The worst about the SpaceX IPO is Nasdaq changing their inclusion rules for the Nasdaq 100. The index fast-tracked SpaceX stock for inclusion 15 days after the IPO, instead of the normal three-month seasoning period. They also changed its 10% minimum float rule to a 3x weighting boost for low-float stockss.
So many people will unwillingly and prematurely invest into SpaceX, before it has any chance to discover its real price.
IE: The floating, 5% at launch, could attain 30% end august, if Nasdaq didn't change their rules it would have included SpaceX after this..
So, the inclusion rules are basically "these are the hard limits that specify which stocks are eligible, unless someone really big and lucrative comes along, in which case it's whatever and we'll just adjust the rules to make them eligible"?
What do you mean? I was under the impression that including SPCX has been massively beneficial for Nasdaq. It creates lots of trading volume and sends a quiet signal to other massive tech companies looking to IPO to come to them, rules be damned. So they're definitely extremely lucrative for Nasdaq.
Having the stock traded on their board is good for them. They also maintain an index. Elon made inclusion in the index a prerequisite for trading the stock on the board.
> Elon made inclusion in the index a prerequisite for trading the stock on the board
Source?
He may have claimed this. But he has no power to. Once a stock is publicly listed, every exchange can trade it. Where Musk had influence was on to whom he paid his listing fee.
"SpaceX stock is expected to be listed on the Nasdaq. To secure such a high-profile listing, While listing requirements remain unchanged, Nasdaq recently amended its index-inclusion rules to accommodate companies like SpaceX when they go public."
Notice a listing on the board and an inclusion in an index are two different things. Nastaq changed the index to secure the listing of SpaceX on their board.
In this case I think it is, because they're talking about whether a particular deal with be lucrative for one particular company named Nasdaq Incorporated.
Much like how Wile E. Coyote is a "safe" customer for Acme Inc, even though he purchases dangerous explosives and deploys them in reckless ways.
I think the rules are there are hard limits unless a multi-trillion dollar company IPOs with a significant absolute float, in which case tracking the "market" obviously includes said company.
A stock index is a business model. The concept of "passive" investing is alluring because you don't have to do any work. However, choosing a proprietor of a index that actually looks out for your well-being is, arguable, always relevant.
We are now at the point where companies can game the system of indexing. Investors need to wake up to this fact and realize this is likely a paradigm shift.
If the underwriters of a fund based on an index are involved in manipulating the content of the index, they are effectively the managers of a managed fund pretending to be an index fund.
Yeah, this is correct. There are so many large multi-trillion dollar companies coming to IPO, which if your are passive index holder and you are trying to track the market it is correct for these companies to be included. And besides SPY has chosen not to fast track where QQQ has. It is a free market, and folks are free to NOT buy QQQ. So I'm not sure why this is a point of debate.
"People" in this instance aren't always informed buyers. Sometimes they're buying an index fund because they don't have the time to research individual stocks and sometimes it's their pension investing.
The normal seasoning period is there for a reason. There is a massive downside to premature inclusion of a stock that is initially overvalued and then settles to a reasonable/sustainable value.
> Sometimes they're buying an index fund because they don't have the time to research individual stocks and sometimes it's their pension investing
Then they should buy a broad-market fund. The kinds in which new issues are a tiny fraction or, if it’s following something like the S&P 500, not included at all. Following the Nasdaq 100 and then complaining it has too many risky tech plays is a bit silly.
The reason you know the people complaining the most about this aren’t serious is that they don’t lead with crsp and vti.
They did change their rules, they did it fairly specifically for spacex and it did drive inclusion in a major index fund (perhaps the biggest one).
Now me personally, as a holder of vti I am good with the change and my included exposure to spacex. Further I think mostly complaining about the inclusion/exclusion of a single name in an index _defeats the point_.
But for those decrying the shenanigans crsp and vti are the example to go with.
how embarrassing! Look, your joke was "If it's only 1.2%, hey, that's not that much, just give it to me for free!" We don't have to believe SPCX is worth whatever it's trading at today, but that 1.2% isn't simply being given away. Under capitalism, money is exchanged for goods and services.
FWIW, I read their joke differently: you were the one who said "only 1.2%", and they turned that on you by asking for you to part ways with "only 1.2%" of your net worth.
They are not questioning money exchange, they are questioning the "only" part, claiming this is significant.
My (non-motivated, don't have NASDAQ or SpaceX) take is that isn't this how these funds are supposed to behave? You buy NASDAQ if you can take risk, S&P otherwise. If you check out what companies are in the NASDAQ, it's not like it's not majority tech, of which a lot of them are AI-based, so adding SpaceX to that mix is reasonable - and if they waited a year or so for price discovery, and had SpaceX been a popular choice (still can turn out like that), then investors would've missed out on those gains.
Yes, and there are tiers of risk. What people are complaining about is that with the recent behavior, NASDAQ has arguably increased the level of risk involved. If it's as simple as "buy NASDAQ if you can take risk" then that would imply it should pull in meme stocks when the WSB crowd are doing their diamond hand thing.
> the inclusion rules are basically "these are the hard limits
The inclusion rules for indices change every couple of years. That’s why there is an index provider versus a mathematical formula. (There are also formulaic indices. They aren’t very popular.)
My comment never says the rules are set in stone permanently - only that every stock needs to abide by the current set, unless there's enough money in play in which case the rules are edited then and there to specifically accommodate that company.
> unless there's enough money in play in which case the rules are edited then and there to specifically accommodate that company
The Nasdaq 100 rule change covers multiple companies.
Like, there is so much wrong with the SpaceX IPO. It’s kind of weird, as someone who’s spent time in both the equity capital markets and private markets, to see this being the thing finance Twitter has fixated on.
> The Nasdaq 100 rule change covers multiple companies.
I don't think that's relevant to the point you're responding to there. A rule change can apply to many parties while the content and timing nonetheless target a single player. The two things aren't at odds.
it's just a generic dismissal, a way of putting someone in a box without actually engaging with anything they say. which lumps it in with 90% of all internet arguments really. "Your argument must be invalid because you're the type of person whose arguments are invalid."
my account is 11 months old, which invalidates your theory that i'm part of some recent influx. also is septemberism still a thing? i thought that went away when most people had home internet rather than getting it through a university.
We're living under true capitalism right now. Look at the incentives. I don't see how we could have progressed to anything besides this, this is the natural outcome of the system in place.
American libertarians often imagine some kind of wonderland capitalism where everyone agrees to play by the rules that aren't enforced by anyone. To my knowledge this has never existed as a long-term equilibrium and it can't exist. I've yet to meet anyone who can tell me how their imaginary ideas go up against claims like
1. Encouraging infinite growth with no controls or limits will always lead to monopolism and is a one-way ratchet
2. Power vacuums are always filled (no public government leads to private companies stepping in and taking the dictatorial role, this time without any of the democracy)
The answer is that most libertarians see both 1.) and 2.) as a good thing they want to achieve. They imagine themselves benefiting as a high profile worker of that monopoly or rule setting company.
Also, note how super ok and welcomming libertarians are toward racists or even fashists. They do dislike pro-democratic center groups, they hate democratic left.
The United States is far more socialist than capitalist and it’s not close. In the early 1900s the federal tax rate was 0. Now we spend 125% of what we bring in in taxes. That is definitely not capitalism. That’s not a free market, that is the government spending far beyond what’s even feasible
What does the relative level of government spending versus taxation have to do with whether businesses will self-regulate? You're just spewing non sequiturs here.
They said we live under true capitalism right now we I’m clearly showing we do not. Not to mentions the US is far from “self regulating” there are millions of words of regulation in the US.
No you didn't, all you did was complain about taxes and say that there exist regulations by counting the number words in them. Not all words are equal, not does it mean that they're effectively enforced. Looking at various monopolies like Ticketmaster or the UnitedHealth group and how they've been allowed to flourish it doesn't seem like America has anywhere near enough regulations to be considered true capitalism. If the market economy isn't a free market because a monopolist is exerting outsize control on the market, it's not a free market. That doesn't make it socialism though, that makes it crony-capitalism instead.
First of all I didn't complain. I don't care what happens personally. Secondly it's just a fact that the US has a tremendous amount of regulations compared to the past. Just look at how few regulations existed in the 70s vs today. Apparently you don't like word counts, but the reality is there are a enormous amount today that didn't exist in the past.
That's not a free market economy.
"it doesn't seem like America has anywhere near enough regulations to be considered true capitalism."
You can't regulate your way into capitalism because capitalism by definition means markets free from government interference. The more it interferes the less capitalism you have.
United Healthcare is a great example. The governments enforce these companies being a monopoly be restricting which companies can operate in which states, having an enormous amount of red tape and regulation, documentation laws, etc.
If it was truly "capitalism" the government wouldn't' get involved at all. Part of the reason that doctors are so expensive to see is because there is a board that the US Government certifies to allow them to control which hospitals are allowed to be teaching hospitals for doctors.
If it was true capitalism there would be no regulation there and any college could graduate doctors. This artificially keeps the supply lower than it would be. These are facts.
For capitalism to exist we must have a system in place to protect private property, e.g. a government. That government must be the most powerful entity to be able to protect property. The capitalist system is competitive, and controlling the decision-making of the most powerful entity is an enormous competitive advantage. Once you control that entity you'll naturally want to expand its powers. Hence capitalism will always lead to a growing government that capitalists will use to get a competitive advantage in their market. This is what capitalism will always lead to.
> socialist than capitalist [...] federal tax rate
My dude, you're acting like Federal government is the only government that matters. It's a common mistake, but in this context it's fatal to your argument.
It's fatal because federal spending is the least relevant kind, since so much of it (and so much of its growth) is for the military, and military spending indicates very little about whether a country is socialist or capitalist on the inside.
In contrast, state/local taxes and programs are--even today--still a majority of the spending that actually tells us anything useful for a socialist/capitalist spectrum, the stuff that involves schools, libraries, policing, homelessness, property rights, etc.
"since so much of it (and so much of its growth) is for the military"
So clearly you are pretty uninformed as the military spending is only 13% of the federal budget. Social Security (AKA a socialist program, IDK if anyone can deny that) is 22%, Medicare (another socialist program is 14.2%). Interest on our prior spending (a lot of it from SS and Medicare, etc, some military too. is 14%
So, if you add social programs you has (SS = 22.5%, Medicare = 14.2%, not counting education) that is 36% of the budget or nearly 3x miltitary spending.
A capitalist economy would NOT have those things are as they are not free market at all, they are the government forcing your to pay into them.
This is another aspect where your thesis is not-fully-baked. If you want people to receive what you meant, you have to stop writing it wrong.
1. You spoke about "the federal tax rate" and claimed it was "0" in 1900.
2. The most charitable interpretation of that is that you meant to say income tax: That's usually what people mean when they're too-vague; It would literally be $0 before it was introduced in 1913; You can't have meant all taxes because those were absolutely >0 and you wouldn't make that kind of math mistake, right?
3. When critiquing the growth and dominance of the income tax, that excludes the separate taxes (payroll) that go to SS/Medicare.
> capitalist economy
I'm not taking a stand on the "what the US is" conclusion at this point. What I'm saying is that your argument--how you're getting there--is unsound (can't ignore state/local level) and unclear (which numbers from where).
The vast majority of you money goes to the federal level. You are here nitpicking and not dealing with any of the real issue. You are dancing around it for the sake of semantics rather than dealing with the actual issue.
The term "capitalism" was literally only created for the purpose of writing criticisms of the (then) current system of markets/trading/taxing/investing.
Try actually defining capitalism in a way that doesn't apply to basically any random society since the dawn of agriculture.
Stuff like people buying and selling items using a currency for a price the individual chooses has been common to basically every human society we have written records for.
The formalization of the process of buying shares in a company and receiving dividends/profits as a result is a bit newer, but the general concept of "I give you money, you use it to make something and sell it then give me money back" has been around for roughly the same amount of time as currency itself.
Anyways, my point is that there is a lot of things to criticize about our current world/economy, using the term "capitalism" while doing so is too vague to be useful in any way.
(Communism/socialism does have more of an actual definition, but very few people are aware of or use it, so it doesn't help all that much).
Saw an interesting discussion on how capitalism has existed for as long as markets have existed, including ancient Greece, and how it inevitably leads to wealth inequality, monopolistic behavior, unsustainable resource extraction, and all the other negatives we see today. The only difference is that in Greece, all of these negatives would have been applied locally but now they're all being applied globally. Instead of one super-wealthy man being a pain in the ass for the local Athens economy, he can now ruin things for everyone everywhere.
I would more simply define that as "wealth inequality" rather than capitalism (or more broadly, power inequality) and perhaps go on to say that the real problem is that, while you can't realistically prevent/remove all inquality, most systems do a poor job of preventing the people with more money/power from using that to consistently increase their own share.
No need to do that, Capitalism—just like feudalism and mercantilism before it—is about how power is distributed. Both feudalism and mercantilism also had extreme wealth (and power) inequality (feudalism arguably had more), as did communism for that matter.
What makes capitalism different is that the power is distributed along capital (as opposed to handpicked by the king under feudalism; or embedded in government monopoly under mercantilism).
In other words, in capitalism, the owners of capital (or the owners of the means of production; i.e the rich; the aristocracy; etc.) are the ones who get to dictate the living conditions of the rest of society. The rulers (be it democratically elected government; an absolute monarch; a military dictatorship) will legislate in order to maintain the interest of the owners of capital. The police (or military) will fight for the interest of the owners of capital, and will suppress any resistance against the interest of the rich, etc.
Nah, Ancient Greece has nothing to do with today’s capitalism. It’s a dumb example and the parallels will fall down to a close inspection. Different world.
Pretty sure Adam Smith captured that in his writings.
Full laissez-faire, free market capitalism generally leads to wealth (and power) imbalance. Regulation is necessary to prevent that (assuming you want to maintain a "fair" democracy of sorts and not regress to oligarchy).
I can't see any system where people are treated fairly (equally and able to reap benefits of their labor aka not slaves) that won't lead to inequality. People are just different, and will have different production rates.
Sure, and that's mostly ok. I earn more than many people, some people earn more than me.
The problem is that extreme wealth imbalance leads to a power imbalance that tends to throw society into turmoil. The French Revolution being a canonical example.
Broadly speaking, I think most people would agree that Maria Hernandez the world renowned neurosurgeon who does 200 surgeries a year makes dozens or perhaps even hundred of times the amount Joe Smith the housr cleaner makes.
Even if they perhaps work the same number of hours a year, Maria has more training and (maybe) some kind of rarer aptitude and as a result we have a lot more house cleaners than neurosurgeons (in america and other places there a whole bunch of other factors like who gets access to the training and so on that causes some of these imbalances, but that's a whole 'nother comment).
The people, in general, are probably considerably less happy with the idea that jk rowling the ultrarich author gets to use her money to try to pass laws taking rights away from people she doesn't like.
Look at the difference between Ellison and Musk. Ellison is probably has similar levels of power to Musk, but he (afaik) mostly uses it to buy giant yachts and annoy other fortune 500 companies, and as a result most people don't really care that he's a billionaire.
Musk, on the other hand, tries to use his power to screw with government services and publically attack minorities and so on.
> Stuff like people buying and selling items using a currency for a price the individual chooses has been common to basically every human society we have written records for.
That's a market economy, which may or may not be capitalist. Markets have existed for thousands of years under various economic systems.
Agree on your other points though, 'capitalism' was coined to just describe and criticize the system they saw emerging, one of private ownership of the means of production, combined with wage workers who do not own their tools or the product of their labor, but instead sell their time.
But its hard to have discussions around because too many people conflate "market economy" == "capitalism" but you can have markets in a feudalist, socialist, communist, any other society, that doesn't inherently make them capitalist. But I still think its useful as a term, but only to specifically describe who owns the capital.
Apply it to reality, and things get muddy really quickly.
The major issue is the "private ownership of the means of production". While some argue it's a recent development, others (like me) argue it has been present since the dawn of civilization and, ignoring the "free market" and "voluntary transactions" part, one could argue both feudalism and socialism are capitalistic systems, with the latter often receiving the term "state capitalism", instead.
And then there's the issue of "wage workers". Workers who own their means of production (i.e. freelancers) are still often considered "capitalists" themselves, as under the umbrella of "small capitalists", even if they rely more on their labor than their ownership.
> Feudalism is a term often used to describe the social, economic and political conditions that existed in Western Europe during the Middle Ages. At its core, it was a system in which a landowner, or lord, granted a piece of land called a fief to a subordinate known as a vassal. In return, the vassal pledged loyalty to the lord, providing labor, military service, payments—or a mix of these.
And then the next paragraph goes on to say that historians think this is way too simple to describe what real people were actually doing.
Either way, unless every single piece of property in the kingdom (including, like, plows and mill stones and spinning wheels) was granted by the king (or someone he had granted to) it seems like there's still a lot of room for buying/selling/investing.
I mean, it's an interesting answer but my basic point is that the "real world" is far too complex for a term like capitalism to be at all useful.
Even stuff like "free market", can a market be "free" if a government exists? What about monopolies? Etc etc.
I just want people to be more specific when they criticize systems!
plows and mill stones and spinning wheels are excellent examples of exactly what a feudal lord owned. They owned the land, the major structures on that land, and the major implements on that land. If you wanted to use them you paid the lord in fees via goods, labor, etc. It's basically the gig economy - you will own nothing, your labor will be for his benefit, and if you want to keep participating you'll make it worth his while.
Tesla does not, AFAICT, also own the land you live on. They pay you in fiat currency that can be exchanged for other goods sold by any provider.
A better comparison to support your "capitalism = feudalism" argument would actually be the era of company stores and truck wages: https://en.wikipedia.org/wiki/Sixteen_Tons
I agree about the company stores thing, but it's pretty common (right now in america) for someone to work at a factory, that they do not own, and live in a house, that they also do not own.
The distinction between that and some kind of stereotypical medieval serf living on a farm he was granted by a lord and producing crops that he uses to pay his rents and so forth seems somewhat minor.
Yes in general a modern american has more government enforced rights and protections, but at the end of the day a lot of rights aren't really all that relevant if you can't afford them in the first place.
Musk and I both have the right to build a factory to produce electric cars, but one of us is going to have a much harder time exercising that right.
(Not to say that we aren't living in a better world, we absolutely are, I would never trade places with basically anyone from "the past", but the point isn't that things aren't as bad as they used to be, the point is how do we improve what we have today)
I understand that you think that, but you're wrong according to pretty much every historical source.
If you don't understand the difference between a feudal lord an Elon musk I'm not sure I can help you. We live in a world where individual rights are orders of magnitude more significant that those of a feudal serf.
I think you might need to brush up on your historical studies. There's no such thing as a generic "feudal serf" that applied across multiple cultures and times.
People who might qualify for the label "serf" had all sorts of differing rights and responsibilities and cultures across the literally thousands of years of history we have access to, anything from slaves in all but name to people who had (the equivalent of) bills of rights and legal protections for things they owned and produced and what duties and obligations they had were enforced by contracts laws and judges.
Musk and I both have "the right" to build a factory to produce electric cars for sale, but one of us is going to have a considerably easier time exercising that right.
It's illegal for both Steve Jobs and I to to park in a handicapped space, but when he gets a fine for doing so, it doesn't affect him in the slightest and he (used) his power to avoid suffering from any consequences, whereas I am meaningfully impacted by the punishment.
“The law, in its majestic equality, forbids rich and poor alike to sleep under bridges, to beg in the streets, and to steal their bread.”
Are things better "now" than "then"? Yes, of course. I wouldn't trade places with basically anyone from more than 100 years ago. But that's irrelevant to the point that people like Musk and the thousands of similar but less famous people have too much power and that power is used to corrode our society.
Living in a house you rent and working at someone else's factory has a number of downsides. It's not all bad, but it's still worth actually considering what is good and what is bad so we can improve things.
Empirically this isn't true. However you feel about "true" capitalism vs socialism, countries underpinned by capitalism have prospered, even the socialist flavors (China, Scandinavia)...while the countries that have attempted pure socialism have all failed.
The problem with that logic is you're treating economic systems as if they all exist in a vacuum, and you're setting up a circular argument of if its successful its actually because capitalism, if it fails it must have been socialism.
It completely ignores the decades of external hostility toward any nation that attempted to build a socialist economy. Almost every attempt has been met with near immediate intervention from captialist super powers, particularly the USA. Nixon activeley worked to cause the military coup in Chile, Cuba has faced the longest trade embargo in modern history (and yet still managed to outperform its peers in the region in healthcare and literacy). Its unscientific to attribute these struggles purely to internal failure when they are subject to deliberate economic warfare.
Secondly, your definitions are being stretched to fit your thesis. Scandinavia is not "socialist flavored" it IS a social democracy, with free markets. Claiming China's success is from captialism is ignoring that its economy relies entirely on state owned land, state owned and controlled banks, and state owned companies, and mandatory five year plans coming from the state.
If we classify any successful state-led initiative as "capitalist" and any blockaded, intervened upon state as "purely socialist" then the argument is an unfalsifiable truism.
I see socialism benefitting from capitalism, but how have capitalistic nations benefitted from socialist ones (other than a place to put military bases)?
smartphone glass: corning, gorilla, etc is an east german invention
the soviet union also pushed humans into space
cuba produces a ton of doctors who then go on to heal people too poor to train local doctors
in terms of, how does socialism benefit jeff bezos and elon musk and the actual capitalism of epsteins and the like using money as power mad exption from the law, i guess musk built space x on soviet rocket designs, but otherwise not a ton.
does it need to benefit the ultra wealthy capitalists to be good though?
Bezos and Elon receive socialism from the American government, no need to talk about other countries there. They are backstopped, they have all their needs met by the government and the government gives them tax money from all of us and then grants them exclusive control over an economic monopoly so they can extract more directly from us
Usually "true capitalism" means one of two things:
1. Capitalism where there is no government or regulatory interference, and the "invisible hand of the free market" produces some kind of utopian society based purely on every business abiding by rules enforced by no one, where somehow corporations don't take advantage of workers they way they do now despite there being no laws against it.
2. The same thing but sarcastically because it's obvious that that system would be demonstrably worse than the restricted version of capitalism that we have now.
The "invisible hand of the free market" works only, if you have many market participants competing one against another. When a participant wins the competition you get monopoly, when multiple participants collude you get oligopoly, or cartel. Market can not solve this.
Where does capitalism mandate corruption? Yes, it is not realistic to assume there is no corruption, but capitalism in and by itself does not mandate corruption.
Obviously this all falls apart when capitalism can buy legislation. We are seeing how the USA is currently eroded by a few oligarchs.
They're not saying it 'mandates' it as law, but that the systematic incentives inevitably lead to corruption. The ability to buy government is irrelevant - this is just the easiest method right now of converting money into power. If there was no government to buy, private business would execute that conversion themselves by ruling over people and enforcing their wishes directly.
"capitalism" was meant to harness the greed in men- they're self-assembling groups on mostly level playing fields, and the people vote during every purchase. The more votes they get, the more opportunities to expand. Only when the people fail to choose wisely is a governmental body supposed to come in and help "regulate". The other option is the government decides from on-high how things should work, and you'd better hope that what got them to power was good. Then these people need to be wizards at allocating labor, research, and benefits.
And the amount of votes someone gets is proportional to the votes they previously received, so the best vote-getters end up having all of the votes to cast between each other, and everyone else ends up with zero votes.
Crony capitalism is true capitalism. The idea that capitalists will simply choose not to organize to benefit their own positions out of some sense of altruism is insanely naive, and puts you in the same camp as USSR apologists claiming that their issue was the lack of true communism. A system that fails when people subvert it to their own benefit is a system that fails.
The power of who lives, dies, and what's allowed are made by the individual consumers (or groups of consumers), so it's the same problem we have with democracy.
> The directors with of such [joint-stock] companies, however, being the managers rather of other people's money than of their own, it cannot well be expected, that they should watch over it with the same anxious vigilance with which the partners in a private copartnery frequently watch over their own
You could make a decent argument that capitalism will very likely end-game devolve into crony-capitalism as it's typical failure mode, but I don't think it's written in stone.
It's funny to me. Everyone rails about Atlas Shrugged being some libertarian fantasy story. I always read it as an allegory warning about crony capitalism and how it ruins society along with a story about trains and magical perpetual motion machines.
Socialism capitalism, history shows basically all human systems devolve into corruption regardless of how sound the underlying concepts are.
Which I’m surprised people don’t point out more. What does it matter which system is the best when at the end of the day the powerful people are going to make back room deals to subvert it and that always leads to a feedback loop
Yep. This is how I view the world these days too. All systems will inevitable devolve into corruption and centralized power. The best system I suppose is the one that starts with the most distributed means of power possible, and then that gives the most quality of life years out of anything before it's time for a horrific reset again.
The best way to sort this out is to have truly random election winners and heads of organizations and bids for govt contracts. And yes, you must have enough numbers in the input for random selection.
If a Pvt corporation fails to deliver a bid or lies in customer features, then CEO is caned (Singapore style) and taken out of the next pool for random selection.
If a politician fails to deliver an election promise in his term, then politician is caned and taken out of the next pool for random selection. Randomly selected judges decide the severity of crime and magnitude of punishment.
In practice the choices tend to be limited for a lot of the people for whom this rule change was meant to ensnare their money because it exists within 401k plans with limited portfolio options.
Right but that's because you've now layered in government control. 401k plans are more heavily regulated, often negotiated by the employer rather than the employee.
The real question is why are employers able to limit employee 401k investment choices and employee health insurance. This is not freedom.
CRSP did change their rule earlier in Feb, where they added a clause that later allowed SPCX to be included, despite having <10% float. The clause allowed SPCX to be included because of its market cap. The timing is also suspicious.
The most insistent the salesman, the highest odds you got a bad deal.
But we are thread is about corruption (probably with bribes, and stealing the money of people that didn't participate on the transaction), while everybody keeps pretending is a consensual sale.
I've started telling basically that to the solar salesmen who come by every few days: if it was so great, you wouldn't have to pretend to be from PG&E or tell a bunch of half-truths about how utilities work.
problem with solar is that in itself it is great, but here in US if you look at the cost per watt produced it is heavily inflated with permitting and marketing costs. which is basically their margins till it becomes barely profitable to you. otherwise most of solar system cost has been fallen quite a bit for last decade plus.
dont believe me, look up how much a open loop DIY system costs.
Oh yeah solar is getting good but the guys who come to your door and say they'll give you a $0 electric bill just sign here are peddling something that's maximally profitable for them
No, but they did hold research sessions and they did draft the policy and the rules and all the updates and have them go through legal... they were planning to, until they saw public sentiment, or other influence. It'd be misleading to claim it was never a consideration.
And beyond that there is a lot of capital in active funds that use an index as their benchmark. So they don’t have to buy anything, but they are trying to beat their benchmark so not buying is an active decision with risk.
While I know it exists again, we are talking about the Nasdaq 100. It’s already a pretty quirky specific index and folks investing in it are already aligned with a spacex type of company.
I'm going to assume this question was in good faith, and ignore that you are seemingly spamming it as a 'gotcha' all over this discussion.
If I'm already invested, and they change the rules on me in a way I don't like, I have to sell, and that's a taxable event.
So if I have invested in a Nasdaq index, and I don't want a massive exposure to SpaceX prematurely, I am forced to close my position and immediately pay taxes on the profits. I pay the taxes, and now my investing capital is reduced because Elon wanted to force index funds to buy SpaceX stock, which indirectly forces all current owners to buy SpaceX.
It's not future buyers so much as people that are already exposed, and were probably not counting on getting rug pulled by the Nasdaq.
So no, you are correct that no one new to investing is forced to own SpaceX stock, but millions of existing fund holders are now exposed to a stock in a way that simply wasn't possible when they put their money in, and will be penalized if they don't want that.
People already own them, and have owned them for months or years before the rules were changed for SpaceX.
There's a cost to selling, the brokerage fee plus in many countries there's then taxes due on any profits. Many people would prefer to have unrealized gains where they can pay the tax years ahead, when they need the money.
(Also please don't make the same comment 4+ times.)
leaving the word 'forced' aside (purposefully), pension funds, 401k holders, and many passive investors end up buying these things. you're right that no one is "forcing" them, but people who try to invest responsibly with little control over the day-to-day which is most people place trust in the institutions who do that investing for them.
I don't think that the claim of "the Nasdaq is misusing their institutional trust" is a controversial claim. Moreover, one of the things that people choose when they (401k, pension funds, passive investors) is institutional mechanisms that prevent potentially mispriced items from entering their portfolios.
Very few retirement plans offer the Nasdaq 100 as a direct investment choice and certainly no plans offer it as the sole choice.
>However, based on figures from the over 700,000 401(k) plans, allocation to Nasdaq-100 Index mutual funds makes up less than 1% of all 401(k) assets, which the firm suggests is a significant underrepresentation compared to the S&P 500 and other Large Cap Growth Indexes.
The problem is a lot of passive investors own large quantities of that ETF, and to take their money out now they have to pay a tax penalty, so they are forced to invest in SPCX due to the rule change.
Its also a matter of principle. They had a seasoning period to allow for market price discovery over time, and they created a process to waive it for one company. Its not unreasonable to say that that is a bad thing.
Correct. Index funds are owned by people. For example, I have invested a large chunk of my retirement savings in an S&P 500 indexed fund (as many, many other people do). Whatever stocks the S&P 500 list, are what I end up owning; if I don't want to own one of those, I have to either roll that money into a different fund (which IIRC has limits, can't do that too often without tax consequences) or take the money out (and pay a tax penalty for withdrawing it before retirement).
So whether the index funds do or don't buy a certain stock has direct implications for real, non-millionaire, people.
I don’t even have access to a NASDAQ fund in my 401K. You have to go out of your way to buy the NASDAQ 100, QQQ and /NQ or /MNQ futures are the most popular instruments for getting exposure.
I have a tiny minute slice of SPCX from owning VTI total market ETF but my 401K holds no SpaceX.
Okay? Just because you don't have access to that investment vehicle doesn't mean others aren't using it. What type of reasoning is this? "I, personally, am not too badly effected, therefore it's not a problem"
And guess what, your VTI which does track NASDAQ as part of it's index is effected by this inclusion rule.
His reasoning is valid. Compared to the S&P500, it's a small sum of money. Most people aren't buying a fund that tracks that nasdaq index. The total effect isn't that large.
Not only is he wrong that it doesn't impact him, because VTI is impacted, but the whole premise is wrong. "I'm not harmed" does not mean things are fine. If I go murder your neighbor, will you come to my trial and demand I go free because you weren't harmed? Should the judge let me go because he wasn't harmed?
He wasn't making the case he isn't harmed. He was making the case that the effect isn't large. You don't appear to understand the claim itself, let alone the reasoning.
Just because you don't understand the basics of the financial system, or the different indices, or the amount of money flowing into the funds that track each, it doesn't mean others don't. The impact if it had been included in the S&P500 would have been at least an order of magnitude more than just the nasdaq 100.
There’s around five trillion dollars indexed to the S&P 500 in large funds. QQQ is half a trillion dollars.
If you look at Fidelity mutual funds, the difference is even greater. FXAIX has $827B in it, USNQX has $9.6B in it.
The absolute dollars do matter, as do the risk characteristics of both baskets of stocks. If and when SPCX meets the S&P 500 index criteria it will be included.
Also, NASDAQ both operates the NASDAQ exchange and also decides what is in the NASDAQ 100. S&P decides what is in the S&P 500 but they do not operate an exchange. Allowing SPCX into the NASDAQ 100 was good for NASDAQ the exchange and it was legal, so it happened. The S&P 500 committee was not facing the same incentive so SPCX will have to wait until it meets the criteria for inclusion.
If you understand the incentives, you can predict the outcome. I agree that it sucks that QQQ holders had to swallow SPCX.
One last thing, if you reread my post, I explicitly acknowledge I have exposure to SPCX through VTI which I own in my Roth IRA. As of right now, 0.14% of VTI is SPCX which means I have $91 of exposure. I think I’ll be OK if it goes to zero :) I said I have no SPCX in my 401K which is just FXAIX, an S&P 500 index fund.
There’s an order of magnitude more money indexed to the S&P 500, you have to go out out your way to buy QQQ since NASDAQ 100 and total market funds are uncommon in 401K options for employees.
QQQ is more volatile and higher risk than the S&P 500, the people buying it should understand that.
Why was musk/spacex so interested in having the rules broken to include spacex stock? Do you think maybe there was a reason that involved musk benefitting??
I'm not sure why that's relevant. The original discussion was about who's forced to buy NDX 100 stocks like SpaceX. The answer to that is "index funds".
Asked and answered. Whatever cute point you're trying to make is rendered moot by real market dynamics and index inclusion rules.
A lot of employer pensions will have limited fund options. (At least in the UK, maybe the US works differently.)
Quite likely that the only sensible one for most people (~global equities) will track S&P 500 internally. So essentially employees are being forced to hold whatever the index includes.
Hopefully it's less of a problem with Nasdaq, but it was a real worry.
Turns out people (and institutions like municipalities and pension funds) sometimes buy index funds before SpaceX enters the NASDAQ 100, and changing their policies over a single event would be a great effort and expense, and set a bad precedent. Sounds crazy, but it's true.
Nobody has any idea what point you're trying to make, and the fact that you're repeating yourself and not being clearer makes everyone suspect that you don't have any idea either.
Funds often have institutional investors. Many of them Pension Funds (i.e. ordinary every day people) and when the institutional investors signed up, they didn't do so expecting Nasdaq rule change.
that is the whole point of an index fund - they buy whatever is in the index so you can get exposure to the total market. The scandalous thing is that an IPO'd company is going to have a lot of volatility for weeks to months after it goes public, so they typically do not allow any newly listed company to be included in the index for up to one year. This is for the benefit of retail. People have put their entire life savings into these funds because they are viewed as the optimal tradeoff between risk and return. Those people are now contractually obligated to either sell everything or expose themselves to spacex's IPO price movements.
So you are saying it could have been worse, and therefor it is not that bad. I feel like this may be a logical fallacy.
It is like saying that the worst thing about twin earthquakes in Venezuela was not the fact that there were two of them, because there could have been three.
Defend your position instead of comparing to earthquakes. The Nasdaq 100 is already quirky in that it’s the largest 100 non-financial companies listed on Nasdaq. So it’s a large-cap growth/tech play or for Nasdaq a showcase piece. I don’t think it’s great they remove the 3 month criteria but also knowing the specific slice of potentially unprofitable companies it highlights does not make it as concerning as the SP500 drastically changing their rules to include.
To clarify: I am not comparing anything to these horrible earthquakes. I am comparing the above rhetoric to a hypothetical rhetoric about the earthquakes.
Nobody would actually say this about these earthquakes, and that is my point.
Again, do you have anything constructive to add to the conversation? Your words are insulting and just putting words in my mouth. The Nasdaq 100 is not that special or unique. You’re comparing a quirky index to earthquakes which is weird. They don’t have much of any rules, the three month modification is maybe not great but also not that big of a deal. Price discovery is pretty quick and for the Nasdaq 100 it fits for their theme. It’s absolutely not the worst thing. It’s not really great or bad, it’s the Nasdaq 100. It might help to go read up on how they market that index.
I know people tend too see “index” and think it’s a rigorous financial instrument but on a lot of cases it’s not. This index excludes financials so it ends up being this mega cap/tech 100. No other rules historically.
I am pointing out (what I think is) a logical fallacy you made earlier.
This what your parent said:
> The worst about the SpaceX IPO is Nasdaq changing their inclusion rules for the Nasdaq 100.
And you replied with:
> It would be shocking if we were talking about the SP500.
My critique is that this is not a valid refutation of your parent’s original claim.
If you don‘t think this is constructive, then that is on you. In my mind you have not refuted your parent’s original claim, and I have explained why above.
Also let me repeat, since you seem to have missed it when I said it above: I am not comparing anything to earthquake. I am making an obviously ridiculous hypothetical claim I just picked earthquakes because it was more obvious. I could have as well made the hypothetical claim about the worst thing about coffee is that it is only lukewarm, and then the refutation saying: “no actually, it could have been room temperature, so lukewarm is not that bad.“
> worst about the SpaceX IPO is Nasdaq changing their inclusion rules
Nasdaq 100 has always been marketed as a tech-forward index. It would be a bit ridiculous if they didn’t include the most value tech companies on the market.
There was a potential scandal at S&P. But it didn’t happen. My personal guess is a lot of finance influencers latched onto this story. When it didn’t pan out they tried to maintain credibility by shifting it onto the Nasdaq 100, where it doesn’t make sense.
> Nasdaq 100 has always been marketed as a tech-forward index. It would be a bit ridiculous if they didn’t include the most value tech companies on the market.
What if they floated only .01%? What's the cutoff for it being ridiculous not to include?
> What if they floated only .01%? What's the cutoff for it being ridiculous not to include?
You’d probably still include it, at least for a tech index. But you’d underweight it relative to float for indices published for funds. (The pure play index would weight it wholly because informationally it’s still a whole company.)
The timing isn’t great. But this was being discussed for a while. If it were only SpaceX, I’m doubtful the rules would have changed. But a tech index not including SpaceX, OpenAI, Anthropic and SK Hynix is a bit silly. And in the end, on index inclusion, the stock still fell.
...such thoughtless justification is not really disproving comparison to "anything goes" discourse of other platforms with a nonsense appeal to empty normalization
100% designed to offload an empty bag onto retail investors
SpaceX is propped up entirely by government subsidy
It has no real sustainable business unlike SK Hynix, very much like OAI and Anthropic
What's silly is propping up ephemeral companies that burn resources and produce nothing
This was a popular meme on Twitter and Reddit and YouTube, granted. The math doesn’t make sense with an index like the Nasdaq 100. But I’ll admit it’s a good story.
> SpaceX is propped up entirely by government subsidy
These companies are built on little more than "a good story" for politicians to sell to voters ..."i voted in Congress for that!"
You're arguing semantics
Economic math is being leveraged against innumerates as euphemism and obfuscation of same old avarice and political corruption. Biology is self selecting. There's no using rhetoric to wave off the ground truth is just a minority of the total population ensuring their own lived experience is put above everyone else's
No it is not. Appeals to equality of condition have existed for centuries. Among them are that term used verbatim.
Ignored the other points and redirected to the least salient. Will take it as acceptance you realized how silly your carrying water for people who don't know or care you exist is.
Age of account makes it clear you need the social system to remain solvent as you're likely rich on paper. Nothing more.
In this comment [1]? Seriously, what salient points were you trying to make?
Nobody is arguing anything is fairly valued. That's your straw man. There's a bit ironically complaining about innumeracy in a series of comments with zero numbers. Then a general appeal to Twitter tropes around sheeple and whatnot.
If anything, the quality of this comment thread sort of points to the quality of the argument for SpaceX being included in the Nasdaq 100 being corrupt. It's based on vibes and feels. Which is a good story–it's clearly convinced a bunch of people to watch another video, click on another ad.
> Age of account makes it clear you need the social system to remain solvent as you're likely rich on paper. Nothing more
...genuine question, how are you connecting that observation to that conclusion?
Back n forth with someone who used "a bit silly" as a justification.
You set a low bar out the gate. I merely met you down there.
Numbers don't make a difference. They can be shaped to any argument like English or German because they're picked by the biases of the author.
You seem to live in a rhetoric derived neural hallucination and are completely detached from physical reality, meaningful thresholds for verification.
Will stick to the skills I picked up studying applied physics and electrical engineering for checking hypothesis and formal verification. No interest continuing a conversation with a functional illiterate who cannot reason outside their native cultural bubble.
To paraphrase Feynman, doesn't make much sense to get hung up on the syntax and their semantics.
If you're so sure you're ignorant of those topics why so sure those measures are meaningful? Why answer what may just be some words you know but irrelevant to the context?
Can you prove the so-called experts know better? Or are you just deferring as you have been socially trained to? Maybe economists have over complicated things and you're too ignorant to know.
Society runs on hearsay. Heard that's how it works as kids, now say that's how it works.
Stats are just euphemism for what happened. For history. They’re not a meaningful basis for next steps. They cannot predict exactly the future; what stats showed covid would occur in 2020 exactly? Not just general appeals to stem a future pandemic.
Why then are economists analysis of history meaningful to future needs?
Like gibberish population forecasts saying 12 billion by 2100! while birth trends now show a halving of population by 2080, a whole lot of priors need to be revisited.
Strong, weak nuclear forces, gravity, and electromagnetism; the fundamental forces of physics that give rise to all we see and know; do not mandate a whole lot of the crap ideas humans babble on about.
How much of your money did they take? Are you one of those people that went all in on WallStreetbets?
Who should be at the gambling commissioner that allows such things? Should people be made Wards of the state and finances placed in Trump's noble stewardship?
I didn’t consider that angle—thanks. I don’t day trade and don’t think anyone should. Lots of folks do anyway, however, and then they predictably lose money. It should be similarly predictable that they’ll then get upset and lash out, sometimes in the correct direction, often not.
(And the influencers pitching day trading and whatnot, lo and behold, are probably also selling the corruption of indices and why you should buy their crypto to not be a "simp" or whatnot.)
Mostly like I think they simply long for communal property ownership with a benevolent overseer that invests and distributes resources according to values that match their own.
Therefore they are offended that private individuals can allocate as they choose, and make losing gambles on other private institutions.
Some of these people were taught indexes are safe havens, and recoil at the idea they might not be safe as milk.
When faced with an information asymmetry (lack of knowledge of other posters) you engage in a kind of phrenology... taking a few sentences of others and filling in huge gaps in your knowledge with biases that you cannot confirm are true and meaningful
Grammatically correct sentences you can come up with are not at all guaranteed to be accurate.
Sincerely... stop it. Get some help. You're a typical human dimwit. Your grasp of contemporary economic language is not a sign of correctness. Just your own limited vocabulary and literacy. You're repeating language you memorized. You're not solving the gap in information.
Surviving this long does not mean you are especially
Indirect realism or the distinction between noumena and phenomena does not mean a model is inaccurate, and it certaianly doesnt mean your hot take is the correct one.
Yeah I know, patronizing random nobody. Way to go with the only option when the potential for inaccuracy is pointed out. "It might not be inaccurate!"
Real big brain stuff wrapped in copy paste of philosophical twaddle.
Not really disproving other posters point HN discourse is better than anywhere else. Random comments about others that might be wrong are not really focus on truth.
I think it is largely memes, but I think that is at the heart of the meme and why it replicates. Most of the time this is more intuitions than explicit convictions about how the world should operate.
That sombody should fix all these messy distrubted market process by replacing it with an engineered solution.
The obvious counterpoint is to direct them to who would be directing that top down system.
Everyone can get behind an omnicient and benevolent central planner on paper.
Idk, I kinda agree with Matt Levine. The purpose of these ETFs is conceptually to track the "largest X companies", so including SPCX is just staying true to that.
If there's an issue I think it's earlier in the IPO pipeline.
But if SpaceX valuation drops by 2/3 before settling into a steady state, does that not mean that SpaceX is not one of the "largest X companies" but rather was overvalued?
The entire reason for these seasoning periods is to give the market time to determine what the company is actually worth to the market itself. Bypassing those rules to get it in earlier says to me that they don't believe it will settle at a price near its start.
If I IPO my lemonade stand at $1T valuation do I deserve to be in that "largest X companies" list? Or does it only make sense if I can maintain that valuation over time?
Is your assertation that spaceX just valued themselves? If your lemonade stand gets underwritten by Goldman Sachs, Morgan Stanley, Bank of America, Citigroup, and JPMorgan Chase, and 18 other large banks then yeah, you belong on that list.
I think a lot of people are upset that they bought something (an ETF or fund that tracks an index, for which has various rules for what gets included) and those rules get broken so the wealthiest man in the world who is also extremely close with the President of the US can get his company included on a shorter timeline. Yes, there's an issue with the IPO process but a) you can just buy SPCX if you wanted exposure b) even if it's not included you're getting decent exposure and c) the IPO process being broken is not the problem of the indexer.
Putting cynicism aside (there's plenty of that here already): there is a theory that people invest in index funds because they don't want to pick individual stocks. They want exposure to "the public stock market as a whole". I think there are good arguments on both sides of including SpaceX in such an index.
Oh come on, that's a view so charitable that not even Musk giving away all of his wealth would come close.
Pretty much everybody know what it was about on day one, brokers were (and still are) operating in blatant bad faith for personal gain and they know they can count on the current US administration to get off scot free. It's like if Jordan Belfort was in charge of Nasdaq.
I think that is the problem with concentrated markets. You can do whatever and younare actually never "punished" by the market. Ie market htpothesis does not work
The president may throw a tantrum that “some crazy democrat throws stones under the feet of that beautiful Elon, the most beautiful Elon we ever had”. Better do what the new Tzar wants. Dude was sent here apparently by the God, don’t mess with the God.
People like that are never friends. It’s a relationship of convenience and power exchange. The public riff was because Elon got upset over something and threw a tantrum.
Some think the index deal was in exchange for Elon helping fund the midterm battle. Scott Galloway, for example.
Sorta invalidates the whole market to know that they'll change the rules in order to manufacture the result that they have pre-ordained to be "correct". NASDAQ seems to have decided that they're in the business of picking winners and losers rather than simply providing people the mechanisms by which to decide for themselves.
nah the very worst thing about the spacex ipo is that schwab won't allow me to short it. has nothing to do with the recency of the issue. today i shorted some skhy when i realized it's trading about 30% over the Korean share price (I could be wrong about that)
> And if you are buying an instrument where you can lose more than you invested, the approach maybe wrong? :-)
This is precisely why shorting can lose more than you "invest", because you're not buying an instrument, you're selling it with the intent (or promise, depending on what kind of instrument it is) to buy it back later, hopefully at a lower price.
There are, as said, depending on juristic regime, products which do not let you lose more than you invested.
On top of this comes national regulation: E.g. in some EU countries, retail traders are exempt from s.c. "margin calls" and the broker is required by regulation to "just close and not ask for more"
I'm not familiar with turbos, but to me it sounds like a CFD? How does a short position on a turbo prevent you from losing more than what you "put in"[0]? If you're shorting underlying X at price Y with a turbo, and price moves to Y+10, you're going to lose 10 times the leverage factor. You could have stop orders, but those are not guaranteed to fill at a price that would cap your loss to a desired amount.
> the broker is required by regulation to "just close and not ask for more"
Some American brokers will also forcibly close your position instead of issuing a margin call. Do you mean that under those national regulations, the broker is required to eat the losses?
[0]: in quotes, since with a short position it's not really the case that you put something in.
> nah the very worst thing about the spacex ipo is that schwab won't allow me to short it.
there are easier ways to make money than betting against Elon Musk. See Tesla and how well it worked out for short sellers there.
I like SpaceX as a company (especially Starlink) but it's over valued in my opinion. In about a year when there's a little bit of public financial history and the dilution is over i'll probably buy in.
I for one am glad that you were not allowed to short SpaceX. People gaming the market for their own profits are the worst kind of exploiters and swindlers. You contribute absolutely nothing while siphoning the profits that workers make, lowering the salaries of everyone that actually works for a living.
Note this has nothing to do with my feelings about SpaceX. I am Elon hater nr. 1 and hope SpaceX burns to dust, I only hope speculative investors burn down with it.
EDIT/CLARIFICATION: This post is fundamentally anti-capitalist. You may feel like I am mis-informed or misunderstanding. I am both of theses things if and only if Capitalism truly is self-evident.
Putting one's money where their mouth is in expressing that a company's stock appears overvalued is very low on my list of "things that exploit the proletariat."
I don’t care the method people use to game the market. They are still participating in a systematic exploitation of workers and deserve the maximum of nothing of what they hope to gain.
My parent wanted to make some unearned money by making speculations and gambles. If they were allowed and if they were successful, they would have made a bunch of money while contributing nothing. Every single dollar they would have made in their speculative gamble would have come from somebody else who actually contributed and but didn’t get the full value from their work.
I am glad that my parent was denied the privileged to participate in this systematic exploitation. The ideal number of speculative investors is zero, and any movement towards that number is an improvement for workers.
What a weird misunderstanding. Shorting reduces fraud in the market, and making it harder to short increases it. There's a reason shady managers had shorts, it increases the chances their bad behavior will be uncovered and punished financially.
I'm not an investor in SpaceX but I don't think shorting stocks at IPO should be allowed. The market should be given time to settle on a price, and it's unlikely that anyone needs to short it on day 1 for hedging. It's purely price speculation.
Yeah, I know why people _want to_ (betting), but it doesn't serve a broader economic purpose.
Going long or going short is your bet on the market. If you can go long, you should be allowed to go short. Restrictions on any trading means you don’t have confidence in the price in which case it shouldn’t be available for trade.
Betting is what everyone who jumped into retail investing and meme stocks does with it, but shorts are a valuable tool in the economy for hedging risk. It also is a good indicator for fraud too.
If you're confident the price of bananas will fall tomorrow you absolutely can sign a contract to deliver bananas next week at the current price and then buy them when the price drops...
Yes, because the guy buying your bananas is able to make banana-buying decisions for next week based on the price you give him.
You’re not going to make up a silly low number because you actually have to buy the bananas yourself at some point, and you help price discovery because now that guy isn’t buying bananas at a higher price than someone is willing to sell them for.
Just as a thought experiment, would you say there are any (societal) negatives to the possibility of thr price of bananas (or the share price of spacex) being able to fluctuate wildly based on semi-abstract economic manipulations, like shorts and futures and such.
What I'm getting at is when does it go from investing, "I think this entity is going to take my money and use it to build a profitable factory that will then return to me a share of the profits", to just gambling "I think this stock price will change by the end of the day and I'm going to bet on it", and what are the positives and negatives of that?
The price of bananas is generally likely to fluctuate less as a result of shorts, futures etc.
The distinction between investing vs gambling and positives and negatives sounds like more the subject of a PhD thesis than an HN comment! At some point the marginal benefit of smaller price spreads from very short term trade to actually allocating physical capital and labour to producing more valuable stuff might actually be lower than the amount it simply inflates asset prices, but that is much closer to microseconds than "you're not allowed to bet against this IPO, the insiders artificially pumping its value need to be able to cash out first"...
If someone wants to dress it up in jargon or talk about beneficial second order effects, they can. But if putting money on an outcome you can’t control isn’t gambling, I don’t know what is.
Is buying insurance gambling? Is giving your second cousin 100k some money so he can open up is restaurant gambling if you expect a percent of the profits but won't actively be involved in advising him on running the business?
Gambling is placing a wager with a negative expected value. If you can gain an edge and have positive EV, it’s not gambling. That’s the distinction between poker and slots. A skilled poker player can take advantage of positive EV positions while slots are programmed to have negative EV. There are traders that have positive EV bets.
I'm not certain you're right, but I think this opinion deserves considerably more (fair) discusson than it's getting.
Lots of replies either personally benefit or just assume the "way things are" is the best, but the stock market has gotten highly abstracted from the original intention of providing capital to grow companies via means other than bank loans.
I get the argument that shorts and friends help make the price the stock is being sold at more accurate, and I believe there's some truth there, but also we constantly see stock prices fluctuate by 10+% in a single day and I have trouble believing the actual value of all these companies changed that much in a single 24 period.
Well the idea that the price of a stock represents the actual value of the company can be complicated but the realization that it's super hard to figure out what the actual value of a company really is, because figuring that out really requires a crystal ball, because you need to know exactly how much money the company will earn in the future, among other things.
None of us have that crystal ball, so market participants try to guess at the future. It's not difficult to believe that those guesses can swing a lot in a single day. Just trying to figure out whether or the Hormuz will be open next week can give you whiplash.
the company manipulates itself to look its best possible, taking long term bad decisions in order to juice the value, and wont have more immediate items to juice the share price again for a while
its a reasonable expectation that 3 months after an IPO the price will be lower than it was at IPO
not really a bet so much as that on average the prices at IPO are a local maxima
Why is line go up price discovery acceptable, but line go down price discovery not? If the shares are trading, you should be able to short, it’s arbitrary to disallow it. It is quite literally a part of the market settling on a price.
(under the assumption your broker is managing their risk if your losses from a short position potentially exceeds capital available for liquidation if the trade moves against you)
Line go down discovery is acceptable (that is what selling a share is). The reason you might not want options trading very early after an IPO is because the market is frothy enough without the additional layer of complexity.
Certainly, its reasonable for a delay in options being available while market makers prepare to make the market for those options. But shorting? Day 1, the shares are trading and available to borrow to sell to short.
Are they actually? How many intermediate steps are involved in finding shares to borrow for a short? I imagine they have to be transferred to some central depository with the feature, for a start, and that takes 2-4 days
Your broker will locate and borrow the shares from an available pool (such as other clients' portfolios), sell them on your behalf, and hold the cash. They don't have to go to the clearinghouse.
Because lines tend to trend up over time. You're betting on lines going down, and paying rent while doing so as shorting requires you to rent/borrow shares from somebody else. It's an extremely high risk activity that can easily result in an investor losing a very large amount of money.
Elon Musk is politicized so you're going to have people wanting to short against him, for reasons other than it being seen as a rational and sound investment strategy. This is one reason brokers tend to restrict this activity to certain types of investors who are more able to appreciate the risks, to say nothing of baseline necessities like needing a margin account to cover potential losses. Shorting is just very different than buying a stock.
Annoying but not much more. It kinda makes sense too if the index is suppose to reflect the corps. The way SpaceX is set up from a governance point of view is a nightmare though. Also, data centers in space is just stupid. Now it seems like they already abandon it and are going for some kind of AI satellites. Still stupid. I should probably take a hyperloop over to US and ask Elon about it, oh wait, that was also garbage.
What you didn't elaborate on is that it's a poor investment thesis, so while the association is Nasdaq == tech, it's not entirely true, and it missing things if what you really want is tech. It also penalizes small floats less than S&P 500, enabling these shenanigans.
I'm sure people planning to invest for only 1 year of their lifespan and began their investment journey exactly 1 year ago and who are in the process of selling everything they own today never to invest in stocks ever again will find that Nasdaq one year performance very useful information!
NASDAQ is famously overweighted in tech. It saw an 80% drop in the aftermath of the dotcom bubble, while the S&P500 only had a 40% drop. It's a double edged sword, with the AI boom it's benefiting, if that reverses it will fall proportionally to those gains.
Rule changes like this create market inefficiencies that can be exploited by retail; if everything plays by constant rules, the vast majority of alpha gets concentrated in the institutions.
I love shaking up the firms. Gives normal people a chance to build wealth.
Wonder how GitHub wasn't able to detect a single token downloading the entire organization's worth of repositories, especially if it's over 6 thousand of them. Surely that's not something that's done regularly? Seems like a pretty massive oversight if anyone can just grab a token and get themselves a full copy of the organization.
You’d be surprised. Repo mirroring systems, continual cloud backups, sysadmins/engineers cloning every repo of an org, 3rd party tools regularly inspecting repos, etc.
The best option is for the organization themselves to monitor their gh/ghes logs, exclude this sort of activity, and then detect it themselves. There’s no way gh can monitor all orgs for mass repo clones without a mess of false positives.
"Persons who received the BA.5-containing bivalent booster had better neutralizing activity against all Omicron subvariants (especially against BA.2.75.2, BQ.1.1 and XBB) than those who received 1 or 2 monovalent [original] boosters"
https://www.nejm.org/doi/full/10.1056/NEJMc2214293
My assumption is that his/her problem is quite the opposite: those vaccines were once approved (?) and some might have even been promoted, and now they are no longer available due to low quality, high risks.
I'm really hoping that in twenty years we will not look back at these vaccines as one of the most impactful mistakes (or cases of corruption) of our century.
AstraZeneca was, IIRC, but its effectiveness against newer variants is pretty weak, to the extent of being pretty irrelevant, so it makes sense to withdraw.
I don’t think many people have ‘fled’ the land down under over the issues he brings up. Most folks here seem to think that the pandemic was handled pretty well compared to (for instance) the US or UK. Though that might be a WA thing. It may not though, for example the premiere of Victoria, despite having imposed lots of lockdowns that the wingnuts were very upset about, was recently voted back in with an increased majority.
(Edit — There does seem to have been an issue with motivated liars in other countries (USA) reporting exaggerations and falsehoods about the severity of it all though, for their own partisan gain. Stories about forced vaccinations at sports stadia, for instance.)
Personally I ‘fled’ the UK mid-pandemic to get here, though that was more for general quality of life reasons than anything specific to covid.
Only purpose of this kind of initiative is to cause trouble.. Marketed by the same trolls who spread medical disinfo, climate negationism, Russian propaganda..
What eliminates social cohesion and trust is
* the disease itself
* the people instrumentalizing the disease and/or the sanitary measures to partisan ends..
There actually is an significant increase in heart problem for young people. Especially in young women and it is assumed that it is connected to uptake of the pill in very early years.
Malone isn't worse than the standard CNN toyboy and the Atlantic isn't too reliable either. At least the online version.
Maybe you should listen to him instead of reading what The Atlantic wants you to believe about him? Have we not learned already that mainstream media is lying to us a lot?
Anyone who has followed politics since 2016 and has half a brain would not trust anything these people say.
Also, Dr. Robert Malone is just one of many who were censored.
>One thing is clear about the revelation of the 2021 military epidemiological data and the military’s response to it: There is undoubtedly a public health and national security crisis in the military, and the Pentagon’s reaction only seems to be concerned with exonerating the vaccine, not fixing its own alleged problem.
The vaccine antigen is only a small part of the virus. Furthermore is was modified and is inert.
https://cen.acs.org/pharmaceuticals/vaccines/tiny-tweak-behi...
Because of international pharmacovigilance we know that ARNm vaccine induce some myocarditis and pericarditis, at a much lower rate than the virus and less severe.
There is not evidence that heart inflammation after vaccination is less common or severe than after COVID-19 infection. For instance: https://www.medrxiv.org/content/10.1101/2021.12.23.21268276v... suggests rates several fold higher for vaccination than infection. Not to say that on balance vaccination is anything but preferable to naive infection, but it's not a side effect free panacea.
Thanks for that link. It contradicts previous studies that put the risk of myocarditis from unvaccinated COVID infection at between 6 and 15 times higher than that from vaccination (and 30x general baseline rate).
So I read through it and in fact, it doesn't say what you assert to say it does. This is comparing vaccinated Vs vaccinated+COVID. See the comments from vepe for full explanation.
Is it comparing vaccinated vs vaccinated + infection or simply vaccinated vs infection (regardless of vaccination)?
Do we have data on specifically unvaccinated infections?
Otherwise we can only speculate on whether the long side effects of infection are less severe with vaccines than without. Considering the general hospitalization rate between unvaccinated vs vaccinated, I know what my guess would be.
> The free-floating Spike proteins synthetized by cells targeted by vaccine and destroyed by the immune response circulate in the blood and systematically interact with angiotensin converting enzyme 2 (ACE2) receptors expressed by a variety of cells including platelets, thereby promoting ACE2 internalization and degradation. These reactions may ultimately lead to platelet aggregation, thrombosis and inflammation mediated by several mechanisms including platelet ACE2 receptors. Whereas Phase III vaccine trials generally excluded participants with previous immunization, vaccination of huge populations in the real life will inevitably include individuals with preexisting immunity. This might lead to excessively enhanced inflammatory and thrombotic reactions in occasional subjects. Further research is urgently needed in this area.
In the case of vaccine only / no infection, is vaccine-mediated inflammation long lasting and damaging? These effects in the paper (platelet aggregation, thrombosis) seem to be capable of causing permanent harm. Platelet aggregation seems like it would cause small amounts of systemic endothelial damage, atherosclerosis, thombrosis, ...
The level of inflammation no doubt varies on a case by case / individual basis, but is it possible that nobody gets out of the pandemic without some level of stress on their pulmonary and circulatory systems?
To state this succinctly, did Covid (whether infected or vaccinated) shave a few days off of all of our lives?
That paper was interesting and the bit about clinical trials is important, but they don’t really offer much evidence that there are substantial concentrations of free floating spike proteins in the blood following vaccination, or that this would be the cause of the inflammatory and thrombotic reactions, vs just the more general immune response
As far as I can tell they’re just citing this one paper about the ACE2 degradation, and the study doesn’t directly address SARS-CoV-2 infection or vaccination at all.
50% and lower rate (the hk children myocarditis study) isn't a "much lower rate". Factor in omnicron and the clear difference between vaccinating everyone and 10% of society getting the virus and unsolvable questions should begin to arise.
the CDC quite likely skews low, given the political ramifications. i've heard non-governmental estimates as high as 80% at this point. my expectation is that 2/3 of americans have had it, which is roughly borne out in my anecdotal experience, particularly since omicron. i think that's why we're seeing the mediopolitical machine starting to relent on covid policy in the past few weeks (that, and it's an election year).
But that's just an assumption. Many people seem to have pre-existing immunity. A study was done in which unvaccinated, non previously infected volunteers actually lay down in bed for a while with SARS-CoV-2 infected liquid in their noses (eww). So they were unequivocally exposed to a massive dose but only about half got COVID. There is no explanation for this within the bounds of the assumptions made by authorities.
In reality, even if you get Omicron now it's so mild it's unlikely to cause any more heart damage than any other common cold. The danger has passed. Except that, almost everyone decided to massively expose themselves to spike protein over and over. So if spikes cause heart damage and they do, especially when the vaccine gets into the bloodstream, then the vaccines will do more damage than the virus could ever do simply because nobody has pre-existing immunity to it.
Many patients who are exposed to SARS-CoV-2 quickly fight off the infection with an innate immune response before the adaptive immune response really engages. That can happen with no pre-existing immunity. Some people just have better immune systems.
Are you trying to define an immune system that can fight off SARS-CoV-2 without having seen it before is not "pre-existing immunity"? If so isn't that merely playing with words? You seem to be agreeing with what I'm saying but arguing that the terminology should be different.
If you don't like the meta analysis, then sample underlying (cited) studies. I have and didn't find any misrepresentations. Ivermectin looks like a great drug to repurpose as an outpatient therapy for COVID-19.
>Nowhere in the paper I read that ADE was detected in the vaccined. Vaccine-induced ADE is only evocated as a possibility.
It's literally in the "highlights" of the paper at the top.
"Infection-enhancing antibodies have been detected in symptomatic Covid-19"
From the abstract:
"As the NTD is also targeted by neutralizing antibodies, our data suggest that the balance between neutralizing and facilitating antibodies in vaccinated individuals is in favor of neutralization for the original Wuhan/D614G strain. However, in the case of the Delta variant, neutralizing antibodies have a decreased affinity for the spike protein, whereas facilitating antibodies display a strikingly increased affinity. Thus, ADE may be a concern for people receiving vaccines based on the original Wuhan strain spike sequence (either mRNA or viral vectors)."
First, the line quoted from the highlights section is referring to the 1054 antibody, which was isolated from a patient infected with SARS-CoV-2, as opposed to one produced from vaccine response[1]. Second, the infection enhancing effect was determined in vitro.
So none of that supports the idea that ADE was actually detected in a human, and particularly the idea that vaccine induced ADE has actually been observed.
All that said, if the results of the paper hold up, they may help explain why the efficacy of the vaccines are reduced in the face of the delta variant. That would be extraordinarily useful in formulating better vaccines, so I'm cheering the science along. I'm less cheerful about the cherry-picking to support anti-vaccine narratives.
"In a recent publication, Li et al. (Cell 184 :1-17, 2021) have reported that infection-enhancing antibodies directed against the N-terminal domain (NTD) of the SARS-CoV-2 spike protein facilitate virus infection in vitro, but not in vivo. However, this study was performed with the original Wuhan/D614G strain. Since the Covid-19 pandemic is now dominated with Delta variants, we analyzed the interaction of facilitating antibodies with the NTD of these variants."
I'm sure this post will be taken down shortly, so I wouldn't worry about it.
https://finance.yahoo.com/markets/stocks/articles/nasdaq-che...
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