Gamestonk. Gamestop. GME. My thoughts are on Reddit, under my u/martinshkreli & subreddit martinshkreli. Those are authentic and discuss why GME is one of the most unprecedented events in market history. Here, I'm going to discuss the populist attitude that is creeping into this odd situation and add some thoughts on short-selling in general.
Let's cover my own unique angle on the concept of a 'short squeeze'. Most would define it as an erratic upward change in price driven by short-covering. I believe short-squeezes defined this way are usually a fictitious idee fixe that aggregates a number of discrete market behaviors and dynamics into a convenient and pithy moniker. The image of python-like buyer constricting some hapless speculator into a higher stock price is evocative but misleading. Many knew me as a short-selling specialist on Wall Street, focused on 'binary events' of biotech stocks. I think I've seen it all: I was once short more than 75% of a company's shares outstanding (I do not recommend this). I bought 75% of a company on the open market, etc.
Short-sellers are governed by the same market dynamics as longs. They get nervous when positions go against them and consider exiting. Like longs, they can double down if they wish. The only difference is that, of course, short positions grow when stocks rise. And they can rise infinitely, while long positions fall asymptotically to zero. But both get, theoretically and assuming no fundamental changes have occurred, more attractive as they move against the trader.
Short sellers have to pay borrow fees to longs (typically tiny, but sometimes massive). They have to locate stock to short, again usually easy, but sometimes difficult. Both are perilous when those rare adverse times arise. Why? Despite the possibility of a growing cost of renting stock, the ultimate fear of a short-seller is a "buy-in". It is nightmarish and has only happened to me once or twice, excluding options-related activity. A buy-in occurs when a broker decides to forcibly exit the short position on behalf of the trader because the broker and trader cannot secure the 'locate' which is supposed to underlie the short sale. The buy-in order is typically violently disruptive: a market order for the whole position near the closing hours of the market! The SEC published a list of stocks at risk of buy-in: the fail to deliver list.
My point is that a 'short squeeze' can only practically affect the trader for two reasons. The first is that the trader digs in, doubles down and doesn't exit as his position grows. That's bad trading, and will eventually blow the trader up. But, if the stock is a 'good short', that short will be replaced by more traders with stronger hands/a better entry price/smaller position. What's more is the average investor can't tell if this is happening! The second is the buy-in. I haven't heard GME shorts being bought in, but again, how would you know, other than the grapevine? My point is most of the disruptive, exciting trading here is simply long speculators banging away at the stock.
New longs are sometimes attracted to rising prices, speculating they'll increase further: that's called momentum. Those buyers are typically offset by the existing longs who are excited to exit at higher prices. But, if there is a large short position in the stock, a speculator may feel that those covering (buying to get out) short-sellers will provide additional fuel to the momentum. That's sometimes the case, but higher prices should lead to more supply from both long and short sellers. My feeling is the actions of large long holders probably have more influence on the stock price than shorts who dart in and out, and typically in smaller size. Remember that shorts who capitulate are often just replaced by new shorts who are attracted at the new lunar prices.
In essence, 'short squeezes' become a self-fulfilling prophecy as new long investors pile in trying to 'squeeze' this sometimes phantom of a short seller, and existing long investors may hold off selling for the same reason. With some Popperian skepticism you will easily see that the same dynamic can exist without the short boogeyman, or with a short boogeyman of any size. Speaking of which, where is Chanos and his slavish groupie, Carson Block?
Speculative momentum can occur for any reason. Let's not forget that the 'trapping shorty' strategy is an awkward idea for a few reasons. Short sellers are often sophisticated market participants who are betting on the decline of a stock. You usually don't want these type of traders sniffing around your favorite longs: I recall writing a 'short report' on a stock to watch it fall 50% that day. If you do a study of stock returns of highly shorted stocks, they are pretty awful. The reason there is 'no arbitrage' is the borrow rate.
But even if you got this poor short to capitulate and squeeze, the amount of buyers who are now holding stock at absurdly high prices put way more energy (and money) into the stock than the short seller's white towel ever could. A sledgehammer killed the fly: now what? Alternatively, are you the host or the parasite?
On populism. I don't really think most investors or speculators should go into any investment thinking that there is 'an enemy'. Concentrated (big) investments (bets) give rise to emotional behavior, typically the enemy in trading and investing as it clouds rational thinking. It's a lot better to be Socratic with your 'opponent' and understand what they're thinking. If your position were to be half the size it currently is, would you be as emotionally interested? Try it! You'll lower your risk and feel better.
Some of the behavior going on at WSB sounds more jihadist than speculative. The idea that there are some investors who are 'good' and others who are 'bad', or that there is an 'establishment' is BS. Everyone has the same goal: I have a pile of money, I'm trying to make it bigger, fuck your pile--I don't care about it. Anything other goal is contrived, foolish and won't help you win. You can't 'fight the rich' by trying to become one of them. Don't you see the irony? A related thought experiment: what if this trade continued to work really well? And another, and another? Then some WSBers are billionaires. Aren't they the new 'enemy/establishment?'
Who do you think hedge fund managers are? They're typically the anti-establishment. Things have changed a bit, but the most successful HFMs are actually the WSBers of the past. These are guys who didn't fit in well at i-banks, often got kicked out for having big mouths or not wearing the right ties, or just wanting to wear jeans at work and not fill out TPS reports. When they started their firms, people like Soros, Icahn, Steinhardt, Robertson, Cohen, Griffin, Loeb (who has posted anonymously on boards), Samberg, even Cramer were fish out of water and had very tiny amounts of capital, often begging for investors.
The need for an enemy. To sustain increasingly insane behavior, it isn't uncommon to use a straw man or a scapegoat. Oppressive regimes used this technique in the past, and the media uses it today. Retail investors don't have much power individually. With your $5k RH account, you can't day trade or even qualify for margin. It's pitiful. So, it's understandably quite exciting to finally feel like a 'player' that you read about. To be a part of 'something'. The problem is the media is goading you to be somewhere between a lemming and a life-agnostic but impotent jihadist. Blowing yourself up won't impress anyone, and there is no afterlife here, other than a minimum wage career and mom's sofa. GME and shorting in general is small potatos in the scheme of the Wall St. machine. Don't worry about getting 'even' with the rich. That's jousting at a windmill that will waste your energy.
No one here, hopefully, wants to be a lemming. Those willing to 'die on this hill' have to realize something: Wall Street doesn't care about its speculators. The new traders who vanquish the old simply replace them. Nothing changes. When LTCM blew up, or Amaranth, Visium, Galleon, or anyone else, it is 'out with the old and in with the new'. So, perhaps WSB can blow up 1 hedge fund or maybe 5, but so what? Eventually, the tables will turn and it will blow up. The leveraged, fast-money trading markets are a violent place and the only people who care one whit are the brokers charging fees (directly or indirectly). They only care to make sure the sorry carcasses can pay their bills. They know there will always be another speculator lined up, ready to shove his money into the lotto machine. There is no pride here. There is no credit for being a good solider. You either survive or you don't. Your job is to survive and thrive. Becoming a lemming will guarantee failure as per the statistical truism of gambler's ruin (enjoy the proof in measure theory). With enough time, anyone playing a game with <50% success rate (equal payouts), will lose all their money. Get that number above 50%. Add the Kelly Criterion to your trading strategy.
You might ask, "(that's all well and good OR we'll agree to disagree) but, Mr. Shrek, isn't this a good trading strategy? (ganging up on shorted stocks)?" As long as you're not a lemming/jihadist (willing to walk over the cliff, whether or not you have a "cause"), and you ignore a somewhat slimy ethical/market manipulation question, I don't see anything wrong with it. There are better ways to make money, since you're asking. Stoking (or worse, participating in) a buying frenzy that is akin to a forced musical chairs game is a little crazy. Once a stock is absurdly valued, you're just hoping the sell-off doesn't happen while you're holding it. If you have enough lemmings or jihadists 'helping you', that's a good thing. They will hold your bag--someone needs to.
Of course, if you've found the "next" Microsoft or Apple, no one needs to hold any bags. But, no company can increase its objective (aka fair) value quickly enough for this... phenomenon? situation? absurdity?... to make it reasonable. Those things take years, go slow and steady, and this frenzied buying/"short squeeze" phenomenon won't let value play a factor. That's why WSB GME longs have shifted theses from "well, Gamestop was/is cheap" to "the gaming cycle" to "Ryan Cohen will save us" to "...jihad?!"
Each member of the herd has its own financial parameters, too. Some may have $500, some $50,000,000 or more. Some may be willing to lose their entire stake (and even more) on an out-of-the-money or levered trade. Some are not. Some were in the latter and somehow end up in the former. Some are in one column at one price and another column at another--some are switched from column to column by force. Today's lemmings/jihadists are tomorrow's sellers. When you're hanging off the mountain, pay attention to the guy holding the rope.
Loosely 'coordinated' buying can certainly affect stocks. Heavily shorted stocks and small cap stocks are the kind that require less capital than typical to 'move' a stock. The irony here is when putting on a position, the trader's goal is typically NOT to move the stock with his actions!
I still think GME is wildly overvalued, but that doesn't exactly mean I'm 'bearish'. One funny idea here is reflexivity: GME stockholders may become serious GME customers and the company's fundamentals improve that way! Excluding some such miracle, eventually GME stock will trade at <50 again. I still think it will trade at 1,000 or more BEFORE that happens, and that the decline process will take a long, long time (several years). Keep in mind, anything can change. GME can do serial secondaries that destroy its stock. Management's job is to create value for their shareholders--but perhaps they will avoid pissing them off. There's a strange loop! Finally, the stock could be halted by the SEC or completely banned by brokers. Don't overdo it. Watch the borrow rate. Keep your positions at less than 25% of your capital--live to play another day.
Disclosure: I've never traded GME stock and do not intend to.
(From martin, posted by mo)

Hay hay, Ay, listen up, B, lemme holler at you a minute. I notice you been eyeing that portfolio real luscious like, almost like you found a couple extra bananas under your tree, am I right?

Cool, cool. So whatchu holdin', homey? Tillllllray? Aw yiss. Aphria? Yeah, she fine as hell. CGC? Oh lawd, dat ass is bangin'. ACB? Aw man, you like the classics, that's dope. OGI? Into the up and comers, respect young blood. SNDL?

SNDL? For real? Dude....

Hi all, NrdRage here. You might remember me from such hits as "pegging $GME dead right multiple times during its bubble, making everybody rich on $RIOT, exposing the $PLUG infinite money glitch, accidentally helping start the $BB craze, never getting an $AMD weekly call right and being in an abusive relationship with the VIX" or maybe "The SEC and you: How you can just say no to having them shove a Mister Fister up your ass". Alright, apes, it's been a great few days being able to throw a dart at a wall of weed stocks and no matter where it sticks, you make money. It's been a great run. But if you're going to expand the acreage of your jungle and the amount of lady gorillas you earn the right to mate with, you gotta start thinking a bit. And that means - hear me out - thinking of how the hell you plan on getting out of SNDL alive. And yes, I realize I'm saying this right after it spiked almost a hundo percent in the last 24 hours. Look, I was playing it, too. I grabbed some 2/19 3c's and a shit ton of 1/22 1.5c's on Tuesday. I also got out of both of those today, though not as high up as I could have. If you check my history, you'll see I even said I was goingt to eye a re-entry. Then the market took a giant dump and gave me that entry, but I passed on it because I had done some research by that point. Whatever, profit's profit.

Here's the TL:DR: It's basically a penny stock that's gotten pumped to hell. But the smart ape realizes when something has gone too mainstream and gets out of the way before the bulldozers wipe out his trees.

Hey, I love shoving a share price around a bit as much as the next guy, I ain't gonna talk shit about that. But it seems like nobody has an exit strategy for this, and I'm starting to see a lot of really stupid shit about Holding to 42.69 and all the other ridiculous bullshit from people who clearly don't even know what they fuck they've invested in that the GME Gibbons fell for.

Here's the reality of SNDL:

The company was on the verge of bankruptcy around Thanksgiving, they have no other markets other than Canada, which is ridiculously oversaturated with weed to the point that wholesale prices are less than a dollar a gram. And they recently got forced to admit that their product fails to meet THC content requirements.

In case you're wondering what that means, it means they sell skunkweed that they cut with paper and sawdust to make it cheaper. They sell garbage. And everyone knows it - their brand is associated with low quality crap.

Plus, they actively solicited us to buy their stock to drive up the price, then diluted it to fuck with a billion share offering. Now, to their credit, this not only enabled them to become debt free, but also up their marketing budget and spend some time trying to create a brand. Don't get too excited, fucking Sam's Choice at Wal-Mart is a brand, too, doesn't mean you should stick a chub of their ground beef up your rectum. By reason of them selling skunkweed, their margins lag well behind that of their competitors.

Looking at their financials, they've got 615 million in cash laying around. That's pretty good - except they're a company that burns 250 million a quarter. Which means they're going to dilute the fuck out of everyone again next month. They've got no exposure to the US market, but had no problem dropping "rumors" that they were going to break in to the US market through licensing deals - which turned out to be 1 pot shop in Bellingham, Washington. They have no real expansion plan anywhere in the world, for that matter.

B...bu.....bu.bu....BUT NRDRAGE! Stonk go up ! Look at it! SNDL to the moon! 🚀 🚀 🚀 ).

Yeah, I know. It's fucking crazy to talk shit about a stock when it's seemingly mid flight. But here I am anyways. Not to talk you out of the weed party - you should totally keep playing that for all it's worth - but rather to get people to see that they've probably outgrown skunkweed now.

Look, the reason this thing mooned is because it was like a dollar. Hell, it was 13 cents not too far back. With a stock worth a dollar, it's easy to get a lot of other apes to throw a couple of bananas at it for the lulz. It's easy to shove around a penny stock with an extra 10 bucks you have laying around from another trade somewhere. But as the price goes up, so too goes up the perceived cost of entering. I can make a strong (unassailable, in fact), argument that $APHA at $25 is cheaper than SNDL at 3.25. But people are conditioned to like smaller numbers. Unfortunately, as the GME Gibbons learned, eventually you run out of buyers, and then things go tits up real fast.

As the Prophet Biggie Smalls once said, Mo' Money Equals Mo' Problems. We all know this equation to be true. And here you are, sitting on bags of bananas you didn't know you were gonna have a week ago thanks to some stonk you hadn't heard of before yesterday. You don't think you've got a problem, but you do. Because those bags of bananas aren't edible until you turn them in to the bank for real cash. If you're sitting on bananas from the gold standard of the weed world (that would be, $TLRY), you're resting pretty easy that no other ape is gonna come by and steal your bananas. There are gonna be lots of bananas to go around, and mostly we're just taking bananas from fools who think their bananas will be less later. But you don't have that with SNDL. All the bananas are currently sitting with people who think the bananas will go higher. You can't all be right, especially when there are billions of bananas, and now your grandparents are starting to buy bananas because some Boomer on CNBC told them it would make their dick bigger and their friends think they were cooler.

Again, I'm not telling you to leave the party

But, if you recall your dorm room years, the best pizza you could afford was the Tony's school lunchroom style shit for a dollar. Then you managed to hide a few bucks from the people who collect your student loans, and you upgraded to Domino's. Maybe by now you're ordering from a local joint that makes it's own dough in house and the sauce is made with the love of an old Italian grandma who accidentally dips her sagging tiddies into the pot 3 times while making it. That just makes it taste better. That's science. But I digress.

The point is, you can get better weed now. You don't have to smoke the skunk. So before you get the rug pulled out from beneath you and are stuck investing in shitty penny stocks again, maybe you should elevate your enterprise. Let's take a look at your options:

Canopy Growth

You could go with $CGC. They not only sell higher quality weed, but are an established brand and also sell oils and shit to those hippie fucks who still think Burning Man isn't just a brogrammer beatfest and go to an acupuncturist to enhance their "luck". They've captured that all important 65+ stoner demographic by marketing their shit as a cure for seizures, cataracts, and dry vag, so they've got a lot of revenue. They've also had a much more muted rise this week because they just haven't been on everybody's lips, which means they've got a lot of room to run. The downside here is they burn almost as much cash as SNDL, but they've also got more bullets.

Aurora

If you go with $ACB, you're going with a company that's already gone through its "shady as fuck" stage and has re-emerged healthy from it. You're also not only getting on weed, but the DIY urban chicken farmer types who want to grow their own weed. They, too, have had a strong run, but have a lot more runway than most because they've actually got a really strong path to dominance in the US market once it opens up to them.

Organigram:

Look, if your dick is still getting hard at the thought of playing a low dollar stonk or you've only got 28 dollars to invest, you could do a lot worse. They've got strong branding, large growth potential, a management structure that doesn't seem to act shady, and they've run almost as well as the other new generation of meme stonks, but lagged back enough because nobody can fucking rmeember their name to where they can rubber band a bit.

Tilray and Aphria:

I'm combining these because they're inexorably joined at the hip (or should be, more on that later) because the two of them are merging. For those who don't know, sometime in Q2, every share of $APHA you own will turn into .833 shares of $TLRY. Even though APHA is the one buying out TLRY. This is basically the gold standard of weed stonkery. When you start investing in these, you know you're a real investor.

Here's the interesting thing with these guys, though. Even though APHIA should be just slightly trailing behind TLRY in terms of stock price, it's currently trading at less than half. With TLRY sitting at 73 a share as I write this, APHA should be at just over $60. But it's at 29. Now, obviously, this means that TLRY has a lot more momentum, and some of that is due to the fact that there's a mini (don't flog me for using the word, but it's true) short squeeze going on with that one, which has turned it into such a strong momentum play. But APHA, by virtue of actual math, needs to be within about 17% of TLRY's price. Which means APHA either needs to moon dramatically, or TLRY needs to fall precipitously. Now either of those things could happen, but the momentum of TLRY is hard to stop, which means it's more likely that APHA rubber bands to catch up to it in the coming months. Even if TLRY does falter, that means APHA still has to come up a bit to meet it. Making APHA kind of a "can't go tits up" situation. TLRY also has the benefit of having enough market cap to where fund bois will buy into it, whereas SNDL is too small to meet most of their requirements. Which can further propel TLRY (and thus, drag APHA with it).

One of the interesting things that's been happening with this pair is that the order books, even though they should mirror one another, have completely inverted from one another numerous times in the last couple of days. This, of course, was a bull flag for TLRY every time it happened, leaving APHA to compensate to try and catch back up shortly thereafter. It's really easy money.

Fundamentally, these guys have one HUUUUUUUGE advantage over the others: They secured the UK distribution, and now have the inside track to be the supplier for the rest of the Europoors across the pond who need to smoke a bond to help forget all the things wrong with them. And if you don't think they won't be able to leverage that to be the front runners out of the gate when the US opens for business, then you definitely ain't black.

Or, you can just stay where you are and do the 💎👐 thing

Ask the $GME Gibbons how well that worked out for them. The ones still holding that stonk are like that one dude sitting at the edge of the bar of the Viper Room, still rocking his mullet and chain wallet, just convinced that Warrant and Slaughter are going to ring in the glory days of hair metal once more and that Queensryche is going to start selling out stadiums again. It's just sad. You're flying right now, but a rug is gonna get pulled out from under you and then you're gonna have your own daily thread where you reassure yourselves that it's gonna be OK and that you're gonna ride it to a thousand one day. Lots of us (myself included) made a fuck ton of money on GME. And we've made a fuck ton on SNDL and the rest of the Weedies this week. But there are always people who Melvin it and hang on to their position too long and get stuck. That's gonna be a lot of you, but you shouldn't let it be you.

TL:DR: Smart apes should look at their much bigger pile of bananas from SNDL while you're way ahead and upgrade them to plantains before the other apes. Plaintains equals breeding with better apes, not low quality apes that cannibalize fellow apes and give ape diseases.

All my love

-Chad Dickens

EDIT 1: I forgot to list my positions
CGC - None
ACB - None
OGI - 10,000 shares @ $4.23, 1000 1/22 5c, 500 2/19 7.5c
TLRY: 20,000 shares @ 18.74, 100 2/12 65c, 500 2/19 65c, 500 2/12 42c, 5000 6/18 43c
APHA: 500 2/19 26c, 500 2/19 25c, 5000 7/16 30c
SNDL: Opted out today

My mom was the sort of person to look like a wallflower until you got close and then spout out facts about her favourite animal. It was an emperor penguin. She said their journey for love and parenthood was the hardest and most connecting with her.
I’m told all the usual things about her; she had a smile that could light up a room, her laugh cut through the malaise of an awkward party, her stride was confident and her form was elegant. From the day I could understand what it was to be remembered, she was painted to me as a true goddess.
After all, aren’t all moms supposed to be that to their children growing up?
Mom died when I was 4. Aggressive cancer riddled her body with tumours, stole her stride, her smile, her laugh. Everything in just 18 short months.
I didn’t see her for much of it. But if I did, I obviously didn’t remember. I heard somewhere we don’t start forming memories until we’re around 2 years old and implicit memories - those unconscious memories that stick with us automatically - aren’t even until we’re 7.
So essentially my mother was already dead for 3 years before I could even unconsciously think of the word “Mom” and go to her face. A face that was stolen from me. A face that I’ll never see.
I’m giving you this background information now because it’s vital that you understand my mom before we get into the thick of it.
I can’t sit here and tell you I loved my mom unconditionally. I didn’t know her. Dad was never in the picture, so Grandparents were where I was shipped off to. Good people, kind people. They raised me on stories of my Mom and made sure to do the one thing she’d requested when her sickness finally got her:
”Show Nick the milestone tapes.”
For those unaware; a milestone tape is something where a loved one, usually a parent, records a loving video to congratulate their kin on a moment they’re missing out on. First day of school, marriage… you get the picture.
I remember being 5 years old, I’d not long tripped on the stairs after miscalculating my steps and smashed my front tooth on the top step, sending my first baby tooth flying. Thankfully, the pain was short-lived in my mind, I was mere days from my birthday and a surprise trip to Disneyland was coming up. In the middle of packing, I was sat down in front of the TV with my Grandpa Mihail and him putting in these pristine discs, a gaudy logo flashing up on the screen still burned into my retinas to this day:
“Gone, but not deleted: A video message from Leanora Stankowski.”
The image would flicker for just a moment, always just a moment each time, then she’d appear.
A young woman sat in a black leather armchair with a small table to her side and patterned wallpaper behind her. She was in her late 20s with her raven black hair tied in a messy bun, strands curled and dangling down her porcelain face, a beauty mark sitting just beneath her right eye, the pair of them shining like emeralds that caught the first ray of sunshine, black lipstick gave way to shimmering teeth and a smile that made even an oblivious little me feel… lost.
“Hi pumpkin, it’s mommy! I hope my little prince is watching the throne while i’m away… how can you be nearly six years old and already losing your baby teeth? You’re growing up too fast, little man!”
She puffed out her cheeks as she feigned a frown before giggling. My heart sank in my chest, I knew something wasn’t right even then. Her tone was playful, buoyant and full of joy, like she’d never missed a moment of my life.
“Make sure you put your tooth under your pillow tonight, Deda Mihail will make sure the tooth fairy comes and nothing else!” She raised a single finger with a wink, posing for a moment before her face fell, her posture sank and she fell back into the armchair a tad, growing smaller as she coughed. After a moment, she cleared her throat with a quiet dignity and made sure the hand she coughed into went out of shot as she fixated on the camera with a weak smile.
“Mommy loves you, my little crown prince. Close your eyes and breathe with me…”
I looked at my Grandfather and with tears streaming down his face and a bite on his lip; he put a hand on my shoulder and nodded. I did as I was told and took a long breath in, the air cold and filling my lungs, intoxicating me as I heard her words. The same words i’d come to hear at the end of every video she recorded:
“I’ll always be with you.”
-
And so it went. For every milestone I undertook, there was an accompanying video. When I graduated middle school, when I rode my first bike… even when I broke my first bone, she had a video ready.
I was around 11, when biking home from school, I collided with a speeding driver. The bastard didn’t even stop as my small body careened over his windscreen, rolled over the hood and smashed into the concrete, tearing my right arm to pieces.
Passers-by said it was a freak accident; that the car just appeared out of nowhere and then vanished. But hell, what do hit & run drivers do? Speed, speed, speed.
Medicated up to my eyes and sitting up in hospital, Grandpa handed me a mini-dvd player and the familiar face shot up. I could never tell you in those earlier videos if these were done back to back or months apart, but Mom still looked radiant… albeit with more coughing in each iteration.
“Hi pumpkin, it’s mommy! Though, i’m sure by now you’re probably cringing at the mere mention of me referring to myself that way… oh god, do people still say cringe? It’s hard to know what the world you’re in is like anymore, but moms are never supposed to be cool, are they?” She chuckled, a faraway look in her eye as the pit of my stomach expanded.
“No…” I thought, tears in my eyes, gripping the sheets with my good hand. “I WANT you to say those things. I WANT you to embarrass me…”
“Well, if you’re watching this, then you’ve broken your first bone… I hope it’s a bit later in life and not when you’re so upset you can’t even hear me. But sweetie, this is an important life lesson that I wanted to be there for; pain happens. It’s a part of our world, and everyone in it must experience it. Sometimes it’s physical, like now when your body hurts so much that you wanna yell and cry out. Sometimes it’s emotional, which you get when someone upsets you, hurts your feelings… something you might also feel from seeing my face right now, which I’m sorry for.” She trailed off, that weak smile plastered across her face like the greatest lie ever told. She took a breath, and I heard the quivers in her voice. Both from sadness and from sickness. “BUT, you are my little crown prince, and while you’re watching the throne, I know you’ll do great things and overcome ANYTHING that stands in your way. You know why?”
“Why…” I breathed, my body radiating with hot pain but my heart aching. I leaned in as she leaned in, like sharing a secret only we would ever know.
“Because you’re my son and my love for you will push you to do anything.” She whispered, my face involuntarily growing into a smile without even realising.
“Just don’t look at the wall behind me.”
My eyes were fixed on hers, a small sliver of the background visible behind her ear. As my eyes slowly broke from her gaze and travelled over, she spoke again.
“DON’T.” A frantic whisper escaped her lips. My eyes snapped back as a pale shade shifted out of sight.
Blinking once, I saw she was sitting back in the chair, talking as if nothing had happened. Had I dozed off? I was on high pain medication; it wasn’t impossible…
“I’m running out of time, these are only supposed to be short, so i’ll finish up here. “Mommy loves you, my little crown prince! Close your eyes and breathe with me…”
Again, I did as instructed and heard a distinct creaking sound from the speakers, undoubtedly her settling into her chair.
“I’ll always be with you.”
-
So the years went, fewer milestone videos popped up. Some of them were simply mundane or not that noteworthy. Not why we’re here. But the usual events; first day as a freshman, last day as a senior, prom night and even an embarrassing one wherein a 17-year-old me had the most uncomfortable 15 minutes of being explained dating etiquette and safe sex by my long-gone mother.
By the time I’d reached 21, only four tapes remained. Grandpa Mihail had passed and Grandma Suza was getting on, so they were given to me with the obvious instruction to not watch them until the time was right.
And this is the part where things take a turn.
A bad breakup, bad life choices, even worse friendship choices with substances readily available, a lifetime of insecurities stemming from no parental figures (all the love in the world to my grandparents, but it’s not the same) and a series of videos from your long-dead mom are enough to fuck anyone up.
So, I grabbed a bottle, some pills and put the next video in, planning to binge them before I took my leave. I mean, fuck it, what’s the harm if I’m ending it all, right?
The video flickered and cast a long shadow across my dismal apartment before the visage of my mom came into focus.
It’d been a couple of years since the last video and in my emotionally unstable, drunken state… I was not prepared for what I saw.
Emaciated, sunken eyes and a slack jaw, her tongue hanging out and drooping to the bottom of her chin, thick pungent saliva with her concave chest heaving under the weight of the oxygen machine wrapped around her face. A looming shadow with two bright blue orbs for eyes and jagged pillars for teeth, wrapping its arms around her.
It locked eyes with me and cocked its head to the side.
“NEW.” It croaked, my skin bubbling with fear and chilling my blood, I had never felt a terror like it.
It felt like it knew me and saw into me.
I recoiled and in my cocktail of fear and horror, retched up everything I’d downed not 10 minutes earlier. A torrid mixture of bile, acid, pills and booze spread over my carpet as tears ran down my face. My stomach ached and every cell in my body screamed at me in protest. The thoughts swirling in my thick skull were that of disappointment, disgust and repulsiveness. I felt weak, alone and broken as I collapsed onto the floor in the fetal position, sobbing.
“Sweetie, it’s Mom.”
Through blurred eyes and a haze of pain, I looked at the TV half expecting some emaciated creature to lurch through, but there was my mom. She looked tired, her hair now matted to her head and exhaustion racking her bones, but beauty radiating through her as she held her hands in her lap and leaned forward, smiling.
“If you’re watching this… then things are bad. I don’t know how bad, but I can guess. Grandpa wouldn’t have let you watch this if you’d gotten your heart broken or were at that age where emotions are as high as a kite and just as volatile… so I can assume that, much like me, you’re in a bad place…” She coughed and I felt the need to sit up and give her my full attention, this woman no more than 6 years my senior frozen in time still finding ways to command my attention with her every word.
It was like I was 5 again.
“Sweetie, I know I can’t talk to you like a child anymore, so I won’t. Honestly, I’d been so excited to see you grow up, go through that phase where we bicker and argue over small things before finally settling in the longest and most beautiful phase of our family dynamic…” I watched her lips quiver and eyes glaze over, my own mirroring as she shakily concluded “The one where we’re best friends who always look out for each other.”
That broke me. Every emotion I’d trained myself to hide away when kids started asking questions I couldn’t answer, situations I’d wanted my mom in, moments I felt alone… I let it out in one volatile evening of self healing, the words on that tape echoing in my head long after it stopped playing.
“The road ahead will be tough without me. It was always going to be. But, you’re the crown prince and you’ll eventually have that throne, survey your kingdom and know you can do ANYTHING and conquer ANYTHING… it’s getting closer now, but we still have some time left. So don’t let whatever is going on beat you, nor the thing after that. The Penguins didn’t, did they? I’m sure Grandpa told you, but they’re my favourite… those little birds share the burden of parenthood, walk over 100 miles and nearly starve to cultivate new life… I’d do all of that and more for you, honey. Because…”
She closed her eyes, and I did too, without prompting, we said it together;
“I’ll always be with you.”
-
It took time to get better. All things do. I would spend so many nights in withdrawal with the shakes, vomit, and staring up at a horrific beast looming over my bed. Like the thing on the tv but foggier, it’d imitate my movements and try to get closer. With every step, its eyes would glow just a bit brighter, everything else remaining shrouded in darkness, even if light passed through my curtains.
I don’t know how I made it through that time of my life.
One night, as it made its way to the foot of my bed, I closed my eyes and breathed on instinct, reciting my mother’s mantra. I suppose in moments of crisis; we turn to our most personal coping mechanisms and I wasn’t about to go back to the bottle. When I finished, it was gone.
Over the years, I completed my program, got clean and went through therapy to cope with the grief. When I hit 26, I met the 2nd most important woman in my life; Natalie. She knew what it was like to go through pain, to go through suffering alone. To play with the wrong demons.
We fell in love; we got engaged and eventually married. As she had been countless times before, mom was there to congratulate us.
Natalie had seen some tapes, but this was her first one that in its own way was directed to her. Mom was nearing the end by this point, her thin frame barely clinging to her always beautiful dresses and her skin beginning to stretch like paper. She took great gulps of air from the oxygen tank before talking, but somehow retained that exuberance she’d always had.
“I knew you’d find someone wonderful eventually, Nick. Penguins always find their mate for life and you’d be no exception!” She giggled through strained coughs, turning her head slightly as if she could see Natalie. “I don’t know you, but I bet you’re the most beautiful woman in the world if my crown prince chose you. Well, after me of course!” Another laugh, this time accompanied by tears from the two of us. “There’s just one more to go… So, look after each other. Love well and experience everything you can. And don’t forget…”
Natalie gripped my hand with her left, a hand on her bump with the right as we closed our eyes. I could hear the scratching sound more prominently now, but I kept my eyes shut, not wanting to ruin the moment.
“I’ll always be with you.”
-
We were so excited to have a baby. Natalie had come from a big family and was eager to start expanding our own. Even though I was reluctant, I couldn’t help but share in her enthusiasm when so many late nights were spent fawning over baby names, cute outfits and lofty plans for the future on how our kid would even behave around us. Determined to be “cool parents”.
But in between all of that, my mind would cast back to those tapes of my mom, the only parent I really knew. I wanted to use them as a guidebook for my own steps. She’d been such an integral part of life, it seemed… odd to not have her in it now.
Keeping the last tape separate, I re-watched the entire set one by one, reliving those moments I couldn’t truly appreciate until my own burgeoning journey into parenthood.
But when I got to the broken bone tape, I froze.
Once again, she leaned into the camera and whispered, eyes full of fright and panic.
“Don’t look.”
I pushed pause on the video and took a moment. Surely I was just highly medicated at the time, there couldn’t *really* be anything there, right?
So why was I so reluctant to move my eyes to the right to find out?
Taking a breath, I moved the video frame by frame and watched the corner where her face didn’t cover.
That shadow. That same fucking shadow. Looming in the background, eyes burning red with fury.
“DON’T LOOK. DON’T LOOK. DON’T LOOK. DON’T LOOK.”
I jumped, the video was skipping, stuck on the sounds of my mother’s panic stricken voice begging me not to stare, but I couldn’t help it. I stared and watched this creature take confident, unnatural and twitchy strides from the background, getting ever closer to the camera. I saw the muscles on its face twist and undulate as it pressed its cheeks up into a twisted grin, the sight of rot and earth and unspeakable things in its mouth all displaying themselves in full glory as it intonated one word that sent screams through my home before shutting off.
“SOON.”
-
Natalie was 8 months gone, petite and a history of prior drug abuse. They said her heart just couldn’t take it, her body gave out, and that it was a miracle our daughter survived.
I took it all in and yet none of it as I cradled my entire universe in my arms, the second greatest woman I’d ever known now taken from me too.
“Phoebe.” I breathed, unable to take my eyes off of her perfect little face as she slept soundly just 12ft from her dead mother. “Her name is Phoebe, and she is the crown princess.”
Somewhere in the corner of my eye, a shadow cast itself over Natalie’s bed, right as they put the sheet over her.
From that night on, there would always be noises outside our home. Always faint howling. Always a solitary spot in the front of the property where no light could touch it.
For a while, I forgot about the videos. Forgot about everything that wasn’t Phoebe. Raising her became priority #1 and I would work any extra hours I needed to, give up any friendship I had to and spite myself in whatever way was necessary to ensure that my perfect girl slept soundly at night.
It wasn’t until Phoebe’s 2nd birthday last week that I finally got the courage to dig out the videos and watch the last one.
How many times had I sat in a home, emotionally destroyed and at a crossroads in my life, waiting to see this woman’s face and hope she’d somehow have the magic words to guide me?
As the picture flickered on, the logo shining up on screen; I cast my head back with a mixture of surprise and sadness as I realised the significance of the year;
I was older than her now.
“Hi sweetie, I guess we’ve finally reached the end, huh?”
Her voice sounded… younger. I looked down and saw her standing up. No chair or wallpaper in sight. It looked like she was recording this in her bedroom, a picture of health, all things considered. Her eyes red from crying but her voice unwavering, like she’d prepared these words carefully.
“This is technically the final video for you, but the first for me. Weird how this all works, but this is how it needs to happen… if you’re watching this, you’ve got your own little princess to protect. The crown prince has now become the king, and I couldn’t be prouder!” She beamed, but my stomach tightened at those words.
“Your own little princess.”
I breathed, my chest tightening. How did she know?
“I imagine you’re now wondering how I know. Well, that’s not the important part. What’s important is if you saw what you think you saw. Within the videos, between the frames. There is something lurking here, Nick. Something ancient.”
I felt the house shudder, settling into place, no doubt. But I couldn’t separate myself from the fear running through my body.
“It feeds on misfortune. It watches from the shadows and waits for small, tiny windows to make itself known. I don’t know where it came from or what it is, but I know what it wants…”
A rumbling behind me, the sound of wood splintering and creaking. The unmistakable sound of tapping that i’d heard every time we did the mantra at the end of a video. I was shaking, but I didn’t stop watching.
“It wants us, Nick. We seem to be a… source for it. When it finishes using us, it moves on. A long time ago... I was told that if I captured it in film, solidified it in these repeatable tapes, it would slow it down… maybe even stop it. I have no idea if it’ll work, but you deserve to know now that you can almost certainly see it too. Because if it doesn’t stop here, if YOU start to see it… start to experience misfortune…”
My heart skipped. Tripping over the stairs and narrowly missing cracking my skull as a child, losing my first tooth. The hit and run that shattered my arm, my first broken bone. Marrying and losing Natalie, my first love…
Oh no.
Oh god, no.
I willed my body to move, to leap out of the seat and rush to Phoebe’s room, but I had to hear the rest through, screaming at my mom to tell me the solution.
“When your Deda Mihail told me about our curse… how he took me in after my Father died... about how it passes from father to daughter, mother to son, and so forth… You can try to avoid it, but it always finds a way…" She looked down in shame, clutching at her sleeves. "Truth be told; I didn’t want to get pregnant. But, things have a way of happening and I knew I couldn’t give you up.” She glanced behind her, something off camera scaring her into grabbing at her arms and rubbing them, shame and fear on her face. “I’m so sorry, baby. But I want you to know that there is power in these words. In these videos. I will do EVERYTHING I can to protect you, just like I know you’ll protect your child. No matter who it hurts in the process. Because…”
One last time. I just had to close my eyes one last time and it would all be over.
I did it on instinct. It didn’t matter that there was a slew of sounds alerting me to an invading presence in my home. That it was rapidly approaching me.
All that mattered was the mantra.
“I’ll be here for you, always.”
But what I heard parroting me back was not my mother.
A guttural, inhuman voice barked back the phrase and I swear I felt its breath inches from my face. I felt eyes unrestricted by pupils or sockets spin around, focusing on my weakest point. But I didn’t waver.
After a few agonising moments, it darted away and out of view, leaving only the static of the TV to keep me aware that I wasn’t in fact dreaming.
As soon as I knew it was safe, I ran to Phoebe’s room and checked on her, convinced that she was next in a long line of losses. Convinced that some otherworldly spectre had taken her from me.
Convinced I would be alone again.
You can imagine my relief when I opened the door to find her softly sleeping, clutching her teddy bear with his own attached blankie. The same toy my mom had given me.
I looked at her with the enormity of the situation overshadowing me. The realisation she was the same age I was when my mom got diagnosed.
The realisation that soon, I would be the one making a slew of videos for milestones I’d never get to see her inherit.
My crown princesses’ kingdom of nightmares.
And I don’t know if this is what my mother intended, but I took those words at the end to heart.
“Protect your child. No matter who it hurts in the process.”
-
I’m sorry, everyone.
I don’t know HOW this translates across mediums, but there is power in describing an old and malevolent force. Just like there is seeing it in the corner of your eye or when you experience a lucky break from death. A mis-step here and a wrong turn there. You’ll always see it.
My mother gave up everything to buy time, give me the chance to right the wrongs and find a better way, a way that involves my daughter growing up with her father in her life, without the plague of whatever this is hanging over either of us.
Maybe you won’t be the one, maybe it will simply look at you and find you not to its liking as it did me that fateful night, inches away from my flesh and determining that I simply wasn’t “ripe enough” yet.
But someone will come across this, and it will bite. It will bite and never let go. Be it nightmares, sleep paralysis, a slew of unfortunate mishaps or something flitting in the corner of your eye, it’ll be there. Whatever it is.
Waiting.
I wish you well, and I hope you don’t judge me too harshly.
But to me and to Phoebe, family is everything.
So close your eyes and take a deep breath.
Because they’ll always be with you.

I've been losing an average of 30 minutes of sleep every night for the past 10 days.
Now I’m down to a paltry 4 hours and 30 minutes, my walls are beginning to shift and my vision is blurring.
I have to focus. I NEED to focus.
Someone out there has to know.
Does anyone know why the garbage collectors have switched to the night shift?
Even asking it sends shivers down my spine. It’s late and soon I will hear them turn up to collect. I can’t sleep upstairs anymore, not where they can see me.
Now I sleep in the living room with my gun propped up against my shoulder, the weight a stern reminder that I am present.
I am awake.
I am a threat to them.
They won’t try anything if I’m a threat to them, right?
Fuck, I’m sorry. Let me explain.
My name is Tyson. I’m a farmer with a thriving family, a loving wife and two bright young boys. We live in a very remote area that requires a significant amount of divergence for basic services. I won’t say where, I won’t risk my family or my business, especially knowing what kind of armchair detectives there are out there. I respect what you all do and fear you in equal measure. So I’d rather throw you a bone you can thoroughly chew on as opposed to delving into mine and my famili’s personal info.
What I can tell you is this patch of land has been in my family for six generations, was not acquired illegally, built on sacred land, and to the best of my knowledge has NEVER had a violent occurrence or bloodshed.
We’re normal, hardworking folks who have always tried to do right.
Which makes what is going on here all the more difficult to understand, to quantify and reason with when the basic logic gives way.
I hear you, you’re undoubtedly scratching your heads and asking “why are garbage collectors such an issue?” and I don’t blame you. I’ll get to that.
Something shifted by the gates. No sound, can’t be the garbagemen, you hear them a mile off.
They’re not subtle about making their presence known.
The first night they turned up was so startling that I honest to god thought we were being robbed by the most unprofessional thieves this part of the world had ever birthed. Rambunctious, loud and borderline jovial in their candour.
It was always the same. Each and every time.
The sounds of the huge mechanical vehicle roaring as it drove up my dirt road, crushing twigs and kicking up dirt as it ground to a stop by the gates some 50ft from my front door.
Two thuds, boots hitting the ground, stumbling over to the main gate where our trash was left for the garbagemen on a Tuesday. Usually a couple of surly men got out, grunted, and hauled ass out of the area as soon as possible.
These two? Couldn’t have been happier to be there from the sounds of things. Young men, the smiles almost visible in their tone;
“This the one, Bill? Looks ready to me!”
“I reckon it is, Jeff! Let’s get ‘er done!”
A laugh, a high five, the sounds of something being dragged and thrown into the truck before they’d back out of the driveway and go off into the night.
Unusual, right? My wife & kids certainly thought so, especially when the trash was still there the next morning.
“Maybe they were some weird kids pulling a prank?” My wife Lucy remarked, taking a sip from her coffee and glancing nervously at the window. I think she was saying it more for our boys benefit than our own. I nodded and ushered them away from the windows, told them to go play.
The next night, it happened again. No specific time so much as that dead of night period between 1am and 3am when the world falls totally silent around you. None of our animals made a peep during that time frame, nor did we dare to.
Because when we heard them roll up again, we were paralysed with fear.
It took a few minutes to realise it, but when I looked to my wife and she returned my fearful glance with a wide-eyed stare and a nod, we scooped up the boys and huddled in our bed.
The exact same sounds. The exact same timed footsteps. The exact same conversation.
We heard them drag something wet into the truck before leaving after maybe 15 minutes. My younger boy Jace was always anxious and hearing this uncanny valley shit at his age sent him into a panic attack. We spent the remaining time soothing him while my older son Travis took to peering through the window with me.
Our pig pen that lay some 40ft to the right of the house had the door ripped off the hinges and a blood trail leading from the entrance all the way to the farm gates where the garbagemen had been.
When we mustered up the courage to inspect further, the pigs were silent, unmoving and staring at the long dirt road that lead away from the home, the tall trees that littered our farm looming overhead as if to silence them from telling what they’d seen.
We tried calling the city council to complain, but they were as perplexed as we were, said trash pickup day was still Tuesday and that since it was only Sunday, we weren’t due. They advised we filed a complain with the police for trespassers, but that yielded absolutely nothing.
In the meantime, things escalated.
Night 3 brought us the same routine, same sounds. Even after we’d taken to putting a lock on the pig pen, they still took one. This time making sure to leave a small pile of viscera behind, perhaps as a warning.
We elected to putting the animals in the barn and dead bolting it, hoping the pranksters would get the message and perhaps get bored. I’d ordered a cctv camera but with my location being so out of the way, it was going to take time to arrive and I wasn’t about to stand in my window with a camera pointed out at some weirdos.
We didn’t consider the consequences of this defiance.
It was Night 5. The boys were sleeping in our room and like clockwork; they showed up and pulled me from what little sleep I was getting, my wife soon after. Silently, goosebumps raised on our skin and a chill in our bones, we strained our ears against the open window, hoping to hear their frustration and subsequent decision to leave.
The routine continued until “Jeff” spoke to “Bill”.
The moment they opened their mouths, I knew something was horribly wrong.
“This the one, Bill? Looks locked to me!”
“I reckon it is, Jeff… Let’s pay ’em a visit.”
They rattled our front door knob and politely knocked at the door. Five rhythmic knocks, five seconds of silence, five more aggressive knocks.
I bolted downstairs and grabbed my rifle, keeping the lights off but my aim focused on them. Adrenaline pushing fear aside, if only to defend my family.
“I don’t know who the fuck you are, but you’ve been coming onto my property unannounced and I ain’t standing for it no more.” I pulled back on the bolt and the sound filled the room.
“You got three seconds to turn on your heel, or I’m firing!”
My eyes adjusted to the front door and in the darkness, two shapes stood behind my door, shrouded by the shadow of the night. They were tall, thin legs and bizarre movements… like they were swaying in place.
Those three seconds felt like an eternity.
“ONE!”
The shadow to the front leaned forward, trying to press its face against the glass. Something was wrong.
“TWO!”
It moved away and tapped the letterbox, testing if it opened up. When it did, it held it open and spoke as the second shadow stepped closer.
Three never came. Instead I backed away out of terror and barricaded our room, unable to speak.
It repeated my last words back at me. Exact same pitch. Exact same tone. But something was… off about it. Like hearing your own voice played back through old speakers, you sense an eeriness to it.
As i’d instinctively taken steps back, however, the other one spoke. This was the first Time either said anything that didn’t repeat and I swear to god it makes my heart pound in my throat just typing it.
“We have come to collect. Come outside.”
My legs carried my body before I could register what was going on. Rushing to the bedroom and locking it, I pulled my family in close and held my head down to theirs, desperate to block out whatever ungodly sounds erupted from our front door.
It took a half hour before they gave up, assumed their usual routine and left, the sound of the tires speeding off up the road bringing some degree of relief.
Until the following morning when our nearest neighbours, The Gundersons, reported a break in at their farm some 5 miles up the road. The perpetrators had smashed through the gate, entered the barn and done such violent acts to their cattle that of the ten that had been attacked and mutilated, only two survived and were immediately put out of their misery by the patriarch, Ted.
“You’ve been havin’ problems with these sons of bitches too, Ty?” He bellowed down the phone once I began retelling our sleepless events. “Shit, you sound like hell and probably look worse than the cows at this point. I ain’t havin’ it. You got a young family to support and when they hurt one of us, they hurt all of us. Tonight we put an end to it, ya hear?”
I nodded, agreeing to stake out our property that night and do whatever needed to be done. Hands still shaking, I grabbed a stiff drink from the cabinet. Never been much of a drinker, most of this was my dads for the tougher times. But if times weren’t tough now, I don’t know when the fuck they would be.
Ted rolls up around 11pm, wife and kids are asleep and we shoot the shit in the living room for a while, mainly discussing how the harvest had gone and what we could do to protect our livelihoods in this day and age. The conversation petered off as they often do when a night draws on, but it was as we fell silent that the realisation swept over us;
We were going to confront these people tonight.
I gripped my gun a little tighter as Ted gave me an assuring nod, peeking out the window for any signs of the garbagemen.
“Son of a… my farm!” He bellowed, springing to his feet and bursting out the door before I could get a word in edgeways.
He was halfway down the road before I could ask him what the fuck he was doing. He turned, his eyes wild with fear and rage, pointing a shaking finger to the small shape that was his house far across the hill.
It was on fire. Large pillars of smoke billowing forth as the fire danced in the light, illuminating the surrounding fields.
“I can’t sit here while my farm… my livelihood burns away, Ty. If those bastards are behind this… well, you can’t bet your ass they won’t last the night when I’m through with ‘em! I’ll teach ‘em a fuckin’ lesson about the value of things… the things people throw away.” He turned on his heel and ran to his truck, speeding off before anything more could be said.
This would be the only night the garbagemen don’t pay us a visit. I get a bit of extra sleep, but my wife doesn’t. She just stares out the window at the Gunderson farm in the distance and shakes her head.
She knows how there will be no help on the horizon.
She knows how close we are to that fate.
And seeing that scares me to death.
-
The 8th night. They arrive with no vehicle sounds, no grand build up to the crescendo of their routine. They whistle softly as if calling an animal, patient in their call as they scrape something around in the dirt.
I’m crippled by fear and cannot dream facing them, I look around in the dark and see Lucy is still asleep, Travis is snoring in the corner… but Jace… Jace is wide awake and transfixed.
And staring at the window overlooking our driveway, reaching out to open it.
I leap out of bed and just about tackle him away, the shock of waking up to such a violent affair sending him into a panic attack as the entire family snaps awake in a frenzy, shouting over one another as he cries uncontrollably.
“This has got to stop, Tyson. We can’t do this anymore… We can’t live like this…” Lucy was exhausted, her eyes barely open and her teeth chattering. In the moment of silence between us, the whistling started again, almost mocking in its tone if it weren’t for the sinister giggling behind it.
“SHUT UP! SHUT THE FUCK UP AND LEAVE US ALONE!” She screamed, walking towards that same window. It took everything I had to hold her back as she fell to pieces in my arms, the entire family crippled by nerves and a lack of sleep.
It was only when one voice cut the air that the final nights events were set in motion.
“The things people throw away…”
Oh, fuck… Ted…
One look into my wife’s eyes and I knew what she was thinking. There was no stopping her.
She darted around, packing the kids’ clothes and any essentials she could find, ignoring the whistling outside and instructing our boys to focus on getting whatever they needed.
“You do what you need to do, I don’t care if the nearest town is a three-hour drive or I undergo the seven-hour drive to my moms. I will not stay another night in this fucking house. Not until they’re gone.” She was almost delirious, fuelled by fear and anger as she darted around like a hurricane, turning over tables to get what she needed as if prepping for a weather event. Within the half hour she’d been rushing around, the noises had faded and the outside once again fell silent.
I couldn’t leave the house. It’d been in our family's lineage for generations. We’d been born here, lived here and died here no matter what. As the head of the family, it was my job to stay here and protect it. Even if I couldn’t protect those that I loved most under its roof.
She waited another hour before getting in the car and leaving, kissing me with all the passion she’d had when we first met. I told Jace he had to be strong and that he’d one day conquer his fears because I believed in him. I told Travis that as the eldest; he needed to protect them like his life depended on it.
Then, just like that, I waved them goodbye and promised I’d join them at their mother in laws when this was over.
Now all that was left was to sharpen my resolve and find out what this was. I took the chance to try and get some sleep during the day, but no matter how hard I tried, it wouldn’t come to me. So, liquid courage it was.
One way or another, this was going to end.
-
Night 9. The penultimate night.
Not a sound. I mean that in the most literal sense. The wind didn’t move; the trees didn’t speak, not a single blade of grass danced and no dirt was kicked up.
Everything was silent. So silent. My own thoughts were amplified in this void of sound, every inane thought of what could happen flitted through my mind and forced me to double check every window and door. Triple check the locks, ensure no oversight was left.
Couldn’t let them get an opportunity. Even if it’s just me. I know they’re watching even now. If I didn’t know any better, I’d have said a shadow moved just behind the porch window. Can’t be sure, not without checking.
I think they were biding their time, keeping me on edge and making sure I *knew* they could step in whenever they wanted and do as they pleased.
But I kept my nerve, I resisted the urge to bolt to the truck. I’ve got my whiskey and I’ve got my gun.
I’ll see this through, even if it kills me.
-
Night 10. Now we’re all caught up.
I checked on the animals this morning. What was left was a pile of bones, flesh and waste. They’d been taken the night before and I don’t know how I didn’t hear during the silence. There was but one horse's body left, teeth marks riddled the torso, and the legs had been torn off.
Our crops had grown fetid, decayed and worn, nothing in our farm would yield a damn thing anymore.
My livelihood was decimated in front of my eyes.
Gone.
It’s late now, I’m sat in my armchair with the rifle loaded and ready. My hands are shaking and my knee won’t stop bouncing. I feel the dread start in my gut and worm its way through my chest before lodging in my throat and forcing every breath to be a labour of pain.
They came early tonight, truck roaring and routine sounds in full swing.
Only there weren’t two sets of thuds this time.
There were six.
They walked up to the porch, a shadow covering every facet of the window and the door panes. Not a spec of light coming through.
The voices don’t change their pattern, they never do.
“This the one, Bill? Looks ready to me!” They pound their fists against the window, a dull moan emanating from the background. Pained, muffled and growing in strength.
“I reckon it is, Jeff! Let’s get ‘er done!” Nails drag down the glass. A horrific groaning accompanying the repeated intonations of their godforsaken phrases.
“The things people throw away...” Ted… poor Ted smashing his head against the wall, repeating it with every sick swing.
It was only when I heard the fourth voice that I finally looked out the window, perhaps on instinct.
“Not until they’re gone.”
My Lucy. My sweet Lucy calling to me.
I can’t begin to tell you what I saw when I pulled back the curtains for just a split second, but every forbidden aspect of it is burned into my brain and it will not leave me even as I shut my eyes from the surrounding chorus of madness.
My kids… my fucking kids are now saying they’ve come to collect. That I must come outside. That whistle has come back, it’s… it’s almost soothing.
I can’t bear to do this on my own, I can’t live with that image in my fucking skull anymore. I miss my wife. I miss my kids. I miss sleeping soundly at night.
What if it is them out there? What if they’re really just wanting me to get help and my own sick mind has put me in such a state that I’m here, asking you for help on something that is, at its core, truly simple?
I’m going to put down the laptop and open the door. I have to know.
I have to.
Why did the garbagemen start coming in the dead of night?
Does anyone know?

Edit: Forgot to say. If you object anything or just wanna discuss about my decisions or your own ideas, please leave a comment. I love these discussions and now I'll have them 3 times less often, so I hope they are good.
Heya! Since balance changes switched to quarterly, I decided to switch to making wishlists quarterly, too. I don't want to post several of them between updates since this strategy only works well with negative posts. This wishlist includes:

More suggestions than in my old wishlists (since it's for a whole quarter), including ones that would require a client update
Changes in bold
Hard data: Grand Challenges 3d data over the last 2 months
Community opinion: Tier list as rated by 50+ redditors in ClashRoyaleSerious * (took this info last month)

This is something I'm doing for the first time, and it's there to show the general opinion of people with adequate knowledge of the game. It's not something I considered much. It is more meant to imply that not only data supports me, but also most of the serious community. Even on S Tier cards, there would often be a couple votes that put the card into the F Tier.

Explanations of why I chose the cards and their exact changes, in which the most important points are in bold italic

Here are my ideas, starting with format changes, then rulebook changes, reworks, regular changes and finishing with small tweaks.

Tiebreaker changes

Change 1: Coinflips introduced all around the game, except for friendly battles

Coinflips are a feature in duels that proceeds after a tiebreaker fails to deduce a winner. I believe it would be a good idea to introduce them all around the game to discourage tie-trading. The only way to achieve a tie would now be a 3-crown tie or a tie in friendly battles. GL if anyone tries to coordinate a tie-trade like this.
But coinflips are unneeded in games without stakes, so they shouldn't exist in friendly battles.

Change 2: Tiebreakers only resort to a coinflip if the opponent's Princess Towers have the same hitpoints as your Princess Towers, and the opponent's King Tower has the same hitpoints as your King Tower.

Otherwise, the tiebreaker always considers the two lowest towers currently on the field, not stopping after destroying one (unless it destroys a king). This makes the probability of a coinflip in regular battles astronomically low.

Change 3: Bandit can no longer survive while dashing and deal damage during a tiebreaker

Last bug in the video here.

Rulebook change to initial attacks

Initial Attack Time is now shown on cards' stats
Adjustments to always be between 0.3sec and 1sec
Adjustments to always be a multiple of 0.1sec

The affected units:

Archer, Valkyrie, Fisherman, Bomber (0.1sec > 0.3sec)
Goblin Brawler, Balloon (0.2sec > 0.3sec)
Royal Hog (0.25sec > 0.3sec)
Dart Goblin (0.35sec > 0.3sec)
Inferno Tower (Re-target time: 1.2sec > 1sec)
Electro Giant (1.4sec > 1sec)
And a few I mentioned lower down in the regular changes.

Initial attack speed. A stat that can make or break a card, as shown many times, yet it is hidden from us. So let's get it all tidy and ready to be revealed.
Only a few units take longer than 1sec or shorter than 0.3sec to initiate their first attack, and they have a sharp or a sluggish animation while doing so. These changes would allow attack animations to play much more smoothly while also being reasonable for balance. 0.3 seconds is still really quick and 1sec is still really slow, so this does not limit balancing options. Keeping initial attacks in this range just makes more sense.
While the point is in consistency, it's worth mentioning that I believe 5 of the changes improve game balance and only 2 of them aggravate it. 4 more are addressed in other ways lower down. Some of this may need to be addressed in future balances. Here are the specifics of what I consider to be relevant:
Negatives
Archers nerfed: Use 4-13%, Win 45-55%, B Tier
Bomber nerfed: Use 2-4%, Win 41-50%, B- Tier
Positives
Fisherman nerfed: Use 9-14%, Win 53-60%, S- Tier
Balloon nerfed: Use 12-17%, Win 50-54%, S Tier
Goblin Cage nerfed: Use 12-16%, Win 51-56%, A Tier
Dart Goblin buffed: Use 3-6%, Win 38-51%, A- Tier
Inferno Tower buffed: Use 3-5%, Win 30-40%, B Tier

Elixir Golem Rework

Elixir Golem:

Hitpoints +32% (1196 > 1584)
Death spawn changed to 3 Elixir Blobs!!!
Speed increased to Medium
Range increased to Melee: Medium

Elixir Blobs:

Hitpoints +77% (299 > 528)
Damage +33% (52 > 70)

Usage 1-3%, Win 35-45%, B Tier
Now here's the basics of the rework: You have a much more powerful Elixir Golem that spawns three MUCH more powerful Elixir Blobs. There aren't any Golemites, though. This reduces the overall impact of the card, but also gives your opponent one less elixir in the end.
Recently, I've seen a few posts that claim the game has become Rock-Paper-Scissors (RPS) because decks that have either 70-30 or 30-70 matchups appear balanced. While this is just untrue for most decks, it is true for Elixir Golem decks. Elixir Golem decks are some of the most RPS: they either win hard or lose hard against the meta. Now, I have to mention that unless you play Elixir Golem, RPS doesn't determine your games so much. Even for Elixir Golem, it's 95% skill and 4% RPS. But it does result in matches being unfun.
Battle Healer, another considerably annoying card, is also primarily used with Elixir Golem. Every Elixir Golem deck has Healer. I will excuse her, though, as Elixir Golem's mechanics are part of what makes the synergy and Healer can actually be found in some not-so-toxic decks.
I don't want to just rant, but I simply have so much to say about this card. A total overhaul is needed beyond any shadow of a doubt. Many of you might not acknowledge it as an issue, because nowadays Elixir Golem is weak and Healer is easier to blame, but it is easily one of the most toxic cards in the game. There's little difference between mediocre and pro gameplay with it, besides pros' consistency. Maybe you'd say "it's good that lower-skilled players have cards they can use" but I will disagree. The card is inherently flawed beyond just being low-skill. I'll explain below. I really insist on this rework.
CWA: Pro Ranks Top 20 Decks from LOWEST to HIGHEST Skill! (Vulkan rating Elixir Golem as the least skilled deck in the game. This is pretty old, but Elixir Golem decks haven't changed much since)
Elixir Golem was also overpowered in the past and it only got health nerfs and a hit speed standardization, not fixing the underlying issues. At this point it is just a half-relevant card that people only tolerate because it's not the meta.
------------
The first issue with the card is how swarmy it becomes. It's hard to put in words, but in many matchups everything gets melted while trying to deal with the latter phases. Heal effects are the best in medium swarm decks, which the golemites phase really capitalizes on, and so Healer and Heal Spirit are good with EGolem alongside with Rage to increase the healing. So if you can't deal with a push, it will get healed back and you will get 3-crowned. Elixir Golem is basically a magnet for yet more cards that are considered toxic. Being swarmy is not an issue on its own, but it just so happens to amplify the other issues.
The next issue with the card is the disconnect between elixir you spend and elixir you put on the board. I believe that an Elixir Golem that doesn't give elixir would cost about 5 elixir. So you get the stats of a 5 elixir card for 3 elixir, giving you an advantage of 2 elixir instantly. In the long run, you lose 2, but some of that elixir might be wasted by the opponent thanks to the sheer advantage you got and used. Then if you get a second Elixir Golem down, you are now 4 elixir up front. One of my decks for Clan Wars II is an EGolem one and this is how some of the most disgusting 3-crown wins happen. In the early days of the pro scene, often both players would ban Elixir Collector to have a sort of "Gentleman game" and not abuse the downward spiral of not being able to stop these custom elixir advantages, which is what Elixir Golem does without there even being any counterplay. Nowadays, the equivalent is that a lot of pros were upset when an Elixir Golem deck finished #1 on ladder, saying that "it doesn't count".
Actually there is a counterplay that devs kept talking about: getting elixir from the blobs.
Probably the biggest issue is how long it takes to gain some of the lead back. You first need to get through an Elixir Golem with 1196 hitpoints. Then, only after then killing an Elixir Golemite with 598 hitpoints, you can start getting elixir by killing an elixir blob with 299 hitpoints. That makes it 1993 damage you need to deal to get just the first elixir. Add 300-400 is added because of wasted damage and it's 2400... except wait, actually you need to deal 300 more damage to get to a blob because EGolem got healed by a Heal Spirit. Also, 100 more because of the Healer. And 100 more, and 100 more... Not to mention your units will probably retarget to the support or the other golemite before starting to attack the blobs, and that each split might reset the attack animation of your units.
Basically, if you use a few point attackers instead of splash, it can often take 3000+ damage, as much as a 5-elixir Giant, just to pop a single blob and start recovering from the disadvantage. This is an awful lack of counterplay on most occasions. All of the high-damage splash attackers that counter this, like Wizard and old Executioner, are/were divisive cards. Besides, with the limited number of cards that handle this, it actually adds to the RPS.
------------
With the changes, the overall hitpoints of the card are reduced from 3588 to 3168 (-12%)
Not so swarmy anymore: The number of units in Elixir Golem goes from 7 to 4, and from 3 splits to 1. The average hitpoints of a unit increase from 513 to 792 (more than 50%), reducing the wasted damage and re-targets of your defense.
You no longer get a 2 elixir lead just by playing it: This lead you get is massively reduced. In my opinion, Elixir Golem would now be worth around 4.5 elixir, reducing this effect by about 25%. Elixir Golem would be more of a cheap cycle-style tank than a powerhouse. Also, because the golem walks faster (by 33%), split pushing will only happen when the opponent is already in the middle of defending the first one and possibly has some of the ground taken back.
The opponent Actually has counterplay: While popping one blob is a little more work (19932112), there is only one re-targeting on the way. But perhaps the more important thing is the reduction of wasted damage. After the Golem pops, you can simply fireball the Elixir Blobs and get your lead back. This would massively discourage heal combos and give rise to less toxic Elixir Golem decks. Meanwhile, it would also encourage taking another look at Healer and Heal Spirit in the future.
So what will Elixir Golem be about? I don't know. Maybe beatdown-cycle hybrids? Or split pushing? After trying to imagine it, I thought it was weak, so just to "play it safe", I also buffed the melee range. The current short range looks visually weird for such a huge guy.
-----
I am disappointed that Elixir Golem has come to be this. I knew from the start its problems were deep. Frankly, not many people in the community, even the pro community, think about things this way. People make up their opinions based on how they feel in battles, which made complaints like "the blobs deal too much damage" take over general concerns about the card's design as they were easier to implement. This led us to some of the most obnoxious decks in the game. It needs to be fixed already. Please.

Freeze Rework

Cost reduced to 3 elixir
Duration -37.5% (4sec > 2.5sec)

Usage 3-5%, Win 41-52%, C+ Tier
Even though Freeze's duration was reduced from 5 to 4 seconds, it remains one of the cards that if you see in a deck, you know the deck will be toxic. The reason for this is obvious: it completely halts counterplay, freezing your units for very long.
Two years ago, Freeze was given damage while its duration at level 13 was reduced by 34%. This change made Freeze a lot more bearable, but it is still toxic. When Clash of Clans reworked their Freeze spell into a little frosty bottle, I was thrilled, thinking that Clash Royale might follow this direction. But it's been a few years and this hasn't happened.
Freeze would be way less frustrating to face if it didn't last for as long. So I'm suggesting this change. Ideally, Freeze retains a ~3% use rate, but those 1.5% of losses don't feel unfair.

Nerfs

Barbarian Barrel nerf: Barbarian deploy time increased (0.5sec > 1sec)

Usage 29-35%, Win 53-58%, S Tier
This card makes me question why devs let some cards rot for years and others shine for months. Should've been balanced before balance changes ever became quarterly.

Lava Hound nerf: Hitpoints -5% (3150 > 3000), Sight range increased (5.5 > 7.5)

Usage 7-10%, Win 55-59%, A+ Tier
Lava Hound is inarguably a very strong win condition. For a long time, it has boasted a 55%+ winrate. Also, it features a sight range inconsistency that forces buildings to be played in less convenient placements. So I'm giving Lava Hound a small nerf and fixing this frustrating inconsistency.

Hunter nerf: Bullets reduced to 9 (removed rightmost bullet)

Usage 22-28%, Win 55-59%, S Tier
Hunter has held an extraordinary winrate for many seasons, which shows there's more to him than his versatility. This suggested change is pretty big, but not as big as it looks since the rightmost bullet is the one that least often hits enemies. Switching to an odd number of bullets also happens to fix an inconsistency with Hunter's aim leaning to the right.

Electro Spirit nerf/rebalance: Chain zaps -3 (9 > 6), Damage +7.5% (84 > 91)

Currently: Use 15%, Win 56%
Electro Spirit was thought to be weak until recently, when it started boasting a massive use and winrate and got on top ladder even despite often being underleveled. These changes shift its power a little bit, and in combination should add up to a nerf.
Increased damage: It makes the ESpirit more damage-based and consistent with Ice Spirit. But mostly, it makes the card more level-dependent. Currently, it's questionable whether it should even be upgraded to max level, as doing so improves few interactions but allows for easier king tower activations when it is cycled. I believe there should be no cards where it is questionable whether upgrading is beneficial at all.
Less chaining: It counteracts the damage buff. But mostly, it makes the card more predictable. Currently, it's near-impossible to predict what the last few zaps will strike and whether they will strike at all.

Miner nerf: Underground movement speed increased, 0.5sec "burrow out" time introduced

Usage 21-28%, Win 54-58%, A+ Tier
Basically, Miner would travel faster underground, but just before he comes out of the ground, he would stop and take a moment to burrow his way out, revealing his exact tile. Overall, the travel to a princess tower would take about the same amount of time.
As I'm writing this, Miner has a 55% winrate in Wall Breakers decks, 57% in Lava Hound decks, and 54% in other decks. This kind of range has held for many months. He is all around a little too strong, besides just being used with other strong cards. I normally avoid being controversial, but this list of balance changes would be incomplete without a Miner nerf. I was still careful with the nerf I decided on, although I expect it to be controversial still
This change aims to make it possible to consistently react to Miner's exact placement tile. An issue a lot of players have with Miner is that once he is sent to a tower, it's random whether you'll predict it correctly or take several hits. Imagine if there was no indication of whether Goblin Barrels are tricky: that's what Miner is like, just with less punishment if you get it wrong. Some say this is skill-based because it asks you to read your opponent, but that's not the case when there are several equally good Miner placements and a skilled player can choose at random. The burrow time makes Miner spend 0.5sec on the tile where he is going to appear, so fast reactions at the last moment would be possible. This mostly nerfs him in competitive, where he is the most prominent.

Buffs

Goblin rebalance: Melee Range increased (0.5 > 0.8), Rulebook Initial Attack (0.2sec > 0.3sec)

Goblins: Use 1%, Win 40-50%, C- Tier
Goblin Gang: Use 7-11%, Win 40-50%, B+ Tier
Goblin Barrel: Use 7-11%, Win 40-47%, A- Tier
The new rule on initial attacks hurts goblin cards when they're already not so great. So I gave them a melee range buff, bringing them to the standard Melee Short. I'm sure most players wouldn't notice this.
It should be a very minor buff to Goblins and not much for Goblin Gang and Goblin Barrel.

Mother Witch: Changes to The Curse mechanic

The Curse does not expire
The only exceptions for The Curse are now shields and buildings.
Units with a death spawn don't turn into hogs, the death spawn units now inherit The Curse (i.e. Lava Hound's curse is transferred to the pups)
Cursed Hogs: Rulebook Initial Attack (0.25sec > 0.3sec)
Units with death damage don't get affected by The Curse when turning into hogs (bugfix)

Usage: <1%, Insufficient data for win rate data, C- Tier
Mother Witch is already designed in a way that favors attacking smaller units, so her curse doesn't need to expire when she attacks a tanky troop. Besides this, if Mother Witch's curse affected death spawns, she would become a better counterplay against a few extra units, mostly Lava Hound, Elixir Golem, and especially Skeleton Barrel.
This helps with the problem that she often feels like dead weight in decks. You would no longer necessarily lose all 10 games before facing a Graveyard.
While these changes might not be enough for Mother Witch, they finess her Curse mechanic, which would make it easier to balance her in the traditional ways in the future.

Heal Spirit rebalance: Damage +235% (27 > 91), Healing -9% (332 > 300)

Usage 1%, Win 40-47%, C Tier
Heal Spirit doesn't feel right with reduced damage. None of the spirits on the Royale arena are particularly combative, they all just want to give hugs, and Heal Spirit is no different. Even with its weak stats, its healing is still disproportionally massive. I insist that's what should be nerfed instead of its damage.

Guards buff: Damage +7.5% (90 > 97)

Usage 1%, Win 30-45%, C+ Tier
The recent rebalance of Guards wasn't much of a buff, unsurprisingly. So I gave them a much more definitive buff here. Even though it doesn't change many relevant interactions, it's quite a big increase.

Other small changes, bugfixes, and consistency

Cannon inconsistency fixed: Initial attack faster (1sec > 0.6sec).

Usage 1%, Win 25-40%, C- Tier
Changed to have the same initial attack speed as Cannon Cart, as it was supposed to 20 seasons ago. Cannon might even become viable with this change.

Tornado inconsistency fixed: Crown Tower Damage reduced to 30% of regular damage (24 > 21)

Usage 22-26%, Win 50-52%, S- Tier
Not very relevant to game balance, but it's a thing.

Royal Ghost bugfix: Now takes damage from centered melee splash before his first attack

Third bug shown here.

Symmetry tweak to 6 cards: Deployment flipped based on the lane they are played

Barbarians, Bats, Goblin Gang, Royal Hogs, Minion Horde, Royal Recruits,

Cards with 2 or 3 units in them abide by this rule. These six don't, which results in all sorts of inconsistent interactions

Note 1: For considering tiers, I took each vote as S=4, A=3, B=2, C=1, F=0; for M being the mean of all votes, I used the floor function of (M-0.5)x13/3 to decide how many tiers above F the card was, with negative being F- (only Mirror) and more than 12 being S+ (only Knight)
Note 2: This is a repost. Hello, brigadiers who sort by New and like to downvote right away!

I want to get better at Ana. I've always loved playing her but find I die/get killed way too easily with her, and I have around 700 hours on mercy which has made me accustomed to a really mobile playstyle.
I play in low plat at the moment for anyone curious for context.
Is it better to use nade off-cooldown or hold it to wait for certain moments, such as multiple critical teammates, enemy team grouped together and no defense matrix or shield, or things like grav or shatter? I've actually asked this question on Ana Mains, but want to see what other people's opinions are from their experience. I'm curious what the census is and how people have managed to maximize value out of nade.
When you're using a nook/wall for cover and your team walks out of line of sight, particularly your shield tank, do you leave your cover to heal them even if it exposes you to the enemy? Or do you stay put and call out LOS? I ask this because I have high deaths per ten on Ana and find it hard to balance cover and being a valuable resource for the team.
Are there any tips/techs/tricks for consistently landing sleep dart?
You've been pushed off high ground by a flanker or have fallen to help a teammate in dire need. Now what do you do? Do you take the time to find a route back to the high ground even though another fight could break out while you're doing so? (I'm so used to accessing high ground really easily... Repositioning Ana feels so slow it's almost a chore)
Thanks in advance, I look forward to hearing what you have to say!
Edit: thanks to everyone who responded and I'm glad this sparked discussion!
Some things I learned:

while the nade debate is purely situational, the census seems to be save nade for high value/high impact moments and self defense if the enemy team have flanky characters
shooting sleep dart near the feet seems to be the most consistent way to land it (along with just picking easy targets). I genuinely didn't have a clue that there was a wider hit box near the feet.
high ground is valuable but if it needs to be given up, it's best to wait for a lull before finding a route back up to high ground

My bar is a shabby little thing. Not only does it naturally attract the weirdest patrons, it also never fails to surprise with just how dilapidated it is. One time, I nearly sprained my ankle tripping over a loose floorboard. The backroom people and I try to fix the place all the time, but it's like new issues pop up everywhere. We repair a lamp in one of the bathrooms and next thing you know, another one goes dark; kinda like that. It wouldn't surprise me if the building was cursed or something.
There's upsides to it as well though. Sometimes, we find cool stuff while cleaning. Change for example, or in this particular case a shiny, thin silver necklace with a crystal pendant. Andrik found it while sweeping the floors. May's excited squeals were what alerted me to it.
"Oh my God, it's so pretty!"
"Weird. Since when do our patrons have jewelry on them?" Bo chimed in. He rarely says anything, so I remember being surprised at that.
"Andrik…" May began, drawing out the name in a saccharine voice. "Can I have it?"
"Sorry, all items found in the bar are at the disposal of our dear lord… I mean lady." He handed me the necklace and I held it up, considering it.
"Well, someone probably lost it. We'll keep it here and see if they come back for it," I decided.
"And what if they don't?" May inquired, a hopeful look in her eyes.
"If that happens… then I'm gonna start wearing it," I said, smiling as her face fell. "I totally would let you have it, but I just don't like people who put up trip wires for me to fall over." May had pulled that actual stunt just a week prior and I'd almost broken my neck.
"And that's why you don't bite the hand that feeds," Andrik told her in a hushed voice, though I'm sure he fully intended for me to hear. I know it's not good holding grudges but it was extremely satisfying. The backroom people love playing pranks. I'm used to it and Andrik isn't as much of a saint as he makes himself out to be–he once emptied an entire bag of potato chips over my head–but May's ones have always been a little more aggressive. A week went by as we waited for someone to return for the necklace. Then another. I eventually gave in to the desire to declare this sparkly thing my own and simply put it on one day.
"Suits you," Andrik said curtly and with that, the matter was off the table. We all just collectively forgot about where it had come from.
That was until I came into the bar one morning to find that all the chairs and stools had been stacked up in the middle of the room, one large, sturdy pile of furniture that kind of looked like a jungle gym built by someone who hates kids. I already mentioned my employees like to play pranks on me, but when I had ordered them to return to the backroom the night prior, the chairs had all been in place. As far as I knew, none of the four could leave until I'd wake them up again, so this couldn't have been one of their practical jokes. I rounded the enormous stack, examining it only to find nothing hinting at its creator.
"Andrik?" I called out. "Are you guys up yet?"
No response. They were still resting, apparently. I stepped up to the door behind the counter, pulled it open and turned on the lights. "Spirits of this house, get up already." I watched as the four of them crawled out from the wall. Just between us; sometimes, I make bets with myself about who will be out first. That time, it was Danika. She stretched her arms and waved at me before walking up the stairs, closely followed by the rest of them.
"That's new," Danika said when laying eyes on the pile of furniture.
"Did you do this?" I asked them.
"Why would we do that? You'd just make us put everything back," Andrik replied.
I shrugged. He made a good point. It was still fairly unsettling seeing as if it had not been them, someone else must have gained access to the bar overnight. We tidied up everything and Andrik told me not to worry.
"Weird things happen here all the time," he explained. "Always have. It's probably nothing."
"If you say so."
That was only the first of many incidents though. That same night, the bar was pretty full for once and we were watching a game on that small flatscreen TV above the counter. I'm not a sports person, but since a lot of the patrons seemed to be paying attention to it, I got sucked in myself a bit. That was until the screen began to flicker and suddenly went out. I could hear disappointed groans coming from several tables and some guy shouted to make it come back on.
Andrik shot me a confused look as he reached for the remote. Either of us knew how odd this was. The TV was the one thing about this bar that had never failed us before. I watched as he pressed a few random buttons, then tried to turn it on and off again, but it didn't react. He groaned and swung himself up on the counter with surprising agility, beginning to fumble around with the back of the TV. I don't know what he did exactly but eventually, it did come back on, transmitting the cheerful sounds of the game. "There," Andrik muttered as he climbed back down. I sighed and got ready to clean the counter where he'd stood, when suddenly, the loud noise of static cut through the air.
I hurriedly glanced up at the TV again just in time to see a face staring down at me. I couldn't see much of it, just two large gray eyes. The rest was obscured by a thin white bedsheet the person had wrapped around their head and shoulders. Just a second later, the game was back on. I turned around to face the patrons. "Did any of you see that just now?"
Some nodded and waved me off like it was no big deal while others didn't react at all. Andrik looked at me with his brows raised. I just shook my head. I decided I would probably have to stop jumping at every small thing happening here. If I'd end up only being nervous all the time, the people here would lose whatever little respect they hopefully had for me. As the days progressed however, these things kept happening and they got more and more extreme.
I would find the tables turned over when coming in in the mornings. One time, five of the old bottles we kept behind the counter had been smashed, putting to waste some of our higher quality drinks and Lord knows we don't have much of those. Our electricity would keep having these little dropouts and while those never lasted, they would occur often enough to annoy everyone. Worse yet, I kept seeing that face. Everytime I turned on the TV or sometimes even my phone, the image of those large eyes framed by the same white blanket would flash up on it for only a split second.
Then one night, Bo came up to me while I was standing behind the counter. "Hey, we've got someone sneaking around outside, I think."
I looked up at him in surprise. "What do you mean?"
"I keep hearing footsteps and the trash can behind the wall has fallen over twice now. I've picked it up both times. I also saw a person creep around there, a really short one dressed in something white. If you want me to go follow them, I could, but I'd have to leave the door unwatched."
I felt a shiver run down my spine at his words. "Please check up on it. I'll keep an eye out for the door while you're gone."
"Got it." Bo gave me a nod before disappearing outside.
I quickly bent down to grab my uncle's box of letters from where I'd stashed it away behind the counter. I had admittedly been a little lazy with my reading; I had only gone through about two more at that point and neither of them contained any advice on what to do when you'd have stuff like this happening. I hurried to grab and scan a few random letters for information, only to find nothing. Upon realizing that if the bar spirits didn't know what was going on, Uncle Mack probably wouldn't have written about it either, I gave up and instead walked up to the door.
I stayed there for a while, but I didn't make for a very good bouncer, especially compared to Bo. A look at my watch told me I'd been waiting for ten minutes already. I was starting to get concerned. Bo literally should have been back by then. Eventually, I cleared my throat and called out his name in a shaky voice. No response, except a strange noise coming from somewhere to the side of the building. There's a very tight little alley between the bar and the house it borders on to its right. It's a dead end and it's where the trash can Bo had mentioned was located. I figured maybe he'd gotten stuck there somehow and needed help. It was hard to imagine anything happening to him considering his enormous stature, but it wasn't impossible.
I went behind the counter and grabbed one of our large cutting knives, concealing it inside my handbag before waving Andrik over and letting him in on what was going on. I told him if I wouldn't be back in twenty minutes, he needed to call the police but refrain from going outside himself. Thankfully, there were only three people inside the bar at the time, and they were all huddled up in one corner focused on a game of cards. At least they wouldn't notice something was up.
I walked outside, the cold air hitting me like a splash of water. This didn't feel right. I tried to keep my steps as quiet as possible. Every time one of my heels met with the cobblestones below, I felt myself wince and the hair on my neck stand up. I had already buried my hand in my purse, clutching the handle of the knife. I rounded the corner and looked down the alleyway. What I saw made me freeze. Bo stood at the very end of it, right in front of the wall. He didn't move or speak, but he had visibly tensed up, staring only at the figure kneeling on the ground a little bit ahead of him.
There, next to the overthrown trash can, sat a young girl. She was wrapped from head to toe in a large, white bed sheet, veiling her in a way that left only her head and bare feet sticking out. She was holding the blanket in place with one hand while rummaging through the trash that had spilled out from the small container with the other.
My eyes remained glued to her for ten seconds which felt like an eternity before Bo suddenly made a surprised noise. I looked up only to find that he had noticed me. His eyes darted between the child on the ground and myself, and he almost seemed to mouth for me to get lost. The girl raised her head. Turning to Bo, she said in a very quiet voice, "Didn't I tell you to stay still?"
He immediately froze up again and she lowered her head, once again focusing on going through the trash. Bo silently raised a finger to his lips. I nodded. She hadn't seen me yet. I didn't know why he was so afraid of her, but I could tell something about her was very wrong. It was not just her blanket, or the fact that she was outside without any shoes this time of the year, it was how she felt. When you have a person standing beside you, you can sometimes feel their warmth and you can see life in their eyes. It's an odd thing to say and I can't properly describe it, but you're simply aware of their presence, one way or another. This little girl did not feel real. It was like I was looking at something I wasn't supposed to see. It was this alien sense of unease that caused my stomach to churn.
Bo slowly took a cautious step towards me, placing the soft soles of his shoes as lightly on the ground as he could. It looked almost like he was trying to cross a river by balancing his way over an old, wobbly bridge. When he finally reached me, he grabbed me by the wrist and began tugging me back towards the bar's entrance. That very second, the girl's head jerked around and she stared at us with wide gray eyes.
"Who are you?" she asked, her high-pitched voice shrill and aggressive. She rose to her feet, pulling the blanket tighter around her shoulders, as she slowly took a step towards us. Before I could answer, her eyes narrowed and she let out an ear-piercing screech. She lunged at me, throwing me to the ground with a strength I would have never expected from her. I screamed with pain as she pushed my head against the stone ground and for a second or two, everything went black. I could hear Bo growling as he tried to pull her off me, only to be shoved away. The girl forcefully turned me over, throwing herself onto my back and starting to scratch the back of my neck.
"Get off!" I whined. "What are you doing?"
Suddenly, I heard a tiny clinking sound and felt something scrape my throat. That's when I remembered the necklace. She had been trying to take it off. Now that she finally had it, she crawled off me. I groaned, slowly turning around to look up at her. She was sitting on the ground beside me, staring at the shiny necklace in her tiny pale hand. She was incredibly calm all of a sudden.
"Thank God… I've been looking for it everywhere," she muttered, talking more to herself than me or Bo. "If Mom found out I'd taken it out to play… if she found out I'd lost it, she would have been so angry." She slowly raised her head and looked down at me, something akin to a smile on her face. "Mom loves her jewelry. She hates when I touch it." With that she got up and, necklace in hand, jogged over to the end of the alley. She was heading right towards the wall and just as she should have been about to run into it, she disappeared. She didn't fade out or anything, but one second she was there and the next she was gone.
I stared after her with my neck craned for a good two seconds before starting my first fruitless attempt to get up. My whole body was aching and I let out a small whimper. Bo rushed to my side and shoved his arm beneath my shoulders to pull me up, but he was rough and my sides flared up with pain. He apologized and ran back inside the bar, returning with Andrik at his side. I chuckled as I looked up at the two of them, tears of pain in my eyes yet at the same time weirdly amused by the sheer absurdity of my situation.
"What happened?" Andrik asked softly, leaning down to help me get to my feet.
"Ask Bo later," I muttered, whining as he propped me up.
"Didn't you have a necklace on you?"
"Wasn't mine. Gave it back."
The two of them half-lead, half-carried me inside The New Saloon. I contemplated going to the hospital, but then again, nothing was broken and as far as I could tell, it was just bruises. We closed down early for the night and I sat down in one of the cozier corner booths. I didn't get up until morning. I really did end up spending the night in my shabby little bar, my head resting on a table the backroom people had thankfully cleaned for me. It was nice having them all be polite at the same time for once. I didn't sleep the entire night though.
I asked Danika to bring me a pen and paper and then told them they could go into the backroom and rest if they wanted to. To my surprise, some of them stuck around though. Bo went straight downstairs while May stuck around to watch TV. I had brought a couple books with me and Danika had borrowed one on small businesses which she was reading a lot more diligently than I ever had. Andrik had sat down on the cushioned bench with me and was watching me ponder over my pen and paper.
"What do you want to write?"
"Since none of you knew about the little girl with the blanket, I've been thinking the letters Uncle Mack left me might need some additions."
Andrik laughed. "You haven't even finished reading them."
"True. But I hope whoever gets the bar after me will be more up to the task. And since you're here already, you should help me out. You knew about doppelgängers, so what do you think about this?"
So now, there is a letter from me somewhere in that box among those that Uncle Mack left me. I won't transcribe it exactly since I just wrote down the better part of everything I know above, but here's what I added with Andrik's help:
"It's possible she's a poltergeist, however she apparently isn't bound to any person in particular and has no trouble showing herself in the same form for an extended period of time. Poltergeists are said to be more likely to haunt a person than a location, which we're not sure is the case with her. She seems to have detailed memories of a past life, mentioning her mother as the reason why she was after the necklace. We don't know how exactly that got into the bar by the way but in the end, we're glad to be rid of it. So if you find any piece of jewelry in the bar that looks like it doesn't belong, just stash it away somewhere the girl can easily find it. Please don't make it hard on her. She seems really confused."
It wouldn't be the last time we'd meet her though.
X
Part 1: The employees sleep in the backroom
Part 2: The regular who had a doppelgänger

On January 28th Robinhood disabled all transactions except for position-closing (selling) for a small set of stocks including Gamestop (GME). This was a new and exciting development in the ongoing saga of how a subreddit called Wallstreetbets (WSB) memed their way into contributing to a short squeeze and profiting from it (or at least the early adopters are likely to profit from it). Freezing stock purchases also generated significant outrage, quickly turning into a narrative of how Big Wallstreet will cheat to avoid losing money to the average Joe. This narrative is simple, appealing, and probably wrong, and the following is an attempt to explain why.
I'm not going to go over the full history here. Others have already done that with plenty of background information. If you want to read the full saga (not necessary to understand the rest of this post, but it is interesting) then check out these links:
The obligatory Vox explainer. A background piece with an interesting explanation of how WSB could profit from this without many of them losing a bunch of money if they can coordinate effectively. A Wallstreetbets thread on GME if you've never visited the subreddit and want to immerse yourself in the full experience of crass GME memes and takes by people who have fully embraced the early 2000's non-PC habit of using intellectual disabilities and sexual orientation as insults.
Anyway, check out those links if you want, or don't, how we got to where we are isn't all that important for explaining why Robinhood shut down certain trades on January 28th.
Disclaimer: I am not an expert on any of this. There's a good chance I've made mistakes in the following explanation. I'm just a guy who wasn't satisfied by the simple narrative and stayed up 4 hours past his bedtime on Thursday night and spent most of his free time since trying to better understand this stuff and writing it up to share what I've learned. If you see anything that you know to be wrong please comment with correct information!
What differentiates this post: There have already been a few other good posts (see links below) on why Robinhood shutting down transactions was not some corrupt conspiracy. But this post is a post for masochists who want to know what's going on in more detail and who want to dig into the technical background and data. If that's you, read on!
Links to other good posts: https://www.reddit.com/neoliberal/comments/l7bo3the_game_stop_situation_is_not_a_conspiracy_an/ https://www.reddit.com/neoliberal/comments/l7bdcv/what_actually_happened_today_hint_there_probably/ https://www.reddit.com/neoliberal/comments/l81tif/why_did_robinhood_stop_allowing_their_customers/ https://www.reddit.com/badeconomics/comments/l7gi70/financial_econ_101_or_link_this_in_bad_reddit/

How a Stock Market Transaction Works

To really understand why the popular narrative about Robinhood is likely to be wrong, we need to better understand how a stock market transaction works. When you buy a stock, you fork over your money and receive in return shares of a stock. The company that provides the user interface or the human that you call up to arrange this transaction is called a broker. That's what Robinhood is. You tell your broker you want to buy X shares of stock Y, you give them the money and they arrange for those shares to be purchased and documented as being owned by you.
But if you're going through Robinhood, and the person that is selling you the shares goes through TD Ameritrade (another broker), Robinhood and TD Ameritrade don't actually talk to each other to complete the transaction. A number of intermediaries may be involved and this can be crazy complicated. Here is a brief explanation of some of the key players:
Broker: The broker interacts with traders. Brokers show traders what the current prices are, takes orders, and handles the traders’ money.
Clearing BrokeEntity/House: These entities handle the logistics of the trade. When a broker interacts with a trader they are basically a conduit for alerting the broader market that someone wants to make a trade of X stock at Y price. The clearing entity is in charge of organizing and documenting things, basically making sure that each side of the transaction transmits the appropriate funds and documenting everything as to who now owns what. Often brokers and clearing entities are combined. Robinhood was originally just a broker (they refer to that as being an "introducing broker") but has since expanded to also do clearing.
Market Maker: A market maker is an entity that has an inventory of certain shares and sells and buys those shares. The purpose of a market maker is to add liquidity. Instead of trying to connect one trader who wants to buy a stock with another trader who wants to sell that stock, brokers can just go to a market maker who they know is holding a stock. The market maker might sell a stock, depleting some of its supply, and then the next instant buy more of that stock to replenish its supply. It's basically a vehicle for faster transactions, and it makes its money by skimming a bit off the bid-ask spread. In other words, it might list a stock for sale at $100, and also list that it's willing to purchase a stock for $99.95. The 5 cent spread on each stock traded goes to the market maker. The reason spreads remain small is people would rather go through the market maker that skims the least off the top. Yay competition!
Exchange: This is like the NASDAQ. The NASDAQ acts as a kind of system enabling the exchange of information and making trades more efficient. This one is confusing to me, but it sounds like an exchange like the NASDAQ brings together market makers and I assume offers them some kind of service and features that makes trading easier. However, it also sounds like market makers don't necessarily have to go through an exchange and can operate without an exchange.
Before we get to the last piece I'll talk about here, keep in mind that all of the above becomes horribly mangled and complicated in reality, because from what I can tell just about any of these entities above can all be under one roof, or subsidiaries of other companies, or any number of different arrangements. The stock market is complicated! This should be your first warning when people try to push simple narratives. Extremely complicated stuff often doesn't fit within a simple story where there are heroes and villains and everyone is out to get the little guy.
The NSCC: NSCC stands for National Securities Clearing Corporation. It is a subsidiary of the DTCC, which stands for the Depository Trust and Clearing Organization. The DTCC is a private company. Each day billions and billions of trades happen. Instead of swapping equities back and forth and all over the place for every single transaction, the NSCC tracks all of these trades, sums them up and at the end of the day says "Company X, you owe company Y $1 billion, company Y, you owe Company X this many shares of each of these securities." The NSCC also handles these transactions, so the money being exchanged by these companies flows through the NSCC. And it does that for every company trading on the stock market. They all go through the NSCC, and the NSCC minimizes the amount of times money and equities have to change hands. There is one private company in the US that tracks and manages all of the trading information to make sure everyone gets paid, everyone gets their shares, and everything happens at the right price. I'm sure the details are complex but I assume brokers that are also clearing entities would be told by the NSCC how much they owe the market makers they exchanged with each day, and vice-versa.
It kind of blew my mind that there's essentially just one main company out there that serves as the central hub of all stock transactions and makes sure the markets work. As you can imagine, resting the entire stock market on one company means that company is going to be heavily regulated to be sure that it can never fail and bring the whole market down with it. We'll get into what regulations are at play soon, but the NSCC is likely the key component in the Robinhood trading freeze.

Claims of Corruption

Okay so we're going to take a brief detour into the reason people are outraged that Robinhood shut down trading. As broken out in this Twitter thread there once was a trader named Gabe Plotkin, he worked at a company called SAC Capital but they got fined for insider trading (not sure how this is relevant to the story other than to get your mind to make the association Plotkin = shady) and he left to start his own company. His new company was called Melvin Capital.
Plotkin's new company did a bunch of shorting, including on Gamestop. His shorts blew up this week with all the Wallstreetbets stuff, putting his firm in bankruptcy danger. But then Melvin got a $3 billion investment from SAC founder Steve Cohen and a Citadel hedge fund manager named Ken Griffin (the tweet thread says bailed out, apparently insinuating that these guys bought a stake in Plotkin's struggling company just to personally help him out, but make of that what you will). Citadel is a market maker. Robinhood uses Citadel as one of its market makers, and Citadel pays Robinhood fees for the trades Robinhood brings them. So Citadel pays Robinhood, Citadel recently bought Melvin capital, which had (and might still have?) a large short position on GME. Therefore the theory is that Citadel stands to lose a lot of money if the short squeeze continues, and since Robinhood gets fees from Citadel there's a big conflict of interest there, the implication being that Robinhood might have restricted purchases of GME in order to drive the price down and prevent Citadel from losing a lot of money via its recent purchase of Melvin.
I didn't fact check any of the above, I'm just presenting the information as I understand it for your knowledge. Make of it what you will, but that's the reason for the outrage. I assume many of the people outraged about it don't even know those details and just think that Robinhood is a big investing company so is probably just trying to save Wallstreet a bunch of money by shutting down trading and stamping out WSB's big short squeeze.
Also, I want to make it clear that this post isn't saying we should completely dismiss the possibility of corruption. It should be fully investigated to make sure nothing shady is happening behind the scenes. The point of this post is that this theory seems a little half-baked, and that there’s a much better theory available.

NSCC Collateral

Back to the NSCC and why it's the key component of all of this. The fate of the US financial market basically rests on its shoulders. So how do we make sure it never goes under? Lots of regulation. The NSCC is required by law to collect a bunch of collateral from the companies it facilitates trades for. That way if the market were to collapse and take down a few of the big market makers or brokers, any outstanding transactions don't completely bring down the NSCC with it, they have some collateral to offset those losses. (Side note: I believe the NSCC also has a means of getting a direct government money infusion in the event of a market collapse so that it can stay afloat and keep processing trades. I don't know the details of this, just wanted to mention it so people rest easier knowing that the sole private company keeping the market afloat isn't only relying on collateral).
You might wonder how much risk there really is for the NSCC. Don't these transactions happen instantaneously through the magic of computers and the internet? Sort of, but not really. While trades execute immediately, they don't actually settle for another two days. This is known as T+2 (In the days of physical stock certificates and paper money it used to take 5 days, or T+5, but computers and internet have sped up the process.). If you buy a stock, you don't officially become the owner until two days later once the NSCC settles the transaction.
Many brokers show the money in your account immediately after a sale, but you may have noticed or heard about delays in making multiple trades, such as not being able to sell a stock, use the proceeds to buy another, and then sell that one. Brokers often allow you to make a trade using unsettled funds for stocks, but they don't let you stack up a bunch of transactions, they require you to wait for settlement to actually occur so that everything is official and so you do a bunch of stuff with money that isn’t really yours yet.
Because these large payments between entities flow through the NSCC it creates a lot of risk for the NSCC. If there were to be a market crash or a sudden bankruptcy of a large trading firm, the NSCC would be exposed to the risk of a collapsed firm missing its payments for trades that have been executed but just not settled yet due to that two day period. I don't know the exact details of how this works, but essentially it sounds like the NSCC would be on the hook for those payments and still have to complete the transaction and pay the firm that the money was supposed to go to. That's why the government requires that companies post collateral each day with the NSCC based on factors like amount of money owed, volatility, and shifts in market price.
After the financial crisis a lot of scrutiny came upon the financial system and Dodd-Frank was passed, which created more oversight and regulation for the financial industry. As part of that, the NSCC was designated as one of eight Systemically Important Financial Market Utilities (SIMFUs) and was required to work under the oversight of the Federal Reserve and the SEC to establish requirements to ensure that it couldn't collapse, such as requiring collateral. The SIMFU designation was something I had no idea existed, so I just wanted to mention that and link to the wikipedia page on it in case anyone else was interested.

Calculating Collateral

The latest rules that the NSCC has created and SEC has approved (under procedure XV here) set forth certain measures to use in calculating how much collateral has to be posted by each firm settling trades with the NSCC. As far as I can tell and based on the original Twitter thread I found this information in (see the end of the post for the credit and link) the collateral is a portion of the outstanding money owed by a firm at the end of the day. For example, if after summing everything up the NSCC determines that Robinhood owes $1 billion to other firms and will receive $0.5 billion from other firms, the collateral will be a portion of the net $0.5 billion they owe. Here's a brief summary of the estimates and steps that go into finding the required collateral, more details on each of these will follow:
1.) Take the highest of two different measures of value-at-risk. Value-at-risk is a measure of how much money you could lose in a certain time period. According to the NSCC proposed rules to the SEC this usually comprises the largest part of the collateral. PDF download of proposed rules is here. 2.) If a single position or stock makes up more than 30 percent of the entire balance owed, the collateral must be a percentage of that balance based on certain historical data, with a minimum of 10% of the size of that position. 3.) A percentage of the difference between the long and short positions in the balance plus the lower balance of the long and short positions multiplied by an even smaller percentage. 4.) The mark-to-market value, which is basically the difference between the initial value of the shares when the trades were executed and any change in market value since then. So if on the first day Robinhood owed $500 billion to the NSCC to be paid out to other companies, but the next day (T+1) the market value of those shares increased by $10 billion my understanding is that Robinhood would have to add $10 billion to their collateral. 5.) Any additional collateral the NSCC demands based on volatility of certain positions. I’m just speculating on this but this seems to be an increase the NSCC can apply if it assesses that there’s widespread exposure to volatility. In other words, the previous four collateral calculations are based on risk exposure from a single firm, but NSCC also would want to look at risk from all of the firms that owe money to the NSCC. Don’t take that as gospel though, the source documents are hard to follow.
The total required value of the collateral is the max of item #1 through #3, plus #4 and #5. So #1 through #3 aren't additive, you just take the worst of them. And there are more than this too, but these are the main five we'll go over now because that's enough complexity and these seem to be the big factors. The others have to do with things like previously unpaid balances, and the ones I have listed here seem to be the biggest factors in calculating required collateral.
To make this less vague I want to give an idea of how these numbers might change as share volatility increases. We'll start with value-at-risk. The value-at-risk essentially looks at the historical volatility and estimates how much you're at risk of losing in a single period. For the purposes of what we're looking at the period is one day. The idea is you normalize the data from a certain time period of daily changes in portfolio price, and then using a normal distribution you see what the 99th percent confidence interval of maximum loss would be. Say Robinhood has a balance owed with the NSCC of $500 billion, they might come up with a number like $50 million, which would mean in a single day they could be around 99% confident that their balance owed wouldn't end up increasing or decreasing by more than $50 million.
But those are fake numbers, so let's estimate some real ones. There are two measures in their rules they use for estimating this. One measure is an evenly weighted volatility function over a period of at least 253 days. That means they look back over the last 253 days or longer and the change in price each day is equally weighted when estimating the mean and standard deviation. The other measure is called an exponentially weighted moving average (EMWA), where they look back a certain number of days but each subsequent day into the past is weighted a little bit less, so that more recent days receive the most weight in your volatility estimate.
Now I want to be clear before I start describing the process that my statistics knowledge is weak, so be aware that I’m following explanations I found online for how to do these things. If anyone notices an error in what I’m doing or in my terminology please correct me. If your stats knowledge is also weak just be aware that this is a case of the blind leading the blind, so don’t assume I know what I’m doing!
My strategy for the value-at-risk was to estimate the value-at-risk of a single share of GME and use that as the basis for estimating the value-at-risk to Robinhood and across the stock market. To estimate these values I downloaded the last 5 years of GME data and ran numbers on the share price at daily close. First I calculated the daily return and applied the natural log to each return. From what I’ve read this is common in the finance world and has some benefits, and it’s generally assumed that the resulting returns are normally distributed. From there for the equivalently weighed method I took the standard deviation on a rolling basis over the past 253 days. According to the NSCC submittal to the SEC, they use a 99% confidence interval to estimate the largest amount that the share price could drop or rise in a single day, based on the data in the historical sample. Or in other words they’re trying to estimate a single-day drop or increase in value that only has a 1% chance of being exceeded.
Once you have the standard deviation you use the assumed normal distribution to find the value-at-risk. The Z score represents the number of standard deviations to the left and right of the mean that results in your confidence interval. As shown in the image below, for a 99% confidence interval the Z score is 1.96. For 99% the Z score is 2.576.
Normal Distribution Showing Z Scores for 95% Confidence Interval
Computing the value-at-risk for the EMWA is a little more complicated. Instead of describing it here follow this link if you want an explanation. But at the end of the day you’re still computing the standard deviation and multiplying it by the Z score, you just compute your standard deviation so that each previous day is weighted as X% of the day after it. I assumed 95% as the decay factor based on the linked article. So today is weighted at 5%, the previous day is 5%*0.95 = 4.75%, the day before that would be 4.51%, and so on.
Below is a plot of results showing the value-at-risk as a percent of the GME share price each day and the GME share price. As you can see, the EMWA generally sticks close to the equivalently weighted method, but fluctuates around it. That fluctuation is because the EMWA is going to be weighing recent price movements a lot higher. So we can see that it makes sense to use the worst case of the EMWA and equivalently weighted value-at-risk, since the EMWA captures recent highs and lows in volatility while the equivalently weighted measures your longer term volatility.
GME Value at Risk as Percent of Share Price Since 2018
You can also see from the chart that what’s happened recently with GME is pretty crazy. The EMWA value-at-risk is close to 80% of the share price! That means if the share price were $100, the 99% confidence interval means it could drop or increase as much as $80 in one day. Previously the EMWA measure had peaked closer to 30% in the last few years, so we’re in pretty uncharted territory for this stock. Below is the same chart but focused on after October 2020 so we can see the recent movement better. As you can see, the equivalently weighted value-at-risk is at about 30%.
GME Value at Risk as Percent of Share Price Since October 2020
That just tells us the value-at-risk for one share. To estimate value at risk for the whole stock market I took the percent value-at-risk times the share price times the volume traded. You can see the result in the image below. I had to show the vertical axes in log-scale because the recent change is just massive. Assuming my method isn’t completely wrong, the stock market as a whole had a value-at-risk peaking at $23 billion on January 27th in just GME stock. That’s some pretty huge volatility.
Dollar Value at Risk for Single and All Shares of GME Since 2018
Here's the same chart but figured on October 2020 onward.
Dollar Value at Risk for Single and All Shares of GME Since October 2020
Robinhood’s value-at-risk is going to be less than that. Their value-at-risk from GME is going to be based on how many shares their users bought and the net Robinhood owed money on each day. So the dollar total for them is going to be quite a bit less than $23 billion. This is difficult to estimate, since from what I can tell brokers don’t really publish their daily volume in each stock. As a back-of-the-envelope, very very rough guess, I’ll start with just roughly assuming 1% of the trades of GME were through Robinhood, and 75% of that was purchases of GME and 25% was selling GME. Doing the math on that would mean that on January 27th Robinhood would be estimated to have $115 million in value-at-risk from just GME alone.
As a second method of estimating I’ll look at what data we do have from Robinhood. In June Robinhood said they had 4.3 million daily average revenue trades (DARTs). That doesn’t really tell us a lot though, because it looks to me like that’s just trades and doesn’t indicate how many shares were traded. That means it’s time to make more arbitrary assumptions! First I’ll assume that average remained the same during the recent craze. I’ll just guess that since Robinhood is billed as for the little guy that the average is 5 shares per trade. And I’ll also assume that in recent days at the height of the craziness that GME accounted for 10% of the trades on Robinhood, and 75% of those were buys. Reasonable? I have no idea, but hopefully. On January 27th the single-share value-at-risk for GME was $250. And total GME shares traded was 93 million. Based on the assumptions, I’m coming up with 2.15 million trades of GME from Robinhood, and a total of $268 million at risk for Robinhood.
So with those two guess-timates it looks like on the worst day, January 27th, the value-at-risk for Robinhood for GME alone could have ranged from somewhere around $100 million to maybe as high as $300 million. And that’s just for GME. The NSCC requires Robinhood to account for value-at-risk of its entire portfolio, all stock purchases net of sales. So the value-at-risk is likely to be even higher than what I’m showing here.
As a final sanity check on this, the NSCC had about $10 billion in its clearing funds as of September 30th, 2020 and about $15 billion as of June 30, 2020. According to our chart, in September and June of 2020 the total value of GME at risk across the entire stock market was about $10 million dollars, or about 0.1 percent of the clearing funds. According to this article, on January 28th the NSCC clearing fund value jumped from $26 billion to $33.5 billion. I’m estimating that GME itself might have accounted for $10 or $20 billion of that. Based on that I’m guessing my estimate of GME’s contribution is probably on the high side. There are other volatile stocks out there besides GME, so for it to be making up over half of the clearing funds seems a bit extreme. That said, we’re at least somewhat in the ballpark, since the clearing fund went from $10-$15 billion in summer and fall to about $25-$30 billion now, so it does seem that GME and other volatile stocks are pushing up the clearing fund by quite a bit.
Bringing that back to our list, what I’ve estimated is that the NSCC might be requiring in the ballpark of $100 to $300 million from Robinhood as collateral for item #1. The rest of the list items I’m not going as in-depth on. For item #2, we have to estimate what the collateral would be if GME was more than 30% of Robinhood’s outstanding portfolio at the end of the day. Let’s say they hit exactly 30%, what would that look like? Let’s use our previous ballpark estimate of 4.35 million trades per day at 5 shares per trade. We’ll also assume GME is around the average price for a stock so we don’t have to weight for stock price. And finally we’ll say GME is at about $300 in share price. Doing that I come up with 6.5 million shares of GME purchased by Robinhood on net, with 10% of that value being $196 million.
I’m going to skip over item #3, I don’t have a good way to estimate that and they don’t define the percentages. We'll just hope items #1 and #2 are larger, which seems like a reasonable assumption.
Where we’re at so far is that we need to take the max of items #1-3. Item #1 was $100 to $300 million, item #2 was $196 million. So we’re still in that $100 to $300 million range.
Item #4 is the mark-to-market adjustment. If we were to stick with our item #2 estimate of 6.5 million shares traded in a day, and pick $100 as how much the stock price jumped in a day (not too far off what it’s been doing recently), then we’d be looking at adding on an additional $650 million in collateral. That’s pretty massive, but also we’re basing that number on the item #2 estimate which assumed that 30% of Robinhood’s trading was GME, which may not be accurate. So the mark-to-market estimate could be a lot lower than that.
Finally, item #5 encompasses several add-ons that NSCC seems to be allowed to demand, which I’m assuming are based on overall risk from all of the entities that owe them money. The rules document I linked previously allows them to require a “special charge” in the event of volatility or liquidity issues, and they can also add something called a market liquidity adjustment which again seems based on volatility and risk.
So where we’re at after all of this is potentially somewhere between $100 million and $950 million in collateral, plus whatever extra the NSCC can demand based on item #5. Likely somewhere toward the middle or higher end of that range, or more. Again, I want to make it clear that I have no idea what I’m talking about and am just trying to get a ballpark estimate. I may be making mistakes. Overall I’m just trying to give an idea of what factors are in play and hopefully give an idea of how much the recent volatility can affect the required collateral.
But honestly this rough estimate doesn’t seem too far off. According to Robinhood their collateral requirement increased 10-fold due to the recent weeks’ events, which they describe in this short (and much too late to stem the outrage) article summarizing why they halted trading on some stocks. And according to this article Robinhood had to draw on up to $1.5 billion in credit to be able to get trading going again. So we’re definitely talking about a huge amount of collateral, and that makes it sound like what I’ve estimated here isn’t that far off all things considered. One important thing to note is that NSCC only handles regular trades from my understanding. There’s another clearing firm called Options Clearing Corporation (OCC) that's used for options. Robinhood likely had additional collateral commitments at OCC for options purchases in addition to what NSCC was requiring on regular GME share purchases. The OCC collateral might be large as well, and it’s possible I could be overestimating the NSCC collateral requirement and that the OCC collateral was more significant.
I did all of my value-at-risk calculations and plotting in this google sheet, feel free to check it out. If you see any errors please let me know.

Where That Leaves Us

Robinhood had to put up a ton of cash as collateral. Just a huge amount. And they weren’t the only ones that had to pause trading due to collateral issues. E-trade, Webull, and several others also restricted trading. And the estimates I’ve provided here, if accurate, serve to quantify to some extent just how large the collateral required is. The alternate theories implying corruption or foul play seem unsupported and implausible when you actually dig in and see what happened with volatility and collateral requirements last week. Again, this should probably all be investigated to make sure there wasn’t any favoritism or alternative motives in the trading halt and increased collateral requirements, but based on all this information it seems that what happened was an unusual but completely legal and ethical situation.
I started looking into this knowing nothing at all about what actually happens when you purchase a stock and now I feel like I have an okay grasp on it. If you read this far I hope it helped you as well.
As a final thought, it worries me how quickly people will jump to assuming malice and corruption in every new turn of events. If the news can be interpreted in a way that makes their perceived enemies look bad people will fully adopt that interpretation without question. This is dangerous and creates outrage and conflict for no reason, so I ask everyone reading this to be an influence in the other direction. Try to avoid taking a strong opinion until you’ve made an effort to better understand all the factors at play and be skeptical when everyone else is jumping to conclusions.

TL;DR

Ha, just kidding! You don't get one of these, this is a complicated issue and trying to reduce it to a simple narrative has caused the country to turn against each other looking for a culprit. Simple narratives based on a shallow understanding of complex issues are bad and are reducing social trust, strive to understand how the world works, it's a fascinating place!

Additional Sources

A lot of credit goes to this Twitter thread, it was the first source I found that explained that there was more going on and provided enough detail to explain why. I basically built on this and expanded it with more background and information. If you're on Twitter go give this person a like and a follow for being a voice of reason and digging into the details.
Just about every concept or entity I discussed in this post has a useful page on Investopedia that you can look at for more information or to verify what I said here. I've probably scanned through about 100 Investopedia pages to try to get a better understanding of these things so I'm not going to flood this post with links, but if you want more information just search for a term on there.

Darts Practice Routines

help me play better darts

help me play better darts - win

Shkreli on GME - 1/31

Pass the bong and gather round, bros! We're gonna like....um....what were we doing again? Oh yeah, we're gonna talk about those Chronic stocks and how you Ganja Gorillas can avoid becoming Game Gibbons