overvalued growth stocks that are popular now and want to get into more value based positions. I have read Security Analysis by Benjamin Graham as well as The Intelligent Investor so I understand the basics of the strategy. My question for you is what platforms/ sites do you use to do research and what factors do you look for in a stock and do you have any stock recommendations? +Thanks for all your help, I’m excited to be in a community that isn’t dominated by insane and irrational children. +Inflation is hitting like crazy and I’m not making anymore money than I used to. It’s so much harder to save. Idk maybe it’s just me. But I feel like everything has gone up in price by a few dollars or a few hundred 😣 +This is one of the reasons why prople don't think going to college is exactly a choice, but I don't think it has to be this way. Is there any way to make it so that there is less of a pressure to go to college? +**EDITED TO ADD THE FOLLOWING:** + +***\[START of edit here\]*** + +*Page 5 of the report states "unrisked mean totals are not representative of the expected total from the prospect and assumes a success case in all 11 reservoirs* + +For XST: + +Andrew Childs has been DAY TRADING this fucking stock himself + +11/02/21 Andrew Childs Buy +10,000,000 ( Exercise of options @ $0.005 ) + +11/02/21 Andrew Childs Sell +3,700,000 (Sold on the same day for $0.02 ) + +11/02/21 Andrew Childs Sell +500,000 (Sold on the same day for $0.02 ) + +&#x200B; + +David McArthur has also been DAY TRADING this stock himself + +16/02/21 David McArthur Buy 5,000,000 ( Exercise of options @ $0.005 ) + +16/02/21 David McArthur Sell +2,500,000 (Sold on the same day for $0.02 ) + +16/02/21 David McArthur Sell +2,500,000 (Sold on the same day for $0.02 ) + +\---- + +Further to these, the announcement released on the 17/02/2021 shows that they have exercised their options AGAIN for more. + +It seems like they liked the rush for flipping for a quick profit. So both Andrew Childs and David Mcarthur have acquired more. + +Andrew Childs acquired another 10 million in XST + +David Mcarthur acquired another 5 million in XST and 2 million in SGC + +\---- + +Going by the above, these are the 2 directors / dogs that dumped onto us on the market. Theyve now acquired the latest batch at the following rates (XST 0.005c / SGC 6c). + +Is this the company you are supporting ? Its nothing but a SHAM. Their options expire in the year 2022 , so why are they in such a rush to exercise and flip them now? + +***\[END of edit here\]*** + +\---------------------- + +I am writing this because i feel like weve been duped. + +Disclosure: i sold out today with a hefty loss , and i didnt make that decision without careful consideration. (if the share price went below what it got to, i would be officialy outside the territory of "only invest what you can afford to lose". Its a shame because ive lost all my profits from prior weeks/months (as always happens to me) and back to square one. Lesson learnt? lol , i never learn my lesson. True autist right here (i make good gains then get too excited and over confident, lose all my gains and start again. Its a never ending cycle). + +**Now back to the point:** + +SGC has mentioned on numerous occasions: *"Sacgasco has an extensive portfolio of natural gas producing wells and prospects at both exploration and appraisal stages,* ***including multi-Tcf opportunities***\*."\* + +From Multi-**TCF** to **19.5bcf** \- what the fuck , thats not even in the same ball park , not even close. Im not sure how they done a CR with misleading information. + +Ive looked deeply into SGC and i can see theyve been a failure for the last 5 years. Their share price had a spike in 2017 and then back down shortly after. They live off CR money, and also, they sell shares on the market to us retail guys. So the other day when there was heavy selling , it could have been the directors themselves offloading on to us. What pieces of trash. + +The same goes for XST. Their share price actually started to decline from 2017, YoY declining further. + +The #1 shareholder of XST is Petroleum Ventures Pty Ltd , and that is Andrew Childs (he is the chairman of SGC and also the managing director of Petroleum Ventures). + +To me it looks like they are all one and the same, same people on the board, and XST is possibly just a shell company to mitigate risk for SGC. Either way they are all heavily affiliated, and they all sell shares on the market to make money. + +**Why did i decide to sell:** + +Firstly (other than the bad report and misleading borba potential from management), there were heavy sellers every day , and low volume buyers. Whenever the buyers start touching a block, these heavy sellers would add another 300k units for sale. It was ongoing with no remorse. The sellers also would keep selling to the next available block when buyers stopped buying at the current block (they dont care about the price, because they have obviously bought in a long time ago, or in the CR for cheap, or with converted options for cheap and are still making good profits). It was definitely not retail dumping those big numbers of shares over the past week. Ontop of that i saw the announcement of the directors exercising options for 0.006 c and were ready to start offloading on market again too. + +That brought a negative sentiment to the management team. Because they were preparing to dump when the SP rose (or thats what we think anyway). Compare that for example, to HT8 director who buys on market when the price drops. These guys are dogs + +Also, based on my opinion, i think that the next few announcements , if very positive and received well, will bring us back to the "break even" zone of the ATH range. I dont see this as that multi bagger rocket anymore after the resource report. AND, if the next few announcements are not received well, or if theyre trash, (or for example if they find gas but its not enough gas to make it commercially viable) we could see some more serious losses and fall in the SP (and that i couldnt afford to go through). Now, it has been a very stressful week and id rather take the hit and recoup the funds elsewhere than to stay on this dog shit for another month with a chance of losing even more (if the project fails). ***Its not a high risk high reward, its a high risk , low reward from my understanding.*** + +Now ofcourse i could be wrong and it could rocket , its just my opinion at this stage + +&#x200B; + +Now i have taken some info from one of our own autists, who did also post on HC recently with his DD: + +[**Catch2200**](https://hotcopper.com.au/search/search?type=post&users=Catch2200) + +**"The 70% chance of geological success is the chance of at least one layer being successful. Individually each layer only has a 17% chance of success (see page 4).** + +**The table on page 4 shows that the total in-situ for SGC (their 66%) is 74.5bcf.** + +**The table on page 5 then rolls up each of the individual probabilities for each layer to determine an all-together probability of success. Remember the 70% chance is only the chance of at least one successful layer. This leaves you with a probability of 19.5bcf.** + +**You can’t read the 141bcf or 74.5bcf figures without then going to the page 5 table. The page 5 table is there for a reason - you can’t ignore it just because it’s a less exciting story.** " + +" **I was holding SGC for a chance of a proportion of a** ***TCF asset*** **in Borba 1-7, not for a proportion of 26bcf. It’s actually 19.5bcf for SGC once you apply the 70% factor (see the table on p ok age 5). That 19.5bcf figure also doesn’t account for chance of development (ie commercialisation) which is estimated at 80%.** + +**When you take all of this and work out a NPV (difficult to do confidently without knowing other factors like how long it could produce for, but I ran the numbers assuming 5 or 10 years with a 10% discount rate each) and you don’t get much compared to what it could have been.** + +**19.5bcf over 5 years at $5 per MMbtu with a 10% discount rate is a NPV of $74M. That becomes $60M when you factor in 80% chance of commercial success.** + +**You never get the full NPV reflected in a pre-production company share price. Most of the time I would expect 1/4 or 1/5 of the NPV for a non producing company but SGC is very close so I’ll call it 1/3 to 1/2 NPV. This means Borba 1-7 is currently worth $20M-$30M on a fully risk adjusted basis to SCG.** + +***It should be enough to sustain a share price around the $0.08 - $0.1 level for sure,*** **and I can see upside above there when you factor in the Canadian assets and also the chance of Borba being more successful long term.** " + +**I think it’s even heading towards good value at this price ($0.08 close), but it’s gone from being an absolutely no brainer throw-everything-at-it play to a more cautious play.** + +\---------------------------------- + +As we can see from the proper DD above, if everything goes well then we're on track to sustain the 0.08-0.10c level (i know everyone calculates / does DD differently, but this autist is a realist, and not aHC ramper). From now until then we may see more volatility (including spikes UP in the SP - which will be good chance for you to get out without loss) , and if things dont go so well the risk of big falls in the share price is high. I dont feel like its worth the risk at all to stay in (IN MY SCENARIO, where i had invested way too much capital and **Liquidity in SGC is BAD**)**. But for others with smaller investments, i recommend to hold and ride it out, you might come out ontop. Theres a better chance for you with that.** + +**In saying that , however, if they are successful it can open the doors for bigger things - and for my diamond hand guys, i truly hope it rockets and they find more gas than ever expected** + +Also im sorry if anyone jumped on board because of my posts , i was also duped in the hype and marketing gimmicks . + +At the end of the day, for all we know next month i could be kicking myself for selling, it was/is a gamble - the gamble may or may not pay off for diamond hands. + +Also , now you know the reason why traders prefer XST. Because if you want out its so easy to get out without affecting the share price. With SGC, for me to get out i had to sell in a range of share prices (because not enough buyers / bad Liquidity .). So to exit i needed to wipe out 5 buyer blocks and drop the SP . And if there were no big buyers i n those blocks it could have been worse. I actually believe they were 'fake' orders , because ive seen it before. Where pumpers would put in big buy orders below the current price to make it look like theres big buyer interest starting, and then get buyers to buy their shares at the current share price (i hope so too because fuck them). Those buy orders never existed prior to the rapid decline in the SP. And whenever they sold 200k shares they would add another 200k shares instantly. Ruthless dumping + +Anyway , this is a super sloppy post , im tired, apologies in advance +I found this quote from Bloomberg particularly interesting: + +"Americans younger than 50 held just 16% of all investable assets in 2016, down from 31% in 1989, according to the Fed’s triennial Survey of Consumer Finances, leaving the rest to households 50 and older." + +Source: [https://www.bnnbloomberg.ca/boomers-are-thriving-on-an-unprecedented-9-trillion-inheritance-1.1350227](https://www.bnnbloomberg.ca/boomers-are-thriving-on-an-unprecedented-9-trillion-inheritance-1.1350227) +As a banker, I worked with highly efficient corporates in the first four years of my career. It was a wake-up call on how I handled my own money. Now I work as a branch manager. It pains me to see how much worse other people are with their money. So I decided to make a list of common rookie mistakes that people do with their money. + +&#x200B; + +If you aren’t doing any of these, you are already a cut above the rest of India. I did some of the mistakes mentioned below as well, but I can safely say I won’t be doing them again. So here they are: + +&#x200B; + +* Buying no-cost EMI even if you have enough money to buy it outright. Your no-Cost EMI actually costs more than an outright purchase. How? The interest levied on credit cards are subject to GST. This GST is added to your credit card bill. Credit card companies claim input credit on this and profit as they have to pay less GST now.(Example, if you buy a product for Rs 12000 on a 12 month EMI plan, you pay Rs 745 as interest over the 12 month period and 11255 as principal, totaling to Rs. 12,000. However, you will also additionally incur GST of 745 x 18% = Rs. 134.10 over the 12 month period.) +* Using insurance as an investment. Insurance is supposed to be a hedge against uncertainty. Stop investing in Unit Linked Insurance Plans. If you are looking to invest, put it in mutual funds. If you need insurance, invest in a term plan. + +&#x200B; + +* Taking out loans on depreciating assets. A home loan might be excused, since + * they have tax benefits + * the asset (land) might appreciate if you invested in the correct location + * The interest rate is low + +(But any other loan like car loans, personal loans, etc. are a no-no. The interest rate is much higher than inflation and you are buying a depreciating asset. [Delayed gratification](https://en.wikipedia.org/wiki/Stanford_marshmallow_experiment) works wonders for your financial health; I learned the hard way) + +&#x200B; + +* Keeping money idle. FDs hardly beat inflation. But people keep large sums of money lying around in their savings account, let alone invest in FDs. The corporates I worked with would immediately transfer excess (I repeat, excess) cash to a liquid fund. As instant redemption has been capped now, liquid funds are no longer attractive. The next best thing you can do is keeping an automatic sweep above a certain balance to FDs. Banks usually allow this for clients who maintain more than 10 lakhs in their current/savings account. + +&#x200B; + +* Not going through your Bank statement once in a while. No bank system is foolproof. Charges can be levied accidentally due to random technical issues. + +&#x200B; + +* Paying higher interest on your loans. RBI has ordered all loans to be linked to a benchmark called repo rate from October 1, 2019. It is cheaper by about 1% (currently) than their previous benchmark (called marginal cost of lending rate – MCLR). Since RBI only ordered new loans to be linked to it, loans taken earlier will continue to be in MCLR unless you specifically request to reduce your interest rate. + +&#x200B; + +Edit: formatting +Edit #2: MCLR is costlier than repo rate by about 1% currently for most banks. But the difference can reduce going forward. +Edit #3: My first award. Thank you kind stranger +I understand he’s great at math but Buffet has already said that being good at math isn’t what’s helping him understand businesses. He’s even said if you have to do a calculation down to the last decimal, the company is probably not a buy. So being good at math isn’t what makes him a genius. + +His evaluation of intangibles is top tier and probably his greatest advantage but the average person *can* (in theory) replicate it. + +Even when people try to replicate what he did, they fail. There have been several books that all say the same things about Buffet, and nobody has come close to his track record. + +Part of me feels Warren Buffet benefited more from people not understanding financials and/or not having access to company financials more than he benefited from being an “investment genius”. However, part of me doesn’t want to believe that at all. + +Thoughts ? +There's this [article](https://monthlyreview.org/2009/05/01/why-socialism/) by Einstein blatantly endorsing socialism. +I'd like to clarify that I have no dog in this fight, and I think Einstein being Einstein deserves the benefit of the doubt. +Now I read the article. It has some interesting points. Though it seems very idealistic in some cases. +Most discussions I've encountered about this article online and on reddit talk about whether Einstein's qualified to talk about this along with the typical socialism/capitalism circlejerks. +None are actually addressing the points being made in the article. +So I'm curious to hear what economists have to say about the things written there. +I think this could be an interesting subject for this sub. What is your one 'secret' weapon that you believe gives you an advantage in life? + +Mine is an early morning run while listening to an educational podcast/show. 30-60 minutes in the morning where I kill two birds with one stone; fitness and education. I feel like I am cheating life while doing it. + +I'm keen to hear from you all. Best of luck out there! + + +EDIT: + +A few folks have asked what my favourite podcasts/shows are. I like to listen to all sorts of subjects, but right now they are; Invest Like the Best, Sam Harris - Making Sense, The Economist - Checks & Balance and Freakonomics Radio. +I'm seeing all these posts about "Did I buy at the worst time?" +The reality is, that you'll be paying off the home for 30 years so just chill out, when that 30 year has passed, you'll be so far along in the journey that it won't matter. + +Did you buy the home to live in or make some investment over the years? The reality is we all need a roof over our heads, and if you bought well done. Don't worry about the articles. +We bought it 2 years ago and found out about it being sold on the internet only a few hours ago. We don't know how long the ad has been up but it's not on the site of the realtor we bought it from... any advice? + +**Edit: Ok... Time to disappoint a lot of people.** + +First of all, thank you to everyone here for the overwhelming response we had. A lot of great and precious advice. + +I have to clarify a few things as well: + +- This isn't happening in the US. Sorry. Sorry. I'm sorry. When I posted this on here I didn't realize that it was based in the US, we wanted as much advice as possible. All the time you spent writing advice wasn't wasted though, because it seems mostly applicable here too; the terminology is just different. +- As a few of you pointed out, no one is "selling" my house without my permission. It's just a listing. Still worrying but not as much as the title implies I guess. +- I am not behind the "scam" (if this turns out to be one). I'm not a realtor and I don't think posting about it on Reddit would be the greatest idea. + +Now for the update part: From what I've read across the 250 or so comments in my inbox (haven't gone through all the replies yet), this could be one of 3 things (from less likely to most likely): + +- An actual scam. Someone is trying to forge documents to gain ownership of the house or something. I haven't really understood the whole process of this one but it's still possible. +- A bait & switch listing, used to get interested people to call to visit the house. Then the realtor tells them it's not available right now but "here are some other houses we can take a look at". We think this one is what is actually happening. They might be taking (or keeping) old ads on their website just to have a good quantity of them so people come. +- An error. Honestly the most likely. The pictures are from 2 years ago when we bought the house. The house is not currently for sale anymore and someone could have forgotten to take the ad down. The price is the same as when we bought it too. + +All in all, this is probably just a fun ride and we're not likely to lose our house that way (thanks for pointing that out, it's reassuring). + +We will call the realtor as potential buyers, saying we're interested and want to visit the (our) house. If they remove the ad it was just a mistake. If they answer offering to take a look at other houses we will send a formal letter asking to remove the listing. Same thing if we don't get an answer. + +Either way, I will keep this post updated. + +PS. I realized that this should have been posted on r/legaladvice instead. I don't think I can just move the whole thing now but if the mods want to remove it because it breaks the rules I'm ok with that.. + +Thanks again for all the replies, advice and to everyone who shared their experience! See ya in "Edit 2" probably + +_Will update when I have something to update_ +My question is based on the following quote from a 2018 [article](https://www.scientificamerican.com/article/the-american-economy-is-rigged/?) in Scientific American: "In the U.S., those at the top pay a smaller fraction of their income in taxes than those who are much poorer." How is that possible? +I see a lot of newbies entering the market, people who hear about Ethereum. If you are such a person, you might be a little bit confused about why there is the Ethereum coin (ETH) and the Ethereum Classic coin (ETC). + +Here is the story of what exactly happened. This is not research, but a first-hand story. I was there when it all happened, in the middle of it. And active in **all** involved communities. + +#It all started during the spring of 2016: + +There was only one Ethereum coin you could buy (ETH). The Ethereum world computer was online for not even a year. Most investors invested in Ethereum because they saw this world computer as something that could change and transform the world. This is not new for you guys reading this now, you are starting to see the potential too. But these early investors were visionaries. They could already see it before it started to happen. + +They saw the possibilities and were excited about what had been built. Excited about what was still going to be build. + +So here follows what the early adopters did next: + +#Growing the eco-system + +An important task at that moment in time, was to grow the eco-system. Companies and startups would be created and motivated to play around with the possibilities of this new technology. + +Thus the early investors were going to work together to build the eco-system up. + +More than a thousand well intended investors had allocated a major part of their hard-earned wealth into a program / contract running on Ethereum (*the contract was named TheDAO*) which was created with the goal to fund startups in the eco-system for at least the next 4 years. + +The idea and the intention to grow the eco-system with this money, was so grand that more than **11 million Ether** (12 % of all ETH in circulation) were allocated to this contract. With the sole plan being that these funds would then later be redistributed over **hundreds of different projects**, all trying and building different use-cases for Ethereum. + +#Then summer came, and a software bug + +Then, for all these investors, the unthinkable happened. Due to an obscure bug in this contract, hackers managed to hijack and steal all of these funds. + +11 million Ether, now worth **more than 2 billion USD** that was meant for the growth and success of Ethereum, could now no longer be used. It was a doomsday scenario for the Ethereum world computer and all dreams and enthusiasm turned into a nightmare for both investors as Ethereum enthusiasts. + +#Bitcoin community celebrations + +There was joy too, on the other side of the crypto community. The biggest Bitcoin forum /r/Bitcoin , which was then famous for censoring (deleting) every single news piece on Ethereum, made an exception and allowed the posting of the "Great Ethereum hack". + +The supposedly pro-innovation Bitcoin-community celebrated the failure of another crypto-experiment that was trying to do something new. As if this was a competition instead of a collective project on building good things for the world. + +But their celebrations were premature. + +#The Ethereum community stuck together, worked together, and fought back. Successfully + + +Through a hard fork, the Ethereum Foundation together with the communities consensus executed a successful redistribution of these **funds** away from the rogue hackers **back into the hands** of those who **rightfully owned** these ethers before: **the investors**. This hard fork caused a split in the Ethereum chain, with the old chain and the new chain. + +The problem, the bug, the mistake, was undone. The money was once again in the hands of the investors, so it could feed the eco-system: a **VITAL** moment in Ethereum's history. + +And so it happened. All of the innovation that we've seen in the past year, and also the ICO's, got fueled by this money, money that was always meant for investments, growth. + +At the same time, not having 12 % of the coins in hands of 1 group of hackers, but instead distributed in the hands of the rightful owners, was another important element to ensure the Ethereum blockchain remains secure for the future (once we go to PoS, which I won't be explaining here now). + +Ethereum has now reached **$200** on this day, **thanks to the efforts** of the entire Ethereum community, both investors as developers. + + +#/r/Bitcoin's reaction: The creation of "Ethereum Classic" (ETC) + +But the Bitcoin community didn't approve of this success. Famous Bitcoin members like the /r/Bitcoin moderators, and institutional Bitcoin investors like Barry Silbert, who had been tweeting and posting about "Why Ethereum can never work" in the months before the above chaos, initiated a new plan. + +The plan was to disrupt the Ethereum network by reviving the old chain. To prove that **"hard forks are dangerous" by trying to make Ethereums' hard fork fail**, trying to kill off Ethereum in the process. This was going to be their best and probably only chance to get rid of this young but strong innovative "rival". Thus, they suddenly allowed Ethereum posts promoting **the mining of the old chain**. They also spawned their own community around it, calling it "Ethereum Classic" and **Barry Silberts** co-owned exchange "Poloniex" raced to be the first exchange to start trading the coin of this old chain (ETC). Thus artificially legitimatizing the ETC coin. + +These old Ethereum-haters turned into Ethereum Classic evangelists. The Ethereum Classic community was being joined solely by people who had a posting history of negativity against Ethereum. *None of these people had any /r/Ethereum posting history, while having a lot of /r/Bitcoin activity.* + +How convenient for Bitcoin. + +#ETC is an Attack against Ethereum + +Let's make this clear here. Ethereum Classic is, and always has been, an attack **against** Ethereum, trying to disturb the cohesion of the Ethereum network and the Ethereum community. But let it be clear that the growth of Ethereums eco-system has proven that our community is much stronger and more vigilant than these attackers had hoped or imagined. The flippening, the moment ETH exceeds BTC, is coming closer every week. + +Every time you buy ETC, you are actively supporting an attack on Ethereum by donating your money to these people, with the added risk to lose your investment. Ethereum Classic has no community, no development team, no future in the real world. + +**It's a technological attack, and a monetary scam**, with its biggest investors and its biggest pumpers being people involved in Bitcoin, people like Barry Silbert. + + +If you believe in the future of Ethereum, buy the real deal, the real thing, which is the ether, the ETH that is the only token that gives you access to the real network. + +If you want to diversify your wealth, I encourage you to do so. Look for the real interesting innovative technologies that want to bring something good to this world, to let us all move forward. Even Bitcoin has its place and role. + +If you have bought, or holding, or still planning to buy ETC, be ready to get hit by some nasty surprises down the road ( on those days - *and I can already foresee a few* - I will be linking everyone back to this thread right here, as a reminder). + +You can not build a future on a coin that's being sustained by rotten apples, scammers, with mal-intent and the lack of an intelligent development community. People are going to burn their hands, and lose their money. + + +These scammers are losers. + +It's at our side, here in the ETH community, that innovation is to be found. The side of the inventor of Ethereum - Vitalik Buterin himself - and our collective team of thousands of developers who have created the greatness in Ethereum. Invest in them, support them. + +Be a part of history, not against it. + +#tl;dr + +**Ethereum (ETH) ~~Ethereum Classic (ETC)~~** +Currently people have more money in the bank due to less money going out. People are bored, stuck in front of their computers and stocks only ever go up, right?... + +Ah, we can go outside again. Let's go on holiday, the pub, buy a new car to go to places...etc +Hello all, what are some examples of tropes from online personal finance forums that do not apply to EU-folks in your opinion? + +For example, an often repeated wisdom is that you need to have at least 3-6 months of expenses in savings as a buffer or emergency fund. I do not see any need for this though, as employment legislation, cheap/free healthcare and excellent renters protection make it hard for me to envision a scenario where I would suddenly be in need for such a huge sum of liquidity. + +What are some other examples? +Hi everyone, + +I would like you to consider this part DD and part thought-gathering. It's quite long, but I can't imagine I captured everything and I would appreciate any constructive feedback. **It is predominantly forward looking**. Though certain financial elements have been considered and noted in places, it has not been the primary objective to assess the current financial health or strength of the companies listed. + +&nbsp; + +^***Disclaimer:*** *^This ^post ^has ^been ^produced ^based ^on ^my ^own ^interpretation ^of ^the ^UK ^government’s ^energy ^white ^paper, ^which ^is ^available ^[here](https://www.gov.uk/government/publications/energy-white-paper-powering-our-net-zero-future). ^I ^am ^not ^a ^professional ^investor, ^nor ^am ^I ^qualified ^to ^give ^financial ^advice. ^It ^reflects ^my ^personal ^opinion ^and ^is ^for ^informational ^purposes ^only; ^it ^should ^not ^be ^construed ^as ^being ^in ^any ^way ^instructional. ^If ^you ^trade ^based ^solely ^on ^what ^I ^have ^written, ^you ^do ^so ^having ^accepted ^fully ^all ^of ^the ^associated ^risk ^and ^liability ^of ^financial ^investment. ^You ^are ^reminded ^and ^urged ^not ^to ^act ^upon ^the ^opinion ^of ^either ^myself ^nor ^that ^of ^others ^without ^performing ^your ^own ^due ^diligence. ^Sources ^are ^provided ^throughout ^but ^not ^exhaustively. ^.* + +&nbsp; + +# **WIND** + +There will be a very heavy focus on building upon and further utilising wind power in the UK. The paper does mention that CfD auctions will be open to onshore wind, however the emphasis appears more heavily orientated towards offshore farms. The government are aiming to have an offshore wind energy capacity of 40GW by 2030 [p. 3]. As of right now, the capacity is 10.4GW [[1]](https://www.renewableuk.com/page/UKWEDhome). That's a four-fold increase in capacity which will require a lot of expansion and upgrade to the existing array of windfarms, including expanding upon floating windfarms and the integration of other technologies to compliment the infrastructure. One particular area of development will be floating offshore wind, as it allows turbines to be built in places traditional windfarms can't be. As there are no major UK manufacturing companies involved with building turbines, the approach I have taken is to look at who has been involved in the production and operation of the existing UK windfarms (both operational and planned). + +&nbsp; + +**PRODUCTION** + +Main pick: +## **Siemens Gamesa** +- There are 35 operational offshore windfarms around the UK, and 60% of the turbines are made by Siemens [[2]](https://en.m.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_Kingdom). It seems likely, though of course not certain, that they will have a role in building the turbines for the four offshore farms currently under construction as well as the further five farms proposed for 2023/25. +- Over 80% of shares owned by institutions, private companies and public companies. +- Price to book (4.6x) overvalued compared to industry average (3.3x). However, share price is still rising (36% in last Q). +- F-Score 3/7. + +&nbsp; + +Secondary pick: +## **Vestas Wind Systems** + + +- Vestas is the other most likely candidate for producing turbines for offshore UK windfarms, with 30% of currently operational offshore turbines having been produced by them [[3]](https://en.m.wikipedia.org/wiki/List_of_offshore_wind_farms_in_the_United_Kingdom). +- 40% institutional ownership including BlackRock, Vanguard and Invesco amongst others. +- Healthy Financials. +- Price to book (11.3x) overvalued compared to industry average (3.3x) but earnings are expected to grow significantly over the next three years. + +&nbsp; + +**OPERATION** + +Main pick: +## **SSE** +- SSE are surprisingly heavily involved in wind energy. They jointly operate 11% of the operational UK windfarms ~~and will be jointly operating one of four farms under construction currently (Neart Na Gaoithe, Scotland).~~ Disputed, and I'm inclined to agree. +- The white paper makes clear in chapter 6 that the government intends to provide opportunities to existing oil and gas companies to repurpose their operations away from unabated fossil fuels, and towards technologies such as carbon capture, utilisation and storage, or clean energy production from renewables and hydrogen. They are financially incentivising large companies to take up those clean technologies. With the well-established operations in the wind sector, as well as government incentives to invest in carbon capture, SSE appear well placed to survive the green transition and receive support from the government to expand further into renewable areas. +- It is also worth noting that Airtricity, who own six onshore wind farms, are a subsidiary of SSE; and that SSE themselves own other onshore wind farms as well. +- SSE are also a member of Catapult's Offshore Renewable Energy (ORE), the centre of excellence for floating offshore wind in particular. As this area off offshore wind expands, SSE are highly likely to be involved [[4]](https://ore.catapult.org.uk/what-we-do/innovation/floating-wind-centre-of-excellence-2/). +- SSE are exploring carbon capture. SSE Thermal is part of the Zero Carbon Humber project, a partnership of leading organisations leading a £75m bid to accelerate decarbonising the north of England by utilising carbon capture and hydrogen technologies [[5]](https://www.sse.com/news-and-views/2020/10/sse-thermal-backs-zero-carbon-humber-bid-to-bring-commercial-scale-ccs-one-step-closer/), [[6]](https://www.zerocarbonhumber.co.uk/). + +&nbsp; + +Secondary pick: +&nbsp; +## **Ørsted** + +- Orsted are one of the major windfarm operators in the industry. Of all the operational UK windfarms, Orsted own and operate either in whole or in part 37% of them. Further, they are the owner of HornseaProject3 which was just granted consent on 31st December [[7]](https://www.hornseaproject3.co.uk). +- Mentioned by name in the white paper as part of a case study in wind energy related the Grimsby port revival, but is also connected to the government's Department for Business, Energy and Industrial Strategy (BEIS) £505million Energy Innovation Programme [[8]](https://www.gov.uk/guidance/energy-innovation). This is in relation to ITM's plans to scale up their Proton Exchange Membrane clean hydrogen production to a 'Gigastack' system, which can then be integrated with offshore wind facilities. More on that to follow. + +&nbsp; + +Wildcard: +&nbsp; +## **Octopus Renewables Infrastructure Trust** + + +- ORIT is the publicly traded 'arm' (I'll show myself out) of Octopus Group, which has been around a while but only floated ORIT on the LSE in December 2019. It is currently trading at just under its ATH at ~114p. +- One of the largest renewable infrastructure groups in Europe, with over £3bn in assets under management [[9]](https://octopusrenewables.com/about-us/). +- Largest independent owner of onshore wind and solar assets in the UK [[10]](https://octopusrenewables.com/about-us/). +- Significant and consistent insider buying throughout 2020 and as recently as 31st December, with the chairman of the board and two board members making a combined purchase of 20,122 shares at market price on that date. The same two board members also bought thousands more shares at various points in 2020 [[11]](https://simplywall.st/stocks/gb/general/lse-orit/octopus-renewables-infrastructure-trust-shares#ownership). +- Octopus Investments, another arm, owns the Fraisthorpe windfarm in the East Riding of Yorkshire, an array of nine Vestas V112 wind turbines [[12]](https://www.powersystemsuk.co.uk/project/fraisthorpe-wind-farm-project/). +- Octopus Energy is a retail electricity and gas supplier with 1.35million domestic business customers as of December 2019. This company is mentioned by name in the white paper in reference to its smart utilisation and its cost saving 'time-of-use' energy tariff in particular, which gives users access to half-hourly energy prices updated daily. This means that when energy prices drop, so does cost to user. It can even go negative, meaning consumers would be paid [p. 23]. + +&nbsp; + +# **HYDROGEN** + + +The government is very interested in new hydrogen technologies and is working toward 5GW of low-carbon production by 2030, with views to scaling hydrogen neighbourhoods into hydrogen towns by the end of this decade [p. 12]. Hydrogen is a target (along with advanced nuclear) of a £1b energy innovation programme, and as alluded to previously, the government are looking at utilising synergies between wind and hydrogen. As well as that, hydrogen fuel cell technology has potential application for large vehicle power especially, like busses, HGVs and construction vehicles. The white paper indicates that in 2021, the government will invest £20mil in freight trials to pioneer hydrogen and other zero emission truck technologies, and £120mil in 2021/22 to start the delivery of 4000 zero emission busses, which will be a mix of battery electric busses and hydrogen busses [p. 94]. + +&nbsp; + +Main pick: +&nbsp; +## **ITM Power** + + +- As I mentioned, ITM are mentioned by name for their Gigastack project. This is a large-scale project involving ITM power, Orsted, Phillps 66 and Element Energy, aimed at demonstrating the efficacy (and carbon benefit) of developing synergies between wind and hydrogen power. The production of hydrogen power has traditionally been associated with high carbon emissions, and the purpose of this project is to produce hydrogen without the associated carbon emissions. Read more here [[13]](https://www.itm-power.com/news/industrial-scale-renewable-hydrogen-project-advances-to-next-phase). +- Given the government's focus on wind and hydrogen in the green industrial revolution, ITM appear uniquely placed to lead and capitalise upon the green development of the UK's energy infrastructure. +- Debt-free and has not had any debt for the last five years. +- Decent cash runaway. +- Recent insider buying by 7 individuals. +- 40% institutional ownership, including BlackRock, AJ Bell, HSBC, Barclays and Morgan Stanley amongst others. + +&nbsp; + +Secondary pick: +&nbsp; +## **Ceres Power Holdings** + + +Ceres are well placed for the green industrial revolution. Their core product is a unique type of solid oxide fuel cell they call the SteelCell, which they claim is not only cheaper to manufacture, more efficient, and more reliable than other fuel cells, but which can also produce power from hydrogen, natural gas, biogas and ethanol as well [[14]](https://www.ceres.tech/technology/why-is-it-unique/). The areas of application for this product are EVs, data centres, and distributed power generation. The only reason this isn’t the primary pick for me is that I am concerned about how much of the company’s growth potential may already be priced in. + + +- They have several big-name partnerships including Bosch and Doosan [[15]](https://www.proactiveinvestors.co.uk/companies/news/936171/ceres-power-partners-with-powertrain-specialist-avl-list-to-turbocharge-fuel-cell-adoption-936171.html). +- Overvalued price to book at 16.8x vs industry average of 2.8x. +- Very healthy financially, with no debt and cash runaway of 3+ years. Short and long term assets exceed short and long term liabilities. +- Insider sale in the last six months but no insider buying in last twelve months. +- 54.7% institutional ownership. +- Market cap: £2.27b. +- Shares outstanding: 172.1m. + +&nbsp; + +Tertiary pick: +&nbsp; +## **AFC Energy** + +If you've been keeping an eye on the electric vehicle (EV) market, you will likely have heard of American companies like Chargepoint, whose market is EV charging. AFC are doing the same in the UK. Their H-Power EV charging ports offer an EV charging solution designed to be modular, scalable, easily transportable, and independent of the grid. This could be especially convenient logistically for areas such as car parks, and companies that operate fleets of vehicles. + +- A global leader in alkaline hydrogen fuel cell technology focused on electric vehicle charging and distributed power generation. +- Announced in December a strategic partnership with ABB, a Swiss electrical systems giant with an established sales and distribution network of DC high power EV charge points, having sold 17,000 units in 80 countries [[16]](https://www.afcenergy.com/afc-energy-and-abb-partner-to-power-up-the-future-of-clean-ev-charging/). +- 34.9% institutional ownership. +- Market cap: £536.86m. +- Shares outstanding: 676.15m. + +&nbsp; + +Wildcard: +&nbsp; +## **Powerhouse Energy** + +Powerhouse Energy is in the business of recovering energy from unrecyclable plastics and end-of-life tyres to produce syngas and hydrogen through their 'Distributed Modular Generation' (DMG) process of gasification. The process involves the plastic being heated to a very high temperature where within a few seconds it melts and is vaporised into gases. Further heating within the chamber reforms the molecules into a syngas, comprising a mixture of largely methane, hydrogen and a smaller volume of carbon monoxide. The Thermal Conversion Chamber operates without oxygen, so there is no burning, however a non-combusting oxidising agent in the form of steam is added to control the process and the quality of the syngas. Once through the Conversion Chamber the syngas is cleaned, leaving behind a few inert harmless residues, which are typically less than 5% of the starting volume of waste plastics. These residues can then be reused for other purposes or safely disposed of. + +- Their product is their DMG system. Powerhouse Energy do not operate any plants of their own. However, the hydrogen their process produces can be used for fuel cells, micro-turbines or ultra-clean engines, meaning they could have plenty of potential clients going forward, especially with an uptake in EV and phase out of diesel. +- Given what the white paper outlines regarding hydrogen powered trucks and busses, as well as the green industrial revolution's emphasis on hydrogen more broadly, they are well placed to expand their business if managed correctly. +- 23.5% institutional ownership including Barclays, Fidelity, HSBC, AJ Bell and Deutsche Bank, amongst others. +- Currently trading at 10p. +- Market cap: £364m +- Shares outstanding: 3.72b. +- They have a lot to prove. Mid-high risk, high reward play. + +&nbsp; + +# **BIOMASS** + +Biomass will have a role in the green industrial revolution as the government consider it 'one of our most valuable tools for reaching net zero', but the extent of that role seems yet to be determined in any concrete sense. However, the government is aiming to deliver a preliminary position paper on this matter by summer 2021 [p. 53]. By 2022 the government intend to have established the role bioenergy with cabon capture, use and storage (BECCS) will play as part of a wider biomass strategy [p. 53]. +Biomass has been controversial due to an infamous loophole whereby the carbon debt of producing the wood pellets is not sufficiently factored in to the carbon cost of biomass energy production, because the pellets magically become carbon neutral in transit if enough trees have been planted to replace those cut down. The objection is that the newly planted trees take 50-100 years to mature, and so we ultimately run biomass at a deficit [[17]](https://greenguide.co.uk/uks-net-zero-emissions-2050-pledge-undermined-by-biomass-energy-loophole/). However, the government seems aware of the hidden carbon cost of biomass, and made it clear in the white paper that BECCS will be "critical to consideration" of biomass support [p 53]. Carbon capture is going to be a significant consideration in all areas of the economy going forward in the green industrial revolution as there is a real need for us to decarbonise. To that end, BECCS capable biomass power plants are appealing because they could potentially deliver negative carbon emissions. It seems unlikely that the Government will fund plants that do not utilise the technology, but that doesn't mean non-BECCS biomass won't be utilised at all, at least initially. + +&nbsp; + +Main pick: +&nbsp; +## **Drax** + +- Already trialling BECCS at Drax Power Station in North Yorkshire, aiming to capture up to a tonne of carbon every day [[18]](https://www.drax.com/press_release/drax-sets-world-first-ambition-to-become-carbon-negative-by-2030/#:~:text=Drax%20is%20already%20running%20a,zero%20carbon%20emissions%20by%202050). +- Aims to be a carbon negative company, not just neutral [[19]](https://www.drax.com/about-us/our-projects/bioenergy-carbon-capture-use-and-storage-beccs/). +- Significant insider buying this year. +- 96.5% institutional ownership including by big players Invesco, BlackRock, Vanguard, L&G and J.P. Morgan, amongst others. +- Healthy finances. +- Pays a dividend. +- Share price up 39% last three months. + +&nbsp; + +Secondary pick: +&nbsp; +## **Active Energy Group** + +- Recently granted US patents for their CoalSwitch and PeatSwitch biomass processes [[20]](https://www.bioenergy-news.com/news/active-energy-awarded-new-us-patent-for-coalswitch-process/). +- 33.9% institutional ownership including HSBC, AJ Bell, and Barclays. +- High debt but positive operational cash flow and decent cash runaway. +- Insider buying in last six months. +- Nb. Unclear if committing to BECCS and may be focusing primarily on US market. + +&nbsp; + +Wildcard: +&nbsp; +## **EQTEC** + +- Highly speculative. +- Specialises in gasification and working with third party plants to implement 'waste-to-value' solutions, but does own stakes in several energy producing plants such as Clay Cross Biomass in Derbyshire amongst others [[21]](https://www.hl.co.uk/shares/shares-search-results/e/eqtec-plc-ordinary-eur0.001/company-information). + +&nbsp; + +# **NUCLEAR** + +An unpopular sector, especially since Fukushima. Nevertheless, the government intends to invest into the next generation of nuclear technology - small modular reactors (SMR) and advanced modular reactors (AMR). With the exceptions of Sizewell B and the currently under construction Hinkely Point C, all 15 of the UK's operational nuclear plants are due to be decommissioned by 2030 [p. 41]. There do not appear to be a lot of nuclear investment opportunities in the UK, and the lead candidates in the government's AMR competition (Tokamak, Westinghouse, and Urenco) are private firms. However, opportunities remain. + +**Edit:** Westinghouse are owned by Brookfield Business Partners, which trades on the NYSE. + +&nbsp; + +Main pick: +&nbsp; +## **Rolls Royce** + +- Actively working on SMR technology. +- They were successful in both phase 2A and 2B of the government's nuclear innovation programme: advanced manufacturing and materials competition [[22]](https://www.gov.uk/government/publications/nuclear-innovation-programme-advanced-manufacturing-and-materials-competition-phase-2-successful-projects/advanced-manufacturing-materials-competition-phases-2a-and-2b-successful-projects). +- Leads the UK SMR Consortium, which aims to develop a Small Modular Reactor designed and manufactured in the UK capable of producing cost effective electricity. An initial £36 million joint public and private investment will enable the consortium to further develop their design. This is part of a greater bid into the Industrial Strategy Challenge Fund worth around £500 million (joint investment with the private sector), subject to future approvals and a final decision to make public investment. The consortium believes that a UK Small Modular Reactor programme can support up to 40,000 jobs at its peak with each Small Modular Reactor capable of powering 750,000 homes [[23]](https://www.gov.uk/government/publications/advanced-nuclear-technologies/advanced-nuclear-technologies). + +&nbsp; + +Secondary pick: +&nbsp; +## **Costain Group** + +Costain operates by delivering integrated, leading edge, smart infrastructure solutions to meet national needs across the UK’s energy, water, transportation and defence markets. They are one of the largest providers of engineering services to the UK nuclear market [[24]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/nuclear/). + +- Involved in new build, decommissioning, as well as nuclear waste management [[25]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/nuclear/). They are very well placed to handle the decommissioning of the currently operational nuclear plants, as well as assisting in the building of SMRs and AMRs down the line. +- Committed to clean energy and decarbonisation [[26]](https://www.costain.com/what-we-do/clean-energy-and-decarbonisation/). +- Costain Group passed phase one of the BEIS SMR competition, and were listed as an eligible participant [[27]](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/665376/List_of_Eligible_Participants_in_Phase_One_of_the_SMR_Competition.pdf)(PDF). This is no guarantee that they will win the government funding, but it seems likely all the same that they will be involved in the government’s infrastructure plans in the end, even without funding. + +&nbsp; + +# **OIL AND GAS** + +When put together, those are two very dirty words in the clean energy sector, and quite understandably so. On ethical grounds, it is a respectable position to ignore existing industry giants. Some more than others. However, to write these companies off economically in the face of the green industrial revolution would be misguided. The fact of it is that these companies have sweeping infrastructure already in place, and it would be better to utilise it through modification than scrap it. +The government agrees, and in the first half of 2021 they aim to agree the North Sea Transitional Deal with the industry which has five key deliverables; + +- Cleaner energy production through rigorous emissions reductions. +- Supporting the delivery of carbon capture technologies +- Diversification of the oil and gas supply chain into new energies. +- Supporting the development of hydrogen production. +- Safeguarding existing jobs and establishing tens of thousands of new high-quality jobs across the sector in diversified energy technologies. + +I am sceptical about some of the oil and gas industry's sincerity in its efforts, believing certain players to be driven by legal obligation more than genuine desire to change or to capitalise on the progressive opportunity. But all the same, the existing industry merits at least a small position in a portfolio based upon the plan for a Green Industrial Revolution. + +&nbsp; + +Main pick: +&nbsp; +## **BP** + +- By far the most controversial pick on here. We're all aware of BP's disastrous oil spill, but there is a project BP are leading which is worth considering in relation to the government's plans. +- They are leading a very large carbon capture project called Net Zero Teesside together with Eni, Equinor, National Grid and Royal Dutch Shell, aiming at turning Teesside into the nation's first net zero industrial cluster [[28]](https://www.netzeroteesside.co.uk/). +Further, they are involved in another, related project called Zero Carbon Humber, which has similar plans. Of note, Drax and SSE are also involved in the ZCH project [[29]](https://www.zerocarbonhumber.co.uk/). +- Further, by 2026 the same group aims to capture and store 50% of the UKs industrial carbon emissions in saline acquifiers beneath the North Sea seabed [[30]](https://www.theguardian.com/environment/2020/oct/27/bp-leads-energy-companies-preparing-two-major-uk-carbon-capture-projects), [[31]](https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/news-and-insights/press-releases/energy-companies-form-development-partnership-for-carbon-emissions-in-uk-north-sea.pdf&ved=2ahUKEwit_-uEiIDuAhWCiFwKHSvXBJYQFjAAegQIBBAC&usg=AOvVaw35dCAqmNjbDqIK8f-eReDv&cshid=1609687319712)(PDF). +- Captured carbon has a multitude of possible uses in the production of cleaner concrete, bioplastics, and synthetic hydrocarbons that could be used to fuel planes [[32]](https://www.drax.com/technology/can-made-captured-carbon/). The capture and sale of carbon represents a significant opportunity for BP to capitalise on the green industrial revolution, and could form a significant part of their future business model, as well as that of other similar companies. + +&nbsp; + +# **AVIATION** + +Aviation is integral to our society. We can’t do without it, but it has to change if we are to reduce its carbon impact. Things like electric planes are a long way off, so in the interim we need to look at making the existing systems cleaner. + +&nbsp; + +Main pick: +&nbsp; +## **Velocys** + +- Velocys is a company involved in the production of sustainable aviation fuels. They use a fischer-tropsch process to produce a sustainable, drop-in aviation fuel from household, commercial, and forestry waste. Drop-in is key here, as it means that Velocys' fuel will not require any modification to the aircraft or their engines in order to be utilised. +- The government have established the Jet Zero Council; whose purpose is to accelerate the development of technologies to work towards net-zero aviation. Part of the plan is to offer a £15mil competition to support the production of sustainable aviation fuels. Velocys is well placed. +- Planning approval granted in June for a facility they are building in partnership with Shell and British Airways at Immingham. It will be the UK's first commercial waste-to-renewable-fuels plant and aims to take over half a million tonnes of waste per year and turn it in to 60 million litres of cleaner burning, sustainable jet fuel, for an estimated CO2 saving of over 80,000 tonnes per year [[33]](https://www.altalto.com/immingham/). +- Currently trading at only 10p. +- Market cap £108m. +- High number of shares outstanding: 1.06b. +- 22.4% institutional ownership including Barclays, Invesco and Fidelity. + +&nbsp; + +# **GRAPHENE** + +Graphene has been touted as the future for the last decade, but we may well be seeing some progress in this field in time for the green industrial revolution, especially in the field of battery technology. However, it is not mentioned in the white paper, and so I will leave this section as a direction for you to look into this area further. With a very significant need for energy storage and EV take-up, it is my opinion that battery technology developments are going to play a role in the green industrial revolution eventually. + +&nbsp; + +Main preliminary pick: +&nbsp; +## **Applied Graphene Materials** + +- Primarily involved in the production of graphene nanoplatelets. Although the company is so far mostly involved in graphene applications for things like paints, coatings and thermal adhesives, the large surface area, high levels of thermal and electrical conductivity, low density, mechanical strength and morphology of graphene nanoplatelets make them an ideal candidate for applications in electrochemical energy storage systems as well. Viewing their website, the company is clearly aware of this. As technology develops, graphene batteries are likely to play a substantial role in energy storage and EVs, as they are not only safer, but significantly more efficient than lithium-ion batteries [[34]](https://futurism.com/scientists-develop-better-battery-thanks-graphene). That makes graphene a good speculative mid-long term play in the green industrial revolution. +- Insider trading in October, with CFO picking up just north of 59,000 shares. +- 54.9% institutional ownership. +- Market cap: £20.4m. +- Shares outstanding: 49.7m. + +&nbsp; + +Secondary preliminary pick: +&nbsp; + +## **Haydale Graphene Industries** + +- Graphene and many other nanoparticles do not mix naturally with other materials. To ensure that its superior properties can be blended into products, nanomaterials may need to be ‘functionalised’, where compatible chemical groups are added to the material surface to enable effective dispersion of the nanomaterial. Haydale has developed a plasma treatment to that end - the functionalising of nanomaterials, especially graphene. +- Insider buying this year, but not since March. CFO purchased 275,000 shares on 12th March. +- 38.5% institutional ownership including Barclays, HSBC, AJ Bell. +- Market Cap: £18.5m. +- Shares outstanding: 425.28m. +Don’t have many people to share this with but yea I had a little over $4200 left on the balance and I paid it all off today. It feels good not having to worry about that anymore. This was one of my major goals and I was fortunate enough to be able to get it done the first month of the year. +One thing that I have learned on my journey to becoming a consistently profitable trader is to try not to bring it up to friends and family. There is nothing wrong with bringing it up once or a couple times if it comes up, but something I have noticed on my journey is that people are stupid and ignorant when it comes to trading. You would not believe the level of stupidity I have experienced from my friends and family when it was brought up. When I first started on my journey, it would discourage me a lot hearing "you cant do that" or "you have to be a crazy smart genius to do that" and I honestly would sometimes believe that non sense. + +So, that is why I think you should mostly keep it to yourself, if you are putting in the work everyday and treating it like a business, then fuck what they all say. ALSO, one important thing.. remember the friends and family who believed in you, or the ones who at least did not say anything negative. As soon as you start seeing results, they will become all of a sudden "Interested" + +Remember those who believed in you, and the ones who did not +For a long time, I’ve felt that I have the pulse of the Apes. I like what you like. I scream when you scream. I am as dumb as the dumbest of us, and I look up to the smart guys just like you and every time Ryan Cohen tweets, I go and jerk off furiously (especially when you deepfake his face onto a sexy person 😉). + +For weeks now I have a felt uneasiness about the way that the moderators were running the show. It turns out, there was a lot of uneasiness and tension within the mod ranks as well. This situation culminated in the Great Dumpster Fire of 2021 and it’s time the people’s voice is heard and listened to, so I’m here with a Fire Extinguisher. + +https://i.redd.it/5elxkmtp20c71.gif + +(EDIT for situational clarity) Effective immediately: Redchessqueen99, Rensole, and Hey\_Madie are no longer on the moderating team (Red and Ren have made statements linked below). Everyone felt this was the best way forward and we thank them for doing what was best for the community. True Apes who have been here from the start know what kind of work, sacrifice, and dedication they gave to this group and we thank them for their service. We want to make it very clear that Ren stepped down voluntarily and was doing so for the good of the community to prevent any further divide. With that said, you spoke and we listened and we hope this is enough to put the drama to bed. + +https://preview.redd.it/lo8i57dr20c71.png?width=720&format=png&auto=webp&s=020e378720579b97c4cf3471759dd83d4d721372 + +For transparency, here are links to the respective resignations statements from mods who've made one: + +* [Red](https://www.reddit.com/r/Superstonk/comments/omt038/farewell/?utm_source=share&utm_medium=ios_app&utm_name=iossmf) +* [Rensole](https://www.reddit.com/r/Superstonk/comments/omr3g2/fuck_it_im_done_with_this_shit/?utm_source=share&utm_medium=ios_app&utm_name=iossmf) +* [~~Jsmar~~](https://www.reddit.com/r/Superstonk/comments/omluu3/ujsmar18_mod_resignation_ama/?utm_source=share&utm_medium=ios_app&utm_name=iossmf) (Jsmar has returned to the team) +* [Sharkbaitlol](https://www.reddit.com/user/sharkbaitlol/comments/om7ty0/i_will_be_stepping_down/) + +Hieronymus1\_1, Sharkbait, ~~Jsmar~~ (EDIT-Jsmar has returned to the team), Broccaaa have all left peacefully on their accords due to their own personal reasons. Also the reason I am not on the mod list on the subreddit is because I am still in the “goldfish” period that every mod has to go through before they reach the level of the regular mod. When I have earned my promotion, I will be added to the moderator list with the respective permissions. + +Moving forward: Bye\_Triangle is now the “Site Owner” and for the time being will remain the only admin of the group until we can find suitable members of the moderation team to fill these gaps. I have known B\_T for months now, have talked with him behind the scenes, and I trust and believe in his ability to remain calm, cool, collected, and level headed through anything. He’s the right guy for the job right now. + +We are also going to work on our internal procedures and policies so that THIS BULLSHIT NEVER HAPPENS AGAIN. (God what a fucking shitshow 🤦🏽‍♂️) This whole thing was an embarrassment from any angle that you look at it and we are looking to rebuild the damage that the moderation team has inflicted on this community. On behalf of the mod team, I am truly sorry this all went down this way. With that said, we will be looking to expand the moderating team and we will be reaching out to people in the community for help on this. Please don't contact us about becoming a mod, we'll come to you. + +\-------------------------- + +I’m gonna be candid with you guys here. I came into this whole ordeal from the perspective of a regular ape watching the shitshow. I was in the dark for most of this week, trying to figure out what the fuck was going on and what I could do to help. When I saw that things weren’t being done quickly enough, I decided to step in and offer my services to the mods. For transparency, they invited me to become a mod weeks ago and I turned them down. Last Friday, I was the one who approached them about joining the team, not them. They did not try to use me a scapegoat. I jumped into the fire because I felt a *Call of Duty*… + +[ Oops \*MoASS EFFECT\* my bad ](https://preview.redd.it/oheb1vyv20c71.png?width=624&format=png&auto=webp&s=445ff31aec69de6d4db08db015ad1eacb3e508e2) + +This place is a mess right now. Who do we believe? Who can we trust? Who is a shill and who is real? I’m confused as fuck too. When I joined the mod team, I came in like a goddamn wrecking ball. + +[ ](https://preview.redd.it/0lojcszy20c71.png?width=600&format=png&auto=webp&s=62f94c738055339b07a1515c37834fe21793d44b) + +From the start, I felt what you guys felt and I tried my best to get the rest of the mods to see the perspective of the Apes. Convincing people is a tough job, and convincing other members of leadership is even tougher. I’m gonna be clear though, I can’t be what you want me to be. I can only be me, an ape, a human who can make mistakes and I hope you are able to forgive me and the mod team for taking so long to come up with the solution that you wanted. The balancing of opposing ideas while also being under duress is a situation that would make most people crack. From my short time in the moderating team, and from my experiences prior to coming on, I can tell you that I trust that the mods have their hearts in the right place and they are true apes trying to make a difference for this community that we love. You guys trusted us to make the right decision and I hope this is it. + +The mods and I await your judgment. Apes Together Strong. +We’re in a position where we would love to make the jump over to an EV because it is clearly, far and away the better option in almost every category except price. + +We are struggling with the absolutely ridiculous entry price of ~$60k to 80k for an EV that is even remotely useful for a young growing family, and dismayed at the fact that some larger car companies seem to have given Australia the cold shoulder. + +It’s unbelievable how few (if any) incentives there are to make the switch, and really hammers home how backwards this country is with anything to do with renewable energy and/or climate. + +Bit of a rant! + +Edit: not talking about Tesla, talking about Hyundai, Kia etc. +Who is responsible? + +I go over to check for a water leak and discover the fill line inside the master toilet tank broke and the float valve didn’t stop flow so the toilet was running non stop for a month++ + +I will replace the entire toilet tomorrow on my dime + +When I spoke to the tenant I ask if the appliances were working okay, the toilets, any leaky faucet. They answered “no”. + +The toilet water running was easy to hear when I went to inspect the property. +I've never liked tipping just because plenty of companies make billions from the service they provide, and I think they should be the ones paying more. It's the business that takes advantage of the employees, the customer, and possibly other businesses. This happens with ride-sharing apps, delivery apps, restaurants, bars, you name it. Oftentimes these businesses charge pretty dang high too. So why make the customers pay twice for the service? Also, why do people think it's rude not to tip? +[https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1646771/pdf/amjph00269-0055.pdf](https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1646771/pdf/amjph00269-0055.pdf) + +[https://pubmed.ncbi.nlm.nih.gov/2430906/](https://pubmed.ncbi.nlm.nih.gov/2430906/) + + + +This study compared capitalist and socialist countries in measures of the physical quality of life (PQL), taking into account the level of economic development. The World Bank was the principal source of statistical data, which pertained to 123 countries and approximately 97 percent of the world's population. PQL variables included indicators of health, health services, demographic conditions, and nutrition (infant mortality rate, child death rate, life expectancy, crude death rate, crude birth rate, population per physician, population per nursing person, and daily per capita calorie supply); measures of education (adult literacy rate, enrollment in secondary education, and enrollment in higher education); and a composite PQL index. All PQL measures improved as economic development increased. In 30 of 36 comparisons between countries at similar levels of economic development, socialist countries showed more favorable PQL outcomes (p less than .05 by two-tailed t-test). This work with the World Bank's raw data included cross-tabulations, analysis of variance, and regression techniques, which all confirmed the same conclusions. **The data indicated that the socialist countries generally have achieved better PQL outcomes than the capitalist countries at equivalent levels of economic development.** +Living downtown sucks. Living in the suburbs also sucks. The houses are frankly too close together. + +Who here is living far outside the city that it's completely private? No neighbors for miles. +This is the infinite money glitch as I see it, explained for 🦧retard apes like me. + +[Thanks to Criand's explanation of how SFTs facilitate the reseting of FTDs.](https://www.reddit.com/r/Superstonk/comments/opuziu/visual_of_the_sft_trades_to_prevent_shorts_andor/) + +The basic premise is that mommy and daddy both balance their books, but mommy and daddy don't talk to one another, so you can scam the system by kicking the can between them. If you can reset an FTD (failure to deliver), you can make infinite money from nothing. + +👩Mommy = Market Makers + +👴Daddy = DTCC (Clearing house) + +😈Child = Hedgefunds (aka dirty fucking assholes) + +🍌GME Shares + +When 😈SHFs sell a 🍌share they don't have, 👴daddy basically gives them a month to locate it or else they label it a FTD and it becomes belt whooping time. + +>*Child, ya can't sell a promise. Go make good on that promise or I'll bend you over and beat ya raw* + +Well, the 😈 did sell that promise. Sold it for 💲. And for a whole month, the 😈 SHF is walking around with pockets full of 💲 all for doing nothing! But the month is coming to a close, and 👴daddy is begining to reach for the belt. + +Well 😈 has never had any 🍌to sell and can't find any, so he goes to 👩 mommy. + +>*What's that? You spent your allowance already? You need some 🍌to go buy ice cream? You promise you'll pay it back? Oh, don't worry honey, mommy loves you.* + +👩Mommy 'poofs' an imaginary 🍌share into existance and gives it to the 😈 SHF. That's what mommy is for, to smooth things out between allowances. But don't be fooled, mommy isn't a pushover, it's not a gift and she wants that 🍌share back soon. She's raising a responsible little child and won't let them run a debt. + +Well the 😈 SHF takes that 🍌and gives it to 👴daddy. Daddy checks it off. It took a month but their child sold a 🍌 and they delivered a 🍌. 👴is proud of their honest child. But here's the thing - 👴Daddy DTCC can't tell the difference between a real 🍌 and an imaginary fake one that 👩Mommy Market Maker created. ***They look the same to him.*** + +Well now all 😈has to do is make mommy happy. He goes into a dark spot on the playground and buys a 🍌from another 😈 friend of theirs using his 💲 from his sold 🍌. It isn't a *real* 🍌 they are buying (their friend is running a scam too) but the fake share will fool mommy. + +And so 😈 takes that 🍌and gives it back to 👩Mommy. Mommy is so proud of their child. She 'poofs' that 🍌out of existance, and zeros out the loan. But here's the thing. That banana was *sold* but hasn't cleared the other 😈's Daddy yet. Mommy can't tell the difference between a real 🍌and one that hasn't been located and settled with 👴Daddy DTCC yet. ***They look the same to her.*** + +Mommy and Daddy don't talk to each other. + +\------------------- + +Wait you say, but the 😈 didn't make any money! He kicked the can back and forth between the DTCC and a Market Maker (like Citadel), but what's the point?? He sold a 🍌for 💲 ... but a month later he just spent a 💲 for a 🍌so nothing changed in the end!! + +Well, for **29 days** 😈had a pocket full of 💲. And for **one day** his pocket was empty. If they naked short sold 1x🍌 each day, then every single day of the month, their pocket would have 29x💲 in it. Their pocket would ALWAYS be full. + +Maybe they take 1x💲 out of their pocket to buy a 🚢 yaht with. No big deal. Each day they only need a single 💲 to reset that day's scam, and after reseting the just naked shot again and get the single 💲back! And they still have 💲x28 left! Let's buy some 🚢🚢🚢s! + +And you know what, this works so well, I think I'm going to start naked short selling 2x🍌🍌 every day now. **Infinite money glitch**. All because 👩Mommy Market Maker and 👴Daddy DTCC can't recognize each other's fake temporary asset from a real one. + +That's the beauty of this. The DTCC has a system to prevent naked short selling, and Market Makers also have a system, BUT ONLY IN ISOLATION. If you can kick it back and forth between them, because you have a month before FTD, you can pocket the spread *in time*. +My favorite author, Morgan Housel, released his new book, The Psychology of Money, last week. In the book, Housel discussed many interesting psychological phenomenon, through the lens of finance. As I flipped through the pages, I started to realize so much of what's happening in r/fatFIRE are examples of what's discussed in the book. + +**No One's Crazy** + +The book begins with how your personal experiences with money make up maybe 0.000000001% of what's happened in the world, but maybe 80% of how you think the world works. + +For example, if you were born in 1970, the S&P 500 increased almost 10-fold, adjusted for inflation, during your teens and 20s. That's an amazing return. If you were born in 1950, the market went literally nowhere in your teens and 20s adjusted for inflation. Two groups of people, separated by chance of their birth year, go through life with a completely different view on how the stock market works. + +*Takeaways for* r/fatFIRE: + +When you read other posts and comments about what stocks to buy, what startups to join, what's the economy going to be like, what's the best asset allocation, etc., remember that is just a single person's point of view. That person may be from a different generation, earns different incomes, upholds different values, keeps different jobs, and has different degrees of luck. + +And remember, don't be mean to others. A view about money that one group of people thinks is outrageous can make perfect sense to another. + +**Luck & Risk** + +The next chapter discusses the big role luck and risk plays in someone's life. Luck and risk are two sides of the same coin. + +Examples from the book: Countless fortunes (and mistakes) owe their outcomes to leverage. The best (and worst) managers drive their employees as hard as they can. "The customers are always right" and "customers don't know what they want" are both accepted business wisdom. The line between "inspiringly bold" and "foolishly reckless" can be a millimeter thick and only visible with hindsight. Risk and luck are doppelgängers. + +*Takeaways for* r/fatFIRE: + +Be careful who you praise and admire. That commenter who joined a unicorn at Series A may look like a genius on the outside, but they may just be lucky and cannot repeat it again. + +Be careful who you look down upon and wish to avoid becoming. That poster who joined WeWork may look like a fool, but they made the best decision based on the information they had at a time. They took a risk and got unlucky. + +Therefore, focus less on specific individuals and case studies and more on broad patterns. + +Furthermore, when things are going extremely well, realize it's not as good as you think -- like the stock market right now. + +On the other hand, we should forgive ourselves and leave room for understanding when judging failures -- like the stock market in March. + +**Never Enough** + +The hardest financial skill is getting the goalpost to stop moving. It gets dangerous when the taste of having more -- more money, more power, more prestige -- increases ambition faster than satisfaction. + +Social comparison is the problem here. A rookie baseball players who earns $500k a year envies Mike Trout who has a 12-year, $430 million contract envies a hedge fund manager who makes $340 million a year envies Warren Buffett who had a $3.5 billion increase in fortune in 2018. + +There are many things never worth risking, no matter the potential gain. Reputation is invaluable. Freedom and independence are invaluable. Friends and family are invaluable. Being loved by those who you want to love you is invaluable. Happiness is invaluable. And your best shot at keeping these things is knowing when it's time to stop taking risks that might harm them. Knowing when you have enough. + +*Takeaways for* r/fatFIRE: + +When you make a big gain, it's totally okay to take profit, as long as you keep your ambition down and acknowledge the possibility that it may go higher. If that happens, no need to play the would've should've could've game, because it very well might've gone the other way. + +When you see someone who got 20x return on Shopify or bet big into Ethereum in 2016, remember they may envy the pre-IPO employees at Shopify or the genius who held Bitcoin since 2010. + +At the end of the day, do not risk more than what's comfortable in your life for the sake of making huge amount of money, because even if you do make it, you may not find it worth it. + +**Tails, You Win** + +Skipping a few chapters to talk about the prominence of tail events. + +At the Berkshire Hathaway shareholder meeting in 2013 Warren Buffet said he's owned 400 to 500 stocks during his life and made most of his money on 10 of them. Charlie Munger followed up: "If you remove just a few of Berkshire's top investments, its long-term track record is pretty average." + +In 2018, Amazon drove 6% of the S&P 500's returns. And Amazon's growth is almost entirely due to Prime and Amazon Web Services, which itself are tail events in a company that has experimented with hundreds of products, from the Fire Phone to travel agencies. + +Apple was responsible for almost 7% of the index's returns in 2018. And it is driven overwhelmingly by the iPhone, which in the world of tech products is as tail--y as tails get. + +And who's working at these companies? Google's hiring acceptance rate if 0.2%. Facebook's is 0.1%. Apple's is about 2%. So the people working on these tail projects that drive tail returns have tail careers. + +*Takeaways for* r/fatFIRE: + +When we pay special attention to a role model's successes we overlook that their gains came from a small percent of their actions. That makes our own failures, losses, and setbacks feel like we're doing something wrong. + +When you accept that tails drive everything is business, investing and finance you will realize that it's normal for lots of things to go wrong, break, fail and fall. If you are a good stock picker you'll be right maybe half the time. If you're a good business leader maybe half of your product and strategy ideas will work. If you're a good investor most years will be just OK, and plenty will be bad. If you're a good worker you'll find the right company in the right field after several attempts and trials. And that's if you're good. + +**Freedom** + +The highest form of wealth is the ability to wake up every morning and say "I can do whatever I want today." The ability to do what you want, when you want, with who you want, for as long as you want, is priceless. It is the highest dividend money pays. + +Research has shown having a strong sense of controlling one's life is a more dependable predictor of positive feelings of wellbeing than any of the objective conditions of life we have considered. + +People like to feel like they're in control -- in the drivers' seat. When we try to get them to do something, they feel disempowered. Rather than feeling like they made the choice, they feel like we made it for them. So they say no or do something else, even when they might have originally been happy to go along. + +*Takeaways for* r/fatFIRE: + +Most of you probably are working thought-based and decision job, your tool is your head, which never leaves you. You might be thinking about your project during your commute, as you're making dinner, while you put your kids to sleep, and when you wake up stressed at three in the morning. You might be on the clock for fewer hours than you would in 1050. But it feels like you're working 24/7. + +If this feels like you, and you do not like it, it is totally fine to switch to a job that pays less but gives you more freedom and independence, because freedom and independence are what r/FatFire is all about. + +\--- + +I'm only half way into the [book](https://www.amazon.com/Psychology-Money-Timeless-lessons-happiness/dp/0857197681), but I can tell this will be one of the best finance book of 2020. If you guys find this useful, happy to come back next week with more insights once I've gotten to the end. I like talking about these things on [Twitter](https://twitter.com/stephenou) too. + +Edit: [here's part 2](https://www.reddit.com/r/fatFIRE/comments/ixqn4u/what_rfatfire_can_learn_from_the_book_psychology/) and [here's a Twitter thread](https://twitter.com/stephenou/status/1308437490961846272) of the best snippets +**tldr: 30m is significantly better than 10m both in absolute access to things you get to buy and in overall lifestyle based on the quantity of 10m NW type decisions you can make. That said, its not worth significant sacrifice… but it is worth something and isn't worth being dismissed.** + +I was writing a response to the current top post in the sub asking whether 30m as a goal is too much. But it got too long winded so figured I'd open another discussion. I've noticed there is a trend on this sub to dog any goal that’s above 5-7m… I think about this a lot and wanted to share a different opinion. + +**30m is better than 10m…**. **By a lot.** I don’t know how to quantify it, maybe not 3 times better but I’d say roughly 20m better. Some people talk about how it’s not enough to buy a private jet… okay, but it’s, in life, the difference between getting to fly 1st class and flying private. + +Here’s some things you can do at 30m you can’t comfortably do at 10m + +* **Housing**. you can buy a $7-12m house in a vhcol city. For those that have legitimately shopped in a city like this, shopping with a $3m budget vs a $12m budget is… crazy different, like you’re playing different sports different. In NY it’s the difference between a brownstone (truly owning a piece of NY) vs. a condo. In some places its the difference between no compromise vs. significant compromise. +* **Giving**. you can make significant & standout social contributions to non profits or causes you care about. At 10m you’re one of the normal donors, maybe giving hundreds of thousands. That gets you praise and thanks in a newsletter, maybe some special access. At 30m you could consider giving millions which gets you simple buildings named after you… +* **Higher Education.** similar to above. It’s literally the difference between being able to legally buy your kids way into an elite university versus committing a felony and seeing jail time occasionally. This is pretty well documented. +* **Angel Investing**. you can be an actually angel investor that’s diversified enough and with enough cache for a probability of return vs being someone that does it for a hobby. It’s the difference between 25-100k checks or being able to write 250k-1m size checks. That’s very meaningful if you understand investing. +* **Alternative Investments.** it gives you access to a WHOLE different level of investments in general. You can start potentially being an LP at a legit hedge fund or VC firm that has significantly better returns than the market. +* **Leisure**. you can take truly unique vacations. At this level you get to charter a plane to fly somewhere, explore outside of established luxury hotels… in luxury. It’s the difference between staying in a four seasons vs. staying in a private villa with similar amenities. + +Even if you live the same lifestyle day-to-day at 30m vs 10m, having 20m sitting behind that is game changing. Let’s say you don’t make any decisions you *couldn’t* make as at 10m when you have 30m…. **The difference here is you can make 3x more of those decisions** (actually more but you get the point). You can fly private somewhere *and* rent a villa for the week. You can buy your kids way into a top university *and* buy them their first house. You can live in a world class city *and* give your kids a yard and top tier schooling. + +**At 30m you start to remove the need to compromise a bit more**. At 50m, you compromise even less. I think the difference between 10m-30m exists in both absolute terms (you literally can’t buy a $12m house under one budget) and compounding terms (you can do 2 expensive things at once). + +But to bring it back to where the sub generally sits and I agree, the question is opportunity cost. If you love your job and are making money. I’d shoot for whatever amount is healthy for you. Would I give up my health, family time, or psychological difference for 30m vs. 10m? Absolutely not. But I wouldn’t give it up for 5m vs 1m either. I just don’t think we should conflate the two (sacrifice vs. value). + +I love my job, I love my impact, I spend tons of time with my family, and I travel and enjoy life as much as I feel I need. I’m early-ish in my career and comfortably FI in the range this sub would qualify, but my plan is to give it another 10-20 years if I keep feeling this way and comfortably hit what I think is a true FatFire number which is 20-40m. For me personally, I think I can get there without significant sacrifice and I do want those things I listed (minus buying my kids way into college, they’ll earn it themselves). My plan would then push me into my 40's or 50's to be able to retire... so see it as a fully valid fatFIRE plan. The great thing is, I think $5m is plenty, so I only need to keep growing because I want to - I can revisit this on a quarterly or annual basis and change my mind whenever... That's the FI part. + +I love this sub despite some of the recent criticism and am excited for the discussion on this. I have a post I've wanted to make about my journey and current thinking, but this is part of that so I thought I’d share since it was on my mind. +Just a quick PSA, because we are not going to leave personalized comments on the dozens of threads getting nuked here, things that are being taken down: + +* WSB mods removed a thread on XYZ + +* I think WSB is manipulating stocks + +* WSB mods are not allowing discussion of [thing I want to discuss] + +* WSB mods are children and shut the sub down + +* anyone thinking /r/investing is the right venue to air out their thoughts on how bad it is that 12 year olds are gambling on Robinhood. + +We just don't care, and we certainly are not going to be a venue for anyone to complain about the moderation of another subreddit. If you have a disagreement with the mods of WSB then slide in to their DM and let them know (modmail, don't actually DM a mod, that's weird), or go to one of the subreddits like /r/subredditdrama that are dedicated to this sort of dumb shit, but don't post about it here because that'll be immediately removed. + +This subreddit is for discussing investing, not for airing out disagreements with other subreddits. I think I've nuked a dozen threads on this topic, and two people have already been banned for re-posting removed threads. + +**E: I don't know how but lot's of confused comments here, "WSB Affairs" means we don't want to see people here bitching about things that happen on that subreddit. It does not mean we're preventing any discussion of any actual trade, investment, whatever. "GME up 70000% in premarket" is a thread that get's to stay because it's an investment topic. "WSB mods did a thing I don't like" is not, that's reddit drama. Simple enough.** +We just saw a house in Kellyville , it's a decent house and should be around 1.5-1.6 mill range or less based on the current market and interest rate rise. + +The agent called us , we provided our offer 1.5 million and he said we already got an offer of 2 million 😊. I told him go ahead as if you are getting that much in this market the prospective buyers must be crazy super rich +Later he messaged and said that due to some disagreement we now are accepting lower offer around my range and asking me whether I want to go ahead or not . + +I feel this is their trick , first time they would say we are working on high range (unbelievable price) , to trap any fool or desperate buyer. + +All I need to say don't be desperate , this market is not to offer high but low .. rest is in your hand as the agent won't be paying your mortgage 🥲 +I came into some money recently. I'm 52 years old and have a 401k with around $450,000 in it and will work another 10-13 years. Three kids are out of college and on a full-ride, so no expense there. I am debating whether a Vanguard 2030 (#VTHRX) is a good play with around $120,000 inherited. ETF's? What is the best play? +I'm a newer investor and newer reader to these threads and I'm a little surprised how casually a lot of people talk about different companies and industries that are objectively pretty unethical. + +I mean we're living through a major climate crisis and some of the most hyped investments on here are for oil sands companies (which are one of the most carbon intensive energy sources on the planet) and crypto (Bitcoin alone this year is supposed to have the same carbon footprint as all of New Zealand). + +I also just saw someone post something in another investing subreddit about how Europe might ban AI for surveillance and it seemed like a bad or annoying thing to a lot of people in the comments. + +I'm just genuinely curious: do a lot of the investor world just genuinely not care about these things or are people content to make small gains on the backs of companies that they don't agree with? Is there a point to using your gains to get a waterfront property if it's going to be underwater in a couple decades anyways? +I’ve been listening to the bigger pockets podcast and David Green keeps downplaying the importance of cash flowing properties. He claims that he prefers appreciation versus cash flow. So he’s buying properties that will appreciate versus properties that will cash flow. + +Seems like really dangerous advice especially in the market that we’re in. Unless you’re finding absolutely amazing deals where you’re finding total fixer uppers there is no way you can guarantee appreciation in a property. Property values could plummet tomorrow and it will have nothing to do with what we did as investors. Same applies to the insane appreciation that we’ve seen over the last few years. Investors had very little control over it. + +The irony is that David green made his money back after 2008 where finding cash flowing properties was like shooting fish in a barrel. Most properties were undervalued and you could buy a house for $100-200k and rent it out for $1,500 -$2,000/month in CALIFORNIA. + +Now David is giving the opposite advice that he used to build his fortune. + +Appreciation is fickle and could change depending on how the wind blows. Cash flow imo is king and if you buy with built in cash flow then you never have to worry about appreciation. + +Thoughts? +I have been investing in the market since high school. My first few years I was just day trading, in and out of this stock and that listening to what anything on the internet was saying. I invested in two companies that were completely broke and eventually went bankrupt losing entire investments. Then I started to listen to Warren buffet and the books he recommended and slowly got better but still loved to gamble in the “sure” things online. Anyways the last couple years I have been killing the market.. a little under 40% CAGR. I think I’ve finally have a decent investing philosophy. This last month it all paid off as the stock I have been investing in for years went up a little over 40% giving me a $19,000 gain in a month. This was a weird feeling because it was awesome but it really didn’t feel like I was 19,000 richer. Just kind of seems out of touch. Has anyone else experienced this feeling after having their first great payout? + + +P.S I’m stoned writing this. +Paid off my $1.3 million dollar home, making me Mortgage Freeman. Took me just under 4 years. I’m pretty proud of myself. I have no one else I can tell. Keep grinding people. + +Edit: fellas changed to people + +Edit: My first award! Thank you kind stranger! +42 years old, medium/high cost of living area. Total Net Worth $21M (up from $4M a month ago :) ) + +Like many of you, I have been dreaming of writing this post for years - I just achieved what for me is FatFIRE eligibility, though I do not yet know when/if I will retire. + +\--- + +This is my story... + +I graduated from a good (but not elite) small liberal arts college. I did not apply myself during college (regretted later), had no idea what I wanted to do. The big 5 consulting firms at the time (late 90s) were interviewing on campus...I had a few friends who had graduated in prior years that were enjoying similar roles, and smart people I knew seemed interested in pursuing these on campus interviews, so I did it. + +Career Chapter 1: 6 years at a big 5 firm + +They put me in the "technology" practice because this is where they were experiencing the most growth (this was leading up to the dotcom bubble). After 6 weeks of intensive (and very high quality) training, I was put in the telecoms practice, writing COBOL for large telecoms company billing systems transitions. + +After 6 years of good but not great performance reviews and promotions, I went from $32K starting salary to $75K. I felt pretty good about it. I had a small 401K (maybe $50K) to show for it. I had lost about $4K of other savings doing margin trading right in to the dot com bubble. I had maybe $10K cash saved. The firm had IPOd and the partner track had lost appeal. I knew I was underpaid based on seeing my clients get paid 25-50% more than I was for doing less work, and I wanted to make money....but working in a cubicle at a large telecoms firm sounded like hell to me. I started taking the LSAT practice courses and decided to go to law school. I was accepted at a decent state school and enrolled to start in the fall. + +Then I got a phone call....I former manager in consulting was starting a software company in Asia and wanted me to come join. He had raised $5M and was forming the initial team. I'd be coding, writing requirements, helping sell, and forming the product vision. I joined as a technical product manager and moved to Asia. + +I took a HUGE pay cut (down to just basic living expenses in a VHCOL city in Asia), packed my shit, accepted some stock options (I had NO IDEA how to even understand how they worked much less how to value them - I trusted the founder was giving me a fair stake). + +Career Chapter 2: The tech startup game + +Immediately I realized I was SO MUCH HAPPIER and more productive working in small teams on concepts that were just visions on a powerpoint, bringing them to life in a software product. + +After 3 years of struggling to get our first clients, I decided I'd had enough and wanted to work back in the states. On what? I knew I wanted to work at a tech startup. From being in Europe and owning new modern phones with internet access and java apps/games, I had this inkling that we were about to see a revolution in mobile computing. I wanted to get myself wrapped up in this wave and hoped my boat would rise with the tide. + +After spending a few months unemployed and getting increasingly nervous, I got a call from a recruiter about a mobile apps startup in my home US city (midwest). I jumped at it. I borrowed a friend's blackberry for the job interview to show I was "obsessed with mobile" (I had a really cheap and shitty samsung phone at the time). I got the job. We spent 4 years working on a platform that would enable easier development of mobile apps. Nobody wanted it. iOS and Android launched and made our system obsolete. The company shut down after burning $30M of investor money with almost zero revenue to show for it. But I had learned a TON about how to design, build, launch and test mobile apps. At this point I was firmly on a path as a software product manager, and was an ideal fit for Sr Mgr or Director level jobs at startups dealing with mobile apps. I had made a good number of connections with mobile apps companies during my time trying to market our platform. One offered me a job and I took it. + +This company was in the early stages of hockey-stick trajectory. It was a consumer content/utility app that became a household name over the next few years as we grew to many tens of millions of registered users. I grew with the company and was the head of product management for the company....when a large public company came and bought us for a couple hundred million. I had amassed options worth around 1% of the company but hadn't exercised them. I learned a tough lesson about what happens with taxes when you get accelerated vesting on stock options. I spent 3 years at a large public company working on the integration and other huge M&A deals. + +My salary had grown from around $100K when I started to $300K + 40% bonus plus around $1M worth of RSUs in the company. After I left the company cratered and my stock was worth zero. I hadn't been diligent about always maxing 401K at during this process. + +I had maybe $700K in post tax brokerage accounts being self-managed, $300K in a 401K, and maybe $25K in cash. + +I had now seen "end to end" all phases of a startup from company formation to successful exit. And had seen a few unsuccessful exit/shutdowns as well. + +Career Chapter 3: Planting a Seed + +Along the way I started a tech startup with a couple of other guys. We each put in $30K, raised some friends and family money, and hired 3 young people to be the "founders" and try to get it going. It struggled for the first few years and nearly died, but eventually started to find a niche, and customers, and was now growing revenue at a healthy clip, I was on the board and stayed close to activities but never worked there. It raised several million dollars from a VC and was regularly getting inquiries from large companies about buying it. + +This chapter isn't really standalone, it runs in parallel, I spent maybe 10 hours a month on this company from board meetings to making intros to interviewing people etc. I funneled a ton of top talent into this company - anyone good I worked with who was looking, I would get them involved - this was the most valuable thing I did over the course of the 8 years the company ran, and I would say this is definitely a key to being successful with an approach like mine. If you can start a company with a couple of other people with deep and solid networks who are able to consistently put high performing talent in to the company, good things can happen. + +Career Chapter 4: My first CEO experience + +I started my own software company with some friends. It wasn't particularly successful but got "acqui-hired" after 2 years, which made for a nice story and an ok outcome (founders got a few hundred K in cash), and investors were made whole for the most part. I was made CXO of the acquiring company and stuck around for 3 years. + +Chapter 4: Winning + +We're now 20 years into a successful software career with experience from qa tester to software developer to product manager to VPx and CXO at companies ranging from 3 people in a garage to massive public companies. I'm plugging along in a pretty cush gig pulling down $400K + options (in something that could be worth zero but still), the company is way overcapitalized. The seedling I had planted 8 years earlier was becoming a small tree, and the market was noticing. We were approached by a large private company and 6 months later we completed the deal. 7 individuals got proceeds in excess of $1M and that was the most gratifying part, to see these people who had built this thing from zero get paid (including a handful I had steered towards the company). + +My take ended up being $17M. + +So that leaves me wondering where to go from here? My wife makes around $800K as a lawyer, I am happy in my job but it doesn't really move the needle financially for me anymore. Our annual family burn is around $220K. Thinking about ratcheting this up to $350K or so, but always maintain the optionality to have zero income from me/wife, indefinitely. Which seems more than doable now. + +I think I would be happy as an angel/advisor type if I could find 5-10 companies to help out. Ideally I'd work 20-30 hours a week but have total flexibility on the terms of it. In my heart I am more of an operator and believe advisors tend to lack the details to be truly useful. + +I'm sharing this because I wanted to remind myself of the journey and hopefully it can be useful for others thinking about the various paths to fatfire. + +Comments/questions welcome! +Dear investors, i wish you a good day. + +I started investing in November 2017 and before i realised what was happening, my super fast gains ended in a bursting bubble and a year of decreasing prices. Im down 52% of my investement and i would love to see how this community is holding up. + +&#x200B; + +Im sure we will see new ATHs in the futute so im not that concerned about my actual "loss". Lets see this subreddit as a support group where we are here for each other (even if its quite tocix from time to time). Dont loose hope because this technology can and will change the future. + +Happy holding and trading everyone! + +[View Poll](https://www.reddit.com/poll/9l9do1) +Hi guys, + +I've posted in here before, but my name is Emma. I'm a reporter for VICE News covering poverty and civil rights. I'm watching all sorts of bill payments, but I understand a lot of folks are really worried about eviction amid COVID-19 because how sudden the consequences are in many states. A lot of civil rights advocates right now are fighting for both suspended mortgage and rent payments, considering how many folks could lose pay (and their homes) during this outbreak and all its resulting economic turmoil. I know we're not at the first of the month, but if this applies to you and you're worried, reach out. You can PM, post here, or email [emma.ockerman@vice.com](mailto:emma.ockerman@vice.com) and I'll get in touch. +Facebook posted there earnings today with an income growth of 35% from 2020 to 2021 but after hours the stock has fallen nearly 20%. So you see this as a buying opportunity? +I live in Japan. Right now the yen is really weak, so you’d think things would be really expensive. But they’re not. There’s been minimal inflation. + +Meanwhile, over in the US the dollar is super strong right now. Which should make things cheaper… but they’re not. There’s massive inflation. + +These two forces are literally reinforcing each other and making prices completely out of sync between countries. Before in Jan 2020 a Big Mac was $4.82 in the US and 390¥ / $3.55 in Japan. Now a Big Mac is $5.15 in the US (7% inflation) and still 390¥ in Japan (0% inflation), but converted to USD, now only $2.83 because of the weak yen. + +Why is inflation and currency value both pushing in the same direction rather than cancelling each other out? +Surely people should not be evicted when the whole economy shuts down. But current set up makes the landlord responsible to sponsor this crisis for their tenants. The mortgage forbearance is not any kind of relief. Taxes, utilities and repairs still have to be paid on time whether rent is received or not. + +When jobs slowly resume, I imagine most tenants will choose to leave instead of having to pay off thousands in arrears accumulated in the last months. + +Am I wrong? +Everything I can find speaks very positively of them, but in practice they are extremely rare. And even the areas that implement them seem to often repeal them. + +What am I missing here? +This famous Anthony Bourdain quote really resonates with me: +"I understand there's a guy inside me who wants to lay in bed, smoke weed all day, and watch cartoons and old movies. My whole life is a series of stratagems to avoid, and outwit, that guy." + +For me, when I'm not traveling, I feel like my life will devolve into just sitting back and consuming media (books and movies mostly). +If your toilet gets clogged, a plunger isn't doing the job, and you have a good idea that it's a soft plug rather than a serious plumbing issue, there's another trick you have to try before calling to get your toilet snaked and paying a plumber $200. + +Get some cheap dish soap, dump a generous amount in the bowl, and wait 15-25 minutes. Dish soap is denser than water so it'll sink to the bottom, lubricate the clog and it'll sometimes take care of itself and you won't even have flush it. This has worked for me every single time. + +EDIT: Damn I was not expecting this to blow up. Thank y'all for the awards! I'm glad this was/is helpful cause who has money to flush down the toilet? + +To address some common concerns in the comments, in my experience this has always worked without warm/hot water, but I'm sure that step makes it more effective. Yes, cheap toilet augers/snakes exist but not everyone has somewhere to safely store it and some of us are too cost burdened to spend $50 on something we might use once a year at most. + + Also, y'all, it's not like we're going around clogging toilets every day lmao. Last time it happened to me was over two years ago... Just thought this would be helpful to share when it came up in conversation the other day. Furthermore, most clogs are toilet paper, i.e. most people aren't taking un-flushable monster shits. Finally, crappy toilets that clog more often than others totally exist. +Hey all, I figured I’ll finally share my retirement story here now that today is my first day. + +The history- I’m mostly a career underachiever. I worked in retail banking and human resources and hated it. I was lazy and mad at the world for not handing me success for work I never did. At 30, I had like $600 and no signs of potential. I had a community college degree and a bachelor's from a for-profit school that no longer existed. Great. And If my mom didn’t pass away a few years prior, I would have finished school to be a teacher, but life happens. I needed to drop out and stick it out in an unfulfilling career. + +I saw my opportunity. This thought influenced me- Not owning your life and spending all your waking hours doing something you don’t like is an awful way to live. Especially when you’re broke too. + +I wanted to marry my passion for fitness with work and decided to open a small CrossFit gym in my garage and train people after work. This was the easiest way to get into the field after considering buying a box truck and training people in their driveway lol. Thinking of the mantra “if you build it, they will come,” I knew I could get my weekend certification, buy a bunch of equipment on a cc, and be cool. But that’s not what happened. I did almost no work in building out my processes, culture, systems, etc., and no one cared to be a member. In a year, I had about 20 people total workout in my garage, 3-5 regulars—a mere few hundred dollars in monthly revenue. + +Presented with an opportunity, I could renew my CF affiliation (on credit) or let it drop and pivot. So, I thought about my skills (talking online and knowing about food/decision making), how to do this around my work schedule (9-5), and how I could still help people and make a career. + +Instead of training, I wanted to remotely manage people's diets (lifestyles). Partly because the industry is an absolute nonsensical shit show of misinformation. But I didn’t want to tell people what to eat, when to eat, what to avoid, etc., because as weird as that sounds, specific food choice, meal timing, and restriction are hardly what matters (people still argue with me about this, mainly because they make money saying the opposite or are influenced aka manipulated by another doctor turned book salesman and social media influencer. As you can see, I’m super-jaded by the field). + +I wanted to be more of a food detective. Crack the case and use a Socratic problem-solving method (guiding people to the answer through a series of questions). + +I asked myself what problems people face and what systems I could plug in to address those problems. + +Things like -people eating more than they realize, they don’t plan, feeling guilt and shame, they lie about it, it being lonely, there being no data, there’s no fun, there’s no community, there’s too much conflicting info, not knowing if it will work, crappy coaches/RD’s, and more. + +So, I started talking about my philosophy online, who were mostly people I knew in real life (big hint for anyone thinking all they have to do is post IG reels for clients). Some thought I was unqualified, a pos, annoying, not fit enough, etc. It hurt my feelings, and I almost didn’t go through with it. But I said f it. Imagine these voices preventing me from doing something awesome and helping people, is what I said. Luckily I had a few people trust me. + +These early folks got results, I would share them, encourage them to share their stories, I would take people shopping, do seminars, work with entire gyms, offices, and neighborhoods, and learn from the evidence-based community to stay up to date. I built a company many would joke was a food cult, and I embraced it. It wasn’t just weight loss or performance, though. People now knew their way around food like never before. I knew we had something special. + +I painted a picture. One that showed lifelong dieting failures, athletes, moms, dads, etc., could all succeed on my program, and it not suck the life out of them. I also gave free information everywhere and built my reputation as a CEO/coach who knew all the inner workings of our clients' struggles, the industry, business, and everything. + +After 13 months of doing this online (making more per month than my yearly salary) and working FT, I had to leap. Now, around 33, I jumped. + +Then things got wild. In a matter of a few weeks, I needed to hire more coaches. Soon after, we added RD’s to expand our offering to more people (think pregnancy nutrition) and got my best friend to quit his job and be my COO. + +Within a few years, we’d be on the Inc 5000 list and have a team of almost 100. We had no paid marketing either. We maintained world-class NPS scores while blitzing-scaling a service-based business. I can’t believe we didn’t mess it up. + +All our growth was from facilitating the image of two things and being relentless with it. 1- You’re missing out if you’re not here improving and having fun with us, and 2- there’s no better place to work in the industry. + +Doing that created what the company would become. Essentially a marketplace that matched people who needed help with those who could help. Being the CEO in it with my team and customers built that brand loyalty that made everyone mention us when someone asked how to lose weight, get healthier, or perform better. Then I would see it, pop in, and thank them even if it was Saturday night. That’s how connected I had to be. Or at least that’s what I tell myself. + +I sold in 2020 for 8 figures (sorry I won’t say the amount), stayed on for about 18 months, and today is my first day of retirement. I never thought I would be in this position, but a few good moves, luck, and support made it happen. + +Along the way, I saved because I always thought this could blow up. I never intended to sell, but having a kid, locking in the success, and projecting ahead made me realize it was the best option. I could have lean-fired early on, but selling made life a little less stressful. Being that this is FF, I think you’ll understand. + +I could have cruised along getting paid and stayed on as founder, but I wanted my headspace back. Thinking of this stuff all day is draining. + +This is a super condensed version of a cool-to-me story. I’m happy to answer questions, please ask. And if I can attribute this success to anything, it would have been my attention to my customers. I knew who they were, where they were, and what they wanted. I didn’t have projections, plans, or any typical business systems. I was good at reacting to feedback and was probably high off the growth, member stories, and job creation. This was my hobby until I fell out of love with it. + +Now, I’m going to just chill with my fam, dabble in little passion projects, and have good conversations. I still enjoy the fitness industry, I just don't want a job anymore. +I understand the basics of what caused the bubble. Subprime mortgages being rated higher than their worth by investment banks believing housing prices would continue rising, even if homeowners defaulted on their mortgages. There’s much more complexity to the picture than I’m detailing, but what I’m most curious about is what finally popped the bubble. What news leak or report or analysis finally caused housing prices to plummet. +We have been over saturated with posts/comments of such that would be found in WSB. Can we not ruin this sub as well by allowing low quality shit posts and comments telling everyone to jump on the train? I congratulate everyone who was able to profit but too many people on here are now having fomo. + +Edit: since everyone is so bothered, this is directly related to the level or maturity in the posts. There is a clear difference between this sub and WSB. Discussions are completely acceptable but keep it mature and don't just post low efforts posts with no insight other that "lets do this together retards." +This was due to an acquisition by a private equity firm who is taking the company private. I bought some shares as a long term value play and I guess someone else thought the company was worth it as well. + + +I do have some questions though, is it better to sell my shares now at $322 and re invest in something else or wait until I get the $330 per share. Thanks in advanced +As the DD has shown they use ITM puts as an expensive last resort to drop the price. Those 4000 puts cost over 51 million. + +This is by far the highest open interest for any ITM put in the entire option chain + +They may unload the remaining 3000 to try bomb the price down before these mass amount of calls expire ITM today, and so there isn't a 3 day weekend of FOMO buildup. + +#Do not set stop losses + +------ + +**Edit:** Well damn I had to go out right after posting this and came back to it being the top post on the sub, lmao + +Want to address this: + +**How do ITM puts drop the price?** + +I see a lot of people asking this, I read it in [this DD](https://www.reddit.com/r/Superstonk/comments/nc1lny/ive_estimated_the_current_si_based_on_the_si/), basically all options put pressure on the price, calls = upward pressure (see January gamma squeeze), and puts = downward. + +How does it go down if the strike they're exercising is higher than the stock is trading and someone has to buy it from you at 300? The same way it goes up when ITM calls are exercised at a lower strike than the current price and someone has to sell it to you at 200. What are the mechanics that make it work that way? I have no idea, I'm as retarded as the next ape + +They also use OTM puts to hide the SI% which can be seen when they have to report to FINRA, and they use ITM calls to satisfy FTDs which has been part of the T+21 cycles. They've been abusing options to manipulate and kick the can from the beginning. + +I'm not sure if that exact date+strike was used today, but quickly looking over the chain for all dates it looks like hundreds of them have been exercised since yesterday just among the top 10 highest OI ITM puts $300 or higher +Right now I just use my debit card from wells fargo to purchase everything. I do have a credit card that I rarely use. Should I switch to the mentioned method to build credit? Or maybe find another cc that racks up flyer miles? Really confused on this and that if it actually benefits my credit score + +Edit: Thanks for the responses! Looks like I'll be researching for one to get. + +Edit 2: Additional questions: + +Does it cost to use cc for bills? Has happened to me several times (Like 2-3% charge) instead of using debt + +Where to keep savings? Stay with Wells Fargo? + +I omitted that my cc has $4k balance on it (from college, used to be 8k) should I pay that off first before switching or keep paying it down and then switch once balance is 0? +[https://www.cnbc.com/2020/10/05/stock-market-futures-open-to-close-news.html](https://www.cnbc.com/2020/10/05/stock-market-futures-open-to-close-news.html) + +Very stable genius, good for the market, smart businessman, etc. etc., +I quit my job and today was my last day. This was made possible in part by Ethereum. + +I first bought Ether at 10 dollars back in January after hearing an interview with Vitalik. It sounded like a neat techonlogy and I thought maybe in 5 years I would see some returns. I had no idea what was about to happen. + +Fast forward 9 months and all I can say is it's been a hell of a ride. + +For my fellow Ethtraders, here a few lessons I've learned - usually the hard way - along the ride so far... + +1) You, me, Jamie Dimon, Mike Novogratz, ScienceGuy9489 and even Vitalik have no fricking idea what's gonna happen. He's said so himself. + +Ethereum could shoot up to 750 tomorrow and then fall to 75 the next day. Or it could lurk around 300 for the next two years before exploding to 3000. Who knows! If you have conviction in the technology invest what you are willing to lose and don't get hung up on the day to day movement. It's just noise. + +2) This has been said a million times, but for good reason: Don't invest more than you're willing to lose. For most people, this means no more than 10-20% of your money. This really goes for any asset class, even cash since there's inflation risk - but especially crypto. Ideally, in addition to crypto your money is diversified among a variety of asset classes like fiat, stocks, bonds, gold, etc. + +3) Never, ever buy or sell on emotion. As a rule, if you feel like you *have* to buy or sell right away, then you don't. Sure, you might luck out once or twice doing so, but this is called gambling, not trading. Being impulsive will ultimately screw you over. + +Our brains are running on millennia old legacy software designed to run away from threats e.g., panic sell, to follow the herd e.g., fomo buy, and in general to survive, *not* to be rational. When big dollar signs are flashing around, our lizard brains think it's life or death and all reason goes out the window. This is why the vast majority of traders, even professionals, lose money. + +Of course in a bull market everyone is a genius. So it's easy to kid yourself, but you're probably not a great trader. I know I'm not. I've read books on trading, and I'm not a total idiot, but the fact is I would be sitting on a lot more Ether right now if I had just bought and held rather than getting all fancy. + +There are a few folks who have zen-like discipline or years of experience, but for the rest of us, short-term trading is a losing game. That said, you can treat a small portion of your holdings as play money that you daytrade. Just don't be surprised if it's gone next week. + +4) Don't be a maximalist. God knows I was when I first arrived here. I thought Bitcoin was Myspace and Ethereum was Facebook. I came to realize Bitcoin and Ethereum are not competitors; they are trying to do different things. The world needs both gold and oil. + +5) This may sound blasphemous, but don't be absolutist about HODL-ing. For most, I think it's wise to take some profits as it goes up by selling a small to moderate portion of your holdings. Then, if/when it majorly corrects you won't freak out and panic sell. Instead, you can buy some back at a lower price. And if it doesn't correct, you'll still walk away with some profit and peace of mind. + +Now, if you are very patient and don't need to take profits it's fine to 100% HODL if you are truly able to stick with it. Just be honest with yourself. There are a lot of fair-weather 'hodlers' here who hit the sell button whenever there's a major pullback. It's better, not to mention a hell of a lot easier to sell when it's pumping up than when it's plummeting. + +6) It's human nature to never be satisfied. No matter how low you bought, you'll wish you had bought lower or bought more. Or you're gonna kick yourself for not selling at a peak. Remember, most people in this world still have no idea what Ethereum is and even if they do, they do not see its potential like you and me. We're early to the party. + +7) Keep your life in balance. This is more important than all the above combined. Sure, it's fine to go through a phase where this consumes your life, but if you spend all day and night staring at red and green on GDAX your health and happiness will suffer. Trust me, I've been there. + +Trading is already addictive but throw in a 24/7 market that never sleeps with bewildering volatility and you have the perfect recipe for sleep deprivation, anxiety, and manic ups and downs. + +If you're overly obsessed with checking prices, try either setting ground rules (what I do is that I only check prices between 10am and 10pm) or step away completely for a few days or a week. I've done this a few times and I always return to the markets with renewed energy and perspective. + +Money is important but once you have enough to get by, it's far less so than friends, family, health, and finding meaningful things to do in life. Remember guys, love over lambos, balance over Binance, and bros over blockfolios.. okay that last one was a stretch.. + +Finally, it's been said before, but that's because it's the truth: the joy is in the journey. Everything in this world is temporary. Whether Ethereum faces some existential threat and gets wiped out tomorrow or goes on to revolutionize human civilization for centuries to come, someday something else will come along and replace it. + +Likewise, your stash may someday be worth zero or a million. But either way you will have won the bigger game in town if you enjoyed the ride and learned a few things along the way. + +Stay safe, stay hungry, and enjoy the ride! + +*Note: Thank you guys for all the replies and encouragement, it means a lot. I had no idea this post would blow up like this. In hindsight, I wish I had titled this post something different and put less emphasis on the quitting job part because that's not what this post is really about. I realized from the responses that the post gives the impression that I am retiring for the rest of my life and intend to never work again. This is definitely not the case! Ethereum simply expedited me getting out of a job situation that I wanted out on anyway and has afforded me some more flexibility and freedom in the short to medium term. While I'm taking a bit of the break from the grind right now, I'll be pursuing work a bit down the line both for financial reasons and because it's part of a meaningful life* +Alright guys, I've had a sleepless night but now I'm ready to get to work on tracking down the asshats who took my money. + +First, let me tell you that I consider myself to be safe with my money. I have two factor authorization set up on every account. I also have triggers to disable accounts if new IPs are used to log in. I also avoid phishing emails, always check the addresses emails come from, and don't click on attachments. But guess what, that wasn't enough. + +Here's what they did. + +1. They somehow spoofed my phone number and had it go to a different SIM card. My current sim card stopped working all of a sudden. +2. I spoke with my cell carrier and they said that there were no manual changes to my sim card with them, so I'm still not sure how this step was completed. +3. They logged into all of my emails \(they had all of my accounts queued up and ready to go\). Once they took over my phone they then put all of my email accounts into recovery mode and had them send codes to my phone for recovery. +4. They then quickly changed all of my email passwords. +5. Next, they logged into every exchange I use and did resets of the passwords or just logged in if they had the password using the 2FA since they now had my phone and emails. +6. They then proceeded to drain my main exchange account on Gemini. Luckily they couldn't get into Binance \(well done Binance\). Gemini did initially freeze my account when they discovered a new IP, but then they sent a freaking email with a link to immediately unfreeze it. No waiting period, nothing. So, it was a useless security step since they had access to my email. They then made two big transfers of my BTC and ETH out of my account. +7. Here is the ETH address they sent to: 0x25c6f8e1ffa1656e6d4546932Dc68b6889A8D769 +8. Here is the BTC address they sent to: 1CuhKC6f6YUqJnuDPT28vqiktVR7chE7nG +9. Since they logged into my email, I got the two IP addresses they were using to do all of this. +10. First IP address: 217.151.98.69 based out of London, UK +11. Second IP address: 68.235.48.108 based out of Chicago, US + +Now, by the time I made it to the cell phone store to get a new Sim Card \(I had a feeling something like this was happening\) everything had already been done. I couldn't stop it because I was immediately cut off from communication and it all went down in about 15 minutes. This was obviously a coordinated attack. + +So, let's see what we can do as a community to keep these scum bags from messing with anyone else. + +1. If those scum bags see this post, you can return the money and everything will be forgotten and I won't pursue this anymore. +2. If they don't return the money, I'll be going to the FBI, Interpol, and whoever else I need to with the information I have. We'll all be watching this money going forward, and no matter how many times they move it, we'll find out where it ends up and make it hell for them to try and spend it. If it makes it into an exchange, law enforcement can then subpoena the exchange for the information to make an arrest. Basically I'll do everything in my power to ensure that if these asshats try and use my money, the authorities will find out. +3. In 24 hours, if the funds haven't been returned, I'll be placing a MASSIVE bounty on the identification of these douchebags. And then every white knight, grey hat, and black hat individual out there will have a vested interest in bringing these guys to justice. + +Basically, I'm giving them 24 hours to make this right. If they don't, I'll do everything in my power to make sure they worry about every spending any of that money with the threat of a lengthy jail sentence hanging over their head. + +EDIT: Also, if folks could share this on the other crypto subs to give it as much visibility as possible. I don't have the karma to post on some of them. THANKS! +It still feels too good to be true. I'm giddy. After nearly a year of dead ends, we finally got confirmation and a start date for his new position. We have increased our annual income by 40% and now make a combined income of $80k/year. + +I could cry. We can finally save for a house. I can buy a new phone. We can keep the AC at 73° instead of 80°. We don't have to worry about car payments or how to pay down our debt anymore. We can finally relax and enjoy life and help out our friends and family occasionally. We can buy gifts for holidays, weddings and birthdays. I'm fucking beaming with joy! + +I'm so fucking proud of him. All his hard work finally paid off. It still doesn't feel real. +Obligatory data: 45m married with four kids in LCOL Midwest. NW of 11m. Up from 6m 2.5 years ago when I exited my tech service company. No YOLO bets involved (Not that those are bad). + +There is always some level of curiosity on the journey each of us is on to (or already at) FATFire. So I thought I would share my story so far, hopefully to reiterate that the American Dream is alive and well for those willing to pursue it. I’ll do my best to share lessons learned at the end. I would love for the result of this to be for others to share their journey, and inspire those on a FATFire journey right now. + +Be warned…this is a long ass post. I enjoy reading long detailed posts…so those of you who also enjoy that…this is for you! + +TLDR: Started with nothing, worked hard, caught some lucky breaks, FATFI…still working on the RE part. + +***Childhood / Young Adult*** + +I grew up in a family of six, where I was the middle of three boys..with a younger sister coming along later. We relocated to the Midwest when I was 10…and some of my first memories after moving were jobs. I immediately wanted some spending money for baseball cards and ultimately a Nintendo. My family was not the kind that had money laying around, so anything I wanted I had to earn. By time I was 12 I had two paper routes, mowed lawns, and sold Current (stationary) door to door in the neighborhood. Working was something that came naturally. I worked a variety of jobs through high school and college…never working less than 20 hours a week and full time in the summers. + +I was an average student in high school and college. I loved my high school history classes, so I progressed to a History major in college, eventually choosing the route of History Teacher over going into Law School. In school I was always socially middle class. Combine that with my middle child syndrome of just wanting to be liked, and it was an interesting journey through school. I picked up a love of computers through high school (first computer was a C64) and college…at one point teaching computer classes to little kids and senior citizens. That became critical later. I graduated and off I went to my first job teaching. + +***Professional Wandering*** + +I was convinced I wanted to be a high school teacher…and proceeded to be just that. IT SUCKED. I was not prepared for the challenges that classroom control (behavior) would present. Lacking a high level of self-confidence at that point, and lack of mastery that a seasoned educator would have…I got ran over. Stuck with it for three years…and those were three very long years. Towards the end of year three, I saw an opportunity to transition into a Helpdesk IT job at a local company and jumped at it. + +My IT career spanned two years, as an in-house IT person for two local healthcare companies. I learned a TON about IT support, and really enjoyed making people’s day by fixing their issues. During those two years, I had my first two entrepreneurial experiences that would fuel my long term desire to make that my career calling. + +***Everquest*** + +So in college I got sucked into computer gaming, and that continued during my time teaching. Everquest was the first MMORPG that I really fell in love with, and I played that game WAY too much. Ultimately was in a big guild where everyone shared accounts, and had access to a lot of dormant accounts. I began to notice that there was a real economy in the game, and people bought a lot of virtual things with real money. My mind was always working to figure out ways to make money…and this one hit a sweet spot. + +My first time dipping my toes into selling things was when there was a particular NPC in the game (Lodizal) that took a group to kill, and no one could figure out how often it spawned. But the item it dropped 100% of the time was worth about $500 in the real world. Since I had access to dormant high powered accounts, I decided if I could figure out the spawn time, I could pop $500 each time. So I setup three computers side by side, and camped a character at the spawn point and started logging every spawn in an excel spreadsheet. Eventually, I figured out the timing and would literally be at my computer every potential spawn time. After a month or two of this (and making 3-5k), I got tired of getting up in the middle of the night, or running home from work to be there for a spawn. So I setup a log parser and had a super loud alarm go off every time the NPC spawned and said its specific text in the chat box. Bingo. + +As I learned more about the market, I realized that people quitting the game would sell their characters for about 30-40% of what I could sell everything individually for. While online auctions for virtual items in Everquest were banned on Ebay, they were alive and well on a site called Playerauctions. So as my first REAL business, I would buy people’s characters (typical purchase was between $500-1500), strip all the items off, sell them for in-game currency, then sell the currency for real money. Eventually even had a website ([www.lootpal.com](https://www.lootpal.com)). Over 18 months, sold 360k of virtual things, for a profit of 160k. Sadly…all good things come to an end, and the Chinese farming companies moved in and devalued the currency so much that it no longer made sense to do what I was doing. Sold off the last of my inventory and closed out that little entrepreneurial journey. + +***IT Support Company (Try 1)*** + +While in my second IT job (and at the tail end of my Everquest business), I really wanted to start my own IT Support business. I just had no real good idea on how to do it. So, I got a separate phone number, and put an ad in the newspaper! $25/hour IT support. I got one customer. Did his IT support for about a year…but never got more than that. Eventually, cancelled the ad and the phone number. #fail + +***Sales*** + +After doing IT support for two years, and having the successful Everquest business, I decided to try my hand at sales. So I got a job as a pharmaceutical sales rep. Little did I know that job was much more marketing and much less sales. About six months in I realized that hard work did not equal results in that industry and started looking for what was next. Here was one of the first BIG luck moments in my life. In that industry, you give physicians big “speaking grants” to come tell other doctors to write more of your medication. Its all one big circle jerk, but everyone got money out of it..and it wasn’t my money so whatever. I met this physician on Thursday who was doing a Dinner, then we were traveling to do a breakfast presentation and a lunch presentation the next day. We talked about technology in healthcare (which I had prior experience in), and had a great time. At the end of the last presentation, we sat down at a coffee shop…and before we know it he asked if I was interested in starting an IT Support company with him! BOOM! Within 60 days, I had quit my job and I was off on a wild entrepreneurial ride. + +***IT Support Company (2nd Try) – 28yo*** + +This worked a lot better than the first time. We had a built in customer (my business partner’s physician practice). We also had great timing / luck, as we started the business in 2003…the dawn of the Electronic Medical Record. Physician practices, which I had strong knowledge of, were transforming from companies that used technology sparingly to needing technology every. The government was ramping up requirements, and physician practices were a perfect customer…they had the money and they pretty much had to implement the technology. The IT Support company grew from just me, to me and two full time employees. The only problem was that I was always going to be a minority partner to the physician. The larger more stable the company, the better chance I had of being voted off the island in the future. I knew that long term this wasn’t going to work. + +Fortunately, I met a very entrepreneurial guy who ran his own solo IT company..and he also specialized in healthcare. Over the next 90 days, we decided we would make good business partners. I bought out my physician partner, and we started a new business with the combination of our two. Up until now…my total yearly income had never eclipsed 60k/year. + +***IT Support Company (3rd Try) – 31yo*** + +If at first you don’t succeed, try…try again. Third time was the charm. My business partner and I started this business with about 450k in revenue. Year one we grew to 1.5m, then 3m the next year, and 4.5m the next. The keys to growth were a combination of a phenomenal engineering / tech team, excellent tailwinds from a growing industry, and a strong sales team (my specialty). There is a glass ceiling in the IT support industry at about 3-5m in revenue…mostly because these companies are started by engineers who aren’t strong at sales. So they cap out due to a lack of being willing / knowing how to build a sales team. We blew through the glass ceiling because we committed to building a sales team…and got lucky with some really talented sales people early on. + +We also learned some important lessons about cash flow early on. We were so focused on top line revenue growth…and lacked the business sophistication to know better…that we neglected our bottom line. We convinced ourselves that investing in growth was why we weren’t making any Net Income…but it brought us close to death from indigestion. The year we booked 3m in revenue, we booked…$3,000 in net income. Whoops. Because of how we handled our invoicing and procurement…we ran dangerously close to running out of money, despite being a rapidly growing company. If it wasn’t for my business partner’s grandma (who lent us $50,000), and a community bank who eventually gave us a 300k LOC, we may have missed a payroll. Lesson learned. + +A key move for us during this time was getting involved in a peer group for IT companies. This was a HUGE factor that gave us access to companies that had the same challenges…and were where we wanted to be (larger). We soaked up every bit of information we could…and implemented countless things learned. Things really started to gain steam. Now we were one of the larger companies in the area…and the flywheel was really starting to turn (Jim Collins reference). + +We grew constantly, year over year, for the first 9 years in business. At one point we had a streak of 8 years in a row on the Inc5000 list of the fastest growing companies. That was pretty cool. There were always challenges, but we had a great team that was constantly up to the challenge. In 2013, someone recommended a book to me that included the concept of “start with the end in mind.” It made me think of what the “end” looked like for me. I knew 100% of my eggs were in one basket, and I had seen many a business owner go from dust to dust. What did my end look like? I decided that I needed to determine that, and came up with the three things that would signal the “end” for this entrepreneurial adventure. (1) The business had to have a leadership team in place so that it would be successful without me, (2) I wanted to sell my 50% internally either to my business partner, the leadership team, or ESOP, and finally (3) it had to be worth my number…mid seven figures. + +In 2018, I realized that I had hit all three of my factors that had signaled the end. But much like many of us on the FATFire journey…how much is enough? Can you really leave a company when things are going smoothly, and you are growing? Then I read this blog post. ([https://www.becomingminimalist.com/jump/](https://www.becomingminimalist.com/jump/)). I knew I had to jump. My wife was critical at this point in giving me the confident reassurance around that move. + +In July 2018 I sold my 50% to my business partner for 6m. + +Seeing the dollars hit the bank account was almost a little anticlimactic. Five minutes of euphoria, followed by “Well, what next?” LOL. One of the key things it DID do for me, was improve my overall stress. When 95% of your net worth is tied up in a business that could be broadsided by who knows what…that’s stressful! Removing that stress was incredible. Leading up to the sale, I had been researching investments…as I felt a strong desire to invest in SOMETHING so that I wasn’t negative cash flow until I figured out what was next. On one of the due diligence calls on a real estate deal…I met a guy who had sold a number of businesses, and he told me “The most important thing I can tell you, is to not make ANY big decisions for six months.” He went on to talk about how I would THINK I knew what I wanted to do…but give it six months and it is almost guaranteed to be different. Great advice…that I ignored at the time. + +***Consulting*** + +During the run at the IT Company #3, one of the key things we had done around 2015 was to implement a system called Traction (Book by Gino Wickman). We hired a professional who helped us implement it, and it had a profound impact on our continued growth and maturation as a company. As my wife and I considered what we were going to do next (she had left her job in public schools as a psychologist), we thought we may enjoy helping other leadership teams / companies implement Traction. So we did. We quickly clients…and still work with most of those today. That has been an incredibly rewarding pursuit, seeing each of these companies accomplish things they wanted to through the implementation of Traction. Highly recommend to any business with 10-250 employees. + +***Finding The Next Entrepreneurial Journey*** + +The consulting scratched our itch for something to do with our time…but not what to do with our money. I’ve always been horrible at passive investing. I like to invest where I feel like I can use my passion and skills to impact the investment. At first, we thought we would just purchase some commercial real estate and collect the checks. But the more we looked, the less we liked that. It was hard to find a return better than 10%, and I didn’t have any particular skills in that area. So by early 2019 we abandoned that idea. + +We took some time to analyze the combination of (1) what were we good at, (2) what were we passionate about, and (3) what could we make money doing. We emerged from that with the clarity that buying companies and working with their leadership teams to grow companies would be a great fit for our next entrepreneurial adventure. It also would contribute to being diversified, through owning multiple companies. So off we went. + +***Baby Private Equity*** + +So the best term for what we are doing is Private Equity…but we aren’t taking on other people’s money…and we’re smaller than typical Private Equity. But if I don’t call it that, its hard to explain quickly what we do. + +Since I had never bought a business (Only sold), I had a lot to learn. I started reading, and consumed a massive amount of information on acquiring a business. My background in running a number of businesses also gave me a good playbook for what to look for through a due diligence process, and there is a lot of information available on the interwebs. Ready to rock and roll, it was time to find business #1. + +***Business #1*** + +I started combing through online business listings looking for a company that would be a good fit. We knew what type of business we didn’t want (daycares, gyms, hospitality, automotive)…so that helped a bit. After reviewing hundreds of listings, I realized that in the size of businesses I was looking at (2-6m purchase price), replacing the active owner was the really hard part. So I switched gears and started looking for absentee owned businesses…and BINGO. Hit on a Flooring company based in the SW. Price was a bit high, but the company was well-run, good GM in place, and had consistently grown revenue year over year for their entire 12 year existence. The factors that I took into account to buy this business: + +* Critical Mass – Enough revenue, staff, customers that it wasn’t fragile or owner-centric +* Growth – Growing year over year top and bottom line revenue +* Market – Located in a city where we can 3-5x the company +* Team – Solid leadership team in place +* Transition – Almost no transition risk because the previous owner was absentee and completely disengaged from the business +* Industry – No real disruption on the horizon for that industr + +We closed on the purchase April 1, 2019 for a purchase price of 4.5m. For those of you who love details, revenue was 8.5m with EBTIDA of 950k in the previous year, so paid just over a 4.5x multiple. I put 1.5m down, did an owner carryback note for 20% of the purchase price, and financed the remaining 50% with a community bank I had a solid relationship with (and now is my primary financing partner). The day of the sale I injected an additional 150k into the business for cash flow purposes. + +Fast forward two years later, and this business is rocking and rolling. GM has really stepped up as a leader…and is focused on scaling the business the right way. Total debt paid down to approximately 2.3m from the initial 3m, and they are cash flowing significantly. Should finish this year around 11.5m in revenue with 1.2m in EBITDA. We have realized an approximate 35%+ ROI on our cash invested from post-tax cash flow and principal paydown, not including an increased valuation. The other major benefit of the transaction is the amount of the purchase price allocated to assets gives us the ability to take accelerated depreciation to drop our taxable income. Overall this is an ideal investment for us…over 35% YoY investment, with business value increase stacked on top. Looking forward to a long hold on this one + +***Business #2*** + +One year after adding business #1, it was time to start looking for a second investment. An early post-sale investment I had made in a REIT was redeemable (1.5m), and with the returns from business #1, I wanted to continue to buy businesses. Begun the search…and connected with a guy who was connected in a tier 2 market. He threw a bunch of things at me…but the first one to stick was a house painting franchise. It was operating smoothly, but the owner / operator was looking to move and needed to sell. I had a GM candidate who I knew personally that I believed would be an excellent GM…and this was a small / starter deal that would give him a chance to shine. So we pulled the trigger…likely without enough due diligence + +Closed the deal at the end of July, 2020. 350k purchase price, with 50k being an earn out tied to cooperation and the two employees staying. Business had done around 800k previous year with 100k NI. First week, existing sales guy quits. New GM starts after two weeks, and brings on another sales guy. So now three people…sales guy, ops, and GM. Team is in place. Just execute the franchise business plan right? + +Well…this one has been a struggle. We were staffed for the 8 great months out of the year…but Nov-Mar was a DUMPSTER FIRE. Tried doing interior work…got outbid. The work we did do wasn’t profitable. I injected 150k into the business because (1) we were overstaffed and (2) we were getting our asses handed to us in a variety of ways. Our Holding Company team (more on that later) has worked hard to make this one work…but feels like the franchisor fights us every move we make. + +I still think this one has the potential to get to 3m in revenue and 300k in NI…but they are a long ways off right now. Good news…its our smallest bet. + +***Business #3*** + +THIS is where it starts getting exciting. We now had around 1.5-2m in cash, and it was time to do another good sized investment. I had been searching myself for the past 3-5 months with limited success. However I had connected with a buy-side broker who I liked, and seemed like they may be a good fit to find us a lower multiple transaction than what I had paid the first time (4.5x EBITDA). So…we engaged to have them look for a business for us. + +Things got off to a quick start with the new buy-side broker. They threw 4-5 deals at us to look at, and we had a couple calls with owners…but within two weeks they had a large flooring company (we know a lot about those now, and loved the idea of another one) in north central US. The company was distressed, as they had gotten beat up by covid-related slowdown quite a bit. The owner was ready to get out after 22 years. They were doing around 14-15m in revenue with 800k ebitda pre-covid. They had a valuation of 3.6m….but as I mentioned they were not having a good 2020. Their plan was to try to break even. + +As we evaluated the deal, we were able to identify some core things they were doing functionally that we could quickly rectify post-purchase. We met with the two key leadership team members, and felt great about their ability to lead the company in the future. Looked at their stores and saw stores that just looked old / stale, and needed to be updated. We knew we would need to put time…and quite possibly money into this deal. So we wrote an offer. + +Slammed an offer in at 2m (basically 3.5x their 3 year average EBITDA including YTD 2020). I was sure they would tell us to F off…but they didn’t! Counter at 2.25 and we signed it as fast as we could. Due diligence was a little messy as we uncovered some more issues…but we realized that properly ran this company could be a 15m company at 1.1m EBITDA with the infrastructure (10+ locations) and upside to be a 30-50m company long term. Funny note…tried to renegotiate price down once I realized how much I would need to put into renovating the stores…and the owner almost walked away. Whoops. Finalized the deal and off we went. + +This deal has turned into a rocket ship (To The Moon #WSB). The leadership team took OFF once they understood they were empowered to make decisions. We implemented Traction (Book by Gino Wickman) that gave us a clear vision, responsibilities, and values for the company. Off they went. We set a budget of 17m in revenue, and they are currently on pace for closer to 20m in revenue with 1.5m NI. + +***Holding Company*** + +Through deals #1-3, my wife and I were the only ones at the holding company level. Our intention was to build out our holding company with a team that would work with our acquired companies to help them grow and be successful. Acquiring #3 allowed us to begin that process. We hired a rockstar marketing person who has amplified marketing across our three companies. Our second hire was a very fortunate one…a longtime acquaintance in my previous industry shook free from his company and was considering retiring. Fortunately he saw the fun / challenge in what we were doing (acquiring and building great companies), and he is the perfect partner for me to work with. He is a phenomenal coach, loves setting big goals and then working with teams to build structure to accomplish that. We have a CFO starting in a week that will work with the financial leaders in each of our companies…and help with overall financial management of the holding company. Together we can also be more thorough in our future acquisitions, instead of being a one-man-band. + +We set some big goals for the next 5-10 years, culminating with the goal of having 300m in revenue and 30m in net income. We will acquire one company a year to stay on pace to do that. Our biggest question right now is whether we want to continue to acquire flooring companies to create something really unique and strong in that industry. We already have some massive competitive advantages at our size, if we continue to add flooring we could really gain steam. On the downside of that…we are concentrated in one industry (scary). No decision on this yet. + +***Personal FATFIRE Journey – Where do we go from here*** + +Part of the goal of building out our team at the holding company, is to continue on a journey closer to the Retire part of FATFIRE. I’m working around 30 hours a week right now (by choice). As we build out the team, I can move out of those tactical areas and continue to focus more on vision / strategy, culture, and acquisitions…while decreasing my hours. + +We are dividing up the next 10 years of our life into two 5-year chunks. First 5 year chunk is with the kids still in the house. Youngest is 13, so 5 years until they are out of high school. During that time, we only travel a week or so at a time, and have significant parental responsibilities. So this is the time to continue doing what I love…building companies. We are getting a good team in place, and hopefully can continue to find good fit companies to buy. + +Second 5 year chunk is after the kids are out. The goal is to be non-essential to the holding company and subsidiaries…with all day to day at the holding companies being handled by a strong team. We want to travel more, and enjoy a kid-free (or atleast out of high school) situation a bit more. We have a second home in Phoenix, and likely will spend 2/3 our time there, and 1/3 our time in our current city. Coming back for family and friends. + +***Real FATFIRE*** + +Yeah…that probably happens 10 years from now. Its not really about the money to do it at that point (it isn’t now either)…its more about maximizing the RE part of FATFIRE that we hadn’t paid as much attention to previously. I’ll be 55 and my wife is similar age…so we want to go explore and continue to enjoy retirement while we still can. I don’t envision giving up the business…but minimizing my engagement to 2-5 hours a week that I can do from anywhere. I don’t ever see being full disengaged from growing things. + +***Keys to my FATFIRE journey:*** + +1. Always learning – It’s a strength of mine… and its returned dividends. This skill has been key to changing careers with minimal disruption (teacher -> IT person -> ecommerce -> sales -> start IT company -> private equity). +2. Take CALCULATED risks – Opportunity is all around us. Some good, some bad. I always do my best to calculate the risk, understand what happens if it all goes south…and compare the upside. I constantly look for high return, low risk deals. +3. Say NO to a lot of opportunities – This goes hand in hand with #2. Warren Buffet called Charlie Munger the “Abominable NO man.” Say no to everything that doesn’t check all the boxes. There are TONS of deals out there…be picky. +4. Don’t hire friends or family – It never works out. Ever. +5. Mentors – Constantly find people who are where you are going…their knowledge makes the road much more smooth +6. Believe in people – If you constantly share what you expect, and that you believe people can perform….they so many times will prove you right. Most professionals want to do great work…show them what it looks like and tell them they can do it. + +Top 5 Book Recommendations + +1. Traction by Gino Wickman – This is the operating system we run all of our businesses on. Gives us a clear vision, and the system to make it happen. Magical. +2. Great by Choice by Jim Collins – This book has concepts and principles that I believe wholeheartedly in. +3. Four Obsessions of an Extraordinary Executive by Patrick Lencioni – Great example of how you should spend your time +4. E-Myth by Michael Gerber – Taught me how to extricate myself from day to day operations of my company +5. Built to Sell by John Warrillow – Create a business that has value not intrinsically linked to you +6. Bonus – The Subtle Art of not giving a F\*ck by Mark Manson – Taught me to let go of the things I was not energized by…and gave me clarity as to what I love to do + +Alright, that’s it folks. If you’re still reading this, congratulations. You made it. + +I’m happy to answer questions. I look forward to updating this once a year as we progress on our FATFIRE journey. + +\-Nick + What do you like/dislike about the strategy? + +I'm thinking about getting into stocks more seriously and I want it to be as stress free as possible. From my initial research it looks like I'd want to dollar cost average into a handful of tried and trusted ETF's like vanguard or something of the sort. + +Just wondering if other stockholders who do such a strategy enjoy it or wish they would have done something different however many years later. +Hello friends ! I have been on the dividend journey for a few years now and now that I hit my goal of $50k invested I'd like to share my experience and emphasize the importance of patience, dollar cost averaging and getting that snowball rolling. + +First of all the portfolio: + +https://m1.finance/c37HY160LBky + +This is not a portfolio strictly for dividends, but is one geared toward mixed growth as well with exposure to the total market as a core and then ETF's and individual stocks for where I want overlap and focus. I make about $1800 a year of this portfolio at the moment plus an additional $370 a year from staking crypto (Cosmos Atom staking at 9% apr via Exodus wallet) + +This is a portfolio I actively manage, sometimes adding and removing holdings as performance of the underlying assets change. This is why I have a core exposure to VTI and VXUS. Thats my foundation that never changes and everything beyond that is free game. + +The first point I want to emphasize is that regardless of the route you choose when investing your portfolio is simply a vehicle to get you from point A to point B. Dividend investing is the Toyota Camry of investing. Not quick or flashy but you can hold it forever and it will serve you well. Dont get discouraged because you're getting passed by people driving a Corvette going all in on growth stocks. As we have witnessed from the recent pullback from growth stocks last month, there are alot of those corvettes that spun out and are now sitting on the side of the highway while we putter by. It is however not a bad idea to mix some growth in there as thats alot of how I blitzed my way to $50k. Start with some growth oriented stuff up front while building your long term holdings then convert that capital into dividend payers. Just be wary of capital gains tax. + +It also takes time for compounding to start becoming a noticeable driving factor in your portfolios growth and for a long time you are going to be doing the heavy lifting yourself. Eventually though your dividends will grow to the point where you get your snowball rolling and you will have to do less and less work to make it grow. + +So at my current rate of investment @ $400 a month with a conservative estimate of 5% dividend growth rate and 5% appreciation of the underlying asset you can see the power of compounding in the table below going forward over the next 10 years. + +https://imgur.com/zrPPSTp + +I have however chosen the stocks in my portfolio because they have a strong history of good balance sheets, strong fundamentals and a history of solid dividend increases and the average combined dividend growth rate for the past 5 years has been closer to 16% + +This is why its important to chase the company and not the yield. This is why I have not touched companies like AT&T, Ford, IBM or Altria. + +I like to check the companies [cash dividend payout ratio] (https://www.fool.com/knowledge-center/what-is-the-cash-dividend-payout-ratio.aspx) the percentage of its free cash flow (FCF) paid out as dividends. If it's over 100%, then its dividend could be unsustainable. Second, I check if its yield is higher than the 10-year Treasury's yield, which is currently 1.6%. If it pays a lower yield, the stock's value is more exposed to rising bond yields. + +Last but not least, I consider the long-term performance of the company's stock, specifically looking to answer one question: Have declines in share price more than offset any dividend gains? If that has been the pattern, the stock is liable to be a poor income investment. + +For example we can use [portfolio visualizer](https://www.portfoliovisualizer.com/backtest-portfolio) to backtest what would have happened if we invested $10k each in AT&T and Costco in 1987. + +As we can see from the [results](https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2021&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&reinvestDividends=true&showYield=true&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=T&allocation1_1=100&symbol2=COST&allocation2_2=100) our portfolio with costco would be worth $573k today vs the $73k with AT&T + +In a very broad sense this is a good way to evaluate large well established dividend payers. I fully admit there are stocks in my portfolio which I hold contrary to this advice such as AY which has a very high cash to dividend payout ratio and it is a bit more speculative but given I have a long timeline and the company itself is secure with long term cash generating contracts, I feel confident that it can grow into its dividend. + +Another factor you should look at when making a diversified portfolio is that you want to minimize overlap if you have alot of ETF's or at the very least be aware of the overlap you do have. + +You can use [this ETF tool](https://www.etfrc.com/funds/overlap.php) to see any overlap you may expose yourself too when selecting ETF's. + +[Trackyourdividends.com](https://trackyourdividends.com/) is also a great tool for keeping track of payout dates or getting visual data for your portfolio. + +At the end of the day I am still very much in the learning phase and what I have put together works for me. Despite the markets turbulence over the course of covid im still up $12k from my cost basis and have a solid foundation with which to learn and grow. + +I hope the best for all of you and im happy to answer questions or even take criticism :) +I open the sub today to people wheeling millions in apple, selling real estate or second mortgaging their home to open option trades. As of tomorrow morning, it's time I run down my premium outstanding by 50%. I currently have about 250k premium float outstanding and will not be opening or rolling anything until I get it down to 125k. Y'all are scaring the shit out of me with these posts. + +Have a great weekend! + +(edit:Thanks for the rewards y'all!) +After two years of lawsuits, a court finally unsealed key evidence from the FBI’s 2020 investigation of North Carolina Sen. Richard Burr for allegedly trading stocks based on nonpublic information. + +Public records at the time show that Burr abruptly liquidated more than half of his and his wife’s equity holdings in February of 2020, when most of the world had yet to focus on the looming coronavirus crisis. + +Burr was ultimately not charged with breaking any laws, but the newly released records show FBI agents believed Burr had committed insider trading and securities fraud. + +The most compelling new evidence is the flurry of calls and texts between Burr, his wife Brooke Burr, her brother Gerald Fauth and Fauth’s wife that took place on the same days that both the Fauths and the Burrs sold off hundreds of thousands of dollars of stock right before the market plunged. + +Read the full article: [https://www.cnbc.com/2022/09/06/unsealed-fbi-docs-reveal-a-flurry-of-calls-amid-burrs-stock-trades.html](https://www.cnbc.com/2022/09/06/unsealed-fbi-docs-reveal-a-flurry-of-calls-amid-burrs-stock-trades.html) + +Senator Richard Burr sold 80% of his stock holdings after receiving pandemic briefings in Feb 2020, per unsealed FBI docs. Days later, the market crashed. Nancy Pelosi was also recently accused of trading on non-public info. Do you think politicians should be charged for insider trading? +[Book 2](https://www.reddit.com/r/Superstonk/comments/qxbzim/moass_the_trilogy_book_two/) + +[Book 3](https://www.reddit.com/r/Superstonk/comments/qzcag6/moass_the_trilogy_book_three/) + +I want to start this with a brief message about myself for those of you that don't follow me. + +There is a lot of FUD about me that I would like to dismiss. + +I think this is an important step so that my work and the work of many others who have helped me along the way. Is not judged on my personality or profession, but by it's quality and adherence to supporting evidence. + +Many of you were likely unaware of my existence or never gave me a glance due to the fact that I did Technical Analysis on a "highly manipulated" stock. + +So here is my GME story, + +Exactly one year ago, to the day, I entered my first position on GME. It was November 17^(th),2020 and GME opened at $11.5, after following DFV's posts for a few weeks I decided that his analysis was solid (far better than anything else I had read on that sub in my couple years lurking there), Bought in Feb.19th 20c and 500 shares. I will never forget inputting those orders, it changed my life and many of you probably have that same memory. + +I began at first to comment and then get more involved with community as a whole I liked watching the streams but found them to be disingenuous, I never felt that AMC was the play and I still don't. So I settled on warden, he was obviously inexperienced at TA and didn't have a lot of market knowledge, but it was cool to have a place to hang out and talk my favorite stock. + +When warden announced he was leaving to handle personal matters I decided that I didn't want the daily posts to end. I thought they helped people hodl and provided a calm grounded narrative of what the stock was doing everyday. With a lot of people returning to work I considered this valuable and tried my hand at it. As it grew keeping up with the barrage of questions became daunting so as per many daily followers request I started a YT stream. + +It was fun and small I got to answer questions and help apes better understand the markets, we had fun. many of the people that were with me those first few weeks are still around today. + +I never did it to make money, GME had already assured that wouldn't be an issue. But, I had to eventually face the fact that there was a real cost to the time I took away from my job trading, and with most of my holdings still in GME I decided to monetize my stream. The support from the people that choose to support me has been invaluable and also allowed me the time to dig deeper and deeper into GME over the last several months. I promised myself that I would never withhold information behind a paywall and that no ape would ever have to become a member to ask me a question. I've kept that promise. + +Then warden blew up his audience on the back of a pretty speculative DD and I got lumped in with the "youtubers are evil" sentiment, which honestly I understand, the vast majority of them are big fucking shills. Regardless of what I had done or service provided, I was so labeled. I've learned to live with it. + +But I've continued plugging away over these last 7-months missing 1 stream, 2 Daily DD posts, and 3 weekly DDs as I was moving. I've flown mostly under the radar most people didn't like my opinions and I didn't want to confirm anybody's bias. The speculative stuff is fine it's fun to talk about but it's not my cup of tea. + +What I did do was try to leverage my newfound role as an "influencer" and I selected from the people interested in my work, the best and brightest I could and built a team to dig into GME's many mysteries. We have succeed and we have failed, but from our failures we learned and pushed forward. + +This DD is the culmination of our efforts. I think over the course of me releasing it, no matter your feelings towards me, that you would be doing your self a disservice by not reading it. I strongly believe this thesis presents the most realistic and evidence based view of the market mechanics that drive GME price action and is the best, to date, predictor of it's potential in the future. + +As always I hodl with all of you, + +\- gherkinit + +🦍❤️ + +So the plan for this DD is as follows: + +* The events leading up to and causing the gamma ramp/volatility squeeze that occurred in January. +* Tie together the ETF, FTD, Options and Futures cyclical movement that drives GME price action +* Lay out my futures cycle theory and explain the price movements on GME to date +* Explain why January's run did not cause the expected short squeeze on GME +* Take a look forward, using the same unavoidable market mechanics, to determine where SHFs, MMs, and ETFs are most exposed. +* Present a case for retail to in fact be the catalyst for MOASS +* Discuss the how and why , this is possible. +* Dispel the misinformation regarding options and present multiple ways they can be used effectively by those with the requisite knowledge. + +I will attempt to make an **evidence backed case** for each of my conclusions and try to tie all of this together in a way people can digest and understand. + +# Part I: January 2021 + +In January of last year we witnessed the price of GME rocket 2700%, according to the SEC report written a few weeks ago this was not due to SHF covering and it was not due to a gamma squeeze as was previously thought. + +Meaning that based on the SEC report, the price action witnessed in January was due almost entirely to retail buying and options hedging. + +While a lot of that conclusion appears to be true from the data presented, January was not likely the result of WSB's largest pump n' dump. + +Something else was going on behind the scenes something left out of the report... + +The massive short interest not only on GME but the short interest on ETFs that contained GME. + +The SEC report touches on this briefly but really limits it's explanation of what was going on, giving an example of XRT, but conveniently not the other 106 (currently) ETFs containing GME. + +**So what actually happened?** + +Well I guess the best place to start is Melvin Capital... + +**Section 1: Melvin Capital** + +As many of you know Melvin Capital, by their own admission, began their short position on GME in 2014. They built a massive short position over several years likely with the intention of driving GME out of business or deeply into debt. + +[The bear case for GME was strong, Melvin's position is evidenced here in the weekly OBV for GME indicating strong selling pressure.](https://preview.redd.it/5hdvmkmgx4081.png?width=2393&format=png&auto=webp&s=5055f9ea87e8c28b180a1693c7f4e4bab4bce41f) + +Until Michael Burry's purchase in 2019 Melvin was definitely winning the battle. This represented a integral change in the short positions on GME the renewed interest on the stock put a massive number of these short positions underwater. + +In August of 2020 and December of 2020 RC Ventures made their purchases of GameStop's stock (catalyzing the cycles I will define later in this DD), further exacerbating the pressure on GME short positions. + +# By the end of December 2020, the last three years of Melvin Capital's short position was negative 33% to 751%. + +**Section 2: The Big Boys** + +How did Citadel, Susquehanna, and Point 72, end up on the wrong side of retail? + +We know of their involvement due to the bailout's offered by them to Robinhood and Melvin Capital in January. Bailouts likely designed to prevent margin calls on these much smaller positions which could have had catastrophic effects for Citadel's et al. margin. + +Well if we take a look at the broader market during this time frame you will see significant short-interest in retail ETFs pick up after March of 2020. With Coronavirus mounting and no end to the pandemic in sight, there was a strong bear case against traditional retail. + +With companies like Amazon realizing all time highs e-commerce was looking better and better. It's not hard to see the justification these guys are likely some of many that went short the entire sector. ETFs presented a great way to short the entire sector in one fell swoop. That combined with less stringent reporting requirements and near infinite ability to create shares, provided the ideal opportunity for the massive funds. + +Go into any mall in America throw a rock and you will hit a company that these guys were short on. + +AdamMelvinCitadel, BBBY, M, EXPR, JWN, DDS, etc... the list goes on and on + +All these stocks move with GameStop because they were short the whole sector/index. They still are. + +[XRT current short interest](https://preview.redd.it/hp5jsp7ve5081.png?width=412&format=png&auto=webp&s=5f67552f4f7b6441d621c33150a5b1b1e69d7588) + +We can still see evidence of this ETF exposure play out on the charts as well + +[Some ETF basket stocks mimicking GME price action ](https://preview.redd.it/1x5sqzkrx4081.png?width=2203&format=png&auto=webp&s=980b1d2bf8404c3fd26efbcaa9baab8e748afec0) + +**Section 3: The Clash of the Titans** + +Moving into January GameStop price is improving exponentially. Putting pressure on existing short positions. + +From August low to December high it is now up 405.37% + +This price increase in the underlying starts to breed FOMO we see retail buying in at ever increasing numbers stock. + +https://preview.redd.it/v8jrkh7zx4081.png?width=644&format=png&auto=webp&s=077a6a3b72ad04a672e616efc338b5fd82ebce2f + +and options... + +https://preview.redd.it/44142jh2y4081.png?width=1201&format=png&auto=webp&s=07933ec0eccb10b10890f08fbed21d1f3a6e5402 + +This push combined with delta hedging led to the price increasing another 2400% over the rest of the month. + +But on January 29th it all comes crashing down... + +But it can't be that simple it wasn't purely FOMO as the SEC would have you believe. + +January's price action was kicked off by a series of events that almost a year later we have a much better grasp of. + +# Part II: Cyclical Market Mechanics + +Underlying all of GME's price movement to date are several independent cycles that I have identified over the last few months. + +I've outlined these a bunch of times on my stream, but I want to get the information all in one place. + +**Section 1:** **Futures Roll Dates** + +First lets start with the first one I noticed that led me down this rabbit hole. + +CME Futures Roll dates strongly corresponded to GME price action So let's look at those. + +[This was the first significant indicator of price action on GME. These became very apparent after the July run into earnings and subsequent drop.](https://preview.redd.it/l4dz8c36y4081.png?width=746&format=png&auto=webp&s=cd86cc39ba844725e9792758c42e3a396a09559d) + +Once we stared digging back into previous rolls we realized that there were two variations. + +**1.** **The Roll:** + +This is marked by an increase of volume and price into the roll date, followed by a drop immediately afterwards. (Feb-Mar and Jun - Jul) + +**2. The Fail:** + +This is marked by a sharp spike in volume several days prior to the roll date then a decline in volume and volatility until a window of activity appears (anomaly) T+35 days after the roll date. **(t**hese T+35 dates also lined up with spikes in SEC FTD reports) + +[Fails create anomalies, Rolls do not](https://preview.redd.it/80grq2zay4081.png?width=2395&format=png&auto=webp&s=9232643a6501a6172f96e9919b4fd9f6388a41af) + +With these data points locked down the next logical place to look was what was causing these initial spikes. + +We currently know of two separate futures position exposure on GME + +* Variance Swaps as described by u/Zinko83 in this excellent DD, Volatility, Variance, Dispersion, Oh my! (must got to profile as it cannot be linked here) +* Swaps used to hedge NAV or exposure on creation baskets in ETFs. More on ETF here in u/Turdfurg23's DD The ETF Money Tree (same deal cause auto-mod) + +https://preview.redd.it/liaux6uhy4081.png?width=1465&format=png&auto=webp&s=b53ba0d63f55dcc18d30ca3e5d4032c2e440dc9c + +**Section 2: ETF Exposure** + +We were fairly confident at this point in our research that ETFs represented a significant part of the short exposure on GME. + +The ease of share creation by Authorized Participants and the exceptionally long settlement periods afforded to them, made ETFs the perfect way to not only continually suppress the price but also a great place to hide longer term short exposure, without the reporting requirements of traditional bona-fide market making. + +[This process is covered exceptionally in this paper by Richard B. Evans](https://jacobslevycenter.wharton.upenn.edu/wp-content/uploads/2018/08/ETF-Short-Interest-and-Failures-to-Deliver.pdf) + +[and this video](https://www.youtube.com/watch?v=ncq35zrFCAg) + +So where was this exposure we knew that somewhere in these overlapping cycles we were gonna find it and we did. + +[These options dates that line up perfectly with OpEx, ETF Quarterly Options and GME Monthly Expiration ](https://preview.redd.it/0u7a2l5ny4081.png?width=1045&format=png&auto=webp&s=4e8ba722102a099879e3b22d4965af300699dbad) + +But it didn't fit until we factor in gamma exposure (GEX) from market makers on T+2/3 + +Then we start to see a very strong correlation with GME initial pump on these runs and overlapping gamma exposure. Starting after RC's initial buy in, with the magnitude increasing exponentially after his second purchase in December. + +https://preview.redd.it/wfvsonavy4081.png?width=2394&format=png&auto=webp&s=9504b0580a4ce2bc3c0073069b3b7e49d9c69651 + +These exposure dates have kickstarted the price increases on GME in the last 5 out of 5 futures cycles + +**So a quick break here to recap...** + +We know ETF Exposure kickstarts these cycles and that they either roll the futures (causing a run as the cover losses before rolling contracts forward) or fail to roll the contracts (causing FTD pile-ups in the anomaly window) + +So this left us asking **why January**? + +We had the obvious answer already, the SEC claimed that retail single handedly pulled off one of the largest pump and dumps in history with zero collusion...but did Daddy Gensler tell us the truth? + +Something had to be different about January's cycle specifically + +Then we stumbled across this little tidbit that had been staring us in the face for months. + +[ETF and Equity Leaps expire not once, but two times in the Dec-Jan Cycle](https://preview.redd.it/hpxl9ig5z4081.png?width=162&format=png&auto=webp&s=12e3e06f4c0006ce71e5d3056e622f3cea0e45d9) + +LEAPS for those of you that are unaware present a far higher amount of gamma exposure than quarterlies. + +[This is largely due to institutional interest in longer dated options contracts](https://preview.redd.it/h1vi3hu7z4081.png?width=1588&format=png&auto=webp&s=6ad62722c46e646fd43f473ee17e7eb01856fb21) + +So let's look at these LEAP exposure dates in relation to the rest of our cycle + +[The price action and volume from Dec-Jan on these dates speaks for itself but June is the most impressive to me because in a sea of red from the ATM share offering and GME ETF rebalancing resulting in 12m+ shares sold at market, even all that liquidity wasn't enough to suppress the price, the expiration and the following t+2 days were still up. ](https://preview.redd.it/zqonhkhdz4081.png?width=2393&format=png&auto=webp&s=a10a25578e14b730f0187b63d446b62446c5f8d6) + +**Section 3: The FTD pileup** + +This is the last bit of what ties all this together. + +Since the futures fail patterns have a unique outcome that causes this anomaly window what exactly drives that anomaly in the areas in between the ETF exposure dates and the the subsequent futures roll. + +The answer is FTDs + +Now there are 2 types of FTDs + +1. **MM and SHF FTDs** \- Most people know this on by now but just in case + +*T+2/3 trading days (locate) + 35 calendar days (REG T)* + +2. **ETF Authorized Participant (AP)** \- + +Authorized participants have a bit more flexibility and thus there failures can occur outside of the standard timeline. + +[So AP's have T+3 trading days \(locate\) & T+6 trading days \(settlement\) + 35 calendar days \(REG T\) ](https://preview.redd.it/m6yfav5hz4081.png?width=978&format=png&auto=webp&s=7652021b21beab48c22d392f8028b98ed201179c) + +In the past you have heard a lot about T+35 and T+21 and this predicted cycles have failed to come to fruition because the anchor points for where the settlement periods end (t+2/t+6) and where the fail must be satisfied (t+35) were misplaced. + +Everyday is T+35 from another day, so having these ETF exposure dates and CME Roll and Expiration dates gave us insight into where MMs and APs had to do the most hedging and also where there was the most gamma exposure or deviation from NAV (net asset value, ETF hedging metric). + +With these anchor point locked down we started to be able to build out a t+35 timeline + +[The light-blue vertical lines represent GME FTD Regulation T dates set from the point of failure](https://preview.redd.it/1h6nrl3mz4081.png?width=2462&format=png&auto=webp&s=0549ae00458182a0056ae30440319f561e7a1c39) + +and since there are still a couple days around these periods with unexplained movement, such as November 3^(rd,) where we were sideswiped by completely unexpected price action. + +This is due to something we had never initially tracked ETF FTDs, throughout the year FTDs on GME containing ETFs had been fairly minimal with a few spikes here and there. So we sidelined the information and focused on GME. + +Well something interesting happened on September 21^(st.), that got attention immediately. + +[GME Containing ETFs Spiked with the largest numbers of FTDs to Date](https://preview.redd.it/7hjs32gpz4081.png?width=1947&format=png&auto=webp&s=c177e6fee4d77fe4945162a479a7cf45f9eb8329) + +Well guess what happened T+6 (trading) and 35 calendar days after that futures failure, like clockwork on November 3rd... + +[The final piece of the puzzle](https://preview.redd.it/jahpcbqsz4081.png?width=2454&format=png&auto=webp&s=f12c438ff49293f33689898c9b793e7e3a770d2a) + +So this at this point we are still unsure if this also occurred in other cycles, the only other large ETF FTD spikes we have this year are far smaller quantity. So now we have to go back and look at the previous cycles. + +* For the cycles that fail to roll futures the largest exposure date is the CME rollover(red line) +* For cycles were they roll the greatest amount of exposure is on the first FTD date (blue line) + +[Historical ETF FTD dates](https://preview.redd.it/f0vy7jphfa081.png?width=2499&format=png&auto=webp&s=848c3889848e30153a551147b0f8787f24c8564b) + +**Section 4: January IS absolutely unique!** + +Remember those LEAPS we talked about earlier? + +One day a year in January the highest amount of open interest and thus gamma exposure in the options chain occurs... + +# GME LEAPS and ETF LEAPS expire simultaneously + +this moment indicates the largest amount of exposure across the entire year on GME, and and also presents the highest probability for a short squeeze (more on this later) + +Without further ado... + +[Full futures Cycle breakdown from Sep 2020 to today](https://preview.redd.it/fhrrolg205081.png?width=2368&format=png&auto=webp&s=c67a7bf00437661aec9146dd29a398bf0f078ded) + +Here is the final guide to GME price action and the summation of this part of the thesis + +These dates and windows (futures) track almost every single move on GME since September of 2020. If it didn't happen on one of these dates/windows then it happened within their respective settlement periods (T+2/3) + +and for the smoother readers... + +[Basic representation ](https://preview.redd.it/jk68w43i15081.png?width=2396&format=png&auto=webp&s=ad00f2e3254eebe05cf5dea139fb290a3903af6a) + +This concludes this part of the DD, I have been writing non-stop since I ended my stream yesterday and am unlikely to do much today. I have been awake for 24 hours and still have to complete the of the other two parts of this by tonight. + +Please avail yourselves of the linked DDs they present evidence necessary to understand the following section of this. + +For my Daily DD followers, I'm sure you understand the time sensitivity of this information and will excuse my absence on this likely red day. + +In the meantime a lot of it is covered here ... [talk with Houston Wade here explaining my current theory](https://www.youtube.com/watch?v=mntHdNqltkw) + +For more information on my futures theory please check out the [clips on my YouTube channel](https://www.youtube.com/c/PickleFinancial/playlists). + +Daily Live charting (always under my profile [u/gherkinit](https://www.reddit.com/u/gherkinit/)) from 8:45am - 4pm EDT on trading days + +on my [YouTube Live Stream](https://www.youtube.com/c/PickleFinancial) from 9am - 4pm EDT on trading days + +or check out the [Discord](https://discord.gg/BGmjnrvHnw) for more stuff with fellow apes + +**As always thanks for following along.** + +🦍❤️ + +\- Gherkinit + +**Disclaimer** + +*\* Although my profession is day trading, I in no way endorse day-trading of GME not only does it present significant risk, it can delay the squeeze. If you are one of the people that use this information to day trade this stock, I hope you sell at resistance then it turns around and gaps up to $500.* 😁 + +*\*Options present a great deal of risk to the experienced and inexperienced investors alike, please understand the risk and mechanics of options before considering them as a way to leverage your position.* + +*\*My YouTube channel is "monetized" if that is something you are uncomfortable with, I understand, while I wouldn't say I profit greatly from the views, I do suggest you use ad-block when viewing it if you feel so compelled.* *My intention is simply benefit this community. For those that find value in and want to reward my work, I thank you. For those that do not I encourage you to enjoy the content. As always this information is intended to be free to everyone.* + +\**This is not Financial advice. The ideas and opinions expressed here are for educational and entertainment purposes only.* + +\* *No position is worth your life and debt can always be repaid. Please if you need help reach out this community is here for you. Also the NSPL Phone: 800-273-8255 Hours: Available 24 hours. Languages: English, Spanish.* [*Learn more*](https://suicidepreventionlifeline.org/) +Hi all, + +All the other investing/stock subs have gone to shit and I'm looking for some advice please - not get downvoted because it's nothing to do with meme stocks, so, sorry if this is in the wrong place. + +Been in crypto a while and gradually started looking into the stock market a month or so ago, got lucky in the timing with gme and want to use the capital in sound investments. + +Before I jump in I'd like to research companies etc. Is there any sites that you can recommend? I googled obviously but are some sites more reputable than others? + +Thanks + +Edit: Appreciate your help all. Will take a look at these websites and pointers over the coming days. +I am interested to know how cities like NYC and London transformed from what they were in the 60s/70s \[low cost of living, small, independent businesses\] to what they are now \[high cost of living, chain stores\]. What are the primary forces behind these transformations, and are they changeable? +For some posts the reply takes two or three days, and the majority of the comments don't get seen at all. If the posts were not regulated the comment with the best most suitable answer would be upvoted anyway. So why does this sub get so much regulation? +Jim Cramer has made 21,609 stock picks in the past 5 years! Let that sink in for a moment. Here is one person, making buy/sell/hold recommendations on more than 2,200+ different stocks across all types of industries. On average, he was making more than 20 picks per episode of his show \[1\]. This is a staggering number of picks to be made by one person! \[2\] + +While we can all argue about his expertise in making recommendations on such a wide array of industries and companies, what I wanted to know was: + +1. **How accurate were his recommendations?** +2. **Would you have made or lost money if you followed them?** +3. **Can you beat the market following his picks?** + +So it’s high time that we put Cramer to the ultimate test and end the debate about his usefulness once and for all! + +https://preview.redd.it/6q6ap2kfev981.png?width=1728&format=png&auto=webp&s=51192225abdf6508dea124119e5590896276f108 + +**Analysis** + +The data about all the stock picks made by Cramer are available [here](https://madmoney.thestreet.com/screener/index.cfm) \[3\]. The picks are classified into five segments (Buy, Hold, Sell, Positive/Negative mention). I have calculated the return for each segment separately \[4\] so that we can know what to focus on if we are trying to replicate this strategy. + +Since Cramer frequently contradicts his own picks and is mainly focused on short-term trades, I am only analyzing the stock returns for the following periods \[5\]. + +a. One-day + +b. One-Week + +c. One-Month + +Given that Mad Money (Cramer’s Show) airs after the market closes, I have used the opening price of the next day for my calculations. (I.e If Cramer makes a recommendation on Thursday night, I use Friday opening price as the base for my calculations) + +All the data used in the calculations are shared at the end. + +https://preview.redd.it/tbf06m0hev981.png?width=1728&format=png&auto=webp&s=0e78ab934bedffa8e5eeb150152cd1fb8347b3fd + +**Results** + +https://preview.redd.it/v6gvmnthev981.png?width=775&format=png&auto=webp&s=614b9ab6f4a85c14d843807d2d8ebd88c8a6d7ff + +1-day performance of Cramer’s recommendations is excellent! On average, the Buy and Positive mention stocks went up by 0.03 and 0.05% respectively, and sell and negative mention stocks went down by 0.1 and 0.02%. + +Another interesting fact is that ***you would not have lost money*** if you followed Cramer’s Buy recommendations. Across the time periods, his Buy recommendations have on average netted you positive returns \[6\]! + +His sell recommendations did not pan out so well. Even though they dropped in price the next day, over the next week and month, they returned inline or even better than his buy recommendations! + +Given that there is a counter-intuitive trend in the returns, let’s calculate the accuracy of his calls. + +https://preview.redd.it/vf1gy9tiev981.png?width=792&format=png&auto=webp&s=d496d4b71dd0374b46b66caaa85ad3ba2e8b51e8 + +Here I am assigning a call as correct based on price change. If he gives a buy recommendation, I expect the price to go up and vice versa. As we can see from the chart above, his recommendations only do slightly better than a coin-toss. Even this only holds for short-term and buy recommendations with long-term sell recommendation performance dropping below 50% \[7\]. + +While this narrow edge over the 50% mark can be used by algo-traders who have the ability to trade a large amount of stocks, if you are an average investor listening in on a Cramer show and hear about a stock recommendation, you might as well toss a coin to see if you should invest or not! + +Finally, it’s time we pit **Cramer against the market**. Do his recommendations beat the market? + +https://preview.redd.it/5pk26mkjev981.png?width=1020&format=png&auto=webp&s=889fe3bdd9d7068b86d5a17b03e0deceecde4db1 + +Oh yeah! I was as surprised with the results as you are. I ran the numbers again and then one more time but got the exact same result! Cramer’s Buy recommendations beat the S&P 500 by a factor of 10 for the **one-day time frame**. But, if you held the stocks for anytime longer, you would have underperformed the market significantly. + +Before you go daytrade on his recommendations you should know that the numbers we are seeing here are heavily influenced by outliers. If you miss out on the top 1% of recommendations (\~110 stocks out of the 11,000+ buy recommendations he had made), your **1-day return would be -0.062% instead of +0.034** \[8\]. + +https://preview.redd.it/1ej85aknev981.png?width=1728&format=png&auto=webp&s=223b90cb57c0bda4e030cf6233458bc34fc083c7 + +**Limitations of the analysis** + +The analysis has some limitations that you should be aware of before trying to replicate the strategy. + +1. As the astute among you might have noticed, if you sum up all the stocks used in the analysis it would only come to 18.5k. I removed \~15% of the overall recommendations as either they did not have stock data present in Yahoo Finance/Alpha Vantage or the price data did not match with the one given on the Mad Money website. +2. The data is obtained from the Mad Money website itself. I haven’t manually verified if the calls recorded on the website are in fact an accurate representation of the calls made by Cramer in his show. The below statement is given in their description and I am taking them on their word. + +>We are impartial in our recording and simply log exactly what was said. We do not interpret the calls. If a call is vague or in question we simply won't list it. + +https://preview.redd.it/wuk8u5lnev981.png?width=1728&format=png&auto=webp&s=15286d3dbe30cc6b18ef09af5e52e0fd24970635 + +**Conclusion** + +No matter the public opinion on Cramer, we can generate excellent 1-day returns following his buy recommendations (even beating the market in doing so!). Whether it’s due to his superior stock picking ability or whether it’s simply due to self-fulfilling prophecy \[9\] (as he has a wide audience who will act on his advice) is yet to be known. + +I would bet on the latter as, if the extraordinary one-day returns were in fact due to his superior stock-picking ability, the returns should have held over longer time periods, and also his sell recommendations would not have ended up performing better than his buy recommendations as we are observing here. + +It only makes sense to listen to his advice if you are a day-trader or an algo-trader who is trading a large variety of stocks over short periods of time. For everyone else, just sticking to the S&P 500 would give you better returns over the long run! + +https://preview.redd.it/zw7h6tknev981.png?width=1728&format=png&auto=webp&s=68e289b2aed1b6a276520e96e30e81c7784014ed + +**Data** + +Excel file containing all the Recommendations and Financial data: [**Here**](https://docs.google.com/spreadsheets/d/1d0mooS_qsfePXChEDq2IDov_of_TFvD1/edit?usp=sharing&ouid=111668650548288730122&rtpof=true&sd=true) + +**Live tracker** containing the performance of Cramer’s 2021 picks: [**Here**](https://rows.com/market-sentiment/my-spreadsheets/untitled-spreadsheet-3-5C58Ix9kx1ixB0cM52DWZi/live) \[10\] (I will be updating this file regularly so that you can see his performance in real-time whenever you want to!) + +https://preview.redd.it/cdgg3jlnev981.png?width=1728&format=png&auto=webp&s=6c34dfee4ea6452780a9e9d7e7aa1abdcb0f8e90 + +**More Interesting Reads** + +From this week onwards, I am including one or two blogs or articles I really enjoy and hopefully, you can discover new and interesting content! + +[**More to that**](https://moretothat.com/)**:** This is by an illustrator called Lawrence Yeo who breaks down really complicated topics into easy to read articles with fun illustrations. [**The Nothingness of Money**](https://moretothat.com/the-nothingness-of-money/) was one of the best articles I have read last year and if you reading just one article this year, it should be this one! + +[**Econometrics**](https://ecoinometrics.substack.com/)**:** If you like the charts I make, you are going to love Econometrics. They present long-term perspective about how digital assets are shaping financial markets with the help of really interesting infographics. [To buy or not to buy](https://ecoinometrics.substack.com/p/ecoinometrics-to-buy-or-not-to-buy) was an excellent article about what is the right time to buy into a Bitcoin dip. The chart below showcases their ability in data visualization and breaking down complex ideas! + +https://preview.redd.it/cd0euaztev981.png?width=733&format=png&auto=webp&s=927d591ea7b3f3c305021b9525bbf7da0e190ba8 + +https://preview.redd.it/o57f5xlnev981.png?width=1728&format=png&auto=webp&s=255e4471038ec603f83e7ca8f16dc8639bdd60fe + +**Footnotes and existing research** + +**\[1\]** For those who don’t know, Cramer makes his picks in a CNBC show called [Mad Money](https://en.wikipedia.org/wiki/Mad_Money). Cramer himself defines the show as something which should be used for speculative/high-risk investing and not for your retirement portfolio. + +**\[2\]** For comparison purposes, an equity research analyst [covers only 10-25 companies](https://whatforwork.com/jobs/equity-research-analyst-sell-side/). + +**\[3\]** It’s not in an easily usable format. I had to parse the data from the webpage using Python (Beautiful Soup) - I have shared all the data used in this analysis as an Excel and Rows file at the end. + +**\[4\]** I did not calculate for Hold as he only made 27 hold recommendations, which is lower than what is required for a statistical significance. + +**\[5\]** In my [last post about Jim Cramer](https://old.reddit.com/r/wallstreetbets/comments/mtehdq/i_analyzed_all_700_buy_and_sell_recommendations/), there was a lot of controversy around how I calculated the time period. So here is the detailed version about how the time period is considered. For One-Day returns, we are considering that we will purchase the stock the next trading day after the market opens and then sells it at the end of the trading day. For weekly and monthly returns, I am using adjusted closing price since across a week or month there can be stock splits as well as dividends. + +**\[6\]** This can also be attributed to the market rally we have experienced over the last 5 years where a large majority of stocks went up. + +**\[7\]** 50% benchmark might be controversial with a lot of you (I agree given that if we are in a bull market there is more than a 50-50 chance of a stock going up tomorrow) → My rationale here is standing today looking at a stock, there are only two things that can happen tomorrow. It can either go up or go down. I assign equal probability to both given anything can happen tomorrow. The market can turn bearish, positive or negative news about the company can come up, etc. If you have a better logic for a benchmark, please do suggest! + +**\[8\]** But to be fair to Cramer, this is applicable to all types of Investment strategies and hedge funds! The performance of a few of the stocks in your portfolio will finally end up heavily influencing the returns of your overall portfolio. → Think of Tesla incase of ARK and FAANG in case of S&P 500. + +**\[9\]** There is some [existing research](https://scholarship.tricolib.brynmawr.edu/handle/10066/588) that deep dives into this topic. + +**\[10\]** Since it’s a live tracker using data from Alpha Vantage, the calculation is done slightly differently than in the analysis (in the live tracker I had to use the closing price on the day of recommendation instead of the opening price of the next day). I will be updating it to follow the same process as the analysis as soon as I get info from Alpha Vantage.