This text was originally posted in Mauerstrassenwetten by u/knutolee. I thought his message was so powerful that I asked him for permission to translate, post (can share chat with Mod if required or check directly with him) and fuck his wife (ok didn’t ask for permission) after and he agreed to all most of this wholeheartedly – like a true Autist. I am trying to catch the message – so don’t expect a word by word translation as you can never catch the greatness of the text in it’s entirety and I got to translate it in a way that even a US degenerate can follow it.
As usual no financial advice, I more or less just copied the text because I liked the text and I like the share. In general I have likely lost more than I won and the stock market is a mystery in itself to me. So make your own due dilligence and don’t trust financial advice of others (the argument for that you can read to a certain extent below).
Autists, Degenerates, Idiocracy of the World – let me get this straight!
In the coming days I don’t wanna see all this whining and bitching on this sub and espescially in the daily GME threads anymore. On every fucking corner of this sub I smell doubt, you read messages the likes of „this is over“, „we missed the squeeze“, „I am going to loose it all“, „entered at 320$ - I am doomed“. What the fuck is wrong with you retards, did you fucking wanker your wifes boyfriend dick all night and lost your mind over the effort to do so? I think I got to get this accross the Buddy Stephens way to get you down to fucking earth and get your attitude right.
1) You come to a sub called wallstreetbets and yolo your hard earned money in $GME
You realize what you are doing here - you true fuck - dont you? This is a community of full blown first class true tits up degenerates which take pleasure in posting losses accumulating into the millions every fucking month and you are putting your money into a BET – yes my dear it is written out in the name of this very fucking sub Wallstreet-B-E-T-S!!! – and follow DD posted by people with names like „SHOW_ME_YOUR_ANAL_TITS“? You realize this is not a fucking Disney ferry „One-Wish-comes-true“ show and we see all day long gain porn and loss porn is something which doesn’t exist in this world? This is a band of true autists which occupied an absolute niche when it comes down to trading (and we even don’t trade stocks normally!). This is the place where one wants to enjoy the sado-masochistic part of the retarded capitalistic system we are living in. Yes we have some (maybe a lot) DD diamonds in this sub which by the way are now impossible to find because you degenerate fucks spam the entire system to the moon but no sane long-term investor would consider to invest into any of these investments – this is about „get rich or die trying!“. This is not investing!
2) Yeah but I saw Reddit in the news and all that stuff about GME and it was going through the roof becasue there is going to be short squeeze and on top of it the hedge funds fucked up, hihihi
If this entire thing was a safe bet why exactly would not the fucking entire world jump on this train? (and even you might get this image from all this „Saudi Arabia calling, China calling, Africa calling posts – but please they invest into BABA, Aramco or I don’t know what’s the hot shit in Lagos stock exchange right now – could be though the next big thing – got to see if I can find a DD on this). So why is this not happening? Because it is a fucking BET – the stock market is a fucking Casino and the major difference between investing and us is that they are always just bet on black or red, while we always go for the magical zero. It is totally unclear whether all of us going to show up at Miami Beach with our Porsche Cayenne or Tesla Model S and hit on the girls (or boys) on the beach! The reasons are layed out to you every fucking day with yet another quality DD that most of us simply dont understand! And yes our chances to already sit on the fucking moon slurping our Pinha Coladas would be certainly higher if everything was going the way we believe the system should be working but even the last person who joined this sub by now should realize – you are potentially fucking with the system itself (by the way something this sub never intentionally wanted and you shouldn’t do if you like the system).
3) Hey but when is the squeeze of the squoze going to happen? 😓
So there is this story going through the media and from Florida to Colorado everybody remotely degenerate is yoloing money into GME. It’s a fucking global movement now (or not – could be also the same 50.000 degenerates cheering up themselves the entire time which would much better fit this place) and according to the DD we just need to have 🙌💎and the shorts a bleeding their panties, their balls feel squozen (and not in a good way) and they are completely in defensive mode. What do you think what people who are responsible for Multi-billion $$$ HF are going to do? How do you think you become a person who is responsible for such an operation? Do you think these guys have served as altar boys or girls in church (no offense if so)? What is wrong with you? Seriously! Do you think if they get some headwind they are going to say: Oh boy – we got defeated and going to realize a multi-fucking-billion-to-the-moon loss? OF COURSE FUCKING NOT! THEY WILL GET EVERY FUCKING BAZOOKA, TANK, ROCKET or INTER-STELLAR DEFENSE SYSTEM IN PLACE TO BRING THIS TO AN END! Influence the market participants (speculation), Short-Laddar attacks (I to this very day haven’t understand the concept or how this works – speculation), demotivational tactics (speculation) and to whomever picks it up – desinformation (well not quite speculation but it could also be that media is just retarded as fuck to get the most simple facts straight). So what would you do with a potential group of 5mn small-size investors – shall we do a collective effort to think about it? Ah fuck it! It is to fucking obvious – you would dry this out through time, divide their interests and drive away their attention. Because let’s be fucking honest – most of you entered this thinking you would hold this wonderful stock for a couple of days (and to be honest in this respect the community how it existed 10 days ago was much more true to itself - no whining just sayin)! Gotcha! Who can tell me who fucked each other two weeks ago in People magazin or on Twitter? Nobody – I even don’t remember shit about this very forum before GME (ok I remember u/variation-separate but that is another story). And all their tactics are completely understandable because there is a fucking huge amount of tendies to be made and they are not that different from us (my fear).
4) That does not give you the fucking right to whine and bitch all the time in the daily threads (and it is not happening already its going to be) and fucking ruin the party
Deal with it – we just got to wait how this thing plays out. That’s it. If we are right – this will play out positively in one or another way (huge tendies or SEC investigating). Let them continue shorting the stock or whatever. If you believe you want to buy more stock – do your DD and do it. When this got picked up a long time ago by people they thought – hmmmm makes sense – I am going to get me one of these tickets to the moon. There was if at all a very little interest to squoze the balls of any HF and it was certainly not the main motivation of this sub. I said it above: Get rich or die tryin! Since last Thursday the whole thing became political and it looks like rules were changed in our disfavour and yeah we can not go back in time but we got to deal with it and the circumstances. [Left out this part as it promotes holding and buying which I don’t want to in the sense that everybody needs to make his own fucking decision but I am going to fucking hold] but WE NEED TO REGAIN OUR POSITIVE SPIRIT which was an essential part of this sub and GME for most part in January (and of course in general before) – no matter how fucked up things looked (individually as there is not such a thing as collective alignment to buy options or stocks on this forum). We will see how the numbers are play out and who provided the adequate picture. In our reality GME is going to the moon and the 🚀 is fueled. Period. We are just prevented from starting because of the windy conditions out there.
So please – no post without 🙌💎🙌💎🙌💎🚀🚀🚀 and if you want to fukn leave the party – leave – but let us continue this party, because we are going to the fkn moon. This is the way and I fkn love GME and if this means I need to hold onto this beauty for another 25 years I am going to do it.
P.S.: One thing dear to my heart - in the past there has been huge donations made by this community to people living with autism. As we use their names every fkn day I would really like to see some of your degenerates not to forget about this cause because we owe them and as much as I like the billboards I’d rather see every $$$ go into charities rather then telling the world about us – I think everybody out there knows by now that we exist and that we have 🙌💎
Edit: Nobody asked for it but 35@231,69 and thanks for the awards which should go to u/knutolee - so you can simply award his original post referenced. More importantly he expressed to me that he is very happy with the translation which is almost as important as the message itself.
Edit 2: Please pay attention to AMA Marc Cuban - https://www.reddit.com/wallstreetbets/comments/lawubt/hey_everyone_its_mark_cuban_jumping_on_to_do_an/ - there is I think some quite enlighting answers in a very easy to understand language.
Edit 3: Bought 5@103
Edit 4: Heading for dinner. Crazy times. Will check later and decide whether to buy more tickets or not. But maybe good advice for some others to make a break. Chillax :)
Edit 5: Read that RH has opened up GME again. For whatever it's worth 🚀
Edit 6: Thanks again for all the Awards and stuff. I can only reload in the morning. Was fun and maybe I am going to translate more in the future - if mods would consider to give me a copy cat 😺 flair it would be the icing on the cake.
Edit 7: Obligatory salute to the one and only DFV and his 💎 balls. This guy will go all the way to the 🚀 with us.

First of all, I can't wait to be berated in the comments.
I'm gonna be blunt, I have seen a whole lot of dumb shit over the last week. A lot more than normal. And compounding all of that is an unprecedented amount of legitimate emotional involvement here. So let me get started by saying outright that people getting emotionally involved with trading stocks always lose. Short, long, whatever. It doesn't matter if you're a 19 year old throwing in your life savings or Bill fucking Ackman not being able to admit he was wrong with Herbalife. Letting your emotions be a major factor in trading is a fantastic way to lose money.
And a whole lot of you are really emotionally involved with this GME, AMC, whatever.
To the point: I am not making a buy/sell/hold/whatever recommendation. I have no special insight in to what's happening with GME or whatever else. What I can tell you is that it is for sure not worth $300.
So let's dispel one quick thing: this is not David vs Goliath. It also isn't the little man vs hedge funds or WSB vs big finance. It might have started out that way, but if you only read one thing read this:

Many of the big retail brokerages, including Robinhood, route a lot of their customer orders to Citadel Securities, so it ends up seeing a large percentage of retail trades in U.S. stocks. It can see if retail traders are mostly buying or mostly selling or mostly pretty balanced. You might expect—I certainly expected—to see that retail traders were buying more than they were selling this week. The stock seemed to be rocketing up on frenzied retail sentiment, and the posters on WallStreetBets were all claiming that they would never sell and keep buying until it hit $1,000.
But here’s what Citadel Securities’ retail flow looked like in GameStop this week: 1
Graphic here
Retail investors were net buyers on Monday but net sellers for the rest of the week (through yesterday), and all in all quite balanced: About 49.8% of retail orders (that Citadel Securities saw) were to buy, and 50.2% were to sell.
What do you make of that? One reading would be: “Retail investors on Reddit might have started the GameStop rally, but they’re not piling into this stock now, and the price action this week is coming from professionals.” Or as one Twitter user put it, “past the retail ignition, the rocket ship was mostly intra-fast money warfare.”

So, just to be clear about this, there is massive institutional money on both sides of this trade, and retail is a toddler sitting at the world series of poker.
Understand that melvin does not need to cover in the way a retail trader needs to cover. You, and everyone else, have no idea what Melvin's position looks like, and they can reorganize and exit a position before you ever knew it happened. You don't know how hedged they are, you don't know what their collateral looks like, and you don't know if they've covered and restructured a short at last week's prices. You simply don't know. You only know what's been presented in the news, which is almost certainly bullshit.
This thing could come to an end as fast as it started and you won't know what happened for weeks. You might go take a shit at 1pm today and come back to GME trading at $16 because Ken Griffin got on CNBC and announced they restructured their short at an average price of $200, and were happy to sit on it. Make no mistake, you'll get kicked in the nuts and have your ball taken away faster than you can comprehend.
Emotions The problem with this whole "strike back at wall street" narrative is that lots of you are getting really worked up over this trade. Losing money sucks, but losing money and feeling like you got shit on by the big guy is going to hurt. This isn't a moral crusade to them, it's 25 billion dollars. So if you're out here putting money and emotions on the line that you can't afford to lose there won't be a happy ending.
Want to fight the good fight against wall street? Write your congressman, Tweet AOC or Ted Cruz, get you a fucking picket sign and go wave it around on the streeet. But dropping money on GME that you need in life ain't gonna change anything except your net worth.
TLDR:
1) know and understand who is playing this game. And that they have access to tools, leverage, and markets that you do not. You're playing Le Chiffre at Casino Royale right now, you might think you're James Bond but there's a good chance that you're just the fat dude in the corner.
2) Short squeezes end fast. As fast as they started. If you're new to trading then understand buying GME at this price can mean all of your money will evaporate before you had time to make a TikTock about it.
3) Get your emotions out of play here. This whole nonsense political narrative is only going to cause you to make trading mistakes. Can't handle that? then maybe it's not a good idea to sit at this table.
Lastly, if you really just can't get yourself out of the whole "fight the hedge funds" nonsense, at least understand that you're spending money that you likely won't get back. If that's worth it to you then have at it. But don't fool yourself in to thinking otherwise.
E: Completely unrelated: I hate reddit awards, reddit doesn't need your money. Go buy like a hundredth of a share of VTI or something.

Remember the guy who guzzled down a cup of his own warm urine because he said SPY wouldn't close green that day? THAT is the WSBets-level of ARRtism that I crave seeing every time I come here- the loss and gain porn is okay but I want to see more ridiculous wagers being paid, don't you?
Here is a list of users with unpaid bets. Users who haven't paid up- get out of here and post in investing, you degenerate scum:

u/yotta_T100 you said if jee-Em-Ee hit $200 you'd get the WSB logo somewhere on your body.

I'm eager to see your new tattoo. Here are his comments if anyone else wants to see how he reacts when someone asks him for proof of a tattoo booking, and his other bet comment. The mod who was verifying that he follows through has been removed, can we get another mod on him? Ban unless he produces proof of a tattoo booking, it's been long enough.
u/HollaHollaBillsYall said they'd get the WSB logo "tattooed on my ass while smoking a joint with the tattoo artist" if it hit $420.69.
u/Hidhtr said they'd get the WSB logo " 'if' "it" crosses 420$" - if? LOL
u/sc00ba_steve owes a rocket emoji tattoo, another "$420.69"-er.
u/EzClapsFN said $100 and owes a GeeEmEe tattoo.
Congrats to u/raymofwuk on his geeEmEe/WSB ass tattoo, he said he'd get it if Gee eM Eee hit $200 a share- he literally bet his ass! Way to go!
This is a casino, and bets need to be paid. These assholes pretend-betting are ruining the essence of WSBets.
EDIT
Donate to Toronto Humane Society instead of awards.
Holding people to their word (and banning those who don't keep their word) is the sure way to weed out imposters and keep the community going. That's why, listed in the stickied comment below are some more of you who need to put your money (and your...toe?...) where your mouth is.
Lots of people recently found this sub and it's time you all see it in it's true ARRtistic WSBets Glory! Vegas is too clean for us. WELCOME TO RENO BABY!
END EDIT

Okay, I know that the title sounds horrible, but hear me out.
About a week ago, a group of friends and I took a trip to Vegas. (And for the record, we all got COVID tested before we went out. I'm looking for a judgement on this specific thing, not on me taking a vacation.) The casinos have just opened up recently, and my friends and I have always enjoyed a little bit of gambling, so we decided to check one out.
I usually have a specific fund dedicated to gambling so I don't use up any of our savings, but most of that fund ended up being put towards rent during quarantine, since my GF got laid off of work.
Now, here's where I think I might be the asshole. It had been over a year since I had gambled last, and I really wanted to gamble. Any other gamblers out there reading this post will get it. I didn't want to take away from the house fund or from our grocery fund, so I decided that taking money from my kids' college funds would be the best option. One of them is 14 and the other is 11, so there was still plenty of time for me to get the money back before they actually go off to college.
And I ended up winning! I kept all of the money that I gambled, and I ended up making a profit of about a quarter of the fund. I called my GF and excitedly told her the news, but she asked where I had gotten the original money from. I told her, and she freaked. Out. She screamed at me, told me that she was going to tell the kids how immature I was, and hung up on me.
I know that it was a little bit irresponsible, but I don't really see the issue. If I had lost the money, it might be a different story, but I won, so I don't get why there's a problem. Now my kids have even more money to put into their college fund, and I got to gamble like I wanted to.
It's been three days since that conversation, and she hasn't responded to any of my calls. I'm getting really sick of reaching out to her when I don't think I did anything wrong, but my flight home is soon, and I don't want her to bitch about me not apologizing when I get home. But do I even have anything to apologize for?
So, reddit: AITA?
Edit: I don't think you guys get it. I only gambled about 30k, and now me and my family are all better off because of it. Don't you guys understand that I won? I accept my judgement, but I disagree.

How is it going my homies
I made this post on investing a few days ago explaining all of the QAnon fantasies and why the top could already be behind us. Some people listened, processed information and asked questions. Some called me a person working for Melvin and hedge funds.
It’s all in the past, but if you got burned on GME or other meme stocks, here are few things you should learn about the markets and trading these bubbles.

1. Set a price at which you will exit and take profit. Don’t look at what happens next, and never rebuy if the price continues growing. Likewise, set a stop loss at which you will exit no matter what.
   
2. Never, and I mean never put in more than you can afford to lose, or even lose sleep over. I have a pretty decent portfolio, and I only put in 0.5% of it in the play. I don’t give a shit about that money, but I still took profit and got a 250% ROI. Easiest cash I’ve ever made, easier than blowing a fat dude in the back alley behind a strip bar. Anyway.
   
3. If you hear about shit on the news. It’s probably not a good time to enter. There is a reason why some early people made money on the play. They understood mechanics of what was driving the increase in price. Many of them didn’t even expect a short squeeze, they just like the fundamentals. Likewise, if your 80 year old grannie (say hi to her from me) calls you and asks you about this magical company called GameStonk, sell that shit right away.
   
4. Always double and triple check information posted on forums and don’t take it for a truth even if it has a lot of upvotes. The amount of misinformation I saw on WSB over the past week with 100 thousand upvotes makes me want to vomit.
   
5. Stock trading is not a team activity. It’s not us vs them. It’s a fucking free for all, and people will drop their bags on you if they see their unrealized gain turn into an unrealized loss. You want to make money? Do your research, and be the first one on the train. Don’t jump on the train when it is speeding and going off the rails.
   
6. If you don’t understand how something works, learn about it. Again, the amount of conspiracy theories that I read about ladder attacks and this grand illuminati conspiracy is driving me nuts. Always use the Occam’s razor, meaning if there is a simple explanation to the situation, it is probably right. There is no need to build out this conspiracy theory for something you don’t understand, it does not help anyone.
   
7. You will get FOMO and you will get confirmation bias. Everybody does, but learning how to battle it is crucial. Look, my dad was a fucking casino gambler in his 30s playing blackjack and losing money, and I have the same traits. Does it mean I need to be the same? No, and I always remember my genes when trading. It is not an excuse to use when you lose money.
   
8. Realize that situations like this are extremely rare, and if you expect to make 300% gain in 3 days, I have some bad fucking news for you, markets don’t work like this.
   
9. Finance gets complicated real fast. Yes, on the surface it’s just buying and selling. I have been studying this shit for 5 years, and I still don’t know a lot of things. There are reasons why even some of the smartest people still lose money. Shit, Newton was burned on a South Sea bubble. Yes, that guy who discovered gravity lost money just any of us.
   
10. One bad trade does not define you. As long as you learn, and don’t repeat the same shit again, you are golden. There are plenty of ways to make money on the markets, be it value investing, selling options or setting up butterfly spreads.
    

TL;DR: Be smart, not dumb.

Since this is a dramawave of an event, we will be making daily megathreads for as long as needed. If you'd like to add something, drop a reply here.
We also apologize for the typo in the title. This thread is for Thursday, Jan 28th.

WSB USERS: PLS DON'T SPAM!

This is a subreddit for the general reddit audience to discuss drama, so please don't clog up the thread. If you want to participate, make sure to follow our rules to avoid having your comments removed.
Background
WallStreetBets is a subreddit that treats "retail investing" (ie, amateur investing and amateur stock trades) like a casino. It's been featured here a few times in the past. (Examples: 1, 2, 3)
WSB users will sometimes pick a stock for silly or shitposty reasons to place their bets on. Gamestop stock (ticker name: GME) has been one of them. (We would appreciate some links to older examples WSB hyping GME stock if anyone has them). EDIT: Christopher-Nolan has provided us this example from a month ago
Our layman's explanation of a short squeeze is if someone "shorts" a stock, they have essentially made a bet its value will drop. But if their bet goes wrong, they will be forced to buy the stock they shorted at painfully high prices. Newspaper's explanation here.
Another simple way of summarizing it is that some hedge funds got into a pissing contest with an internet forum, except millions of dollars are on the line, and the hedge funds shorting GME were in a very vulnerable position, and their competitors in this match pride themselves on alleged mental deficiency. As the short squeeze doomsday scenario for these hedge funds has seemed more likely, the drama and excitement have overwhelmed social media, and a few WSB users are in a position to become millionaires.
Another reason this is making the national news is that it's unprecedented. Although short squeezes have happened, it's never been seemingly spurred by retail investors on social media. Now that the drama has hit the main stream it's starting lots of arguments around the internet about the stock market in general and what it really means to "manipulate" it, and what the role of the SEC and other regulators should be.
WSB was featured on SRD this week first for drama about a mod-sponsored twitter account, and then for making international news for the upcoming GME short squeeze.
Wednesday night update
WallStreetBets went private briefly on Jan 27, and is now back open. The closure seems to have been triggered by Discord's ban of the WSB server.
Meanwhile on twitter, the mod-sponsored account is back online and trying to call out WSB mod impersonators
Thursday 11 am update courtesy of No_Fuel_ and Existential_Owl
On the morning of Thurs, Jan 28, the retail trading platform Robinhood no longer allowed its users to purchase GME and other stocks popular on WSB, causing a huge uproar against Robinhood on wallstreetbets (examples 1, 2, 3) and twitter (examples 1, 2, 3, 4)
1 pm EST
A class action lawsuit against Robinhood has been filed
2 pm EST
WSB begins posting about Robinhood selling users' shares without their consent. According to the commenters, if you buy stock with borrowed money ("on margin"), your brokerage can force you to sell when the share price drops.
DeepFuckingValue, a redditor who bought 50,000 shares for cheap last year, is still holding. If he'd sold a portion of his shares yesterday he could have been a multi millionaire. WSB users congratulate him for "holding the line" under the hopes that if they all wait to sell, they will make the short squeeze even more expensive for the shorters.
11 pm EST
Posts relating to the short squeeze currently crowd the front page of reddit. Reuters is estimating the short sellers have taken over 70 billion in losses so far. AOC hosted a twitch stream in which former reddit CEO Alexis Ohanian appeared as a guest

TLDR: GameStop’s Congress hearing is on Feb 18th, they need to investigate the Prime Brokers and DTCC for their complicity in enabling naked shorting within GME and by extension, potential collusion to shut down trading on Jan 28th, the day the short squeeze was going to kick off. (stick to the end for an analysis of some illegal tactics short side hedge funds have been using)
Thesis: On the day the retail market for GME shut down on 1/28 (the day the short squeeze would’ve happened had there been no market intervention), DTCC (clearing house monopoly) shut down retail buying in order to protect itself and Prime Brokers (which privately own the DTCC) from being exposed to the consequences of being party to illegal activity. I believe Prime Brokers and DTCC need to be called to the GameStop hearing on February 18th to be questioned for their complicity in enabling illegal naked shorting of the GME stock, as well as potential collusion to shut out retail buyers on 1/28.
In my previous post (which I recommend reading for some context) I explored the subject of rampant illegal naked shorting in GME, and how Prime Brokers (consisting of banks like Goldman, Morgan, etc) and DTCC would be complicit in the naked shorting. This in turn raises the thought experiment that they would be incentivized to do anything possible to prevent the short squeeze from happening on 1/28 because had the short squeeze happened, the shorts would go bankrupt and their Prime Brokers who lent them their naked shorted shares would need to cover the shares. This would not only represent a humongous capital expense for Prime Brokers, the culpability of Prime Brokers (and that of the DTCC) in this situation would also have likely been exposed as well.
A quick primer on what a Prime Broker is: Prime Brokers are essentially the service side of the short- selling business. They lend out securities and cash, you can think of them as the “house” in a casino: They provide a gambler with markers to play and to manage his winnings. According to Matt Taibi, “Under the original concept, if a hedge fund that wanted to short a stock they would first need to “locate” the stock with his Prime Broker but as time passed, Prime Brokers increasingly allowed their hedge-fund customers to use automated systems and “locate” the stock themselves, and what this does is enable short-sellers to sell stock without delivering and thereby perform naked shorts with counterfeit shares. (source: https://web.archive.org/web/20210213125246/https://www.rollingstone.com/feature/wall-streets-naked-swindle-194908/). (I highly recommend you read Matt Taibi’s article on naked shorting and how it was used to take down Bear Stearns and Lehman Brothers. There are so many parallels with GME it’s hard to miss. It’s amazing to consider that 12 years after this article was published and brought to public awareness, the problem of naked shorting still exists as a systemic issue.)
Prime Brokers have a long history of being associated with naked shorting. To highlight a few examples, Prime Brokers like Merill Lynch and Goldman have long been implicated for naked shorting Overstock.com (https://www.rollingstone.com/politics/politics-news/accidentally-released-and-incredibly-embarrassing-documents-show-how-goldman-et-al-engaged-in-naked-short-selling-244035/, https://www.forbes.com/2007/02/02/naked-short-suit-overstock-biz-cx_lm_0202naked.html?sh=271400d1763f). Another example is when Goldman’s Prime Brokerage was implicated by the SEC in 2016 and got away with a small fine of 16 million (Source: https://www.sec.gov/news/pressrelease/2016-9.html). An example that very recently came in the news is a story where CIBC, BOA, UBS and TD Bank Prime Brokerages are accused of facilitating naked short selling and using counterfeit stock to attack and bring the stock price of a company from $34.77 to $1.83 (Source: https://www.securitiesfinancetimes.com/securitieslendingnews/industryarticle.php?article_id=224548).
The DTCC also has a very long history of being associated with naked shorting. The Wall Street Journal noted that 1% of the DTCC’s volume end in failure to deliver which “have put DTCC in the middle of a long-running fight over whether unscrupulous investors are driving down hundreds of small companies' share prices… DTCC has turned a blind eye to the naked-shorting problem. ” (Source: https://www.wsj.com/articles/SB118359867562957720). The DTCC has also had numerous complaints submitted to the SEC for enabling naked shorting (source: https://www.sec.gov/rules/proposed/s72303/decosta122203.htm) and have been sued tens or hundreds of times for assisting naked shorts (source: https://smithonstocks.com/part-3-in-series-on-illegal-naked-shortings-role-in-stock-manipulation-prime-brokers-and-the-dtcc-have-a-troubling-monopoly-on-clearing-and-settling-stock-trades/ and http://counterfeitingstock.com/CS2.0/CounterfeitingStock.html and https://www.wsj.com/articles/SB118359867562957720)
On 1/28 Robinhood received a letter from the DTCC at 4 am requiring them to halt trading or come up with 3 billion dollars, which Robinhood did not have, and therefore with one swoop of the pen the DTCC shut down buy side momentum but strangely allowed selling. Retail investors were shut out of the market and as any student of microeconomics would know, by shutting buy but only allowing sell, the price is bound to fall. Meanwhile while hedge funds were able to keep trading not only in the market but also crosstrade in the dark pools (“private” stock markets that retail is shut out of, more on this later), and use this crucial lifeline given to them by the DTCC to prevent the squeeze from happening that day.
With retail abruptly being shut out from buy (even cash accounts were shut out, which didn’t make sense) and only allowed to sell, almost everyone could smell manipulation was afoot (which triggered the Congress hearing) and the most of the blame was pointed at Robinhood. Personally and in hindsight, I believe Robinhood was just a willing scapegoat. When we think about who had the most to lose if a short squeeze occurred, I’ll narrow it down to three entities, Shorts and their stakeholders (ie Citadel), Prime Brokers and the DTCC.
It’s important to remember that the actual impetus that triggered the shutdown of the market for retail investors came from the DTCC. Working backwards, if you consider that GME was rampantly naked shorted and DTCC and Prime Brokers would have to be complicit in it, I believe the DTCC, Primer Brokers and possibly Citadel (who provides 40% of Robinhood’s revenue) brazenly manipulated the market on 1/28 by shutting down purchasing for retail buyers to prevent the squeeze from being squoze on that day as doing so would be catastrophic for all aforementioned parties involved. I believe that on the upcoming Gamestop Congress hearings the Financial Services Committee needs to call on decision makers of DTCC and Prime Brokers explore their role and complicity in the shut out of retail buyers that day as well as being enablers of naked shorting in GME.
An interesting thought experiment: On 1/28 when the price was 450+ and shorts were likely under 100, if we assume prime brokers allowed naked shorting in GME, then when the squeeze was about to happen (or happening), if Prime Brokers had margin had called the shorts, they would presumably also also gone down because shorts would not be able to pay in that event and the brokers would be holding the bag. By that logic, they have every incentive in this case to NOT to margin call and instead the most logical option would probably would have been to make a backroom deal, which is what I personally think most likely happened.
If you’ve read up to this point, you might be thinking what can I do about this? I am aware that there a lot of cynicism that we can’t do anything, that there will be no justice for retail investors who were harmed this situation, and that institutions and people in power will prevent anything from being done. I feel this sometimes too, but remember:
A single voice can be drowned out, but if we all speak together then we will make our voice heard. Ape Strong Together.
With the hearing coming up on February 18th, I highly recommend you email and tweet the representatives involved in the hearing, as well as your own district representatives, and urge them to read into the factors presented in this post and call the DTCC and Prime Brokers to the hearingl. They need to be questioned on why GME has so many counterfeit shares, failed to deliver, their complicity in naked shorting, and investigated for their role in the retail shut down of 1/28. Below are 4 members of congress I recommend both tweeting and emailing
Alexandria Ocasio-Cortez https://twitter.com/AOC, email: [[email protected]](mailto:[email protected])
Al Green https://twitter.com/repalgreen, email: [[email protected]](mailto:[email protected])
Maxine Waters https://twitter.com/maxinewaters, email: [[email protected]](mailto:[email protected])
Nancy Pelosi Email: https://twitter.com/SpeakerPelosi email: [[email protected]](mailto:[email protected]).
And you can find other members of Financial Services Committee here to reach out to: https://financialservices.house.gov/about/committee-membership.htm
What follows should probably be a separate post, but I will take the opportunity to summarize some of the illegal tactics that shorts have been identified to be using in their war with retail investors. Note that this may not be an exhaustive list and there may be newer tactics deployed in the future. Retail investors might not have the same tricks, resources and willingness to break the law for profit as hedgies do, but my hope and belief is that if we pool our knowledge and analysis, we will figure out their game and effectively adapt.
Feel free to forward the list below to any representatives and lawmakers if you concur that these tactics were used:
Rampant Naked Shorting - With the extremely high number of Fail to Delivers (FTID) , short interest being as high as 226% recently, and institutions alone holding a staggering 177% of the total float (likely due in large part to counterfeit shares), signs strongly point to GME being rampant with naked shorts and counterfeit shares. I believe the original goal of shorts was to drive GME to bankruptcy with these naked shorts, using the laddering of naked shorts (aka short ladder attack), executed with the help of counterfeit stock which is a classic and reliable method of driving down the stock price. I believe the GME stock has seen relentlessly aggressive short attacks, especially on the week of Monday February 1st, which drove the stock price down and triggered panic selling.
Ladder Attacks with the help of Dark Pools - Another identified method of ladder attacks was identified to come from crosstrading with darkpools (the stock market has its own private stock exchange where institutions can trade…). Essentially darkpools are private stock markets retail investors do not have access to, where short side funds can purchase securities “off market” and then sell “on-market”, with the effect of creating a lot more downward pressure on the market without the upward pressure from buying.
Illegally masking shorts with synthetic longs. Another tactic shorts are suspected of using in GME is the use of illegally using options to evade short positions in violation of Reg SHO which SEC describes in this risk alert and which I elaborate in this post. Essentially it’s the use of using options to create synthetic longs to illegally and artificially cover and prolong short positions and at same time obscuring the true short interest %. If you consider that it would be far more profitable for shorts to not cover at high prices but instead ladder attack the price and wait for retail investors to lose interest and close their shorts at as low of a price as possible, then you can see why this strategy would be very effective.
Using way out-of-money call options to obscure true short interest. You may have heard about the 43 million worth of 800 dollar calls purchased when the price was 100 and found it odd. Later it was identified as a tactic to cheaply purchase synthetic call options (since at 800 its way out of money) to obscure their short positions (with the added benefit of hedging at 800 if a squeeze does happen)
One thing I want to note, particularly to legislators at the GameStop hearing: Retail investors were not incited to pump GME. Retail investors spotted a unique Short Squeeze opportunity created by the greed of short side hedge funds, whereby GameStop was being abusively naked shorted with the goal of bringing it to bankruptcy, and hedge funds were so greedy about it that they shorted the company with a short interest of 226% of float, meaning A LOT of counterfeit shares were being used to short the company. Retail investors saw this as an opportunity to short squeeze the hedge fund shorters, which is a legal and legitimate investment strategy. The short squeeze would have happened had everyone played fair, but instead, financial institutions who were culpable to the naked shorting intervened and shut down retail buying, hurting the retail investors and successfully manipulating the market. The investment itself was in my opinion a sound decision based on the short squeeze, but in hindsight retail investors did not seriously consider the risk of the market would be blatantly and publicly manipulated and that the market would be rigged against them.
If this post was useful (and I hope it was! Gave up my Friday night to write this for you Apes), please upvote for visibility and share it far and wide. The GameStop hearings could be a first step and hope towards legislative change, and it’s extremely important that the right story is told at those hearings (and by the right story I mean the real truth of what happened.) I hope the truly culpable parties are investigated and brought to justice. Again, I know many of us feel cynical that anything meaning will be done towards finding justice against the lawbreakers in this case, but if you feel even an ounce of injustice or empathy at how retail investors were unfairly harmed in the course of investing in GME, I strongly urge you to contact a legislator associated with the GameStop hearings and bring this to their attention so they can review this case with more complete information. In addition I recommend you to contact the SEC and any journalist you know or via journalist tip lines. It’s not going to be easy but the more awareness we raise the higher the likelihood our voices will be heard and positive change will be made.
As we navigate the rocky waters ahead, I’ll gift you with a favorite quote of mine:
The only difference between a nightmare and a dream is how big your balls are.
🚀🚀🚀
Disclaimer: I am not an investment advisor, I just like the stock.
Ps. If you’ve read to the end, I’ll leave you with a few more thoughts and reminders:
- If I were to distill life into one thing, it would be to never lose hope.
- Remember that if you’ve lost money in any way shape or form, don’t be depressed, money can always be made back and the important thing is to maintain a good attitude.
- Only invest what you can afford to lose.
- Perhaps the most important factor in good investing is patience.
If you’d like to read more about counterfeiting stocks this is a good place to start http://counterfeitingstock.com/CS2.0/CounterfeitingStock.html

The market is open and there is a new thread to collect today's events. You can read the Background section to get info on past events, and skip to the Today's Events section if you're already caught up.
This thread will be updating live.
Want to contribute? PM this account with links to drama. If we use your links we will credit you
WSB USERS! PLEASE DON'T SPAM!
This is a subreddit for the general reddit audience to discuss drama, so please don't clog up the thread. If you want to participate, make sure to follow our rules to avoid having your comments removed.
Background
WallStreetBets is a subreddit that treats "retail investing" (ie, amateur investing and amateur stock trades) like a casino. It's been featured here a few times in the past. (Examples: 1, 2, 3)
WSB users will sometimes pick a stock for silly or shitposty reasons to place their bets on. Gamestop stock (ticker name: GME) has been one of them. (We would appreciate some links to older examples WSB hyping GME stock if anyone has them). EDIT: Christopher-Nolan has provided us this example from a month ago
Our layman's explanation of a short squeeze is if someone "shorts" a stock, they have essentially made a bet its value will drop. But if their bet goes wrong, they will be forced to buy the stock they shorted at painfully high prices. Newspaper's explanation here.
Another simple way of summarizing it is that some hedge funds got into a pissing contest with an internet forum, except millions of dollars are on the line, and the hedge funds shorting GME were in a very vulnerable position, and their competitors in this match pride themselves on alleged mental deficiency. As the short squeeze doomsday scenario for these hedge funds has seemed more likely, the drama and excitement have overwhelmed social media, and a few WSB users are in a position to become millionaires.
Another reason this is making the national news is that it's unprecedented. Although short squeezes have happened, it's never been seemingly spurred by retail investors on social media. Now that the drama has hit the main stream it's starting lots of arguments around the internet about the stock market in general and what it really means to "manipulate" it, and what the role of the SEC and other regulators should be.
WSB was featured on SRD this week first for drama about a mod-sponsored twitter account, and then for making international news for the upcoming GME short squeeze.
Wednesday
WallStreetBets went private briefly on Jan 27, and is now back open. The closure seems to have been triggered by Discord's ban of the WSB server. Meanwhile on twitter, the mod-sponsored accountwent back online trying to call out WSB mod impersonators
Thursday
On the morning of Thurs, Jan 28, the retail trading platform Robinhood no longer allowed its users to purchase GME and other stocks popular on WSB, causing a huge uproar against Robinhood on wallstreetbets (examples 1, 2, 3) and twitter (examples 1, 2, 3, 4)
WSB began posting about Robinhood selling users' shares without their consent. According to the commenters, if you buy stock with borrowed money ("on margin"), your brokerage can force you to sell when the share price drops.
WSB users congratulate DeepFuckingValue, who owns about 50,000 shares, for still holding.
Posts relating to the short squeeze crowded the front page of reddit all day. Reuters is estimating the short sellers have taken over 70 billion in losses so far. AOC hosted a twitch stream in which former reddit CEO Alexis Ohanian appeared as a guest
Friday
Today is a much hyped-day as some of the hedge funds that shorted GME will now have to pay out. WSB is predicting that the "short squeeze" event will start today.
At the time of posting, the European markets have been open for several hours and the US market has just opened. More updates coming.
9 AM
A thread accusing news network CNBC of doxxing DeepFuckingValue was massively upvoted. Some users in the comments debate what counts as "doxxing", seeing as DFV gave an interview to the Wall Street Journal. The user who made the post seems to have deleted both the post and their own account.

Imagine you’re a hedge fund CEO or senior executive.
You’ve always had an inflated ego, and going to Wharton for an MBA definitely didn’t help in that regard. You interned at GS for the summer of 2003 and told all your friends about it, probably even brought it up oh so casually on dates. When you were hired as a trader by a moderately good to great fund, you probably lost a good deal of friends from your previous life, because they “just don’t get you now.” You’re in a different league than them, even your classmates that now work at lesser funds. You act friendly, liking Facebook posts, returning their calls, but there’s a nagging feeling that they’re holding you back. That you’ve made it, and you don’t need some loser that doesn’t even work on the East Coast.
Jump ahead a few years
It’s September 20th, 2008. Bear Stearns closed months earlier, Lehman went bankrupt a few days ago. "Buddies" of yours from both funds have been texting you, some you know from college. Maybe you’ll take pity on them and put in a good word, maybe you’ll tell them nothing’s available right now and that you’re sorry. You don’t tell them you were part of your fund's effort to short sell theirs into oblivion. Maybe you really are sorry though. What you’re more sorry about, however, is that your bonuses are probably going to be shit for a few years. They could even dip into five figures, god forbid. Your thoughts are of course directed to the millions of people losing their jobs across the country by the news, but inevitably your bonus reduction resurfaces as your biggest concern. “It’s not like I can do anything,” you say, after downing some wine. You go to sleep fairly easily, while across the country, innumerable people are forced to contemplate moving.
Let’s jump ahead a few more years
It’s mid-March, 2020. At this point, its become evident that COVID-19 is going to ravage the world, in some capacity (not gonna put politics into this because that’s not the point). As either a CEO or senior executive at a mid-range hedge fund, your thoughts gravitate towards your craft. It’s clear the market is going to tank, so you do what you do best. You short the shit out of several clearly sinking industries (https://www.cnn.com/2020/03/31/investing/short-sellers-market-coronavirus/index.html). But you don't stop there. You go on CNBC, Fox Business, maybe even the BBC, and announce doom and gloom. Doing this will get people to dump their stocks, meaning your shorts print even more money. Oh well, if there’s a positive to be gained from this whole thing it’s your fund making good money, right? By late March or early April, your wife convinces you that going with the kids to the Hampton’s would be the best choice, since the upper east side is getting a little claustrophobic. You’ll need to cancel your two week St. Barts vacation, what a bummer. You rent out a nice beach house in Sag Harbor for 125k a month, managing to beat out the other bidder by upping them by 10k. Once again, millions of people are losing their jobs, and you’re shorting the companies they work for. What else should you do?
Only a few months forward this time
It’s October. Weeks turned into months, and while you’ve started getting back to the city more and more, you’re still staying in Sag. Sometimes you have family friends over for an ostensibly socially distanced wine + cigar. You don’t think much of the events of the summer, aside from that one tweet you had PR send out in July. Your kids might have thoughts, you haven’t asked.
Just a few more months, I promise
It’s January. For really no other reason than the prospect of making more money, you along with a few other funds have decided to open naked shorts on GameStop. While technically not allowed, there are loopholes. Why would the loopholes be there, if not to be exploited, right? Not like you don’t do the same thing with your taxes.
Then, the unthinkable happens
A bunch of retail investors, led by a specific part of Reddit, decide to fuck your position by dramatically raising the share price. Since you firmly believe these people incapable of sticking to such an audacious play, you do nothing. Before long though, you start to become slightly unnerved by how steady the growth of the stock is. It's approaching $100, and you're losing hundreds of thousands to millions every day on short interest. So, you decide to take action. You get on CNBC, and cry about fundamentals. About volatility crushing these people. They don't listen, and keep buying. A week passes with you and your rich friends trying various strategies, none of it working. You're aware of another fund leaning on a popular trading app to force them into not accepting buy orders for GME, amongst others. You're not above sacrificing pride for money, so you announce your fund has closed its shorts. You're lying, of course. What kind of looks what you get at future parties if you cowed to these people? No, fuck that. You've read all the right books, been to the right schools, made the right friends, networked at the right parties and functions. You will not close, everything in your life has conditioned you not to. In fact, you'll double down. You go on CNBC some more. Artificially lower the stock price by trading between a few other funds. None of it's working, and you're intensely aware of another potential gamma squeeze on Friday. Restrictions on buying help during the day, but after hours, the stock jumps. That momentum carries it into a solid Friday. You won't budge, but at this point you're losing millions of dollars a day.
So, here we are
These people do not care about you. You're the least of their concerns, actually. They care about money and fund image, in that order. We have a real chance to make guys exactly like this hurt where it counts (for them), and I want people to understand that. I'm not saying throw your rent into GME. I'm saying you have the chance to really be a part of something, to screw the people that have been doing the screwing for your whole life. The house has been running a fixed casino, and you have the chance to hit back.
Do not close. We have them, and they know it. We're winning, and if we keep winning they will give in.

Edit 1: More ARKQ buying today (~50k shares). Thank you everyone for the positive feedback and discussion!
Bottom Line Up Front (BLUF) or TL;DR for the non-military types:
LMT is a good target if you want to literally go to the moon, and my PT is $690.26 in two years (more than 2x from current levels). Justification and some possible trade ideas are listed below, just CTRL-F “Trade Ideas”. I hope you guys enjoy this work and would appreciate any discussion or feedback. I hope to catch you in the comments.
Team,
We interrupt today’s regularly scheduled short squeeze coverage to discuss a traditionally boring stock, LMT (Lockheed Martin), with significant upside potential. To be clear, this is NOT a short squeeze target like many reddit posts are keying on. I hope that this piece sparks discussion, but if you are just looking for short squeeze content, all I have to say is BUY, HOLD, and GODSPEED.
The source of inspiration for me writing this piece is threefold; first, retail investors are winning, and I believe that we will continue to win if we continue to identify opportunities in the market. In my view, the stock market has always been a place for the public to shine a light on areas of innovation that real Americans are excited about and proud to be a part of. Online communities have stolen the loudspeaker from hedge fund managers and returned it to decentralized online democracies that quickly and proudly shift their weight behind ideas they believe in. In GME’s case, it was a blatant smear campaign to destroy a struggling business. I think that we should continue this campaign by identifying opportunities in the market and running with them. It may sound overly idealistic, but if reddit can take on the hedge funds, I non-ironically believe that we can quite literally take good companies researching space technology to the moon. I think LMT may be one of several stocks to help get us there.
Second, a video where the Secretary of State of Massachusetts argues that internet boards are full of a bunch of unsophisticated, thoughtless traders really ticked me off. This piece is designed to show that ‘the little guy’ is ready to get into the weeds, understand business plans, and outpace analysts that think companies like Tesla are overvalued by comparing them to Toyota. That is a big reason that I settled on an old, large, slow growth company to do a deep-dive on, and try my best to show some of the abysmal predictive analysis major ‘research firms’ do on even some of the most heavily covered stocks. LMT is making moves, and the suits on wall street are 10 steps behind. At the time of writing this piece, Analyst Estimates range from 330-460 (what an insane range).
Third, and most importantly, I am in the US military, and I think that it is fun to go deep into the financials of the defense sector. I think that it helps me understand the long-term growth plans of the DoD, and I think that I attack these deep-dives with a perspective that a lot of these finance-from-day-one cats do not understand. Even if no one ever looks at this work, I think that taking the time to write pieces like this makes me a better Soldier, and I will continue to do it in my spare time when I am feeling inspired. I wrote a piece on Raytheon Technologies (Ticker: RTX) 6 months ago, and I think it was well-received. I was most convicted about RTX in the defense sector, but I have since shifted to believing LMT is the leader in the defense space. I am long both, though. If this inspires anyone else to do similar research on other companies, or sparks discussion in the community, that is just a bonus. Special shout-out to the folks that read more than just the TL;DR, but if you do just read the TL;DR, I love you too!
Now let us get into it:
Leadership
I generally like to invest in companies that are led by people that seem to have integrity. Jim Taiclet took the reins at LMT in June of last year. While on active duty, he served as a C-141B Starlifter pilot (a retired LMT Aircraft). After getting out he went to work for the American Tower Corporation (Ticker: AMT). His first day at American Tower was September 10, 2001. The following day, AMT lost 13 employees in the World Trade Center attack. He stayed with the company, despite it being decimated by market uncertainty in the wake of 9/11. He was appointed CEO of the very same company in 2004. Over a 16 year tenure as CEO of AMT the company market cap 20x’d. He left his position as CEO of AMT in March of last year, and the stock stagnated since his departure, currently trading at roughly the same market cap as to when he left.
Jim Taiclet was also appointed to be the chairman of the board this week, replacing the previous CEO. Why is it relevant that the CEO came from a massive telecommunications company?
Rightfully, Taiclet’s focus for LMT is bringing military technology into the modern era. He wants LMT to be a first mover in the military 5G space, military application of AI space, the… space space, and the hypersonic glide vehicle (HGV) space. These areas are revolutionary for the boomer defense sector. We will discuss this in more detail later when we cover the company’s P/E multiple and why it is absolute nonsense.
It is not a surprise to me that they brought Taiclet on during the pandemic. He led AMT through adversity before, and LMT’s positioning during the pandemic is tremendous relative to the rest of the sector, thanks in large part to some strong strategic moves and good investments by current and past leadership. I think that Taiclet is the right CEO for the job.
In addition to the new CEO, the new Secretary of Defense, Secretary Lloyd Austin, has strong ties to the defense sector. He was formerly a board member for RTX. He is absolutely above reproach, and a true leader of character, but I bring this up not to suggest that he will inappropriately serve in the best interest of defense contractors, but to suggest that he speaks the language of these companies effectively. I do not anticipate that the current administration poses as significant of a risk to the defense sector as many analysts seem to believe. This will be expanded in the headwinds section below.
SPACE
Cathie Wood and the ARK Invest team brought a lot of attention to the space sector when the ARKX, The ARK Space Exploration ETF, Form N-1A was officially filed through the SEC. More recently, ARK Invest published their Big Ideas 2021 Annual Report and dedicated an entire 7-page chapter to Orbital Aerospace, a new disruptive innovation platform that the ARK Team is investigating. This may have helped energize wall street to re-look their portfolios and their investments in space technology, but it was certainly not the first catalyst that pushed the defense industry in the direction of winning the new space race.
In June 2018, then President Trump announced at the annual National Space Council that “it is not enough to merely have an American presence in space, we must have American dominance in space. So important. Therefore, I am hereby directing the Department of Defense (DoD) and Pentagon to immediately begin the process necessary to establish a Space Force as the sixth branch of the Armed Forces". Historically, Department of Defense space assets were under the control of the Air Force. By creating a separate branch of service for the United States Space Force (USSF), the DoD would allocate a Chairman of Space Operations on the Joint Chiefs of Staff and clearly define the budget for space operations dedicated directly to the USSF. At present, this budget is funneled from the USAF’s budget. The process was formalized in December of 2019, and the DoD has appropriated ~$15B to the USSF in their first full year of existence according to the FY21 budget.
Among the 77 spacecraft that are controlled by the USSF, 29 of them are Lockheed Martin GPS satellites, 6 of them are Lockheed Martin Space-Based Infrared Systems (SBIRS), and LMT had a hand in creating and/or manufacturing for several of the other USSF efforts. The Next Generation Overhead Persistent Infrared Missile Warning Satellites (also known as Next-Gen OPIR) were contracted out to both Northrup Grumman (Ticker: NOC) and LMT. LMT’s contract is currently set at $4.9B, NOC’s contract is set at $2.37B.
Tangentially related to the discussion of space is the discussion of hypersonic glide vehicles (HGVs). HGVs have exoatmospheric and atmospheric implications, but I think that their technology is extremely important to driving margins down for both space exploration and terrestrial point-to-point travel. LMT is leading the charge for military HGV research. They hold contracts with the Navy, Air Force, and Army to develop HGVs and hypersonic precision fires. The priority for HGV technology accelerated significantly when Russia launched their Avangard HGV in December of 2019. Improving the technology for HGVs is a critical next-step in maintaining US hegemony, but also maintaining leadership in both terrestrial and exoatmospheric travel.
LARGE SCALE COMBAT OPERATIONS (LSCO)
The DoD transitioning to Large-Scale Combat Operations (LSCO) as the military’s strategic focus. This is a move away from an emphasis on Counter-Insurgency operations. LSCO requires effective multi-domain operations (MDO), which means effective and integrated strategies regarding land, sea, air, space, and cyberspace. To have effective MDO, the DoD is seeking systems that both expand capabilities against peer threats and increase the ability to track enemy units and communicate internally. This requires a modernizing military strategy that relies heavily on air, missile, and sensor modernization. Put simply, the DoD has decided to start preparing for peer or near-peer adversaries (China, Russia, Iran, North Korea) rather than insurgencies. For this reason, I believe that increased Chinese and Russian tensions are, unfortunate as it may be, a boon to the defense industry. This is particularly true in the missiles/fires and space industry, as peer-to-peer conflicts are won by leveraging technological advantages.
There are too many projects to cover in detail, but some important military technologies that LMT is focusing on to support LSCO include directed energy weapons (lasers) to address enemy drone technology, machine learning / artificial intelligence (most applications fall under LMT’s classified budget, but it is easy to imagine the applications of AI in a military context), and 5G to increase battlefield connectivity. These projects are all nested within the DoD’s LSCO strategy, and position LMT as the leader in emergent military tech. NOC is the other major contractor making a heavy push in the modernization direction, but winners win, and I think a better CEO, balance sheet, and larger market cap make LMT the clear winner for aiding the DoD in a transition toward LSCO.
SECTOR COMPARISON (BACKLOG)
The discussion of LSCO transitions well into the discussion of defense contractor backlogs. Massive defense contracts are not filled overnight, so examining order backlogs is a relatively reliable way to gauge the interest of the DoD in a defense contractor’s existing or emerging products. For my sector comparison, I am using the top 6 holdings of the iShares U.S. Aerospace & Defense ETF (Ticker: ITA). I hate this ETF, and ETFs like it (DFEN) because of their massively outsized exposure to aerospace, and undersized allocation to companies like LMT. LMT is only 18% smaller than Boeing (Ticker: BA) but is only 30.4% of the exposure of BA (18.46% of the fund is BA, only 5.62% of the fund is LMT). Funds of this category are just BA / RTX hacks. I suggest building your own pie on a site like M1 Finance (although they are implicated in the trade restriction BS… please be advised of that… hoping other brokerages that are above board will offer similar UIs like the pie design… just wanted to be clear there) if you are interested in the defense sector.
The top 6 holdings of ITA are:
Boeing Company (Ticker: BA, MKT CAP $110B) at 18.46%
Raytheon Technologies (Ticker: RTX, MKT CAP $101B) at 17.84%
Lockheed Martin (Ticker: LMT, MKT CAP $90B) at 5.62%
General Dynamics Corporation (Ticker: GD, MKT CAP $42B) 4.78%
Teledyne Technologies Incorporated (Ticker: TDY, MKT CAP $13B) at 4.74%
Northrop Grumman Corporation (Ticker: NOC, MKT CAP $48B) at 4.64%
As a brief aside, please look at the breakdowns of ETFs before buying them. The fact that ITA has more exposure to TDY than NOC and L3Harris is wild. Make sector ETFs balanced how you want them to be balanced and it will be more engaging, and you will likely outperform. I digress.
Backlogs for defense companies can easily be pulled from their quarterly reports. Here are the current backlogs in the same order as before, followed by a percentage of their backlog to their current market cap. All numbers are pulled from January earning reports unless otherwise noted with an * because they are still pending.
Boeing Company backlog (Commercial: $282B, Defense: $61B, Foreign Military Sales (FMS, categorized by BA as ‘Global’): 21B, Total Backlog 364B): BA’s backlog to market cap is a ratio of 3.32, which is strong, but most of that backlog comes from the commercial, not the defense side. Airlines have been getting decimated, I am personally not interested in having much of my backlog exposed to commercial pressures when trying to invest in a defense play. Without commercial exposure, their defense only backlog ratio is .748. This is extremely low. I understand that this does not do BA justice, but I am keying in on defense exposure, and I am left thoroughly unsatisfied by that ratio. Also, we have seen several canceled contracts already on the commercial side.
Raytheon Technologies backlog (Defense backlog for all 4 subdivisions: 67.3B): Raytheon only published a defense backlog in this quarter’s report. That is further evidence to me that the commercial aerospace side of the house is getting hammered. They have a relatively week backlog to market cap as well, putting them at a ratio of .664, worse off than the BA defense backlog.
Lockheed Martin backlog (Total Backlog: $147B): This backlog blows our first two defense backlogs out of the water with a current market cap to backlog ratio of 1.63.
General Dynamics Corporation backlog (Total Backlog: $89.5B, $11.6B is primarily business jets, but it is difficult to determine how much of their aerospace business is commercial): Solid 2.13 ratio, still great 1.85 if you do not consider their aerospace business. The curveball here for me is that GD published a consolidated operating profit of $4.1B including commercial aerospace, whereas LMT published a consolidated operating profit of $9.1B. This makes the LMT ratio of profit/market cap slightly in favor of LMT without accounting for the GD commercial aerospace exposure. This research surprised me; I may like GD more than I originally assumed I would. Still prefer LMT.
Teledyne Technologies Incorporated backlog (Found in the earnings transcript, $1.7B): This stock is not quite in the same league as the other major contractors. This is an odd curveball that a lot of the defense ETFs seem to have too much exposure to. They have a weak backlog, but they are a smaller growing company. I am not interested in this at all. It has a backlog ratio of .129.
Northrop Grumman Corporation backlog ($81B): Strong numbers here. I see NOC and LMT as the two front-runners in the defense sector. I like LMT more because I like their exposure to AI, 5G, and HGVs more than NOC, but I think this is a great alternative to LMT if you like the defense sector. Has a ratio of 1.69, slightly edging out LMT on this metric. LMT edges out NOC on margins by ~.9%, though, which has significant implications when considering the depth of the LMT backlog.
The winners here are LMT, GD, and NOC. BA is attractive if you think anyone will have enough money to buy new planes. BA and RTX are both getting hammered by commercial aerospace exposure right now and are much more positioned as recovery plays. That said, LMT and NOC both make money now, and will regardless of the impact of the pandemic. LMT is growing at a slightly faster rate than NOC. Both are profit machines, but I like LMT’s product portfolio and leadership a lot more.
FREE CASH FLOW
Despite the pandemic, LMT had the free cash flow to be able to pay a $2.60 per share dividend. This maintains their ~3% yearly dividend rate. They had a free cash flow of $6.4B. They spent $3.9 of that in share repurchases and dividend payouts. That leaves 40% of that cash to continue to strengthen one of the most stalwart balance sheets outside of big tech on the street. Having this free cash flow allowed them to purchase Aerojet Rocketdyne for $4.4B in December. They seem flexible and willing to expand and take advantage of their relative position during the pandemic. This is a stock that has little downside risk and significant upside potential. It is always reassuring to me to know that at the end of the day, a company is using its profit to continue to grow.
HEADWINDS
New Administration – This is more of an unknown than a headwind. The Obama Administration was not light on military spending, and the newly appointed SecDef is unlikely to shy away from modernizing the force. Military defense budgets may get lost in the political shuffle, but nothing right now suggests that defense budgets are on the chopping block.
Macroeconomic pressure – The markets are tumultuous in the wake of GME. Hedgies are shaking in their boots, and scared money weighed on markets the past week. If scared money continues to exert pressure on the broader equity markets, all boomer stocks are likely weighed down by slumping markets.
Non-meme Status – The stocks that are impervious to macroeconomic pressures in the above paragraph are the stonks that we, the people, have decided to support. From GME to IPOE, there is a slew of stonks that are watching and laughing from the green zone as the broader markets slip deeper into the red zone. Unless sentiment about LMT changes, I see no evidence that LMT will remain unaffected by a broader economic downturn (despite showing growth YoY during a pandemic).
TAILWINDS
Aerojet Rocketdyne to the Moon – Cathie Wood opened up a $39mil position in LMT a few weeks ago, and this was near the announcement of ARKX. The big ideas 2021 article focuses heavily on satellite technology, deep learning, and HGVs. I think that the AR acquisition suggests that vertical integration is a priority for LMT. They even fielded a question in their earnings call about whether they were concerned about being perceived as a monopoly. Their answer was spot on—the USFG and DoD have a vested interest in the success of defense companies. Why would they discourage a defense contractor from vertical integration to optimize margins?
International Tensions – SolarWinds has escalated US-Russia tensions. President Biden wants to look tough on China. LSCO is a DoD-wide priority.
5G.Mil – We still do not have a lot of fidelity on what this looks like, but the military would benefit in a lot of ways if we had world-wide access to the rapid transfer of encrypted data. Many units still rely on Vietnam-era technology signal technology with abysmal data rates. There are a lot of implications if the code can be cracked to win a DoD 5G contract.
TRADE IDEAS
Price Target: LMT is currently at a P/E of ~14. Verizon has roughly the same. LMT’s 5-year P/E ratio average is ~17. NOC is currently at a P/E of ~20. TSLA has a P/E Ratio of 1339 (disappointingly not 1337). P/E is a useless metric because no one seems to care about it. My point is that LMT makes a lot of money, and other companies that are valued at much higher multiples do not make any money at all. LMT’s P/E ratio is that of a boomer stock that has no growth potential. LMT’s P/E is exactly in line with the Aerospace and Defense Industry P/E ratio standard. LMT’s new CEO is pushing the industry in a new direction. I will arbitrarily choose a P/E ratio of 30, because it is half of the software industry average, and it is a nice round number. Plus, stock values are speculative and nonsense anyway.
Share price today: $321.82
Share price based on LMT average 5-year P/E: $384.08 (I see this as a short term PT, reversion to the mean)
Share price with a P/E of 30: $690.26
Buy and Hold: Simple. Doesn’t take much thought. Come back in a year or two and be happy with your tendies (and a few dividends to boot).
LEAPS Call Debit Spread (Based on last trade prices): Buy $375 C 20 JAN 23 for $26.5, Sell $450 C 20 JAN 23 for $12. Total Cost $14.5 for a spread width of $75. Max gain 517% per spread. Higher risk strategy.
LEAPS: Buy $500 C 20 JAN 23 for $7.20. Very high-risk strat. If the price target is hit within two years, these would be in the money $183 per contract for a gain of 2500%. This is the casino strat.
SOURCES
https://www.lockheedmartin.com/en-us/news/features/2020/james-taiclet-from-military-pilot-to-successful-ceo.html
https://www.warren.senate.gov/newsroom/press-releases/in-response-to-senator-warrens-questions-secretary-of-defense-nominee-general-lloyd-austin-commits-to-recusing-himself-from-raytheon-decisions-for-four-years
https://news.lockheedmartin.com/2019-08-30-Lockheed-Martins-Expertise-in-Hypersonic-Flight-Wins-New-Army-Work
https://www.lockheedmartin.com/en-us/capabilities/hypersonics.html
https://research.ark-invest.com/hubfs/1_Download_Files_ARK-Invest/White_Papers/ARK%E2%80%93Invest_BigIdeas_2021.pdf?hsCtaTracking=4e1a031b-7ed7-4fb2-929c-072267eda5fc%7Cee55057a-bc7b-441e-8b96-452ec1efe34c
https://www.deseret.com/2018/6/19/20647309/twitter-reacts-to-trump-s-call-for-a-space-force
https://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2021/fy2021_Budget_Request_Overview_Book.pdf
https://www.airforcemag.com/lockheed-receives-up-to-4-9-billion-for-next-gen-opir-satellites/
https://spacenews.com/northrop-grumman-gets-2-3-billion-space-force-contract-to-develop-missile-warning-satellites/
https://www.lockheedmartin.com/en-us/capabilities/directed-energy/laser-weapon-systems.html
https://emerj.com/ai-sector-overviews/lockheed-martins-ai-applications-for-the-military/
https://www.defenseone.com/business/2020/07/new-ceo-wants-lockheed-become-5g-playe167072/
https://www.wsj.com/articles/defense-firms-expect-higher-spending-11548783988
https://www.etf.com/ITA#efficiency
https://s2.q4cdn.com/661678649/files/doc_financials/2020/q4/4Q20-Presentation.pdf
https://investors.rtx.com/static-files/dfd94ff7-4cca-4540-bc4b-4e3ba92fc646
https://investors.lockheedmartin.com/static-files/64e5aa03-9023-423a-8908-2aae8c7015ac
https://s22.q4cdn.com/891946778/files/doc_financials/2020/q4/GD_4Q20_Earnings_Highlights-Outlook-Final.pdf
https://www.fool.com/earnings/call-transcripts/2021/01/27/teledyne-technologies-inc-tdy-q4-2020-earnings-cal/
https://investor.northropgrumman.com/static-files/6e6e117f-f656-4c68-ba7f-3dc53c2dd13a

TLDR: GameStop’s Congress hearing is on Feb 18th, they need to investigate the Prime Brokers and DTCC for their complicity in enabling naked shorting within GME and by extension, potential collusion to shut down trading on Jan 28th, the day the short squeeze was going to kick off. (stick to the end for an analysis of some illegal tactics short side hedge funds have been using)
Thesis: On the day the retail market for GME shut down on 1/28 (the day the short squeeze would’ve happened had there been no market intervention), DTCC (clearing house monopoly) shut down retail buying in order to protect itself and Prime Brokers (which privately own the DTCC) from being exposed to the consequences of being party to illegal activity. I believe Prime Brokers and DTCC need to be called to the GameStop hearing on February 18th to be questioned for their complicity in enabling illegal naked shorting of the GME stock, as well as potential collusion to shut out retail buyers on 1/28.
In my previous post (which I recommend reading for some context) I explored the subject of rampant illegal naked shorting in GME, and how Prime Brokers (consisting of banks like Goldman, Morgan, etc) and DTCC would be complicit in the naked shorting. This in turn raises the thought experiment that they would be incentivized to do anything possible to prevent the short squeeze from happening on 1/28 because had the short squeeze happened, the shorts would go bankrupt and their Prime Brokers who lent them their naked shorted shares would need to cover the shares. This would not only represent a humongous capital expense for Prime Brokers, the culpability of Prime Brokers (and that of the DTCC) in this situation would also have likely been exposed as well.
A quick primer on what a Prime Broker is: Prime Brokers are essentially the service side of the short- selling business. They lend out securities and cash, you can think of them as the “house” in a casino: They provide a gambler with markers to play and to manage his winnings. According to Matt Taibi, “Under the original concept, if a hedge fund that wanted to short a stock they would first need to “locate” the stock with his Prime Broker but as time passed, Prime Brokers increasingly allowed their hedge-fund customers to use automated systems and “locate” the stock themselves, and what this does is enable short-sellers to sell stock without delivering and thereby perform naked shorts with counterfeit shares. (source: https://web.archive.org/web/20210213125246/https://www.rollingstone.com/feature/wall-streets-naked-swindle-194908/). (I highly recommend you read Matt Taibi’s article on naked shorting and how it was used to take down Bear Stearns and Lehman Brothers. There are so many parallels with GME it’s hard to miss. It’s amazing to consider that 12 years after this article was published and brought to public awareness, the problem of naked shorting still exists as a systemic issue.)
Prime Brokers have a long history of being associated with naked shorting. To highlight a few examples, Prime Brokers like Merill Lynch and Goldman have long been implicated for naked shorting Overstock.com (https://www.rollingstone.com/politics/politics-news/accidentally-released-and-incredibly-embarrassing-documents-show-how-goldman-et-al-engaged-in-naked-short-selling-244035/, https://www.forbes.com/2007/02/02/naked-short-suit-overstock-biz-cx_lm_0202naked.html?sh=271400d1763f). Another example is when Goldman’s Prime Brokerage was implicated by the SEC in 2016 and got away with a small fine of 16 million (Source: https://www.sec.gov/news/pressrelease/2016-9.html). An example that very recently came in the news is a story where CIBC, BOA, UBS and TD Bank Prime Brokerages are accused of facilitating naked short selling and using counterfeit stock to attack and bring the stock price of a company from $34.77 to $1.83 (Source: https://www.securitiesfinancetimes.com/securitieslendingnews/industryarticle.php?article_id=224548).
The DTCC also has a very long history of being associated with naked shorting. The Wall Street Journal noted that 1% of the DTCC’s volume end in failure to deliver which “have put DTCC in the middle of a long-running fight over whether unscrupulous investors are driving down hundreds of small companies' share prices… DTCC has turned a blind eye to the naked-shorting problem. ” (Source: https://www.wsj.com/articles/SB118359867562957720). The DTCC has also had numerous complaints submitted to the SEC for enabling naked shorting (source: https://www.sec.gov/rules/proposed/s72303/decosta122203.htm) and have been sued tens or hundreds of times for assisting naked shorts (source: https://smithonstocks.com/part-3-in-series-on-illegal-naked-shortings-role-in-stock-manipulation-prime-brokers-and-the-dtcc-have-a-troubling-monopoly-on-clearing-and-settling-stock-trades/ and http://counterfeitingstock.com/CS2.0/CounterfeitingStock.html and https://www.wsj.com/articles/SB118359867562957720)
On 1/28 Robinhood received a letter from the DTCC at 4 am requiring them to halt trading or come up with 3 billion dollars, which Robinhood did not have, and therefore with one swoop of the pen the DTCC shut down buy side momentum but strangely allowed selling. Retail investors were shut out of the market and as any student of microeconomics would know, by shutting buy but only allowing sell, the price is bound to fall. Meanwhile while hedge funds were able to keep trading not only in the market but also crosstrade in the dark pools (“private” stock markets that retail is shut out of, more on this later), and use this crucial lifeline given to them by the DTCC to prevent the squeeze from happening that day.
With retail abruptly being shut out from buy (even cash accounts were shut out, which didn’t make sense) and only allowed to sell, almost everyone could smell manipulation was afoot (which triggered the Congress hearing) and the most of the blame was pointed at Robinhood. Personally and in hindsight, I believe Robinhood was just a willing scapegoat. When we think about who had the most to lose if a short squeeze occurred, I’ll narrow it down to three entities, Shorts and their stakeholders (ie Citadel), Prime Brokers and the DTCC.
It’s important to remember that the actual impetus that triggered the shutdown of the market for retail investors came from the DTCC. Working backwards, if you consider that GME was rampantly naked shorted and DTCC and Prime Brokers would have to be complicit in it, I believe the DTCC, Primer Brokers and possibly Citadel (who provides 40% of Robinhood’s revenue) brazenly manipulated the market on 1/28 by shutting down purchasing for retail buyers to prevent the squeeze from being squoze on that day as doing so would be catastrophic for all aforementioned parties involved. I believe that on the upcoming Gamestop Congress hearings the Financial Services Committee needs to call on decision makers of DTCC and Prime Brokers explore their role and complicity in the shut out of retail buyers that day as well as being enablers of naked shorting in GME.
An interesting thought experiment: On 1/28 when the price was 450+ and shorts were likely under 100, if we assume prime brokers allowed naked shorting in GME, then when the squeeze was about to happen (or happening), if Prime Brokers had margin had called the shorts, they would presumably also also gone down because shorts would not be able to pay in that event and the brokers would be holding the bag. By that logic, they have every incentive in this case to NOT to margin call and instead the most logical option would probably would have been to make a backroom deal, which is what I personally think most likely happened.
If you’ve read up to this point, you might be thinking what can I do about this? I am aware that there a lot of cynicism that we can’t do anything, that there will be no justice for retail investors who were harmed this situation, and that institutions and people in power will prevent anything from being done. I feel this sometimes too, but remember:
A single voice can be drowned out, but if we all speak together then we will make our voice heard. Ape Strong Together.
With the hearing coming up on February 18th, I highly recommend you email and tweet the representatives involved in the hearing, as well as your own district representatives, and urge them to read into the factors presented in this post and call the DTCC and Prime Brokers to the hearingl. They need to be questioned on why GME has so many counterfeit shares, failed to deliver, their complicity in naked shorting, and investigated for their role in the retail shut down of 1/28. Below are 4 members of congress I recommend both tweeting and emailing
Alexandria Ocasio-Cortez https://twitter.com/AOC, email: [[email protected]](mailto:[email protected])
Al Green https://twitter.com/repalgreen, email: [[email protected]](mailto:[email protected])
Maxine Waters https://twitter.com/maxinewaters, email: [[email protected]](mailto:[email protected])
Nancy Pelosi Email: https://twitter.com/SpeakerPelosi email: [[email protected]](mailto:[email protected]).
And you can find other members of Financial Services Committee here to reach out to: https://financialservices.house.gov/about/committee-membership.htm
If there's one thing I took away from this its that we can't wait for other people to do the right thing, we each need to individually step up to ensure it happens
What follows should probably be a separate post, but I will take the opportunity to summarize some of the illegal tactics that shorts have been identified to be using in their war with retail investors. Note that this may not be an exhaustive list and there may be newer tactics deployed in the future. Retail investors might not have the same tricks, resources and willingness to break the law for profit as hedgies do, but my hope and belief is that if we pool our knowledge and analysis, we will figure out their game and effectively adapt.
Feel free to forward the list below to any representatives and lawmakers if you concur that these tactics were used:
Rampant Naked Shorting - With the extremely high number of Fail to Delivers (FTID) , short interest being as high as 226% recently, and institutions alone holding a staggering 177% of the total float (likely due in large part to counterfeit shares), signs strongly point to GME being rampant with naked shorts and counterfeit shares. I believe the original goal of shorts was to drive GME to bankruptcy with these naked shorts, using the laddering of naked shorts (aka short ladder attack), executed with the help of counterfeit stock which is a classic and reliable method of driving down the stock price. I believe the GME stock has seen relentlessly aggressive short attacks, especially on the week of Monday February 1st, which drove the stock price down and triggered panic selling.
Ladder Attacks with the help of Dark Pools - Another identified method of ladder attacks was identified to come from crosstrading with darkpools (the stock market has its own private stock exchange where institutions can trade…). Essentially darkpools are private stock markets retail investors do not have access to, where short side funds can purchase securities “off market” and then sell “on-market”, with the effect of creating a lot more downward pressure on the market without the upward pressure from buying.
Illegally masking shorts with synthetic longs. Another tactic shorts are suspected of using in GME is the use of illegally using options to evade short positions in violation of Reg SHO which SEC describes in this risk alert and which I elaborate in this post. Essentially it’s the use of using options to create synthetic longs to illegally and artificially cover and prolong short positions and at same time obscuring the true short interest %. If you consider that it would be far more profitable for shorts to not cover at high prices but instead ladder attack the price and wait for retail investors to lose interest and close their shorts at as low of a price as possible, then you can see why this strategy would be very effective.
Using way out-of-money call options to obscure true short interest. You may have heard about the 43 million worth of 800 dollar calls purchased when the price was 100 and found it odd. Later it was identified as a tactic to cheaply purchase synthetic call options (since at 800 its way out of money) to obscure their short positions (with the added benefit of hedging at 800 if a squeeze does happen)
One thing I want to note, particularly to legislators at the GameStop hearing: Retail investors were not incited to pump GME. Retail investors spotted a unique Short Squeeze opportunity created by the greed of short side hedge funds, whereby GameStop was being abusively naked shorted with the goal of bringing it to bankruptcy, and hedge funds were so greedy about it that they shorted the company with a short interest of 226% of float, meaning A LOT of counterfeit shares were being used to short the company. Retail investors saw this as an opportunity to short squeeze the hedge fund shorters, which is a legal and legitimate investment strategy. The short squeeze would have happened had everyone played fair, but instead, financial institutions who were culpable to the naked shorting intervened and shut down retail buying, hurting the retail investors and successfully manipulating the market. The investment itself was in my opinion a sound decision based on the short squeeze, but in hindsight retail investors did not seriously consider the risk of the market would be blatantly and publicly manipulated and that the market would be rigged against them.
If this post was useful (and I hope it was! Gave up my Friday night to write this for you Apes), please upvote for visibility and share it far and wide. The GameStop hearings could be a first step and hope towards legislative change, and it’s extremely important that the right story is told at those hearings (and by the right story I mean the real truth of what happened.) I hope the truly culpable parties are investigated and brought to justice. Again, I know many of us feel cynical that anything meaning will be done towards finding justice against the lawbreakers in this case, but if you feel even an ounce of injustice or empathy at how retail investors were unfairly harmed in the course of investing in GME, I strongly urge you to contact a legislator associated with the GameStop hearings and bring this to their attention so they can review this case with more complete information. In addition I recommend you to contact the SEC and any journalist you know or via journalist tip lines. It’s not going to be easy but the more awareness we raise the higher the likelihood our voices will be heard and positive change will be made.
As we navigate the rocky waters ahead, I’ll gift you with a favorite quote of mine:
The only difference between a nightmare and a dream is how big your balls are.
🚀🚀🚀
Disclaimer: I am not an investment advisor, I just like the stock.
Ps. If you’ve read to the end, I’ll leave you with a few more thoughts and reminders:
- If I were to distill life into one thing, it would be to never lose hope.
- Remember that if you’ve lost money in any way shape or form, don’t be depressed, money can always be made back and the important thing is to maintain a good attitude.
- Only invest what you can afford to lose.
- Perhaps the most important factor in good investing is patience.
If you’d like to read more about counterfeiting stocks this is a good place to start http://counterfeitingstock.com/CS2.0/CounterfeitingStock.html

This is not financial advice, just an attempt to explain the real story of what happened before the pile-on started
There’s a huge misleading narrative that WSB “picked” GME because of its short interest and that’s the only reason the short squeeze is on.
Here’s the thing...
WSB hated on the GME DDs! The pile on happened after the initial squeeze began...

This was always going to happen

Let’s start at the beginning.
GME was shorted at 171% at 2.50. To use DFV’s words: “that’s a seriously ballsy bet!”
GME was never going bankrupt in 2021. Here’s why:

1) Console cycle

Historically, GME stock price jumps significantly when new consoles come out. This can be observed easily.
The shorts were aware of this, but bet that it wouldn’t happen again because new consoles wouldn’t have optical discs.
They were wrong...
There’s plenty of support for this thesis by real analytics investors. I give you Micheal Burry - of Big Short fame. He went in at <5 because of the above console cycle.
He later said GME was a value play at 20-60, a short play at 80. The reason it isn’t a short play now is because of later events.

2) Financial Heath

This one is simple. Mid COVID, with terrible stock prices, GME bought back 7-800 million of debt.
This is simply not something a company going bankrupt does. If they were going bankrupt they’d focus their efforts on survival and bank on discharging the debt in bankruptcy court if it hit that level.
For the record, this fact is what got me into the play thanks to Uberkikz. Buying back debt is not the action of a company dying in the next 12 months.

3) Ryan Cohen and digital gold

For those of you who don’t understand the times we live in, user data is literal gold when used properly. Ryan Cohen knows this.
Let’s talk about who he is:
He wanted to found an e-commerce pet food franchise based on customer loyalty. He was laughed out of investment meetings based on the market being dominated by giants with established market and low prices.
He said that even in the age of dirt cheap virtual flea markets there was a gap to be filled via customer-centric e-commerce. He was correct. He built Chewy up and only sold it because his grandfather got sick.
RC wrote a letter to GME saying they could accelerate their shift and utilize the unique data they have on three generations of gamers to capture a market that is growing by leaps and bounds daily.
When I was looking for recovery plays, i eyed up AMC (lol), but didn’t bite. DFV and Uberkikz convinced me and I bought in.
Then Ryan Cohen upped his stake... Then he hired an activist lawyer specializing in takeovers.... Then they PUT HIM ON THE FUCKING BOARD
Now he has 3 seats and two friendly votes.
Here’s the thing, yes Reddit piled on but that’s because at this point they were sold. The thing they’d been ignoring as dumb now had proof.
GME was becoming a tech company and tech companies are forward valued thanks to our bubble, look at Tesla!
This wasn’t a planned attack!!

As soon as RC joined the board, the shorts should have covered

They made a bad bet! When Dr Wilson in the 90s realized his short of the casinos went bad, he sent a telegram saying “cover all shares”
Instead, they dug in and endangered everything with their over-leveraged bet ( not gonna get into share loaning and over-shorting but best believe there’s something fucked there).
Reddit piled on because the bull case was clear and the shorts were in the wrong.
There’s nothing wrong with investing on an opinion.
My opinion is that they’ve helped GMEs turnaround by making this news and it’s a foregone conclusion.
Thanks for attending my TED talk. Stop the fuck the billionaires narrative, this is a story about shorts making a bad bet against an unlikely value play.... period
Edit2: i realized I got lost in explaining the value play and forgot the point. I’m trying to point out that before the pile-on there was a valid bull thesis.
Once Ryan Cohen was put on the board, the internet flocked to this and everything went crazy, but I am seeing people on the news saying that “we all got in to fuck the billionaires” and that is just patently untrue.
I got in because at 2.50-10, GME was worth more. Now it’s being squeezed so I have no idea where this lands.
🚀🚀🚀🚀🚀🚀
Edit: as requested, my positions:
300 shares originally, got fucked down to 200 by attempting to day trade them right as my broker restricted buys. 50 shares at 14, 250 at 200
options at 14c, 16c, 30c all bought at GME price 14-15, pre earnings from hell: I sold these because I’m sorry I’ve been in since October and this was more money then I’ve ever had.
I hold my shares until the end!

It's here boys and girls! The Cayo Perico DLC has been released!

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"Unlike previous Heists, there is no specific style when it comes to approaching Cayo Perico.

Once you’ve gathered the necessary gear, you can choose to complete as much (or as little) set-up and planning as you want – though be warned that these decisions will, in turn, affect the way the action unfolds. If you want to call in an airstrike or use a cutting torch to burn through steel beams, for example, you would be well advised to put the time in beforehand.
Once all the groundwork is laid down, you can nail down your final details before approaching Cayo Perico. These choices include how you infiltrate and escape the island, your weapons loadouts, air support, and even the operation’s time of day. As a result, no two approaches are alike on subsequent playthroughs. And repeat visits will allow you to heist valuable artifacts and other valuables as they become available.
There is also a load of extra opportunities you can use to play to your advantage, such as breaking into storage lockups to raid hidden stashes of cash and contraband to bolster your bottom-line and fatten up your take. These chances and the tools necessary to complete them will rarely be found in the same place twice – some are only accessible when playing with multiple players, so joining up with friends is very much encouraged."
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This Megathread will serve as the place to discuss all things related to the DLC. We will be updating this as more information is released, so keep checking back.
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The Heist works very similarly to the Casino Heist. You have to hack cameras and scope out locations.
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Important Links: (Added once they become available)

Cayo Perico Heist DLC Wiki Guide

Cayo Perico Simple Question and FAQ Post

Official Trailer
Newswire Article
Patch Notes
Availability/Size:
Playstation - LIVE - 6.8GB
Xbox - LIVE - 6.6GB
PC - Live - 9.3GB
Other Links:
DLC release Crew Event info
Weekly Update Thread
Simple Question Thread
Still Slippin' Radio Channel Guide
​
Misc Info:
Kosatka(sub) is $2.2 million to start, up to $9.8 million with everything, and IS DRIVEABLE!
Two new vehicles available with the Kosatka:
Sparrow (Small Helicopter) Can be equipped with machine guns or missiles.
Kraken Avisa (Small Sub)
Island is not available in Free Mode
No New vehicles on SSA or LM at release. These vehicles will be dripfed to us over the coming weeks and months.
6 new vehicles available on release day, the Submarine and 5 more with trade prices unlocked by completing the Heist. Link to new vehicle pics and prices.
Winky (Jeep) $825,000 - $1,100,000
Kurtz 31 Patrol Boat(Gunboat) $2,216,250 - $2,955,000
RO-86 (Bomber) $3,262,500 - $4,250,000
Annihilator Stealth (Helicopter) $2,902,500 - $3,870,000
Toreador (CaSub) $3,660,000
Longfin (Boat) $2,125,000
New weapons:
Perico Pistol
Military Rifle - $397,500
Combat Shotgun - $295,000

The Free Vehicle from the Heist Challenge will be Available this Friday and will be the Dinka Veto Classic go-kart. You MUST claim the vehicle between the 18th and 20th of December or it will no longer be free.

Twitch Prime Members get the Sonar Add On for Free (or a rebate in 72 hours if it doesn't show as free)
Rockstar Cloud Save Issue Solved
Cayo Perico Heist DLC Wiki Guide
​
Note: Off topic posts will be removed.

English

Hi theNetherlands. This megathread will serve as a hub for all information regarding the corona virus. Please don't share rumours or unconfirmed information.

• Corona virus Dashboard by the Dutch Government
• Current information and data regarding the Netherlands in English by RIVM (National Institute for Public Health and the Environment)
• Questions & answers about the corona virus by RIVM
• Current international information and data by Johns Hopkins University CSSE

Keep 1.5 meters (5 feet) distance, wash your hands with soap often, cough and sneeze into the inside of your elbow, use disposable paper handkerchiefs and don't shake hands. Wear a face mask in public transport and publicly accessible spaces. A curfew is in effect from 9.00 pm to 4.30 am. If you exhibit symptoms, stay home and make an appointment for a test with the GGD at 0800-1202 (open daily from 8 am to 8 pm). If you have any other questions, call the RIVM at 0800-1351 (open daily from 8 am to 8 pm).

Nederlands

Dag theNetherlands. Deze hernieuwde post zal dienen als verzamelplaats voor alle informatie rondom het coronavirus. Deel hier alsjeblieft geen geruchten of informatie die niet officieel bevestigd is.

• Coronavirus Dashboard van de Rijksoverheid
• Routekaart risiconiveaus en maatregelen van de Rijksoverheid (vernieuwd)
• Actuele informatie en gegevens over besmettingen in Nederland, door het RIVM
• Vragen en achtergronden over het coronavirus, door het RIVM
• Actuele internationale gegevens met besmettingen, door Johns Hopkins University CSSE

Belangrijke aandachtspunten

• De lockdown blijft tot ten minste 1 maart actief. Op 23 februari vraagt het kabinet advies aan het OMT of het versoepelen mogelijk en verstandig is.
  
• Het kabinet vraagt ook advies aan het OMT over het voortzetten of opschorten van de avondklok, die op 10 februari af zou lopen.
  
• Twee derde van alle nieuwe besmettingen met het virus gebeuren door de Britse variant, die aanzienlijk besmettelijker is dan de bekende variant.
  
• Er is een vernieuwde routekaart gemaakt.
  

Actuele maatregelen

De volgende maatregelen zijn geldig tot ten minste 1 maart 2021, tenzij anders vermeld.

• Er geldt een avondklok van 21.00 uur ’s avonds tot 04.30 uur ’s ochtends tot 10 februari. Als het noodzakelijk is om naar buiten te gaan, moeten mensen een formulier ‘Eigen verklaring avondklok’ meenemen. Als dit voor werk is, moeten mensen ook een werkgeversverklaring tonen. Uitzonderingen:
  
  • In geval van een calamiteit;
  • Als uzelf, een hulpbehoevend persoon of een dier dringend (medische) hulp nodig heeft;
  • Als u van uw werkgever voor werk naar buiten moet;
  • Als u naar het buitenland reist of terugkeert naar Nederland;
  • Als u onderweg bent in verband met een uitvaart en dit kunt aantonen;
  • Als u onderweg bent in verband met een oproep van een rechter, officier van justitie of bezwaar- of beroepschriftenzitting en dit kunt aantonen;
  • Als u in uw eentje een aangelijnde hond uitlaat;
  • Maaltijdbezorgers.
• De meeste locaties zijn gesloten:
  
  • Winkels (behalve voor essentiële zaken zoals levensmiddelen);
  • Locaties van contactberoepen zoals kappers, nagelstudio’s, seksinrichtingen;
  • Theaters, concertzalen, bioscopen, casino’s, etc.;
  • Dierenparken, pretparken, etc.;
  • Binnensportlocaties zoals sportscholen, zwembaden, sauna’s, wellness, etc.;
  • Restaurants en cafés.
  • Hotels zijn open, maar restaurants en roomservice in een hotel zijn gesloten.
• Winkels mogen vanaf 10 februari wel klanten laten bestellen en afhalen. Er moet een tijdsslot gereserveerd worden en er moet minstens vier uur tussen bestellen en ophalen zitten om funshoppen te voorkomen. Winkels die hun deuren toch openen worden helemaal gesloten.
  
• Onderwijsinstellingen bieden voornamelijk onderwijs op afstand tot en met ten minste 1 maart.
  
  • Basisonderwijs en de kinderopvang gaan open op 8 februari, met strenge voorwaarden. Zodra er één positieve test in de klas is, gaat de hele klas in quarantaine en laat zich testen. Er komen meer (snel)testen en intensiever bron- en contactonderzoek.
  • De buitenschoolse opvang en middelbare scholen blijven nog dicht tot 1 maart.
  • In het voortgezet onderwijs kunnen praktijkonderwijs, lessen voor examenleerlingen en het afnemen van schoolexamens in het (voor)examenjaar wel op locatie plaatsvinden.
  • In MBO, HBO en WO mogen examens en tentamens worden afgenomen en is praktijkonderwijs mogelijk.
  • In alle vormen van onderwijs mag er een uitzondering gemaakt worden voor het begeleiden van kwetsbare leerlingen en studenten.
  • Voor kinderen van ouders die een cruciaal beroep hebben, is er noodopvang op de basisschool of de kinderopvang en buitenschoolse opvang.
• Alleen (para)medische contactberoepen zijn toegestaan.
  
• Ontvang thuis niet meer dan 1 persoon van 13 jaar of ouder per dag. Uitgezonderd mantelzorgers.
  
• Ga maximaal 1 keer per dag ergens op bezoek.
  
• Werk thuis. Alleen mensen die essentieel zijn voor de voortgang van een bedrijfsproces en die hun werk niet thuis kunnen uitvoeren, mogen naar het werk komen.
  
• Ga alleen naar buiten met leden van je huishouden of met een groepje dat bestaat uit maximaal 2 mensen. Uitgezonderd uitvaarten tot 50 mensen.
  
• Volwassenen sporten alleen of met zijn tweeën, en alleen buiten. Kinderen t/m 17 jaar mogen sporten in teamverband en mogen wedstrijden onderling spelen, maar ook alleen buiten.
  
• Maak alleen gebruik van het openbaar vervoer voor strikt noodzakelijke reizen.
  
• Blijf in Nederland. Ga niet op reis naar het buitenland en boek geen buitenlandse reizen tot en met 31 maart. Er gelden reisbeperkingen. Een PCR-test én sneltest zijn verplicht en mensen moeten 10 dagen in quarantaine wanneer ze inreizen.
  

Hoe kun je verspreiding van het coronavirus voorkomen?

• Blijf thuis bij klachten, laat je testen en ziek uit.
• Was vaak je handen met water en zeep.
• Hoest en nies in de binnenkant van je elleboog.
• Gebruik papieren zakdoekjes om je neus te snuiten en gooi deze daarna weg.
• Schud geen handen.
• Houd 1,5 meter afstand (2 armlengtes) van anderen.
• Vermijd drukte en draag een mond-neusmasker in openbare ruimten.
• Werk zoveel mogelijk thuis.

Heb je meer vragen over het coronavirus?

Lees de Vragen en Achtergronden of neem telefonisch contact op met het RIVM via 0800-1351 (dagelijks geopend van 8:00 tot 20:00 uur).

Wil je laten testen of je het coronavirus hebt?

Neem contact op met de GGD via 0800-1202 (dagelijks geopend van 8:00 tot 20:00 uur). Hou je burgerservicenummer (BSN) bij de hand. De test is gratis. Lees ook de informatie van het RIVM.

Heb je verdere ondersteuning nodig?

• Rode Kruis Hulplijn - 070 4455 888 - Hulp en advies bij quarantaine en een luisterend oor. Maandag t/m zondag bereikbaar tussen 9:00 en 21:00 uur.
• Luisterlijn - 0900 0767 - Voor een luisterend oor. 24 uur per dag bereikbaar per telefoon, chat en e-mail.
• Stichting MIND - 0900 1450 - Voor ondersteuning bij psychische klachten en lotgenotencontact. Elke werkdag bereikbaar tussen 9:00 en 18:00 uur.
• 113 Zelfmoordpreventie - 0800 0113 - Voor hulp bij acute zelfmoordgedachten op anonieme basis. 24 uur per dag bereikbaar per telefoon en chat.
• iPractice - 020 2444 889 - Voor een telefonisch consult door een psycholoog op donatiebasis. Bereikbaar op afspraak.
• Mantelzorglijn - 030 760 6055 - Voor informatie over mantelzorg en het coronavirus via telefoon en WhatsApp. Bereikbaar op werkdagen van 9:00 tot 18:00 uur.
• Coronahulp.nl - Verwijzingen naar websites voor praktische hulpvragen.

Alle vorige megathreads.

Guys, I wrote a new DD but WSB moderators keep removing it and all other SNDL posts for some odd reason so here's the link posted on /SNDL . Please share and crosspost to other subs. https://www.reddit.com/SNDL/comments/l9rbri/im_convinced_sndl_is_on_the_verge_of_a_big_merge
SNDL OR SUNDIAL GROWERS is a debt-free cannabis company currently trading at .49 cents, more than 98% down since its ipo price of $13 back in 2019. It's not just SNDL tho, the ENTIRE CANNABIS SECTOR has been pressed by short sellers since its peak in 2018. But these shortsellers are getting scared and shitting their shorts (pun intended) cuz of the recent mega squeezes that we've witnessed in GME, BB, AMC etc. But also cuz Biden/Kamala administration is in talks of legalizing it on fed level. So GME, BB (which i bought at $4.10 and wrote a DD on it back in November) and other stocks have these key things in common with SNDL when they were about to pop :

1. GOLDEN Cross 2. Highly Shorted 3. Positive PR 4. Expanding Market 5. Under $10 stock 6. Actively traded by young traders

[UPDATE Jan 28] ALL THIS PRESSURE ON ROBINHOOD AND OTHER FRAUD CASINO APPS TO REOPEN TRADING RESTRICTIONS TOMORROW WILL CAUSE OUR STONKS TO EXPLODE LIKE PENT UP DIARRHEA 🌋🌋🌋🌋
House always wins but not if we all unite and fight against it. Restricting our baby penny $SNDL from trading was truly a blessing in disguise. It has now caught the attention of the mass media and we're getting free coverage along with $GME, $AMC etc. Even Dave Portnoy (Barstool guy) is ticker tagging $SNDL on his tweets who is also in the center of all this sh!tstorm.
So with that said, we launching this rocket very soon! BTFD but most importantly DON'T F*CKNG SELL!
​
*I'm not a financial advisor

A day or so ago, I wrote this, and of course, I was downvoted to hell. It was both expected and entertaining.
In the comments, I got all sorts of shit talking about how my math was off and

potential returns of 30x? the potential return on a short is 100%. And thats not even including the interest.

It just showed that 1) the GME "investor" has absolutely no regard for information and 2) the little that is given is undigestable.
In the post, I also wrote this:

This is becoming as much an opportunity of a lifetime on the short side, as it was on the long side when the stock was in single digits.

And as expected, I was asked to "short it then". To which I replied honestly, that I will look into possible plays of shorting GME. I then spent almost the entire weekend trying to analyze GME options as of Jan 29 close, and the conclusion was simple... There is no winning in GME options with a WORTHY risk.
I'll explain what that means, but for the near 5million people who just joined the subreddit yesterday, I'm going to take a wild guess and say you're only here for "tendies" because you saw a billboard sponsored by an actual autist who has been lurking the subreddit for years. Or at best, you finally saw a news segment that captured your attention and you thought "oh, I can make money".
Well, welcome aboard! You belong here and I mean that sincerely.
So, first thing first, I didn't short. It makes no fucking sense to short given the risk/reward ratio. Hedge Funds and billion-dollar institutions are shorting NAKED for mega returns because they can afford that... and even then some of them are going BK. Yeah, that's right, they're shorting with their pants off and their dicks in their hands. That's why they felt so exposed when the stock decided to propel itself through the fucking stratosphere and nearly reached escape velocity. But the more important thing to note is that it didn't actually reach escape velocity, a crucial thing for a mission to the moon.
Today, go look at the GME options... here's a link.
Despite a 30% fall, every PUT option across the board is down by mid-double digits. The picture is equally shitty for a vast majority of CALLS, even some ITM calls... and rightly so, CALLS shouldn't be going up if the price is going down (given all other variables remain unchanged).
But that is not how the world works and variables don't remain unchanged. IV, a crucial aspect of options will crush whatever you buy, CALL or PUT, unless the stock sees truly retarded movements... and I mean 60-75% or more.
Despite that, I'm seeing people buy Feb 05 $800 CALL for $500 a contract. Some even paid about $3k a contract at the height of the day.
Now, while this seems like a good idea because if the stock reaches $800, you will indeed be the perfect person to go to the moon. On top of that, your 90 tonnes balls of steel filled with autistic sperm will be enough to fill moon craters with your savant jizz and in a matter of 9 strokes, you'd have made that shitty rock full of life.
So, why am I writing this. The goal of the last post wasn't to scare you... It was to let you know that there are other, unseen forces trying to take your fucking lunch money. Instead of listening and managing your risk, you went ahead and gave them the whole thing and then bent over.
The goal of this post is to try and get some of you savants to stop taking the risk that isn't worthwhile. Many of you aren't even sitting at a casino anymore, you're actually sitting at a bonfire and using your wallet for fuel... it's great if you're a billionaire, and if so, continue fueling it.
But, learn to manage risk. Even the man, the myth, the legend (DFV) didn't just wake up one day and decided to buy a 300% deep OTM money calls expiring in 4 days. He did a 1000x on his investment after detailed analysis, months of research and then followed it with brilliant risk management by longing shares and calls. For those who know, check out his YouTube and then read the timestamps on the uploaded videos. Some of them go back 6 months.
And I get it, GME is a risky stock and has returns to justify it as an "investment". But that is why the words manage and unnecessary are used. Some risks are worthwhile... some are not.
TLDR: Stop taking unnecessary risks by buying deep OTM calls that expire in 4 days.

The last drama post I did about Kuma Miko seemed to have gotten some praise, but some wished to see a Hobby Drama post that had consequences outside “people got angry over it”. So without any further delay, here’s a story about a studio that’s close to my heart, one that I’ve backed twice and seen die twice.
Note: This is a fairly lengthy drama, so forgive me if I’m not able to provide all of my sources. Most of the front half of this comes from this video, which chronicles the first half of Lab Zero entirely in Russian.
From Ahad to Mike Z
Let’s start in the beginning. Alex Ahad is a freelance illustrator who, in between other work, had created character designs for a prospective fighting game. Mike Zaimont is a professional fighting game player best known for games like BlazBlue and Marvel Vs. Capcom, but since 1999 had been coding a custom engine in his free time, which he hoped could be used for a fighting game. The two met in 2008, and the two quickly realized that with each other’s help, their dream could come true. In 2010, the two joined the newly developed game studio Reverge Labs. Joining their team was Mariel “Kinuko” Cartwright, a friend of Ahad’s and daughter of a Disney animator who helped animate games such as Scott Pilgrim vs. The World and Shantae; Peter Bartholow, who acted as CEO of Reverge as well as their PR arm; and an assortment of other animators and designers. Their goal: a fighting game in the style of Marvel vs. Capcom 2 with hand-drawn animation that they called Skullgirls.
After obtaining publishers in Autumn Games and Konami (at the time of development the Microsoft required indie devs to have a retail publisher in order to bring their games to Xbox Live Arcade), the team got to work on Skullgirls. Initial impressions were favorful - people liked Ahad’s unique character designs, the fluid animation, and the solid engine Mike Z built - but upon release, there were some concerns. The time and money needed to develop each character meant a starting roster of only eight characters, a far cry from other fighting games (the original MvC had 15 characters in 1998), and due to the team trying to get the game out, there was no in-game move list. Some were also concerned that the cast, consisting entirely of women, was too fanservice-filled, although Bartholow said that the characters were just attractive women who could fight as opposed to characters using their sexuality in battle (Ahad said that sex wasn’t his main focus, he just wanted to have monster girls fight each other). The team at Reverge Labs stressed that they would continue to update the game, with plans to add DLC if the game sold well enough. Good thing nothing could go wro-
Everything goes wrong
Alongside publishing Skullgirls, Autumn Games and Konami had previously published a karaoke game called Def Jam RapStar. Unfortunately, around March 2012, the time Skullgirls released, both parties were at the end of several lawsuits made against them - one argued that Autumn and Konami did not get the rights to some of the songs used in the game, while another claimed that the game was funded with a bank loan which Autumn Games was unable to pay back. The result of these costly lawsuits was that Autumn was unable to pay Reverge the money made from Skullgirls - this led to the entire Reverge team being laid off around July, and the future of the game in the air.
And so, the team decided on a whim to reconvene as a new development studio, Lab Zero Games. At a fundraiser for breast cancer research which included a fighting game tournament, Mike Z revealed the first DLC fighter and promised that new information about her and the team would be posted soon. This would turn out to be an Indiegogo fundraising campaign that asked for $150,000 to develop the first DLC fighter, with more characters promised if people backed enough.
In the end, $829,829 was raised in the campaign, enough to fund five DLC characters, a bevy of stages and voice packs, and other features. It was quickly becoming a cult classic.
The Skullgirls Curse
And so work on Skullgirls DLC was underway. However, a variety of events happened to befall Lab Zero during development, some causing controversy and others just annoying the team. Some dubbed this “The Skullgirls Curse”. So let’s go over some of them:

• Paypal Woes: During the Indiegogo DLC campaign, Lab Zero announced that Ahad had created around 30 prospective designs for DLC characters, and that there would be a vote to see which characters would be the two “mystery characters” teased in the Indiegogo campaign. As you would guess, this caused the Skullgirls fanbase to get heated, to the point where some stressed that they would ask Indiegogo for their money back if their character didn’t win. PayPal, who managed the funds for this campaign, was concerned about these threats and put nearly all of the money on hold. Bartholow tried to negotiate with PayPal, and was eventually able to get the funding - once PayPal was given a hefty sum as collateral.
• Bad Juju - If you notice on the list of prospective DLC characters, one character is Juju, a character who was designed by Ahad from a fan’s suggestion on a Whiteboard Wednesday art stream. Ahad seemed to like the idea of the character, and kept building her up until she became a legit character in the game. The original fan made a joke on Facebook that he’d like to be compensated for the design, which led Lab Zero to negotiate obtaining the character rights from him. They eventually worked out a contract that would give them the rights to the character, but only if the original fan didn’t reveal it until Lab Zero announced it themselves. The fan then posted about it on the Skullgirls forum the very next day, breaking the NDA immediately and making it so that Lab Zero couldn’t use the character at all.
• Don’t be (Red) Cross with me: One of the characters included in the base game of Skullgirls is Valentine. As you can tell, the two biggest features of her character are her being a nurse and a ninja - as such, her costume is decorated with red crosses. This was upsetting to the real Red Cross, which fights hard to prevent its trademark from being associated with violence - as such, when they came to the Skullgirls publisher demanding a change, all red crosses in the game had to be changed to magenta.
• #FucKonami: In November 2013, due to Konami barely helping at all with the publishing process for Skullgirls (they refused to greenlight any patch or DLC until Lab Zero tested it itself on their own time and money, they didn’t help with Microsoft’s certification process for Xbox, etc), Lab Zero dissolved their publishing agreement. This led to a massive snafu where, due to the dissolution, the original Skullgirls was taken down on consoles, and Lab Zero had to scramble to get a new publisher on the consoles side and then reupload the game as Skullgirls: Encore. It was a tangled web of issues which the above YouTube video relays, but required certification from both console storefronts and even the Japan storefront, as their publisher there was also coincidentally being dissolved at the same time without Lab Zero knowing.
• EVO 2014: During one of the largest fighting game tournaments of 2014, Skullgirls was promised a space for airing their tournament stream by controller distributor Madcatz. Lab Zero and Autumn provided a pot for the tourney, and everything was smooth sailing - until a multitude of delays made it so that the entire time Skullgirls had for streaming was replaced with Tekken tournaments. By the time these issues were fixed, only the final four matches were able to be shown.
• What’s the worst kind of ship? Censor-SHIP!: In April 2015, one of the patches of Skullgirls altered the animation of some characters, which according to Lab Zero themselves was because of their own artistic values (while they admitted that panty shots in a fighting game comprised entirely of girls is unavoidable, they didn’t want to go out of their way to show them). As you might expect, this led to a massive onslaught of negative Steam reviews and caustic tweets from people who abhor censorship of any kind. Funnily enough, this brigade started around October, six months after the changes were made, and only via word of mouth - people didn’t even notice there was a change until someone told them about it.
• Backer characters: As part of their Indiegogo campaign, some of the highest-paying backers could have their original characters put in the background of some custom stages. Lab Zero warned these backers that these stages would be a casino and a ballroom, respectively, so their OCs should ideally be designed with a formal flair. Some backers did follow this unspoken rule - ZONE, a notoriously NSFW Flash animator who helped work on the DLC characters, made a perfectly formal look for his mascot Zone-tan. As for the others, well...
• SonicFox: This isn’t included in the compilation video mentioned above as this occurred way after all the initial Skullgirls drama. Basically, SonicFox is a five-time EVO champion and one of the best Skullgirls players in the world. In May 2020, after Skullgirls was mostly complete, they were given a cameo in Skullgirls’ training stage. Of note is that SonicFox is black, non-binary, and a furry, and the character added to the game was their fursona, who has a trans rights flag in the inside of their jacket you can only see for like one frame. People reacted as you would expect. Also, one of the original backers requested to change their character as they were now transitioning, which didn’t get as much flak, so that’s nice I guess.

So as you can see, Skullgirls had a menagerie of problems and issues during its dev time. However, their Skullgirls curse seemed to have faded away, as they had a new game in store.
If I was Indivisible
Indivisible was a new project of Lab Zero, announced in 2015 as Skullgirls DLC production was nearing an end. Billed as a platformer RPG similar to games like Valkyrie Profile, it would tell the story of Ajna, a young girl whose town is stricken by tragedy and she finds out that she’s a portion of the god of creation, who has grown discontent with the world and wishes to remake it anew. Its Indiegogo campaign focused on Incarnations, party members who came from a variety of cultures, religions, and demographics not usually represented in popular culture. And as you can see by the fact that it got over two million dollars in funding, people were excited to see what Lab Zero could do. They even got enough funding to get Studio Trigger, of anime fame, to create the opening for the game.
Of course, it wouldn’t be Lab Zero without the occasional issue here and there. As shown above, some Incarnations were changed or scrapped during development, which irked some who backed because of that character specifically (not naming any names, but look in the incarnation list and see if you notice any). Backer characters were included again, and although there were more places to add them so they didn’t look out of place, you still had the occasional few that did. Critics liked the art and presentation of the game, but disliked some gameplay issues: the second half of the game became a cakewalk once you progressed far enough, it was a bit of a pain to go from one end of the map to another, especially for side quests, and a bunch of party members simply weren’t complete. Most egregiously of all, the Nintendo Switch version of the game was ported by a different company and released before Lab Zero was even aware of it - which forced them to scramble again to patch it up so it was on par with other consoles.
Still, it was a better situation they were in than when Skullgirls started. They had a legit publisher in 505 Games, people were satisfied with the base game, and Mike Z mentioned how the base game would continue to be refined with gameplay changes, small additions, and guest incarnations from other indie games. NBC even announced that Indivisible would be adapted into a television program for their Peacock streaming service. Things were looking up for Lab Zero.
Everything goes wrong... AGAIN
During the production of Indivisible, Alex Ahad was let go by Lab Zero. Not much is mentioned about it except that he was growing increasingly hostile, making it difficult to work with him, and his art was not meeting the standards for the game. He left, tried to sue Lab Zero, and eventually agreed to a sizable settlement. Mariel became the lead artistic director in his stead, and the art team had to be rearranged to compensate.
Now, as Lab Zero was preparing to transition from being employee-owned, Mike Z was made the temporary head of the studio. In June of 2020, Mike Z did an “I can’t breathe” joke during a Skullgirls livestream just days after George Floyd’s death - he later apologized for this, claiming he was trying to bring attention to the issue. Soon, more people provided proof that Mike Z has had a history of sexual harassment. Kinuko chimes in as well, noting that while she tolerated inappropriate behavior for years, when she talked to Mike Z about it, he blamed her for his actions. She talked with others in the team, who came to the conclusion that Zaimont had treated all of them like this. Some Lab Zero employees resigned on their own, while others pushed for Zaimont to resign. However, as Mike was still head of the studio, he dissolved the studio board and laid off the rest of the staff.
So where does that leave everyone?

• Ahad is still doing art on his own, and gets by with commissions and his Patreon.
• Kinuko, as well as the majority of Lab Zero, created a new studio called Future Club, which has promised to create new titles with the same art style they refined from Skullgirls and Indivisible.
• Autumn Games still own the rights to Skullgirls, and with the help of some former Lab Zero devs, created a mobile version of the game. It’s surprisingly not bad, although it’s of course stuffed with microtransactions. However, they’ve apparently made enough to fund a completely new character for the game for both the mobile and console/PC versions.
• After everything with Mike Z, 505 games put out a statement which signaled the end of all development of the game, leaving it unfinished. Mike Z has been suspended from Skullgirls streams and the like, making his future in the gaming world unclear.

There’s probably something I’ve missed in all of this, but yep. I backed them twice, both for Skullgirls and Indivisible. I don’t regret it, and I’m looking forward to whatever Future Club does, but I won’t lie - I’ll always miss what could have been.