Disclaimer: I am not a financial advisor. This entire post represents my personal views and opinions, and should not be taken as financial advice (or advice of any kind whatsoever). I encourage you to do your own research, take anything I write with a grain of salt, and hold me accountable for any mistakes you may catch. Also, full disclosure, I hold a net long position in GME, but my cost basis is very low (average ~$67--I have to admit, the drop today was too tasty so my cost basis went up from yesterday)/share with my later buys averaged in), and I'm using money I can absolutely lose. My capital at risk and tolerance for risk generally is likely substantially different than yours. In this post I will go a little further and speculate more than I'd normally do in a post due to the questions I've been getting, so fair warning, some of it might be very wrong. I suspect we'll learn some of the truth years from now when some investigative journalist writes a book about it.
Thank you everyone for the comments and questions on the first and second post on this topic.
Today was a study in the power of fear, courage, and the levers you can pull when you wield billions of dollars...
Woops, excuse me. I'm sorry hedge fund guys... I meant trillions of dollars--I just briefly forget you control not just your own but a lot of other peoples' money too for a moment there.
Also, for people still trading this on market-based rationale (as I am), it was a good day to measure the conviction behind your thesis. I like to think I have conviction, but in case you are somehow not yet familiar with the legend of DFV, you need to see these posts (fair warning, nsfw, and some may be offended/triggered by the crude language). The last two posts might be impressive, but you should follow it in chronological order and pay attention to the evolution of sentiment in the comments to experience true enlightenment.
Anyway, I apologize, but this post will be very long--there's just a lot to unpack.

Pre-Market

Disclaimer: given yesterday's pre-market action I didn't even pay attention to the screen until near retail pre-market. I'm less confident in my ability to read what's going on in a historical chart vs the feel I get watching live, but I'll try.
Early in the pre-market it looks to me like some momentum traders are taking profit, discounting the probability that the short-side will give them a deep discount later, which you can reasonably assume given the strategy they ran yesterday. If they're right they can sell some small volume into the pre-market top, wait for the hedge funds try to run the price back down, and then lever up the gains even higher buying the dip. Buy-side here look to me like people FOMOing and YOLOing in at any price to grab their slice of gainz, or what looks to be market history in the making. No way are short-side hedge funds trying to cover anything at these prices.
Mark Cuban--well said! Free markets baby!
Mohamed El-Erian is money in the bank as always. "upgrade in quality" on the pandemic drop was the best, clearest actionable call while most were at peak panic, and boy did it print. Your identifying the bubble as the excessive short (vs blaming retail activity) is money yet again. Also, The PAIN TRADE (sorry, later interview segment I only have on DVR, couldn't find on youtube--maybe someone else can)!
The short attack starts, but I'm hoping no one was panicking this time--we've seen it before. Looks like the momentum guys are minting money buying the double dip into market open.
CNBC, please get a good market technician to explain the market action. Buy-side dominance, sell-side share availability evaporating into nothing (look at day-by-day volume last few days), this thing is now at runaway supercritical mass. There is no changing the trajectory unless you can change the very fabric of the market and the rules behind it (woops, I guess I should have knocked on wood there).
If you know the mechanics, what's happening in the market with GME is not mysterious AT ALL. I feel like you guys are trying to scare retail out early "for their own good" (with all sincerity, to your credit) rather than explain what's happening. Possibly you also fear that explaining it would equate to enabling/encouraging people to keep trying to do it inappropriately (possibly fair point, but at least come out and say that if that's the case). Outside the market, however...wow.

You Thought Yesterday Was Fear? THIS is Fear!

Ok short-side people, my hat is off to you. Just when I thought shouting fire in a locked theater was fear mongering poetry in motion, you went and took it to 11. What's even better? Yelling fire in a theater with only one exit. That way people can cause the financial equivalent of stampede casualties. Absolutely brilliant.
Robin Hood disables buying of GME, AMC, and a few of the other WSB favorites. Other brokerages do the same. Even for people on 0% margin. Man, and here I thought I had seen it all yesterday.
Side note: I will give a shout out to TD Ameritrade. You guys got erroneously lumped together with RH during an early CNBC segment, but you telegraphed the volatility risk management changes and gradually ramped up margin requirements over the past week. No one on your platform should have been surprised if they were paying attention. And you didn't stop anyone from trading their own money at any point in time. My account balance thanks you. I heard others may have had problems, but I'll give you the benefit of the doubt given the DDOS attacks that were flyiing around
Robin Hood. Seriously WTF. I'm sure it was TOTALLY coincidence that your big announcements happen almost precisely when what has to be one of the best and most aggressive short ladder attacks of all time starts painting the tape, what looked like a DDOS attack on Reddit's CDN infrastructure (pretty certain it was the CDN because other stuff got taken out at the same time too), and a flood of bots hit social media (ok, short-side, this last one is getting old).
Taking out a large-scale cloud CDN is real big boy stuff though, so I wouldn't entirely rule out nation state type action--those guys are good at sniffing out opportunities to foment social unrest.
Anyway, at this point, as the market dives, I have to admit I was worried for a moment. Not that somehow the short-side would win (hah! the long-side whales in the pond know what's up), but that a lot of retail would get hurt in the action. That concern subsided quite a bit on the third halt on that slide. But first...
A side lesson on market orders
Someone printed bonus bank big time (and someone lost--I feel your pain, whoever you are).
During the face-ripping volatility my play money account briefly ascended to rarified heights of 7 figures. It took me a second to realize it, then another second to process it. Then, as soon as it clicked, that one, glorious moment in time was gone.
What happened?
During the insane chop of the short ladder attack, someone decided to sweep the 29 Jan 21 115 Call contracts, but they couldn't get a grip on the price, which was going coast to coast as IV blew up and the price was being slammed around. So whoever was trying to buy said "F it, MARKET ORDER" (i.e. buy up to $X,XXX,XXX worth of contracts at any price). This is referred to as a sweep if funded to buy all/most of the contracts on offer (HFT shops snipe every contract at each specific price with a shotgun of limit orders, which is far safer, but something only near-market compute resources can do really well). For retail, or old-tech pros, if you want all the contracts quickly, you drop a market order loaded with big bucks and see what you get... BUT, some clever shark had contracts available for the reasonable sum of... $4,400, or something around that. I was too stunned to grab a screencap. The buy market order swept the book clean and ran right into that glorious, nigh-obscene backstop limit. So someone got nearly $440,000 PER CONTRACT that was, at the time theoretically priced at around $15,000. $425,000 loss... PER CONTRACT. Maybe I'm not giving the buyer enough credit.. you can get sniped like that even if you try to do a safety check of the order book first, but, especially in low liquidity environments, if a HFT can peak into your order flow (or maybe just observes a high volume of sweeps occurring), they can end up front running your sweep, pick off the reasonable contracts, and slam a ridiculous limit sell order into place before your order makes it to the exchange. Either way, I hope that sweep wasn't loaded for bear into the millions. If so... OUCH. Someone got cleaned out.
So, the lesson here folks... in a super high volatility, low-liquidity market, a market order will just run up the ladder into the first sell order it can find, and some very brutal people will put limit sells like that out there just in case they hit the jackpot. And someone did. If you're on the winning side, great. It can basically bankrupt you if you're on the losing side. My recommendation: Just don't try it. I wouldn't be surprised if really shady shenanigans were involved in this, but no way to know (normally that's crazy-type talk, but after today....peeking at order flow and sniping sweeps is one of the fastest, most financially devastating ways to bleed big long-side players, just sayin').
edit *so while I was too busy trying not to spit out my coffee to grab a screenshot, piddlesthethug was faster on the draw and captured this: https://imgur.com/gallery/RI1WOuu
Ok, so I guess my in-the-moment mental math was off by about 10%. Man, that hurts just thinking about the guy who lost on that trade.*
Back to the market action..

A Ray of Light Through the Darkness

So I was worried watching the crazy downward movement for two different reasons.
On the one hand, I was worried the momentum pros would get the best discounts on the dip (I'll admit, I FOMO'd in too early, unnecessarily raising my cost basis).
On the other hand, I was worried for the retail people on Robin Hood who might be bailing out into incredibly steep losses because they had only two options: Watch the slide, or bail. All while dealing with what looked to me like a broad-based cloud CDN outage as they tried to get info from WSB HQ, and wondering if the insta-flood of bot messages were actually real people this time, and that everyone else was bailing on them to leave them holding the bag.
But I saw the retail flag flying high on the 3rd market halt (IIRC), and I knew most would be ok. What did I see, you ask? Why, the glorious $211.00 / $5,000 bid/ask spread. WSB Reddit is down? Those crazy mofos give you the finger right on the ticker tape. I've been asked many times in the last few hours about why I was so sure shorts weren't covering on the down move. THIS is how I knew. For sure. It's in the market data itself.
edit So, there's feedback in the comments that this is likely more of a technical glitch. Man, at least it was hilarious in the moment. But also now I know maybe not to trust price updates when the spread between orders being posted is so wide. Maybe a technical limitation of TOS
I'll admit, I tried to one-up those bros with a 4206.90 limit sell order, but it never made it through. I'm impressed that the HFT guys at the hedge fund must have realized really quickly what a morale booster that kind of thing would have been, and kept a lower backstop ask in place almost continuously from then on I'm sure others tried the same thing. Occasionally $1,000 and other high-dollar asks would peak through from time to time from then on, which told me the long-side HFTs were probably successfully sniping the backstops regularly.
So, translating for those of you who found that confusing. First, such a high ask is basically a FU to the short-side (who, as you remember, need to eventually buy shares to cover their short positions). More importantly, as an indicator of retail sentiment, it meant that NO ONE ELSE WAS TRYING TO SELL AT ANY PRICE LOWER THAN $5,000. Absolutely no one was bailing out.
I laughed for a minute, then started getting a little worried. Holy cow.. NO retail selling into the fear? How are they resisting that kind of price move??
The answer, as we all know now... they weren't afraid... they weren't even worried. They were F*CKING PISSED.
Meanwhile the momentum guys and long-side HFTs keep gobbling up the generously donated shares that the short-side are plowing into their ladder attack. Lots of HFT duels going on as long-side HFTs try to intercept shares meant to travel between short-side HFT accounts for their ladder. You can tell when you see prices like $227.0001 constantly flying across the tape. Retail can't even attempt to enter an order like that--those are for the big boys with privileged low-latency access.
The fact that you can even see that on the tape with human eyes is really bad for the short-side people.
Why, you ask? Because it means liquidity is drying up, and fast.

The Liquidity Tide is Flowing Out Quickly. Who's Naked (short)?

Market technicals time. I still wish this sub would allow pictures so I could throw up a chart, but I guess a table will do fine.
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Date	Volume	Price at US Market Close
Friday, 1/22/21	197,157,196	$65.01
Monday, 1/25/21	177,874,00	$76.79
Tuesday, 1/26/21	178,587,974	$147.98
Wednesday, 1/27/21	93,396,666	$347.51
Thursday, 1/28/21	58,815,805	$193.60

What do I see? I see the shares available to trade dropping so fast that all the near-exchange compute power in the world won't let the short-side HFTs maintain order flow volume for their attacks. Many retail people asking me questions thought today was the heaviest trading. Nope--it was just the craziest.
What about the price dropping on Thursday? Is that a sign that the short-side pulled a miracle out and pushed price down against a parabolic move on even less volume than Wednesday? Is the long side running out of capital?
Nope. It means the short-side hedge funds are just about finished.
But wait, I thought the price needed to be higher for them to be taken out? How is it that price being lower is bad for them? Won't that allow them to cover at a lower price?
No, the volume is so low that they can't cover any meaningful fraction of their position without spiking the price parabolic almost instantly. Just not enough shares on offer at reasonable prices (especially when WSB keeps flashing you 6942.00s).
It's true, a higher price hurts, but the interest charge for one more day is just noise at this point. The only tick that will REALLY count is the last tick of trading on Friday.
In the meantime, the price drop (and watching the sparring in real time) tells me that the long-side whales and their HFT quants are so certain of the squeeze that they're no longer worried AT ALL about whether it will happen, and they aren't even worried at all about retail morale to help carry the water anymore.
Instead, they're now really, really worried about how CHEAPLY they can make it happen.
They are wondering if they can't edge out just a sliver more alpha out of what will already be a blow-out trade for the history books (probably). You see, to make it happen they just have to keep hoovering up shares. It doesn't matter what those shares cost. If you're certain that the squeeze is now locked in, why push the price up and pay more than you have to? Just keep pressing hard enough to force short-side to keep sending those tasty shares your way, but not so much you move the price. Short-side realizes this and doesn't try to drive price down too aggressively. They can't afford to let price run away, so they have to keep some pressure on at the lowest volume they can manage, but they don't want to push down too hard and give the long-side HFTs too deep of a discount and bleed their ammo out even faster. That dynamic keeps price within a narrow (for GME today, anyway) trading range for the rest of the day into the close.
Good plan guys, but those after market people are pushing the price up again. Damnit WSB bros and Euros, you're costing those poor long-side whales their extra 0.0000001% of alpha on this trade just so you can run up your green rockets... See, that's the kind of nonsense that just validates Lee Cooperman's concerns.
On a totally unrelated note, I have to say that I appreciate the shift in CNBC's reporting. Much more thoughtful and informed. Just please get a good market technician in there who will be willing to talk about what is going on under the hood if possible. A lot of people watching on the sidelines are far more terrified than they need to be because it all looks random to them. And they're worried that you guys look confused and worried--and if the experts on the news are worried....??!
You should be able to find one who has access to the really good data that we retailers can only guess at, who can explain it to us unwashed masses.

Ok, So.. Questions

There is no market justification for this. How can you tell me is this fundamentally sound and not just straight throwing money away irresponsibly?? (side note: not that that should matter--if you want to throw your money away why shouldn't you be allowed to?)
We're not trading in your securities pricing model. This isn't irrational just because your model says long and short positions are the same thing. The model is not a real market. There is asymmetrical counterparty risk here given the shorts are on the hook for all the money they have, and possibly all the money their brokers have, and possibly anyone with exposure to the broker too! You may want people to trade by the rules you want them to follow. But the rest of us trade in the real market as it is actually implemented. Remember? That's what you tell the retailers who take their accounts to zero. Remember what you told the KBIO short-squeezed people? They had fair warning that short positions carry infinite risk, including more than your initial investment. You guys know this. It's literally part of your job to know this.
But-but-the systemic risk!! This is Madness!
...Madness?
THIS. IS. THE MARKET!!! *Retail kicks the short-side hedge funds down an infinity loss black hole\*.
Ok, seriously though, that is actually a fundamentally sound, and properly profit-driven answer at least as justifiable as the hedge funds' justification for going >100% of float short. If they can be allowed to gamble INFINITE LOSSES because they expect to make profit on the possibility the company goes bankrupt, can't others do the inverse on the possibility the company I don't know.. doesn't go bankrupt and gets a better strategy from the team that created what is now a $43bn market cap company (CHWY) that does exactly some of the things GME needs to do (digital revenue growth) maybe? I mean, I first bought in on that fundamental value thesis in the 30s and then upped my cost basis given the asymmetry of risk in the technical analysis as an obvious no-brainer momentum trade. The squeeze is just, as WSB people might say, tendies raining down from on high as an added bonus.
I get that you disagree on the fundamental viability of GME. Great. Isn't that what makes a market?
Regarding the consequences of a squeeze, in practice my expectation was maybe at worst some kind of ex-market settlement after liquidation of the funds with exposure to keep things nice and orderly for the rest of the market. I mean, they handled the VW thing somehow right? I see now that I just underestimated elite hedge fund managers though--those guys are so hardcore (I'll explain why I think so a bit lower down).
If hedge fund people are so hardcore, how did the retail long side ever have a chance of winning this squeeze trade they're talking about?
Because it's an asymmetrical battle once you have short interest cornered. And the risk is also crazily asymmetrical in favor of the long side if short interest is what it is in GME. In fact, the hedge funds essentially cornered themselves without anyone even doing anything. They just dug themselves right in there. Kind of impressive really, in a weird way.
What does the short side need to cover? They need the price to be low, and they need to buy shares.
How does price move lower? You have to push share volume such that supply overwhelms demand and price therefore goes down (man, I knew econ 101 would come in handy someday).
But wait... if you have to sell shares to push the price down.. won't you just undo all your work when you have to buy it back to actually cover?
The trick is you have to push price down so hard, so fast, so unpredictably, that you SCARE OTHER PEOPLE into selling their shares too, because they're scared of taking losses. Their sales help push the price down for free! and then you scoop them up at discount price! Also, there are ways to make people scared other than price movement and fear of losses, when you get right down to it. So, you know, you just need to get really, really, really good at making people scared. Remember to add a line item to your budget to make sure you can really do it right.
On the other hand..
What does the long side need to do? They need to own as much of the shares as they can get their hands on. And then they need to hold on to them. They can't be weak hands either. They need to be hands that will hold even under the most intense heat of battle, and the immense pressure of mind-numbing fear... they need to be as if they were made of... diamond... (oh wow, maybe those WSB people kind of have a point here).
Why does this matter? Because at some point the sell side will eventually run out of shares to borrow. They simply won't be there, because they'll be safely tucked away in the long-side's accounts. Once you run out of shares to borrow and sell, you have no way to move the price anymore. You can't just drop a fat stack--excuse me, I mean suitcase (we're talking hedge fund money here after all)--of Benjamins on the ticker tape directly. Only shares. No more shares, no way to have any direct effect on the price whatsoever.
Ok, doesn't that just mean trading stops? Can't you just out-wait the long side then?
Well, you could.. until someone on the long side puts 1 share up on a 69420 ask, and an even crazier person actually buys at that price on the last tick on a Friday. Let's just say it gets really bad at that point.
Ok.. but how do the retail people actually get paid?
Well, to be quite honest, it's entirely up to each of them individually. You've seen the volumes being thrown around the past week+. I guarantee you every single retailer out there could have printed money multiple times trading that flow. If they choose to, and time it well. Or they could lose it all--this is the market. Some of them apparently seem to have some plan, or an implicit trust in certain individuals to help them know when to punch out. Maybe it works out, but maybe not. There will be financial casualties on the field for sure--this is the bare-knuckled capitalist jungle after all, remember? But everyone ponied up to the table with their own money somehow, so they all get to play in the big leagues just like everyone else. In theory, anyway.
And now, Probably the #1 question I've been asked on all of these posts has been: So what happens next? Do we get the infinity squeeze? Do the hedge funds go down?
Great questions. I don't know. No one does. That's what I've said every time, but I get that's a frustrating answer, so I'll write a bit more and speculate further. Please again understand these are my opinions with a degree of speculation I wouldn't normally put in a post.

The Market and the Economy. Main Street, Wall Street, and Washington

The pandemic has hurt so many people that it's hard to comprehend. Honestly, I don't even pretend to be able to. I have been crazy fortunate enough to almost not be affected at all. Honestly, it is a little unnerving to me how great the disconnect is between people who are doing fine (or better than fine, looking at my IRA) versus the people who are on the opposite side of the ever-widening divide that, let's be honest, has been growing wider since long before the pandemic.
People on the other side--who have been told they cannot work even if they want to, who wonder if congress will get it together to at least keep them from getting thrown out of their house if they have to keep taking one for the team for the good of all, are wondering if they're even living in the same reality.
Because all they see on the news each day is that the stock market is at record highs, or some amazing tech stocks have 10x'd in the last 6 months. How can that be happening during a pandemic? Because The Market is not The Economy. The Market looks forward to that brighter future that Economy types just need to wait for. Don't worry--it'll be here sometime before the end of the year. We think. We're making money on that assumption right now, anyway. Oh, by the way, if you're in The Market, you get to get richer as a minor, unearned side-effect of the solutions our governments have come up with to fight the pandemic.
Wow. That sounds amazing. How do I get to part of that world?
Retail fintech, baby. Physical assets like real estate might be a bit out of reach at the moment, but stocks will do. I can even buy fractional shares of BRK/A LOL.
Finally, I can trade for my own slice of heaven, watching that balance go up (and up--go stonks!!). Now I too get to dream the dream. I get to feel connected to that mythical world, The Market, rather than being stuck in the plain old Economy. Sure, I might blow up my account, but that's because it's the jungle. Bare-knuckled, big league capitalism going on right here, and at least I get to show up an put my shares on the table with everyone else. At least I'm playing the same game. Everyone has to start somewhere--at least now I get to start, even if I have to learn my lesson by zeroing my account a few times. I've basically had to deal with what felt like my life zeroing out a few times before. This is number on a screen going to 0 is nothing.
Laugh or cry, right? I'll post my losses on WSB and at least get some laughs.
Geez, some of the people here are making bank. I better learn from them and see if they'll let me in on their trades. Wow... this actually might work. I don't understand yet, but I trust these guys telling me to hold onto this crazy trade. I don't understand it, but all the memes say it's going to be big.
...WOW... I can pay off my credit card with this number. Do I punch out now? No? Hold?... Ok, getting nervous watching the number go down but I trust you freaks. We're still in the jungle, but at least I'm in with with my posse now. Market open tomorrow--we ride the rocket baby! And if it goes down, at least I'm going down with my crew. At least if that happens the memes will be so hilarious I'll forget to cry.
Wow.. I can't believe it... we might actually pull this off. Laugh at us now, "pros"!
We're in The Market now, and Market rules tell us what is going to happen. We're getting all that hedge fund money Right? Right?
Maybe.
First, I say maybe because nothing is ever guaranteed until it clears. Secondly, because the rules of The Market are not as perfectly enforced as we would like to assume. We are also finding out they may not be perfectly fair. The Market most experts are willing to talk about is really more like the ideal The Market is supposed to be. This is the version of the market I make my trading decisions in. However, the Real Market gets strange and unpredictable at the edges, when things are taken to extremes, or rules are pushed beyond the breaking point, or some of the mechanics deep in the guts of the Real Market get stretched. GME ticks basically all of those boxes, which is why so many people are getting nervous (aside from the crazy money they might lose). It's also important to remember that the sheer amount of money flowing through the market has distorting power unto itself. Because it's money, and people really, really, really like their money--especially when they're used to having a lot of it, and rules involving that kind of money tend to look more... flexible, shall we say.
Ok, back to GME. If this situation with GME is allowed to play out to its conclusion in The Market, we'll see what happens. I think all the long-side people get the chance to be paid (what, I'm not sure--and remember, you have to actually sell your position at some point or it's all still just numbers on your screen), but no one knows for certain.
But this might legitimately get so big that it spills out of The Market and back into The Economy.
Geez, and here I thought the point of all of this was so that we all get to make so much money we wouldn't ever have to think and worry about that thing again.
Unfortunately, while he's kind of a buzzkill, Thomas Petterfy has a point. This could be a serious problem.
It might blow out The Market, which will definitely crap on The Economy, which as we all know from hard experience, will seriously crush Main Street.
If it's that big a deal, we may even need Washington to be involved. Once that happens, who knows what to expect.. this kind of scenario being possible is why I've been saying I have no idea how this ends, and no one else does either.
How did we end up in this ridiculous situation? From GAMESTOP?? And it's not Retail's fault the situation is what it is.. why is everyone telling US that we need to back down to save The Market?? What about the short-side hedge funds that slammed that risk into the system to begin with?? We're just playing by the rules of The Market!!
Well, here are my thoughts, opinions, and some even further speculation... This may be total fantasy land stuff here, but since I keep getting asked I'll share anyway. Just keep that disclaimer in mind.

A Study in Big Finance Power Moves: If you owe the bank $10,000, it's your problem...

What happens when you owe money you have no way to pay back? It's a scary question to have to face personally. Still, on balance and on average, if you're fortunate enough to have access to credit the borrowing is a risk that is worth taking (especially if you're reasonably careful). Lenders can take a risk loaning you money, you take a risk by borrowing in order to do something now that you would otherwise have had to wait a long time or maybe would never have realistically been able to do otherwise. Sometimes it doesn't work out. Sometimes it's due to reasons totally beyond your control. In any case, if you find yourself there you have no choice but to dust yourself off, pick yourself up as best as you can, and try to move on and rebuild. A lot of people had to learn that in 2008. Man that year really sucked.
Wall street learned their lessons too. Most learned what I think most of us would consider the right lessons--lessons about risk management, and the need to guard vigilantly against systemic risk, concentration of risk through excess concentration of leverage on common assets, etc. Many suspect that at least a few others may have learned an entirely different set of, shall we say, unhealthy lessons. Also, to try to be completely fair, maybe managing other peoples' money on 10x+ leverage comes with a kind of pressure that just clouds your judgement. I could actually, genuinely buy that. I know I make mistakes under pressure even when I'm trading risk capital I could totally lose with no real consequence. Whatever the motive, here's my read on what's happening:
First, remember that as much fun as WSB are making of the short-side hedge fund guys right now, those guys are smart. Scary smart. Keep that in mind.
Next, let's put ourselves in their shoes.
If you're a high-alpha hedge fund manager slinging trades on a $20bn 10x leveraged to 200bn portfolio, get caught in a bad situation, and are down mark-to-market several hundred million.. what do you do? Do you take your losses and try again next time? Hell no.
You're elite. You don't realize losses--you double down--you can still save this trade no sweat.
But what if that doesn't work out so well and you're in the hole >$2bn? Obvious double down. Need you ask? I'm net up on the rest of my positions (of course), and the momentum when this thing makes its mean reversion move will be so hot you can almost taste the alpha from here. Speaking of momentum, imagine the move if your friends on TV start hyping the story harder! Genius!
Ok, so that still didn't work... this is now a frigging 7 sigma departure from your modeled risk, and you're now locked into a situation that is about as close to mathematically impossible to escape as you can get in the real world, and quickly converging on infinite downside. Holy crap. The fund might be liquidated by your prime broker by tomorrow morning--and man, even the broker is freaking out. F'in Elon Musk and his twitter! You're cancelling your advance booking on his rocket ship to Mars first thing tomorrow... Ok, focus--this might legit impact your total annual return. You need a plan, and you know the smartest people on the planet, right? The masters of the universe! Awesome--they've even seen this kind of thing before and still have the playbook!! Of course! It's obvious now--you borrow a few more billion and double down again first thing in the morning. So simple. Sticky note that Mars trip cancellation so you don't forget.
Ok... so that didn't work? You even cashed in some pretty heavy chits too. Ah well, that was a long shot anyway. So where were you? Oh yeah.. if shenanigans don't work, skip to page 10...
...Which says, of course, to double down again. Anyone even keeping track anymore? Oh, S3 says it's $40bn and we're going parabolic? Man, that chart gives me goosebumps. All according to plan...
So what happens tomorrow? One possible outcome of PURE FANTASTIC SPECULATION...
End of the week--phew. Never though it'd come. Where are you at now?... Over $9000^\)!!! Wow. You did it boys, and as a bonus the memes will be so sweet.
^\)side note: add 8 zeros to the end...
Awesome--your problems have been solved. Because...
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..
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BOOM
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Now it's EVERYONE's problem. Come at me, Chamath, THIS is REAL baller shit.
Now all you gotta do is make all the hysterical retirees watching their IRAs hanging in the balance blame those WSB kids. Hahaha. Boomers, amirite? hate when those kids step on their law--I mean IRAs. GG guys, keep you memes. THAT is how it's done.
Ok, but seriously, I hope that's not how it ends. I guess we just take it day by day at this point.
Apologies for the length. Good luck in the market!
Also, apologies in advance for formatting, spelling, and grammatical errors. I was typing this thing in between doing all kinds of other things for most of the day.
Edit getting a bunch of questions on if it's possible the hedge funds are finding ways to cover in spite of my assumptions. Of course. I'm a retail guy trying to read the charts and price action. I don't have any special tools like the pros may have.

Yes, as you read, cross post from boringpeople, but it's well worth a read, as long as it is. All credit to u/jn_ku, and go read the other parts. Godspeed autists
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Disclaimer: I am not a financial advisor. This entire post represents my personal views and opinions, and should not be taken as financial advice (or advice of any kind whatsoever). I encourage you to do your own research, take anything I write with a grain of salt, and hold me accountable for any mistakes you may catch. Also, full disclosure, I hold a net long position in GME, but my cost basis is very low (average ~$67--I have to admit, the drop today was too tasty so my cost basis went up from yesterday)/share with my later buys averaged in), and I'm using money I can absolutely lose. My capital at risk and tolerance for risk generally is likely substantially different than yours. In this post I will go a little further and speculate more than I'd normally do in a post due to the questions I've been getting, so fair warning, some of it might be very wrong. I suspect we'll learn some of the truth years from now when some investigative journalist writes a book about it.
Thank you everyone for the comments and questions on the first and second post on this topic.
Today was a study in the power of fear, courage, and the levers you can pull when you wield billions of dollars...
Woops, excuse me. I'm sorry hedge fund guys... I meant trillions of dollars--I just briefly forget you control not just your own but a lot of other peoples' money too for a moment there.
Also, for people still trading this on market-based rationale (as I am), it was a good day to measure the conviction behind your thesis. I like to think I have conviction, but in case you are somehow not yet familiar with the legend of DFV, you need to see these posts (fair warning, nsfw, and some may be offended/triggered by the crude language). The last two posts might be impressive, but you should follow it in chronological order and pay attention to the evolution of sentiment in the comments to experience true enlightenment.
Anyway, I apologize, but this post will be very long--there's just a lot to unpack.
Pre-Market
Disclaimer: given yesterday's pre-market action I didn't even pay attention to the screen until near retail pre-market. I'm less confident in my ability to read what's going on in a historical chart vs the feel I get watching live, but I'll try.
Early in the pre-market it looks to me like some momentum traders are taking profit, discounting the probability that the short-side will give them a deep discount later, which you can reasonably assume given the strategy they ran yesterday. If they're right they can sell some small volume into the pre-market top, wait for the hedge funds try to run the price back down, and then lever up the gains even higher buying the dip. Buy-side here look to me like people FOMOing and YOLOing in at any price to grab their slice of gainz, or what looks to be market history in the making. No way are short-side hedge funds trying to cover anything at these prices.
Mark Cuban--well said! Free markets baby!
Mohamed El-Erian is money in the bank as always. "upgrade in quality" on the pandemic drop was the best, clearest actionable call while most were at peak panic, and boy did it print. Your identifying the bubble as the excessive short (vs blaming retail activity) is money yet again. Also, The PAIN TRADE (sorry, later interview segment I only have on DVR, couldn't find on youtube--maybe someone else can)!
The short attack starts, but I'm hoping no one was panicking this time--we've seen it before. Looks like the momentum guys are minting money buying the double dip into market open.
CNBC, please get a good market technician to explain the market action. Buy-side dominance, sell-side share availability evaporating into nothing (look at day-by-day volume last few days), this thing is now at runaway supercritical mass. There is no changing the trajectory unless you can change the very fabric of the market and the rules behind it (woops, I guess I should have knocked on wood there).
If you know the mechanics, what's happening in the market with GME is not mysterious AT ALL. I feel like you guys are trying to scare retail out early "for their own good" (with all sincerity, to your credit) rather than explain what's happening. Possibly you also fear that explaining it would equate to enabling/encouraging people to keep trying to do it inappropriately (possibly fair point, but at least come out and say that if that's the case). Outside the market, however...wow.
You Thought Yesterday Was Fear? THIS is Fear!
Ok short-side people, my hat is off to you. Just when I thought shouting fire in a locked theater was fear mongering poetry in motion, you went and took it to 11. What's even better? Yelling fire in a theater with only one exit. That way people can cause the financial equivalent of stampede casualties. Absolutely brilliant.
Robin Hood disables buying of GME, AMC, and a few of the other WSB favorites. Other brokerages do the same. Even for people on 0% margin. Man, and here I thought I had seen it all yesterday.
Side note: I will give a shout out to TD Ameritrade. You guys got erroneously lumped together with RH during an early CNBC segment, but you telegraphed the volatility risk management changes and gradually ramped up margin requirements over the past week. No one on your platform should have been surprised if they were paying attention. And you didn't stop anyone from trading their own money at any point in time. My account balance thanks you. I heard others may have had problems, but I'll give you the benefit of the doubt given the DDOS attacks that were flyiing around
Robin Hood. Seriously WTF. I'm sure it was TOTALLY coincidence that your big announcements happen almost precisely when what has to be one of the best and most aggressive short ladder attacks of all time starts painting the tape, what looked like a DDOS attack on Reddit's CDN infrastructure (pretty certain it was the CDN because other stuff got taken out at the same time too), and a flood of bots hit social media (ok, short-side, this last one is getting old).
Taking out a large-scale cloud CDN is real big boy stuff though, so I wouldn't entirely rule out nation state type action--those guys are good at sniffing out opportunities to foment social unrest.
Anyway, at this point, as the market dives, I have to admit I was worried for a moment. Not that somehow the short-side would win (hah! the long-side whales in the pond know what's up), but that a lot of retail would get hurt in the action. That concern subsided quite a bit on the third halt on that slide. But first...
A side lesson on market orders
Someone printed bonus bank big time (and someone lost--I feel your pain, whoever you are).
During the face-ripping volatility my play money account briefly ascended to rarified heights of 7 figures. It took me a second to realize it, then another second to process it. Then, as soon as it clicked, that one, glorious moment in time was gone.
What happened?
During the insane chop of the short ladder attack, someone decided to sweep the 29 Jan 21 115 Call contracts, but they couldn't get a grip on the price, which was going coast to coast as IV blew up and the price was being slammed around. So whoever was trying to buy said "F it, MARKET ORDER" (i.e. buy up to $X,XXX,XXX worth of contracts at any price). This is referred to as a sweep if funded to buy all/most of the contracts on offer (HFT shops snipe every contract at each specific price with a shotgun of limit orders, which is far safer, but something only near-market compute resources can do really well). For retail, or old-tech pros, if you want all the contracts quickly, you drop a market order loaded with big bucks and see what you get... BUT, some clever shark had contracts available for the reasonable sum of... $4,400, or something around that. I was too stunned to grab a screencap. The buy market order swept the book clean and ran right into that glorious, nigh-obscene backstop limit. So someone got nearly $440,000 PER CONTRACT that was, at the time theoretically priced at around $15,000. $425,000 loss... PER CONTRACT. Maybe I'm not giving the buyer enough credit.. you can get sniped like that even if you try to do a safety check of the order book first, but, especially in low liquidity environments, if a HFT can peak into your order flow (or maybe just observes a high volume of sweeps occurring), they can end up front running your sweep, pick off the reasonable contracts, and slam a ridiculous limit sell order into place before your order makes it to the exchange. Either way, I hope that sweep wasn't loaded for bear into the millions. If so... OUCH. Someone got cleaned out.
So, the lesson here folks... in a super high volatility, low-liquidity market, a market order will just run up the ladder into the first sell order it can find, and some very brutal people will put limit sells like that out there just in case they hit the jackpot. And someone did. If you're on the winning side, great. It can basically bankrupt you if you're on the losing side. My recommendation: Just don't try it. I wouldn't be surprised if really shady shenanigans were involved in this, but no way to know (normally that's crazy-type talk, but after today....peeking at order flow and sniping sweeps is one of the fastest, most financially devastating ways to bleed big long-side players, just sayin').
Back to the market action..
A Ray of Light Through the Darkness
So I was worried watching the crazy downward movement for two different reasons.
On the one hand, I was worried the momentum pros would get the best discounts on the dip (I'll admit, I FOMO'd in too early, unnecessarily raising my cost basis).
On the other hand, I was worried for the retail people on Robin Hood who might be bailing out into incredibly steep losses because they had only two options: Watch the slide, or bail. All while dealing with what looked to me like a broad-based cloud CDN outage as they tried to get info from WSB HQ, and wondering if the insta-flood of bot messages were actually real people this time, and that everyone else was bailing on them to leave them holding the bag.
But I saw the retail flag flying high on the 3rd market halt (IIRC), and I knew most would be ok. What did I see, you ask? Why, the glorious $211.00 / $5,000 bid/ask spread. WSB Reddit is down? Those crazy mofos give you the finger right on the ticker tape. I've been asked many times in the last few hours about why I was so sure shorts weren't covering on the down move. THIS is how I knew. For sure. It's in the market data itself.
I'll admit, I tried to one-up those bros with a 4206.90 limit sell order, but it never made it through. I'm impressed that the HFT guys at the hedge fund must have realized really quickly what a morale booster that kind of thing would have been, and kept a lower backstop ask in place almost continuously from then on I'm sure others tried the same thing. Occasionally $1,000 and other high-dollar asks would peak through from time to time from then on, which told me the long-side HFTs were probably successfully sniping the backstops regularly.
So, translating for those of you who found that confusing. First, such a high ask is basically a FU to the short-side (who, as you remember, need to eventually buy shares to cover their short positions). More importantly, as an indicator of retail sentiment, it meant that NO ONE ELSE WAS TRYING TO SELL AT ANY PRICE LOWER THAN $5,000. Absolutely no one was bailing out.
I laughed for a minute, then started getting a little worried. Holy cow.. NO retail selling into the fear? How are they resisting that kind of price move??
The answer, as we all know now... they weren't afraid... they weren't even worried. They were F*CKING PISSED.
Meanwhile the momentum guys and long-side HFTs keep gobbling up the generously donated shares that the short-side are plowing into their ladder attack. Lots of HFT duels going on as long-side HFTs try to intercept shares meant to travel between short-side HFT accounts for their ladder. You can tell when you see prices like $227.0001 constantly flying across the tape. Retail can't even attempt to enter an order like that--those are for the big boys with privileged low-latency access.
The fact that you can even see that on the tape with human eyes is really bad for the short-side people.
Why, you ask? Because it means liquidity is drying up, and fast.
The Liquidity Tide is Flowing Out Quickly. Who's Naked (short)?
Market technicals time. I still wish this sub would allow pictures so I could throw up a chart, but I guess a table will do fine.
DateVolumePrice at US Market CloseFriday, 1/22/21197,157,196$65.01Monday, 1/25/21177,874,00$76.79Tuesday, 1/26/21178,587,974$147.98Wednesday, 1/27/2193,396,666$347.51Thursday, 1/28/2158,815,805$193.60
What do I see? I see the shares available to trade dropping so fast that all the near-exchange compute power in the world won't let the short-side HFTs maintain order flow volume for their attacks. Many retail people asking me questions thought today was the heaviest trading. Nope--it was just the craziest.
What about the price dropping on Thursday? Is that a sign that the short-side pulled a miracle out and pushed price down against a parabolic move on even less volume than Wednesday? Is the long side running out of capital?
Nope. It means the short-side hedge funds are just about finished.
But wait, I thought the price needed to be higher for them to be taken out? How is it that price being lower is bad for them? Won't that allow them to cover at a lower price?
No, the volume is so low that they can't cover any meaningful fraction of their position without spiking the price parabolic almost instantly. Just not enough shares on offer at reasonable prices (especially when WSB keeps flashing you 6942.00s).
It's true, a higher price hurts, but the interest charge for one more day is just noise at this point. The only tick that will REALLY count is the last tick of trading on Friday.
In the meantime, the price drop (and watching the sparring in real time) tells me that the long-side whales and their HFT quants are so certain of the squeeze that they're no longer worried AT ALL about whether it will happen, and they aren't even worried at all about retail morale to help carry the water anymore.
Instead, they're now really, really worried about how CHEAPLY they can make it happen.
They are wondering if they can't edge out just a sliver more alpha out of what will already be a blow-out trade for the history books (probably). You see, to make it happen they just have to keep hoovering up shares. It doesn't matter what those shares cost. If you're certain that the squeeze is now locked in, why push the price up and pay more than you have to? Just keep pressing hard enough to force short-side to keep sending those tasty shares your way, but not so much you move the price. Short-side realizes this and doesn't try to drive price down too aggressively. They can't afford to let price run away, so they have to keep some pressure on at the lowest volume they can manage, but they don't want to push down too hard and give the long-side HFTs too deep of a discount and bleed their ammo out even faster. That dynamic keeps price within a narrow (for GME today, anyway) trading range for the rest of the day into the close.
Good plan guys, but those after market people are pushing the price up again. Damnit WSB bros and Euros, you're costing those poor long-side whales their extra 0.0000001% of alpha on this trade just so you can run up your green rockets... See, that's the kind of nonsense that just validates Lee Cooperman's concerns.
On a totally unrelated note, I have to say that I appreciate the shift in CNBC's reporting. Much more thoughtful and informed. Just please get a good market technician in there who will be willing to talk about what is going on under the hood if possible. A lot of people watching on the sidelines are far more terrified than they need to be because it all looks random to them. And they're worried that you guys look confused and worried--and if the experts on the news are worried....??!
You should be able to find one who has access to the really good data that we retailers can only guess at, who can explain it to us unwashed masses.
Ok, So.. Questions
There is no market justification for this. How can you tell me is this fundamentally sound and not just straight throwing money away irresponsibly?? (side note: not that that should matter--if you want to throw your money away why shouldn't you be allowed to?)
We're not trading in your securities pricing model. This isn't irrational just because your model says long and short positions are the same thing. The model is not a real market. There is asymmetrical counterparty risk here given the shorts are on the hook for all the money they have, and possibly all the money their brokers have, and possibly anyone with exposure to the broker too! You may want people to trade by the rules you want them to follow. But the rest of us trade in the real market as it is actually implemented. Remember? That's what you tell the retailers who take their accounts to zero. Remember what you told the KBIO short-squeezed people? They had fair warning that short positions carry infinite risk, including more than your initial investment. You guys know this. It's literally part of your job to know this.
But-but-the systemic risk!! This is Madness!
...Madness?
THIS. IS. THE MARKET!!! *Retail kicks the short-side hedge funds down an infinity loss black hole\*.
Ok, seriously though, that is actually a fundamentally sound, and properly profit-driven answer at least as justifiable as the hedge funds' justification for going >100% of float short. If they can be allowed to gamble INFINITE LOSSES because they expect to make profit on the possibility the company goes bankrupt, can't others do the inverse on the possibility the company I don't know.. doesn't go bankrupt and gets a better strategy from the team that created what is now a $43bn market cap company (CHWY) that does exactly some of the things GME needs to do (digital revenue growth) maybe? I mean, I first bought in on that fundamental value thesis in the 30s and then upped my cost basis given the asymmetry of risk in the technical analysis as an obvious no-brainer momentum trade. The squeeze is just, as WSB people might say, tendies raining down from on high as an added bonus.
I get that you disagree on the fundamental viability of GME. Great. Isn't that what makes a market?
Regarding the consequences of a squeeze, in practice my expectation was maybe at worst some kind of ex-market settlement after liquidation of the funds with exposure to keep things nice and orderly for the rest of the market. I mean, they handled the VW thing somehow right? I see now that I just underestimated elite hedge fund managers though--those guys are so hardcore (I'll explain why I think so a bit lower down).
If hedge fund people are so hardcore, how did the retail long side ever have a chance of winning this squeeze trade they're talking about?
Because it's an asymmetrical battle once you have short interest cornered. And the risk is also crazily asymmetrical in favor of the long side if short interest is what it is in GME. In fact, the hedge funds essentially cornered themselves without anyone even doing anything. They just dug themselves right in there. Kind of impressive really, in a weird way.
What does the short side need to cover? They need the price to be low, and they need to buy shares.
How does price move lower? You have to push share volume such that supply overwhelms demand and price therefore goes down (man, I knew econ 101 would come in handy someday).
But wait... if you have to sell shares to push the price down.. won't you just undo all your work when you have to buy it back to actually cover?
The trick is you have to push price down so hard, so fast, so unpredictably, that you SCARE OTHER PEOPLE into selling their shares too, because they're scared of taking losses. Their sales help push the price down for free! and then you scoop them up at discount price! Also, there are ways to make people scared other than price movement and fear of losses, when you get right down to it. So, you know, you just need to get really, really, really good at making people scared. Remember to add a line item to your budget to make sure you can really do it right.
On the other hand..
What does the long side need to do? They need to own as much of the shares as they can get their hands on. And then they need to hold on to them. They can't be weak hands either. They need to be hands that will hold even under the most intense heat of battle, and the immense pressure of mind-numbing fear... they need to be as if they were made of... diamond... (oh wow, maybe those WSB people kind of have a point here).
Why does this matter? Because at some point the sell side will eventually run out of shares to borrow. They simply won't be there, because they'll be safely tucked away in the long-side's accounts. Once you run out of shares to borrow and sell, you have no way to move the price anymore. You can't just drop a fat stack--excuse me, I mean suitcase (we're talking hedge fund money here after all)--of Benjamins on the ticker tape directly. Only shares. No more shares, no way to have any direct effect on the price whatsoever.
Ok, doesn't that just mean trading stops? Can't you just out-wait the long side then?
Well, you could.. until someone on the long side puts 1 share up on a 69420 ask, and an even crazier person actually buys at that price on the last tick on a Friday. Let's just say it gets really bad at that point.
Ok.. but how do the retail people actually get paid?
Well, to be quite honest, it's entirely up to each of them individually. You've seen the volumes being thrown around the past week+. I guarantee you every single retailer out there could have printed money multiple times trading that flow. If they choose to, and time it well. Or they could lose it all--this is the market. Some of them apparently seem to have some plan, or an implicit trust in certain individuals to help them know when to punch out. Maybe it works out, but maybe not. There will be financial casualties on the field for sure--this is the bare-knuckled capitalist jungle after all, remember? But everyone ponied up to the table with their own money somehow, so they all get to play in the big leagues just like everyone else. In theory, anyway.
And now, Probably the #1 question I've been asked on all of these posts has been: So what happens next? Do we get the infinity squeeze? Do the hedge funds go down?
Great questions. I don't know. No one does. That's what I've said every time, but I get that's a frustrating answer, so I'll write a bit more and speculate further. Please again understand these are my opinions with a degree of speculation I wouldn't normally put in a post.
The Market and the Economy. Main Street, Wall Street, and Washington
The pandemic has hurt so many people that it's hard to comprehend. Honestly, I don't even pretend to be able to. I have been crazy fortunate enough to almost not be affected at all. Honestly, it is a little unnerving to me how great the disconnect is between people who are doing fine (or better than fine, looking at my IRA) versus the people who are on the opposite side of the ever-widening divide that, let's be honest, has been growing wider since long before the pandemic.
People on the other side--who have been told they cannot work even if they want to, who wonder if congress will get it together to at least keep them from getting thrown out of their house if they have to keep taking one for the team for the good of all, are wondering if they're even living in the same reality.
Because all they see on the news each day is that the stock market is at record highs, or some amazing tech stocks have 10x'd in the last 6 months. How can that be happening during a pandemic? Because The Market is not The Economy. The Market looks forward to that brighter future that Economy types just need to wait for. Don't worry--it'll be here sometime before the end of the year. We think. We're making money on that assumption right now, anyway. Oh, by the way, if you're in The Market, you get to get richer as a minor, unearned side-effect of the solutions our governments have come up with to fight the pandemic.
Wow. That sounds amazing. How do I get to part of that world?
Retail fintech, baby. Physical assets like real estate might be a bit out of reach at the moment, but stocks will do. I can even buy fractional shares of BRK/A LOL.
Finally, I can trade for my own slice of heaven, watching that balance go up (and up--go stonks!!). Now I too get to dream the dream. I get to feel connected to that mythical world, The Market, rather than being stuck in the plain old Economy. Sure, I might blow up my account, but that's because it's the jungle. Bare-knuckled, big league capitalism going on right here, and at least I get to show up an put my shares on the table with everyone else. At least I'm playing the same game. Everyone has to start somewhere--at least now I get to start, even if I have to learn my lesson by zeroing my account a few times. I've basically had to deal with what felt like my life zeroing out a few times before. This is number on a screen going to 0 is nothing.
Laugh or cry, right? I'll post my losses on WSB and at least get some laughs.
Geez, some of the people here are making bank. I better learn from them and see if they'll let me in on their trades. Wow... this actually might work. I don't understand yet, but I trust these guys telling me to hold onto this crazy trade. I don't understand it, but all the memes say it's going to be big.
...WOW... I can pay off my credit card with this number. Do I punch out now? No? Hold?... Ok, getting nervous watching the number go down but I trust you freaks. We're still in the jungle, but at least I'm in with with my posse now. Market open tomorrow--we ride the rocket baby! And if it goes down, at least I'm going down with my crew. At least if that happens the memes will be so hilarious I'll forget to cry.
Wow.. I can't believe it... we might actually pull this off. Laugh at us now, "pros"!
We're in The Market now, and Market rules tell us what is going to happen. We're getting all that hedge fund money Right? Right?
Maybe.
First, I say maybe because nothing is ever guaranteed until it clears. Secondly, because the rules of The Market are not as perfectly enforced as we would like to assume. We are also finding out they may not be perfectly fair. The Market most experts are willing to talk about is really more like the ideal The Market is supposed to be. This is the version of the market I make my trading decisions in. However, the Real Market gets strange and unpredictable at the edges, when things are taken to extremes, or rules are pushed beyond the breaking point, or some of the mechanics deep in the guts of the Real Market get stretched. GME ticks basically all of those boxes, which is why so many people are getting nervous (aside from the crazy money they might lose). It's also important to remember that the sheer amount of money flowing through the market has distorting power unto itself. Because it's money, and people really, really, really like their money--especially when they're used to having a lot of it, and rules involving that kind of money tend to look more... flexible, shall we say.
Ok, back to GME. If this situation with GME is allowed to play out to its conclusion in The Market, we'll see what happens. I think all the long-side people get the chance to be paid (what, I'm not sure--and remember, you have to actually sell your position at some point or it's all still just numbers on your screen), but no one knows for certain.
But this might legitimately get so big that it spills out of The Market and back into The Economy.
Geez, and here I thought the point of all of this was so that we all get to make so much money we wouldn't ever have to think and worry about that thing again.
Unfortunately, while he's kind of a buzzkill, Thomas Petterfy has a point. This could be a serious problem.
It might blow out The Market, which will definitely crap on The Economy, which as we all know from hard experience, will seriously crush Main Street.
If it's that big a deal, we may even need Washington to be involved. Once that happens, who knows what to expect.. this kind of scenario being possible is why I've been saying I have no idea how this ends, and no one else does either.
How did we end up in this ridiculous situation? From GAMESTOP?? And it's not Retail's fault the situation is what it is.. why is everyone telling US that we need to back down to save The Market?? What about the short-side hedge funds that slammed that risk into the system to begin with?? We're just playing by the rules of The Market!!
Well, here are my thoughts, opinions, and some even further speculation... This may be total fantasy land stuff here, but since I keep getting asked I'll share anyway. Just keep that disclaimer in mind.
A Study in Big Finance Power Moves: If you owe the bank $10,000, it's your problem...
What happens when you owe money you have no way to pay back? It's a scary question to have to face personally. Still, on balance and on average, if you're fortunate enough to have access to credit the borrowing is a risk that is worth taking (especially if you're reasonably careful). Lenders can take a risk loaning you money, you take a risk by borrowing in order to do something now that you would otherwise have had to wait a long time or maybe would never have realistically been able to do otherwise. Sometimes it doesn't work out. Sometimes it's due to reasons totally beyond your control. In any case, if you find yourself there you have no choice but to dust yourself off, pick yourself up as best as you can, and try to move on and rebuild. A lot of people had to learn that in 2008. Man that year really sucked.
Wall street learned their lessons too. Most learned what I think most of us would consider the right lessons--lessons about risk management, and the need to guard vigilantly against systemic risk, concentration of risk through excess concentration of leverage on common assets, etc. Many suspect that at least a few others may have learned an entirely different set of, shall we say, unhealthy lessons. Also, to try to be completely fair, maybe managing other peoples' money on 10x+ leverage comes with a kind of pressure that just clouds your judgement. I could actually, genuinely buy that. I know I make mistakes under pressure even when I'm trading risk capital I could totally lose with no real consequence. Whatever the motive, here's my read on what's happening:
First, remember that as much fun as WSB are making of the short-side hedge fund guys right now, those guys are smart. Scary smart. Keep that in mind.
Next, let's put ourselves in their shoes.
If you're a high-alpha hedge fund manager slinging trades on a $20bn 10x leveraged to 200bn portfolio, get caught in a bad situation, and are down mark-to-market several hundred million.. what do you do? Do you take your losses and try again next time? Hell no.
You're elite. You don't realize losses--you double down--you can still save this trade no sweat.
But what if that doesn't work out so well and you're in the hole >$2bn? Obvious double down. Need you ask? I'm net up on the rest of my positions (of course), and the momentum when this thing makes its mean reversion move will be so hot you can almost taste the alpha from here. Speaking of momentum, imagine the move if your friends on TV start hyping the story harder! Genius!
Ok, so that still didn't work... this is now a frigging 7 sigma departure from your modeled risk, and you're now locked into a situation that is about as close to mathematically impossible to escape as you can get in the real world, and quickly converging on infinite downside. Holy crap. The fund might be liquidated by your prime broker by tomorrow morning--and man, even the broker is freaking out. F'in Elon Musk and his twitter! You're cancelling your advance booking on his rocket ship to Mars first thing tomorrow... Ok, focus--this might legit impact your total annual return. You need a plan, and you know the smartest people on the planet, right? The masters of the universe! Awesome--they've even seen this kind of thing before and still have the playbook!! Of course! It's obvious now--you borrow a few more billion and double down again first thing in the morning. So simple. Sticky note that Mars trip cancellation so you don't forget.
Ok... so that didn't work? You even cashed in some pretty heavy chits too. Ah well, that was a long shot anyway. So where were you? Oh yeah.. if shenanigans don't work, skip to page 10...
...Which says, of course, to double down again. Anyone even keeping track anymore? Oh, S3 says it's $40bn and we're going parabolic? Man, that chart gives me goosebumps. All according to plan...
So what happens tomorrow? One possible outcome of PURE FANTASTIC SPECULATION...
End of the week--phew. Never though it'd come. Where are you at now?... Over $9000*!!! Wow. You did it boys, and as a bonus the memes will be so sweet.
*side note: add 8 zeros to the end...
Awesome--your problems have been solved. Because...
..
BOOM
Now it's EVERYONE's problem. Come at me, Chamath, THIS is REAL baller shit.
Now all you gotta do is make all the hysterical retirees watching their IRAs hanging in the balance blame those WSB kids. Hahaha. Boomers, amirite? hate when those kids step on their law--I mean IRAs. GG guys, keep you memes. THAT is how it's done.
Ok, but seriously, I hope that's not how it ends. I guess we just take it day by day at this point.
Apologies for the length. Good luck in the market!
Also, apologies in advance for formatting, spelling, and grammatical errors. I was typing this thing in between doing all kinds of other things for most of the day.

Also on my blog with better formatting, cute footnotes and inlined images.
Note that not much here is new material, mostly rehashing existing points.

Disclaimer

This article started out as research for my betting against Bitcoin on the stock market. This isn't financial advice. As a matter of fact, I encourage all readers you to not buy or short crypto, through any market or derivative. Use your money for productive uses.
Here's a TL;DR:

1. The current parabolic price increase in Bitcoin is a bubble that has started popping.
   
2. A stablecoin called Tether is either one of the largest frauds or money laundering operation in history, and is providing most of the liquidity in the cryptocurrency ecosystem.
   
3. A BTC bubble pop, incoming regulation on stablecoins or the current NYAG investigation into tether will expose tether's insolvency to the crypto market. This is bigger than it sounds.
   
4. (Speculative, but one can hope) Current prices to mine BTC could end up higher than BTC market price, exposing BTC to a 51% attack.
   

A Recap: Bitcoin is useless and should go away

Bitcoin serves no purpose. Let's just rehash that by quickly debunking the major claimed uses over time as seen here

• Proof of concept: No argument here, but now that the market cap of cryptocurrencies is closing in on a $700B, this seems moot.
  
• Cheap Payment Network: Nonsense, since BTC transactions are currently >$10 and this worsens the more people use it.
  
• Anonymous Darknet Currency: I'd have said "no argument here", but apparently it's surprisingly easy to trace BTC nowadays. However, crypto ecosystem as a whole seems to do a decent job at laundering money as we'll see later.
  
• Reserve Currency for Crypto: Since a reserve currency should be useful as a means of exchange, and I wrote several thousand words on how BTC is not that, my position is pretty clear. Also, the fact that a cryptocurrency indexed to the US dollar has trounced BTC as the main means of exchange in the crypto ecosystem speaks for itself.
  
• Programmable Shared Database: You know what's programmable, shared and a database? The database we use at work. Just learn to implement access control lists on your SQL server.
  
• Uncorrelated Financial Asset: Given BTC crashed just like the rest of the market when COVID showed up, this doesn't hold up
  

The stupidest version of the "uncorrelated asset" argument I hear is "Bitcoin is a great hedge for inflation!"
You know what's a good "hedge for inflation"? Literally anything. The definition of inflation is "the price of money". If the price of money goes down (inflation) then everything else has a positive return by comparison.
People who say "bitcoin is a good hedge for inflation" shouldn't be trusted to manage their own money, let alone give financial advice to anyone.

• Censorship Resistant e-Gold: This is a roundabout way of saying "BTC is a store of value"! Which, again, can only be said by people who've never read the definition of "store of value" in a textbook.

I already went into detail into this, but BTC is a terrible store of value because it's volatile. Assets that can lose 20% of value overnight don't "store value". BTC is a "vehicle for speculation".
The only way price is sustained for BTC is that you can find some other idiot to sell it to. Just as a reminder, 50% of Gold is used for things that aren't speculation, like Jewelry, so you'll never have to worry finding a seller there.
Here are some real uses for bitcoin:

• Gambling is fun. You buy BTC, the price might go up! Or down! This is exciting.
  
• Hackers, money launderers and other criminals certainly find cryptocurrencies useful.
  

Reminder: BTC is an ecological scourge
The current cost to mine a BTC is around $8000 in electricity. This electricity mostly comes from subsidized coal in China.
And given the current amount of BTC generated each day, we're using about equivalent to the electricity from all of Belgium, largely in coal, to keep this going.
I don't mind wasting time on intellectual curiosities, but destroying our planet for glorified gambling is not something I'm happy about. I want cryptocurrencies to go away entirely on this basis, philosophically.

Current BTC prices are a bubble

Before we go into tether, reminder that at the time of writing, the plot of BTC price against the S&P500 looks like this
BTC price has increased by ~800% since March. Still, no one uses it for anything useful since the last bubble in 2017, or the other one before that in 2013. This is another bubble however you put it.
BTC is not "new technology"
10 years the internet became popular, Google and Amazon already existed. We're 8 years after the popular emergence of deep learning and it has already revolutionized machine translation, computer vision and natural language processing in general.
You could argue that deep learning and the internet existed before their emergence, but so did cryptocurrencies. Look up b-money and hashcash for instance.
Bitcoin has existed since 2008 and emerged in popularity around the same time as deep learning did, yet we're still to find actual uses for it except speculation and criminal uses. It's a solution waiting for a problem.
Institutional investors are also idiots
The narrative this time is that "institutional investors" are buying into BTC. This doesn't mean it's not a bubble.
Many of the institutions were buying through Grayscale Bitcoin Trust. Rather, many of them were chasing the premium over net asset value that hovered around 20%. Basically, lock money in GBTC for 6 months, cash out and collect the premium as profit. Of course, this little Ponzi couldn't last forever and the premium seems to be evaporating now.
Similarly, totally-not-a-bitcoin-ETF-wearing-a-software-company-skinsuit Microstrategy (MSTR) trades at a massive premium over fundamentals.
There will always be traders chasing bonuses from numbers going up, regardless what is making the number going up. The same "institutional investors" were buying obviously terrible CDOs in the run-up to 2008.

Tether is lunacy

Tether is a cryptocurrency whose exchange rate is supposed to be pegged to the US Dollar. Initially this was done by having 1-to-1 US Dollar reserves for each tether issued. Then they got scammed by their money launderer, losing some $800M, which made them insolvent.
Anyway, now tether maintains their reserves are whatever they want them to be and they haven't gotten audited since 2017.
You know, normal stuff.
There's a problem to backing your USD-pegged security with something that isn't US Dollars. Namely, if the price of the thing you're backing your US Dollars against goes down, you're now insolvent. If you were backing $10B in tether with $10B of bitcoin, then the bitcoin drops by half, you're insolvent by $5B.
And then this spotlessly clean company they somehow added $20B to their balance sheet in the second half of 2020
Reminder: one side of that balance sheet is currently floating around the cryptocurrency ecosystem. Cryptocurrency traders own it as an asset and sell it to others. The other half of the balance sheet is whatever tether wants.
There are only two possibilities that explain tether's growth:

• Massive unbacked issuances, because they're afraid their scam has run its course.
  
• Money laundering. Lots of it.
  

It could also be a happy mix of both.
One particularly interesting date is 30/8/2020, where tether added $3B to its balance sheet overnight. This is interesting because it predates the subsequent movement in bitcoin price and large movements in other cryptocurrencies.
The story from tether and tether's bank's CEO is that this money largely comes from foreign nationals through an OTC desk which implies the transaction goes as following:

1. A foreign national sends money in a foreign currency to an OTC desk. This is exactly as clean as you'd think -- often raw cash transactions in the millions.
   
2. That OTC desk converts the money to USD and sends it to tether's correspondent US bank. The OTC desk gives tether to the foreign national.
   
3. Wait tether has a correspondent US bank?
   

Oh, I forgot to mention, no bank wants tether as a customer because they obviously break KYC/AML compliance. So tether first bought invested in a bank called Noble which then lost its relationship with Wells-Fargo when they realized tether were lying to them about AML. Poor tether lost its legal access to USD.
Tether has been banking in the Bahamas with a bank called Deltec since. First they had a money launderer called Crypto Capital Corp to send funds to customers, who stole the $800M from them and subsequently went to jail.
But worry not! Tether found a way to get banked in USD afterwards. Curious coincidence, an executive at Deltec was randomly blogging about buying small US community banks in 2018. You know, that thing money launderers do.
So tether's story is that in 2020, they took in roughly twenty billion USD of shady foreign money into the small community US bank their deltec bankers bought. These transactions are necessarily breaking KYC/AML. The foreign parties to those transactions wouldn't take such a rickety route to convert billions into cryptocurrencies if they weren't laughed out of the room in serious banks.
But of course, Deltec will say it did KYC on tether. Really solid KYC, clearly, since they're the last bank on earth taking tether's business. Tether says they do KYC on their customers (the large OTC desks). And I'm sure the OTC desks would be shocked, shocked if the cash money they get in Russia and China turns out to be dirty. So everyone can pass the buck of responsibility down the road and claim "We do KYC on our customers".
Sure you do, tether. If you did such great KYC, you wouldn't have such problems finding banking relationships. I mean when even HSBC is not doing business with you you're apparently more obviously moving criminal money than fucking drug cartels.
And, according to tether's people, this money is what's backing tether's reserves. Money that will get frozen the instant a prosecutor even looks at it.
Reminder: the above is the charitable, positive case for tether.
The less charitable case is that they took crayons and added zeros to their balance sheet, and that there's a couple billions waiting to burn a hole in the crypto ecosystem.
Anyway, the $25B garbage fire that is tether will make a great book/netflix series at some point and their hilariously stupid CTO going on podcasts while flinching on questions about how BTC ended up on their balance sheet will be a fun part of it.
But I'm not here to write a book, I'm here to make money by shorting all of this. For my purposes, even in the positive case tether is a ticking time bomb waiting to burn a hole in the crypto ecosystem, because...

KYC and AML are coming for cryptocurrencies

If you listen to "crypto news", all incoming crypto regulation is just great, because that means crypto is becoming legit. However, companies investing in crypto are very angry about them.
This is because crypto transactions break the FinCEN travel rule, where KYC information should "travel" along transactions, to prevent money laundering obfuscation schemes.
Of course, according to the crypto industry this is "stifling innovation". A more reasonable take is that by being leaving the crypto industry outside normal financial regulations, we're enabling a "race to the bottom". As we saw with shadow banks in the 2000-2007 era this leads to "creative banking". I don't want my bankers to be creative, I want them to be solvent.

Tether's effect on the crypto ecosystem

When tether implodes, it's taking most of the crypto industry along for a fun ride. Tether can implode in one of a few ways:

1. A BTC price crash triggers it. If
   
2. Regulators decide they've had enough of AML avoidance and regulate them.
   
3. The NYAG investigation, which is waiting for an update in a few weeks, finds something and shuts them out.
   

Let's assume tether falls to $0 for simplicity. The analysis is the same directionally if tether significantly "breaks the buck".
This doesn't happen instantly, but it happens quickly. The peg breaks, and most people holding tether will try to sell it for other crypto (BTC, ETH, etc.). This puts downward pressure on the price of tether, incentivizing even more people to "pass the buck". Automated inter-exchange arbitrage bots might try to exploit emerging gaps in bid-ask spreads, only to end up with worthless tether instead, as their operators rush to pull the plug.
Then, we have a small village of cryptocurrency enthusiasts being out some $24B. With the trading bots turned off and the trading lubricant (a dollar pegged asset) gone, the bid-ask spreads blow up. You get a predictable flight to safety -- that is, to real money. This puts downward pressure on BTC.
While all of this is happening, there are all sorts of fun second-order effects happen. A lot of DeFi derivative products are priced in cryptocurrencies, so having normally stable prices shuffle around (eg. USDC price moving above $1 in a flight to safety) triggers a tsunami of margin calls. Some exchanges might insolvent (they're the ones redeeming tether for USD after all).

If BTC price drops below $8000, fun things happen

Currently, the price to mine a BTC is roughly $8000. Most of the mining comes from huge mining farms using subsidized coal in China, and mining costs more the more hardware there is to mine it.
Since the price of BTC hasn't substantially dropped below cost to mine we're in for a fun experiment if the price drops below this threshold. Most of these farms should turn off so that the price to mine comes back to breakeven in a case of prisoner's dilemma.
But if too much hardware turns off, this leaves mining hardware idle and the door becomes wide open to a 51% attack. It's not clear at what price below breakeven cost to mine a 51% attack becomes a serious threat, but once this threshold is crossed, we're in the "irreparable harm to BTC" risk zone.
And for a person like me, who just wants to see crypto disappear forever this is very exciting.
Maybe those mining farms could be replaced with nice forests soaking up all the carbon they emitted for posterity. One can hope.

How do I bet against all of this?

Microstrategy (MSTR) is, at this point, a bitcoin ETF wearing the skinsuit of a dying software company.
Michael Saylor, MSTR's CEO, is quite the character. I wrote a lot about his lack understanding of what a currency is, but it's on another level to look at the early stages of a bubble pop and decide this is a good time to buy $10M more of the stuff, as seen here
However, this bubble is tame by Michael's standards. Look at the historical stock of his company
What's happening on the left is that Saylor pumped the numbers with accounting fraud then the SEC took issue with the fake numbers. The stock dropped 90% practically overnight. Their accountants, PWC, paid $51M in fines. Saylor and friends paid fines, partly with company stock.
You could also short GBTC, but when Mr. Saylor provides you with an options market instead, why not use it? Shorting on crypto exchanges that might become insolvent in the very event you want to happen with this bet is a bad idea, on the other hand.

Mike can't cash out

The bitcoin market is illiquid and leveraged when it comes to real money coming in and leaving the ecosystem. Buys in the $10M-$100M seemingly move the price of BTC by upwards of $1000 in the last weeks. This means hundreds of millions of real money means tens of billions in movement in BTC market capitalization.
Now imagine what cashing $1.1B of BTC into real money would mean for the price. And this is purely in market terms, before the PR damage from bitcoin's demigod abandoning ship would have second-order effects.
Saylor has painted himself into a corner. Even if he wanted to cash out, he can't.

MSTR fundamentals: Why it should be valued below $10

In early 2020, MSTR was a slowly dying business. The EBITDA has been rapidly evaporating in the last 5 years
At that point, MSTR a stock price of $115 meaning a market cap of $1.1B. This included some $560M of cash they were sitting on. I presume the remaining $550M was an implicit sales premium for the inevitable private equity firm investors expected was going to relieve them of this stock and make the business profitable again.
Of course, they didn't sell.
Instead, they took the $560m they were sitting on and bought $400m of BTC at prices $11k and $13k in late summer 2020. Then, in early December, they took on $600m of debt to buy BTC with at $23k. They also bought $10m more in January at a price of $30.5k.
At this point, we can mostly value MSTR like a trust.

• Price the underlying software business as being worth $600M, as the market did before the bitcoin nonsense. If BTC went to $0, this is what we'd value it at, and the MSTR stock should be around $65.
  
• But wait! MSTR took on $650M in debt in December. Their actual value with a BTC priced at $0 should be much, much lower than $65 depending on how you value the debt. You could make an argument it should be in the single digits.
  
• They hold 70,784 BTC. At current prices ($32,000) this is worth roughly $2.2B. With the current market cap of MSTR ($577 stock price), this means MSTR is currently priced at an eye watering $3B premium over fundamental value.
  

GBTC's 20% premium-to-NAV is a joke compared to the MSTR premium.

The cannabis market right now is so similar to the start of the green energy market.. its nowhere near done being bullish. Save for some small dips, there will very likely be a huge bullish trend for 2021. EVEN NASDAQ AGREES. I’ve posted my positions a few times, and I’ll continue to do so. But this is my reasoning for investing in cannabis stocks in general for 2021.

• I've been a bull on cannabis since the democrats had a strong pro-cannabis platform. But what made me go balls deep into the market was that the UN changed its classification of cannabis. Countries follow the UN closely for guidance on their own classification of controlled substances. Congress has repeatedly cited the UN’s classification as one of the reasons for not changing it. Several countries immediately changed their stance on cannabis in response to this, including Israel, which In November 2020, announced that it was moving forward with a plan to legalize recreational cannabis nationally. “The country is aiming to implement recreational legalization within nine months, and even if there are delays, that means mid-to-late 2021.” (This is my reason for investing in Canadian cannabis companies, because they are already poised to expand internationally since its legal there nationwide)

​

• THE SENATE IS NOW BLUE! The Georgia runoffs were won by Democrats, and they can now swing the vote left with VP Harris. She promised it as part of her platform, so we know it will be prioritized. CHUCK SHUMER SPONSORED THE MORE ACT. HE WILL BE SENATE MAJORITY LEADER. IT WILL 100% BE PRIORITIZED BETWEEN HIM AND VP HARRIS.

​

• EVERYONE predicted beforehand that the republicans would win Georgia... everyone talked down decriminalization passing the house because of they believed it would NEVER pass the republican majority senate. But the left spent more than any senate race in history to encourage voters to go out and vote. Only once the race started did it become clear that the left had a chance. Then some gains from the surprise that they won. However the gains from 1/5 onwards definitely hasn’t been priced in for all the future legislation, because some of it will be completely new legislation that wasn’t possible to consider before without a blue senate. THIS HASN'T BEEN PRICED INTO THE MARKET YET.

​

• The SAFE BANKING ACT has bipartisan support, and is likely to pass BEFORE decriminalization because it is tied into some stimulus bills.

​

• The government is broke post-COVID. There is a terrible image of the police. They don’t want to waste more resources on cannabis related crimes that would be fixed under decriminalization. And the tax revenue from decriminalization would be significant. Decriminalization (THE MORE ACT) opens up the borders to interstate-commerce and international import/export. This would all trickle down into Uncle Sam’s empty pockets.

​

• New York Governor Cuomo announced on Jan 6 his plan to legalize marijuana for adult use (right after New Jersey vote, as I anticipated in my last post) as part of his State of the State agenda. The next step is a ripple out on the North East. NY didn’t want to miss out on tax revenue, neither will any of the other states in the northeast within driving distance of NJ and NY. This is Cuomo’s third attempt in three years to legalize adult-use cannabis in the state; last year, Cuomo included a legalization proposal in his state budget, but the plan was ultimately cut in the wake of the COVID-19 pandemic.

Other ongoing state legislature:

• Rhode Island: Regulators have received 45 applications for six new medical cannabis dispensary licenses in the state. If all applicants meet the requirements for a license, six will randomly be selected in a lottery to operate retail locations in different regions across the state. Read more
• Missouri: Rep. Shamed Dogan has filed legislation that would place an adult-use cannabis legalization measure on the state’s 2022 ballot. Meanwhile, Missourians for a New Approach has announced plans for a separate 2022 ballot initiative after an unsuccessful signature campaign to get the issue before voters in 2020. Read more
• Alabama: Sen. Tim Melson plans to reintroduce a medical cannabis legalization bill this year. Medical cannabis legislation passed the Alabama Senate during the 2020 session, but failed to clear the House. Read more
• Illinois: Illinois lawmakers have proposed the creation of 75 new cannabis retail licenses to give disadvantaged and minority applicants a second chance at licensing following the controversial licensing lottery to issue an initial 75 dispensary licenses. A work group made up of lawmakers and members of Gov. J.B. Pritzker’s administration met this week to finalize details of the bill, which will be introduced in a lame-duck session that starts Jan. 8, before new lawmakers are sworn in Jan. 13. Read more
• Minnesota: House Majority Leader Ryan Winkler is again renewing his push to legalize adult-use cannabis in the state, announcing plans to reintroduce a legalization bill this year. Winkler told WCCO that he sees “Senate leadership as being the number one obstacle,” but said that if lawmakers agreed to place an adult-use legalization initiative on Minnesota’s 2022 ballot, “it would pass overwhelmingly.” Read more
• Virginia: Del. Steve Heretick has reintroduced a bill to legalize adult-use cannabis. Heretick has proposed legislation related to decriminalization and legalization in the past, and this year’s bill would legalize the cultivation, sale and consumption of cannabis in the state. Read more
• Connecticut: Gov. Ned Lamont renewed his push for adult-use legalization during his State of the State address Jan. 6, announcing that it is a priority for the new legislative session. Connecticut’s 2021 legislative session opened Jan. 6, and Lamont, a Democrat, kicks off the session with increased majorities in the House and Senate, which could increase his chances of passing an adult-use legalization bill. Read more

Now that you understand why I’m going green, here’s my reasoning for my positions.
TLRY (Tilray)

• largest cannabis company in the world by revenue post merger. Will run out of Seattle and New York City. New York Legalization on top of senate turning blue is a big catalyst for TLRY.
• Merger hasn’t completed yet, and the merger happened before the senate went blue.. that was the gamble APHA was making, and they won. The sky is the limit now. When they merge, they will reduce expenses and be much more likely to post profitable quarters. (This is why mergers have so much hype; the sum is > than their parts because they can reduce operating expenses while maintaining revenue from the two companies)
• Tilray CEO Brendan Kennedy: “I think medical cannabis will be legal at the federal level, which means medical cannabis can cross state lines and be imported into the U.S., like we export cannabis from Canada and Portugal to about 15 countries now,” Kennedy said. “Anyone who thinks there’s a state-specific medical market is wrong.” As for the recreational market, Kennedy says the state-specific markets, with interstate trade banned, “are not going to last long.” Kennedy believes that cannabis will be distributed like alcohol and tobacco within two years’ time. That would require significant overhaul of US federal drug laws—and would significantly disrupt all US cannabis companies’ existing business models. Brendan Kennedy, the cannabis billionaire will step down as Tilray's chairman and CEO. Irwin D. Simon, Aphria's current chairman and CEO will take Kennedy's place.
• [On December 18, 2020, just three days after the U.S. Senate adopted the Cannabidiol and Marihuana Research Expansion Act (CMREA or the Act) (more on this below), the U.S. Drug Enforcement Administration (DEA or the Administration) published in the Federal Register a final rule, “Controls To Enhance the Cultivation of Marihuana for Research in the United States” (Rule), which finally paves the way for DEA to issue additional licenses to grow “marihuana” (i.e., cannabis) for research purposes.](https://www.jdsupra.com/legalnews/on-heels-of-senate-s-adoption-of-36129/)

GNLN (Greenlane Holdings)

• One of the largest global sellers of premium cannabis accessories. Pax/JUUL/Volcano products. I’ve had Pax products, and although I prefer Arizer because of the affordability, I can’t deny Pax has quality products and is like the “iPhone” of vaporizers. I like their products, I like their branding. There’s lots of hype and loyalty, especially with their Volcano desktop vaporizer.
• Strong US brands.
• The main reason they did poorly was bad timing. They IPO’d during the year that JUULs started being banned. They’re actually at all those levels again. Theres a ton of upside potential.
• Market cap is ridiculously low for some really renown brands all because of the JUUL flavor pod ban. Everyone knows Pax, Volcano, and JUUL. But no one knows Greenlane because of the bad timing of their IPO and the subsequent JUUL flavor ban. It’s crazy. They’ve already broke all time high for the year. But I’m holding until they break 1B market cap.
• Recently became the exclusive distributor for the world's first gravity powered contactless water hookah.
• Overall i think too many people count it out just because of their IPO and subsequent decline in JUUL sales from the JUUL flavored pods ban. They definitely have the potential because of their strong branding and quality products. I’m betting on them having more high quality products in the future with equally loyal customers.

​
SNDL (Sundial Growers)

• SNDL must close above $1 per share for 10 consecutive sessions by June 26, 2021 or it will be delisted from NASDAQ. People see this as a fear factor, I see this as “they will do anything necessary to reach $1 for a week so they won’t be delisted”.. IMHO reverse splitter probably isn’t on the table since they could have done that in 2020, but instead applied for a 6 month extension after announcing “alternative strategic investments”. We can already see this by their predatory loan SPAC spinoff.
• Rumors of a merger with CGC; SNDL also purchased a SPAC recently and entered an agreement with Zenabis, immediately claiming they defaulted. Turning that SPAC into predatory loan/debt repurchasing company. Imo if they want to complete a merger, it would be easy to sell ownership through that SPAC to the buyer.
• THEY RECENTLY WENT DEBT FREE by selling off unprofitable assets in the business. This means we are much more likely to see earnings in future quarters, and they are much more attractive for mergers.
• Because they are indoor growers, they are more likely to be bought up by a company in the consolidating Canadian cannabis market than fail all together. The amount of space licensed to grow cannabis in Canada is now heavily skewed toward outdoor cultivation instead of indoor for the first time, according to new data from Health Canada. A growing population of licenses for outdoor growers means that there aren’t as many indoor licenses being given out... If a company ANYWHERE IN THE WORLD wants to quickly expand into indoor growing OR into the west, they would have to purchase an existing company that has the license to quickly do so. This is WAY faster, and a guaranteed way to obtain a license rather than applying for one and waiting x amount of months and be rejected for some requirement that wasn’t met.
• From my own experience, outdoor cannabis is subpar quality to indoor grown cannabis. So a growing market for outdoor cannabis doesn’t necessarily mean its better... it is likely just cheaper. I would imagine a high quality “craft cannabis” company would want to purchase SNDL, or an existing outdoor growing company that wants to quickly expand to indoor grown cannabis. With this being a Canadian company, there’s a chance a company in another country like Israel would be interested in purchasing it in the near future.

​
PLNHF (Planet 13 Holdings)

• Biggest tourist trap in Las Vegas if you’re a stoner, casual smoker, or just wanting to try it. From my own experience, I think they will continue to be successful. If I went around the US trying other brands I’d probably be more confident in putting 5-10% of my portfolio into those picks or choosing to not include them lol. Like for example, I used to have Curaleaf. But there's tons of bad feedback on Curaleaf, a friend has tried it said the nug is really subpar quality and if I tried their nug I’d probably confirm that I wouldn’t want to invest in them. With PLNHF, i’ve seen the ambience and tried the product myself. It’s definitely a lot of hype price wise, but still quality. This is my own bias showing, but I still think they’ve got solid fundamentals and excellent location/strong US branding.

​
I’m well aware of other good stocks like GTBIF, CRLBF, SSPK, TCNNF, GRWG.. but these stocks haven’t been swinging as hard in response to pro-cannabis news. E.g. TLRY, SNDL, GNLN swung more than 20% some days from pro-cannabis news...I will likely reduce my current positions shortly after inauguration, after some news about the timeline for cannabis legislation, and diversify my positions more between these other good picks.
​
2021 is the year of cannabis boys

Chapter One: Bozeman or Bust (lots of bust)
I had done it once again, like so many other years before, by traveling north to one of the harshest and coldest states that a hobo could possibly go to during the dead of winter, late-January 2021: Mon-fucking-tana. Or as the locals jokingly say, "Montucky". (edit: Shout-out to Montucky Cold Snacks, the cheap horse-piss watered down beer that is Montana's equivalent of Washington's "Rainier Ale" or Oregon's "Session Lager"). I digress.
If I was a goose, I'd surely be the Jonathan Livingston Seagull of the flock…the black sheep shitshow of a goose flying in the completely wrong direction at the worst time of the year. As forementioned, this was not the first time, nor second time, that I've done this. In fact, it's become a habit, if not straight-up routine.
Laramie, Wyoming circa November 2016. Glendive, Montana circa January 2015 Minot, North Dakota circa January 2014. Yukon, Canada circa November 2013. Bellingham, Washington circa January 2006. The list goes on, and on, and on…
And here I am. Bozeman Fucking Montana, circa January-February 2021. The locals say it's an unusually warm winter, which by Montana's standards might include 5 inches of snow in the afternoon and temperatures dropping below 10F degrees at night. However, according to the high standards of a low-class hobo born and raised on the Gulf Coast of Alabama, this weather is colder than a witches tit.
Now, that's not to say that I ain't prepared though. I assure you that I am. Sixteen years of living on the road and rails has made this black goose a well-seasoned bird, with all the trimmings. I have a military sleeping bag that can keep me alive down to negative 30 temperatures. My military backpack is waterproof, and so are the snowboarding pants that I wear under my insulated Carharrt overalls. I have alpaca wool thermal pants, merino wool socks, thermolite waterproof boots, thinsulated gloves, and several wool and polyster beanie hats. My dual-layer mountaineering tent can withstand hurricane-force winds and all the snow that a blizzard can muster.
Winter? Montana? Bring it bitch. Hit me with your best shot. You know I like it. wink
Sigh. However, DESPITE the freezing temperatures and shit tons of snow, there's a lil secret that I've learned during my many years of traveling, and that secret is certainly DUE to these wintery conditions: Jobs! Lots and lots and lots and lots of jobs! Jobs here, jobs there, jobs every-fucking-where. Hotel jobs, restaurant jobs, retail jobs, construction jobs, maintenance jobs, driving jobs, even jobs just to help other people get more damn jobs!
You want a job during winter? Well they got jobs out northern Californie way, Oregonie way, Montanie way, Washingtonie way, North and South Dakotie way, and every which way can go above above the Mason-Dixon line!
If you can't find a damn job in the Northwestern United States of America during winter, you ain't fucking looking, and that's a fact. If you got one arm and you can swing a hammer, or punch a number on a cash register, then consider yourself hired on the spot and you can start today.
Before this chapter turns into an entire damn book of its own (A Hobo's Guide to Finding Jobs) let's get back to the story here: Bozeman or Bust.
As I begin this chapter, I have a red-wine hangover that is enough to drive me to a bullet in the head. I made a pot of coffee only to puke it back up on my hands and knees in front the porcelain thrown. I think it was good ole Earnest Hemingway that once said "Write Drunk, Edit Sober". Experienced words of wisdom from a fine man that knew everything a man could possibly know about drinking shit tons of wine and writing shit tons of stories. I wouldn't be lying if I was to confess that Mr. Hemingway, along with Mr. Steinbeck and Mr. Twain, are drunken heroes of mine that I could only hope someday to sit alongside in the bookstores of Hell and Hades with a gallon of cheap Merlot. Salut, gentleman.
After puking, rolling cigarettes, drinking coffee, and puking several times more, I was finally able to sit down to try and remember what-the-fuck happened yesterday; a solemn meditation technique that involves tons of coffee and contemplation; a time to worship the asinine achievements that are accompanied in both rejoice and regret.
Yesterday started off sober as a saint. I had a job interview at this place I had found on craigslist, some place looking for fresh warm bodies to fill up their production-assembly line. I took a bus to the address they had given me, which ended up being the adress to the Bozeman City Bank.
"A bank?", I thought, as I wondered around the parking lot dumbfounded and confused for a solid 5 minutes, checking the address several times on my phone, wondering why on earth I've been sent to a state bank. After circling the parking lot, I noticed a door on the side of the bank that said "Job Choices Employment Services: Second Floor".
Godammit. I had been fucking conned. Fucking craigslist. I know what's going on here…this a goddamn employment agency that wants to take 10-15 percent of my paycheck, take away my rights to healthcare and benefits, in the so-called promise of finding me a "great career path of opportunity".
Employment agencies. Just like rats. The only "opportunity" here was them: Creatures of opportunity, parasites hellbent on scavaging peoples money and benefits. "A not-even-close-to-great career path of 9-5 slave-labor bullshit involving years of suckling away your mind, body, and spirit", the sign on the door should have read.
This was definitely a mistake. And anyone that has ever had the unfortunate pleasure of being with me can you tell one thing about me: I fucking love mistakes. I love making them, and I love learning from them. I am a walking-talking connoisseur of mistakes. In fact, I just made a mistake trying to spell connoisseur, so I asked Google "Hey Google, spell connoisseur", and due to lack of interpreting my Alabama accent, Google made the mistake of showing me the word Coitus. I have now learned that the word "coitus" is another word for sex. As a writer and the son of an English teacher, I love learning new words. As a human male, I love sex. So learning a new word for "sex" is a fantastic trade-off for that fortunate mistake!
I digress.
I decided to walk into the bank, up the stairs to the second floor, and down the hall to the employment agency. A well-dressed and very sexy debutant by the name of Tracy stood up and greeted me with a smile that was formal, professional, and admittedly very sexy.
While my dirty mind started playing cheap porn music, along with vivid images of me and Tracy wrecking that office like wild alleycats, I was suddenly snapped back into reality with Tracy's sexy voice, saying:
"Hey, you must be Mr. Huck! Are you here for the 3:00 o'clock interview? Could you please start by filling out this application? You can have a seat over at the desk here"…
Godammit. This employment agency was GOOD. I was Tracy's submissive little slut. I walked right where Tracy told me to walk, sat right in the chair Tracy pulled out for me to sit in, and I started filling out the application with the ballpoint pen that Tracy had somehow put in my hand without me even realizing it. Tracy could have stolen my wallet and the 11 dollars inside of it as well, had she wanted to, and I wouldn't have even noticed. And even if I had noticed, I would have let her do it anyway. Godammit!
As I started to fill out the application, I got to the section I dreaded most: job references. Oh boy…allow me to tell you a little about Huck's references, or lacktherof:
At my last job, I was fired because of a fight that broke-out between my ex-girlfriend and myself, which began with lots of shouting and shoving, and ended with me getting a black-eye from being punched in the face twice. Fun fact: Italian women are fiery as they are fierce, and bold as they are beautiful. And just like their male Italian counterparts, such as Sylvester Stalone or Al Capone, they know how to land a solid right jab. This fight erupted in the worker's dormitory for all employees to hear and see. And although I was the one with the swollen black eye, I was the one they decided to fire. C'est la vie, such is life. Que sera sera, it be what it fucking be.
We can scratch that job off as a reference, without a doubt.
The job before that, I was at a marijuana farm called "Great American Cannabis", in which my managers and co-workers tried to recruit me into a far-right group of sexist and racist baboons called "The Proud Boys".
There was a pre-determining factor in why that farm had hired me, and assumed I would be interested in their idealogical gang. That pre-determing factor was the very same factor that led Google to teaching me the wrong word and definition: my Alabama accent.
Great American Cannabis had hired me based on a phone interview, in which they assumed my southern accent indicated two things, in which case one of their assumptions was right, and one was wrong:
Assumption Numero Uno: Huck has an Alabama accent, which therefore indicates that he has years of experience working on farms, growing plants, and being an honest and hard-worker.
Assumption Numero Dos: Huck has an Alabama accent, therefore he must be idealogically aligned with far-right beliefs including sexism and racism.
Welp, I am proud to say that even that although a 50% winning percentage may be fine and dandy with gambling in Vegas, and can be seen as half full or half empty based on however optimisitic or pessimistic you might be, in the case of Great American Cannabis and The Proud Boys, those odds ended pretty badly.
As it turns out, despite being raised by a racist father and surrounded by bigotry in the not-so-sweet home of Alabama, those very dispositions made this black sheep child rebel from such ass-backward beliefs, and I am staunchly pro-civil rights, which means I am pro-immigration, and a proud supporter of the sufferage movement for womens right.
Obviously, that did not go very well with my co-workers at the farm, and I was fired within the first month. But wait, theres more tragic humor to the story of this farm, which I'll organize in two keypoints:
Keypoint Numero Uno: The farm was owned by Iranian immigrants. I…shit…you…not. That's right. YOU DID READ THAT CORRECTLY. Not only was the farm owned and managed by a minority group of immigrants, those very immigrants came directly from the very country is at the VERY TOP of White-America's shitlist: Iran.
Keypoint Numeros Dos: After I was fired based almost entirely according to my leftist and progressive views on race and gender equality, within just a couple of weeks nearly everybody on the farm was fired and replaced by cheaper immigrant labor in the form of Laotian women. That's right…a white-blooded American-born legal-working male, was replaced by brown-blooded, foreign-born, mostly-illegal-working females, on a farm owned and managed by right-wing racists and sexists that were anti-immigration. Once again, I…shit…you…fucking…not...let THAT shit sink in.
I literally cannot make this shit up, and let it be forever proof that reality, however tragic or ironic it may be, is far greater than fiction. You can write that last sentence in a letter, shove that puppy in an envelope, slap that bitch with a stamp, and mail it to the fucking MOON. Or you can mail it to Iran, or Laos, whichever you prefer.
However, I digress.
So, being that I was fired from Great American Cannabis by a bunch of Iranian Proud Boys, you can scratch that job off of the "reference" list as well. Sigh.
So, how about the job before that? Well, that's a hell of a story too, but I'll make it quick and cut shorter to the chase:
I worked on a fishing boat for a Mormon captain. Although I loved him like a Dad, and he often treated me like a son, my job ended in these words:
"Huck, I really like you. You're one of the hardest working deckhands I've ever had, despite it being a very terrible year for fishing. However, as a man that is a Latter Day Saint of God, as a Mormon, I'm going to have to ask you to leave because of three reasons:
1) You smoke cigarettes, marijuana, and drink alcohol and coffee.
2) You curse worse than a sailor.
3) You are an atheist/agnostic."
And in case you, the reader did not know: Mormons HATE cigarettes, marijuana, alcohol, AND coffee. They are forbidden to curse, and they are not even allowed to tolerate the company of anyone that isn't a believer in God.
Well Godammit. How in the hell am I so goddamn misfortunate and unlucky, to be the must FIRST FUCKING PERSON in the entire HISTORY OF FISHING, that has gotten fired for using curse words and drinking whiskey. I couldn't even absorb the fact that my boss was firing me because I couldn't get over the fact that I was possibly the first sailor or fisherman in all of ocean-faring humanity that had gotten fired for doing what sailors and fisherman are guaranteed and known to do best: drinkin' and cursin'
We can also scratch THAT job off the possible reference list as well.
It was at this point in the office of Job Choices Bozeman that the porn music had long since stopped playing in my head, and that I suddenly and swiftly fell deeply into a full blown existential crisis right there in Tracy's office while simply trying to think of a single reference from my last 3 jobs. The unbelievable amount of misfortune, tragedy, irony, and utter insanity of my last 3 job experiences had truly started to sink in, and I was beginning to legitimately lose my temporary grasp on sanity along with my faith in humanity altogether in one great, big, sloppy sandwich of existential fucking crisis.
Allow me to self-diagnose this existential crisis sandwich by peeling off some of the layers of this enormous stinking onion that is in the middle of it all: Either that curse that was put on me a few years ago by a Mexican trainhopping gypsy from New Orleans is proof that curses are indeed fucking real, or either I am the unluckiest son of a bitch on this entire planet that is so very unlucky that I am slowly (or quickly) coming to the conclusion that this entire life is a simulation that is programmed by some sick comedic asshole that specializes in the tragedies of both irony AND misfortune. And though some people in this world call that programmer God or Allah or Jehovah, I call him Jeff. I call him "Jeff in Programming", with same amount of disdain and hatred that Michael Scott refers to "Toby in Human Resources" in the American version of the show "The Office".
(Sidenote: If you do not understand my last reference because you have not watched The Office, then you need to stop reading this book right now, go sign up for one month of Netflix, and spend that entire month binge-watching one of the greatest sitcoms ever made in the history of television: The Office (US Version). Go. Now!)
I digress.
As I collapsed into a full-blown existential crisis while thinking of job references on the second floor employment services office above Montana State Bank, my fantasy-based relationship with Tracy was also about to crumble into an existential crisis as well, based on two very important qualities:
Quality Numero Uno: Tracy and I had no relationship that actually existed outside of my head and a stupid job application form. We had never knocked over all of the filing cabinets, water-cooler, or broken the copying machine with tantric sex. That scenario never existed period.
Quality Numeros Dos: I was about to not only lie, but also commit non-existent adultery to Tracy, thus putting a very real end to a not-very-real relationship.
I stood up from the desk that me and Tracy had never fucked on, and I told Tracy that I had to use the bathroom. And though I did really have to use the bathroom, it wasn't for the purpose of pissing or taking a shit, it was for the purpose of throwing the application in the toilet and sneaking my way down the hallway and out of the employment agency. In which case, that is precisely what I did.
Upon stepping out of the door and back into the parking lot of Bozeman City Bank, I noticed another hot little woman across the street: A dazzling red-headed freckle-faced damsel by the name of Wendy, who promised in her fertile bosom the birth of two-dollar cheeseburgers and loaded baked potatoes. I went inside Wendy's house, and began to have an oral relationship by penetrating my mouth with nearly everything that was offered on Wendy's dollar-value menu.
Stop here, acquire coffee, booze, and cigarettes until I feel like writing again, which may be later tonight, tomorrow morning, or possibly fucking never

General / QoL

• Dark Mode is now available as a setting and on by default. We also tied down the guy (who wrote the flashingly bright note about seizures) in a opthalmic speculum, in a dark room while opening and closing the said bright note for 3 hours.
• Light Mode uses grayish / genshin-impact-blue color scheme.
• Users can now map keys in settings.
• New user center setting : Allow Teyvat Times to publish my in-game alias (not username) and last 4 digits of my UID (When you set a world record of hunting fowl and etc.)
• Added setting for persistent aiming mode. If turned on, your character will try to get back to aiming mode even when you dash or you are knocked back.
• Going in and out of aiming mode is now much smoother. You can still dash, cast skills and still keep the cursor on. Inspired by Tombraider? Idk why I wrote this.
• When crafting an item and you run out of materials for it, the item selected stays in place and will not scroll all the way down.
• When choosing characters for the abyss, the preview button to see which enemies you will face is also there.
• When finishing an abyss floor, you can return to the abyss menu without ending the "run" to collect rewards or browse around.
• Fixed a bug with sucrose/xinqiu bonus materials when crafting.
• Fixed a bug with razor's c1 constellation not increasing his damage and not displaying a buff indicator.
• All buffs are now grouped/stacked by icon category, attack/defense/regen etc. Hovering the cursor in the grouped icon will display verbose info. (e.g. thrilling dragon tales, character talent, gouba pepper etc).
• Daily Login Bonus is permanent.
• Claim All and Repeat Buttons are now available in Blacksmith, Battlepass, Expeditions and the Like.
• VA/CV list is displayed instead of current selected voice language in character details. (e.g. if you go to a character screen, and have english voice language, you will only see english voice actor and you have to change language just to find out who the cn and jp voice actor is)
• Hide ui/hud setting and dedicated hotkey is added for creating fan-made cinematics.
• Unless it is an artifact or a weapon, an item previously recorded and consumed will no longer display as "new"
• Added shield bar on top of health bar
• Added party icon on the top right ui and a dedicated hotkey to switch parties
• Added hotkey to switch to your saved Comps 1 to 4
• Resin is now always visible at the top of UI (without needing to open up the map)
• Moved UID a bit further down by 2px so it doesn't overlap with the buttons
• Changed UID Opacity by 75% and has grayish text color, inspired by "windows is not activated"
• Added a space character on the launcher download text (e.g. "Downloading75%" into "Downloading 75%")
• Bonus damage from element-affected status (e.g. "deal 15% increased damage against cryo affected enemies" are enclosed in parentheses
• Expedition Slot Remembers Last Character Used
• Expedition Slot Remembers Last Hour Used
• All map objects are navigatable for consistent experience. and are not overridden by quests. You will always be directed towards the one you choose.
• Navigated Map Object Always Display Their Distance and Light Beacon (e.g. Leylines not having those)
• Added enemy weakspot zones with varying degrees (green,orange,red) in the adventurer's handbook, if you kill 150 of a certain enemy type. Humanoid types generally have the head as a weakspot.
• Fraction of Fraction of a bullet time effect and a red particle glows when you hit the weakest spot of an enemy.
• Reading and Clearing Story/Voice Lines syncs across all devices you own.
• Statues' Remaning Healing Energy now Visible on the Tower Itself. Dat Glowy thingies deplete when you use them.
• Statue's First Healing Tick Revives Fallen Characters by 10hp%. Second Healing Tick is Full Restoration or until Remaining Healing Energy Allows it.
• Critical strike Indicator
• Enemies in the handbook are dynamically arranged by type , then alphabetically. All hypostasis are lined up.
• All enemies are displayed in the handbook regardless of what region you currently are.
• Journal (J) is now binded to (F1), since this is where you look commissions for rather than the Adventurer Handbook (F1)
• Journal , Handbook and Archive are compressed and combined.
• We bought a time machine and went back to the time when we did the hypostasis event. The last challenge in the event is now a new hypostasis after the three old hypostasis.
• Andrius's Boss Fight is now properly a Trounce Domain, For consistency with other weekly boss.
• Changing a Team Member in your active roster won't override that slot in your saved team comp
• Active Roster and Saved Team Comps are now a seperate thing
• Selecting a Saved Team Comp will replace the Active Roster (so you can replace one member before "deploying")
• Clicking Deploy in a Saved Team Comps will immediately send you back to the game
• Switching Party Members is smoother than an oiled tits smooth, regardless of network latency. Especially in Single Player Mode.
• Resource and Player Position in the map has better visual clarity. (Imagine klee collecting wolf berries or philly mushrooms)
• Option to adjust map size , and resource/player icons.
• PC , map pin size collision reduced. If I clicked Taishan Mansion, I meant Taishan Mansion.
• Mora , Artifact Limits and etc always visible in inventory screen regardless of which tab you are on
• Blacksmith remembers the quantity of ores you refine
• Adventurer's Handbook remembers the last filter you used when browsing enemies (all, elite ,boss)
• Adventurer's Handbook points you the next enemy you are hunting (when you kill 1 ruin guard, you dont have to open handbook again to see the next one in the map)
• Adventure's Handbook knows ALL of the elite enemy locations. The list seem to be manually added instead of dynamic, possibly due to chest concealment similar mechanic. If you hunt ruin guards, I think the book only lists 4 of them in the whole map.

Gameplay

• Training dummy added near favonius hq. You have to do a story quest and spend resource to have it constructed.
• Enemies now have a difficulty rating. The higher the difficulty rating is, the higher character xp/gold they will provide. XP scales off your adventure rank level. Extra Large enemies have a guaranteed chance to drop 1-4* artifacts. They will respawn longer as a consequence. It doesn't make sense that a huge lawachurl and smol hilichurl both give 20xp.
• First and Second Dash now have different color indicators.
• If you used 2 dashes consecutively, a subtle glow/indicator pops around your character for when you are able to dash again. Inspired by Deadcells.
• Added Treasure Compass for Dragonspire.
• All excess anemoculus/geoculus/dendroculus and crimson agate can now be traded in the antiques shop.
• Treasure Compass will automatically change depending on what region you are on. If you don't have a treasure compass for that region, it will remain unchanged from what is the last equipped.
• Treasure Compass search radius is increased region wide. It will point the "nearest" treasure chest's direction. The color of the direction changes the farther you are.
• Treasure Compass will now consider puzzles as treasure, and display a different indicator. It won't tell you what steps to take to open it, though.
• Added a domain for gladiator and wanderer's troupe artifact sets. Artifact drop rate from world bosses are FURTHER reduced. Weekly boss artifact drops are unaffected.
• Prototypes will now drop at least once in the last weekly boss you face, if you are unlucky. The chance to acquire multiple prototypes within a week is unchanged. Drop rate is reduced consequently.
• World Boss Artifact Drop Rates are now visible in the adventurer's handbook.
• Prototype Drop Rates are now visible.
• Domain Artifact Drop Rates are now visible.
• 1-3* Weapons are now craftable. They will require a shit ton of ores and materials. Cold Steel for instance will require 200 pieces of mint.
• Added 6 new craftable weapons. Of course it will require prototypes you f2p piece of shit.
• Craftables, Shops and Loot have higher priority versus signboards and npc.
• Monsters and Enemies have higher priority (when attacking or casting skills) versus ores and flaming/freezing flowers and other resource objects.
• You can now equip up to 3 gadgets.
• New Action : long pressing a gadget opens up Gadget Wheel to switch gadgets without opening the inventory. Gadget goes into long cooldown.
• Domains now consider your condensed resin before saying you are out of resin.
• After completing a domain challenge, The start challenge object will respawn in the center of the arena. Game will no longer go into a loading screen. This is for the console peasants.
• When claiming domain challenge rewards, it also displays how much condensed resin you have (so you know you can still do 1 more, or gtfo) when it asks if you want to continue or leave
• Anemo Hypostasis will die if you manage to collect all the orbs, for a more consistent experience with other hypostasis.
• Weekly boss timers are now consistent. (Some have none , some at top, some at bottom)
• Dvalin's Mini Cutscene will hold your altitude (if you are gliding) when it triggers
• Childe's Mini Cutscene is now automatically skippable (named "skip when already viewed once" found in settings).
• Food is now sortable by type.
• When choosing a revival food, the icon sizes are reduced and displayed in a grid rather than a long line. When in single player mode it slows down time. Like witcher 3 or tomb raider.
• MRE can now hold all types of food, up to 3 slots.
• You can long click/hold the MRE button and switch the food it holds. Goes into long cooldown.
• Charged Longsword and Bow Attacks (for claymoreless comps) will now allow you to mine ores more effectively. This affects rock shield wall hilichurls as well.
• No one uses claymore charged attacks, even with stunned enemies. Claymore charged attacks now deal increasing damage the longer it was charged uninterrupted. You will get staggered and take more damage as a consequence. The last attack of a charged attack deals more damage and wipes half of the planet's population.
• Constellation can now be toggled on/off

Gacha / Shop

• The first cheapest crystal top up (60+60) has been buffed to (80+80) crystals. We realized it wasn't even enough for a single pull and we laughed until our sides hurt. As a tiny token of goodwill this will retroactively affect everyone who purchased this item for n amount of times the person has purchased this item.
• All in-game currencies (primo/fate/genesis/future except mora) are always displayed in the topright corner when wishing and shopping.
• Pity Counter. When it reaches 75 it glows like christmas.
• Gifting of purchase is now possible. In the case of chargebacks , the gifter gets banned. Gifts can only be sent after 60 days of purchase, and usable by the recipient after a week. Maximum of 1 gift per month.
• Gifter must have a track record of >= $20 of purchase within the last 3 months.
• Gifting is a sensitive topic. Chargeback scams fucks up game companies, banks and third party payment platforms.
• Purchase history and total is added to track expenses.
• Gambling addicition reminders when you rage spend. Also alerts a mhy employee when huge purchases are being made in error. It displays a huge red alert on the employees screen.

In Consideration

• Reworked Elemantal Mastery to also increase Elemental Skill Damage by 25% (base, some current/future characters might interact with less or more) of your total Elem Mastery. Consequently, Skill Damage from Attack Ratios are lowered. Think of ad/ap ratios in League of Legends.
• Character skills to deal compound damage of physical+element when using a weapon (e.g. diluc smash bouncing off pyro slimes, despite his big sword being sharp and shiny)

Items

• Wind Catcher Gadget now refills with anemo energy particles.
• Prototype Aminus/Archaic's proc cooldown refinement is restored. (Used to be 15/14/13/12/10)
• Boar Traps are now craftable and equippable as a gadget. You can leave it up to 48 hours to check if you caught something.
• Cast net are now craftable and equippable as a gadget. Can be used to catch multiple fish and crystal flies.
• Crab Traps , can be left in the wild for 48 hours and catches 3 crabs per trap.
• Inflatable balloon for safe swimming. Requires anemo slime materials.
• Portable towers no longer expire.
• Portable towers max deployed count is increased up to 5.
• Condensed Resin can now be used on World Boss
• Condensed Resin cap increased to 5.
• Artifact Inventory Limit increased to 5000.
• Weapon Cooldown Indicator displayed as status icon (sacrificial sword, archaic, etc)
• Seelie Companions give 1% passive bonus CharXP(Blue), CompanionXP(Purple), Mora(Gold)
• Crafting Table no longer consumable
• Portable Cooker no longer consumable (requires fuel , 1 fire stamen = 3 uses)
• Portable Warmer no longer consumable (requires fuel , 1 fire stamen = 3 uses)
• Items mined are ores
• Refined ores are ingots
• Option to refine Magical Crystal Chunk without resin, but with immensely increased cost and time

Coop

• You can see the general direction and how far an ally is like in pubg.
• In-game voice chat for random players in matchmaking

Battlepass / 12 Episode Anime

• Battlepass can now have excess points up to 3000xp , for the times when you do your reputation bounty and missions earlier before the next battlepass comes out.
• When a new Battlepass starts, it starts on mondays , so no mission gets left out. All excess days until the next new-battlepass-monday are dynamic and flexible.
• When using a condensed resin in a domain, it counts as 2 domains cleared in the Battlepass
• Cooking ingredients (sugar, bacon, cheese, etc) counts as cooking in the Battlepass
• You don't need to switch tabs in the battlepass when using claim all. Clicking claim all, claims all.
• New battlepass campaign for 12 episode anime. Milestones are displayed on website and forum. Sales earned are transparent in game and website. Inspired by dota 2 international.
• Percentage of battlepass campaign sales will go to anime funding.
• Having at least 1 season of anime puts mihoyo in the "mainstream" status in the leagues of Fate, Princess Connect, Grand Blue etc. It solidifies the IP.

Quests

• Option to abandon story quests (restart from scratch) to prevent blocking of coop
• Repeatable Quests Ideas below. Coop and matchmaking is enabled. 15~30 minutes long, walking pace. Not mandatory for daily activity/event/battlepass for people with little time to play. Gives worthwile rewards (3 pieces of adventurer's wit, 5k mora etc)
• Long escort caravan mission, from Mondstadt all the way to Liyue. From Springvale to Liyue. People and Caravan must survive. Enjoy the beautiful world of Teyvat, optional pit stops, coop chat/discord, region guard checkpoints and enemy ambush. Multiple client routes available. Go through dragonspire for a shorter, but more dangerous path. Get harassed by Fatui at borders. Board a ship and load the caravan. Get checked by Border Patrol for smuggled goods and diseases.
• Repeatable Town defense without towers. Defend the Town from hordes of invaders. Something fun with coop.
• Fatui and Friends Battle Royale. All npcs and doors disabled. You and the fatui bots duke it out. Healing only comes from special food that you pick up. Matchmaking enabled.
• Beach Defense. Prevent the Fatui from invading the coastline. Your friends rain arrows from starsnatch cliff.
• Beach to Mondstadt/Springvale goods escort services.

Elemental Reactions

• Vaporize's Steam deals aoe damage
• Overloads damage (electro->pyro) now deals x1.5 (pyro) damage
• Overloads damage (pyro->electro) now deals x2 (pyro) damage.
• Overload's knockback decreased significantly
• Superconduct's damage (electro->cryo) now deals 2x (cryo) damage
• Superconduct's damage (cryo->electro) now deals 1.5x (cryo) damage
• Superconduct's negative armor debuff is moved to Melt
• Melt gains the negative armor debuff due to the sudden temperature change, making surfaces brittle.
• Melt damage consequently reduced. (pyro->hydro) at x1.4% , (hydro->pyro) at x1.8%
• Geo New Reaction : Smoldering Rock or something (pyro->geo)(reverse not applicable) deals x0.3 (pyro damage) on top of crystallize
• Geo New Reaction : Mud or something (hydro->geo)(geo->hydro) deals x0.1 (geo damage) on top of crystallize, slows enemy movement
• Geo New Reaction : Snow or something (hydro->geo)(reverse not applicable) deals x0.2 (cryo damage) on top of crystallize, slows enemy attack speed
• Geo New Reaction : Seeds or something (dendro->geo) deals x0.1 (dendro damage) on top of crystallize, restores 3% of your hp. Or entangle. Prevents enemy movement (can still attacc and cast spells)

Enemies

• Enemies inside domains and abyss have their return-to-spawn-point-then-regenerate-to-full-health disabled.
• Enemy AI a bit smarter. Those with mobility skills (whopper, smol geovishap, cycin mages) won't follow you to drown in the water. The game will not check if you are wet , but if you are in a swimming state.
• Enemies attack cycle improve. Fixed bug when enemies stop attacking. Baedou Problems.
• Hydro Abyss Mage's and Hydro Fatui Gunner's Hydro Barrier now takes the same damage rate/ratio from opposing elements (cryo,electro) for consistency.
• Hydro barrier new opposing element : Geo. It makes it harder to maintain the water shield due to the mud soaking up the water and adding weight.
• Boss Childe's Spirit Whale Attack generates water in the sides of the arena, pushing you towards the center. You must have enough stamina to keep dashing to the sides before he does this, or you will have to perfectly dodge the spirit whale attack.
• Hydro SamaChurl now heals at a rate of +300/HoT per AR Milestone instead of percentage. This is for when you are hunting a LawaChurl Bounty that is near dead and healed to full health in 3 seconds. Having a fixed amount of healing ensures that it is big enough for the intended smaller enemies and portionally good enough for large enemies. The other option is to use different healing ratios for small and large enemies.
• Queen of Pain , I mean Cycin Mages have a stagger window when they are about to cast their almost-undispellable shield
• Zed , I mean Shadow Fatui Agent makes use of his shadows to dodge your attack sometimes.
• Smol Geo Vishap now drops less geo shields
• Smol Geo Vishap now uses his rolling attack near you, not 150m away from you.
• Smol Geo Vishap now burrows a bit less frequently
• Ruin Hunter doesn't stay in the air up and raining artillery forever , in consideration of bowless comps
• Fatui Cryo and Hydro Gunner Turn Rate Reduced by 10% when on Spray Mode.
• Primo GeoVishap now has a tired/exhausted animation, instead of standing still and looking at you and what life could have been for 10 seconds.
• Primo GeoVishap spin attack now has a 0.2 dodge window (previously none) and Spin Radius Decreased by 100m.

Characters

• Dvalin's Cutscene when you dispel his barrier is removed and much smoother. He just falls in place and no clipping.
• Character's "Main Stat" is now visible in attributes. Previously you can only know it when ascending or when using google, or if you really have a big brain.
• All characters passive talents are now combat related.
• All characters now have their own cooking/exploration/crafting/smithing talents. It is possible not to have OR have multiple talents in each category. We get it , everyone can taste what a good gravy is, but not everyone can make a good gravy.

Ayaka

• Alternate sprint binded to a different hotkey.
• Yes I came from the future.

Albedo

• Elevator can be activated to go up and down by using the F key.
• C2 stack counter / indicator via particles (think of razor geo sigils)
• C4 plunged attack covers albedo's sword in geo energy (like noelle, but smol)
• C6 crystallize shield has a different shape (leaf)

Amber

• Increased ultimate radius by a tiny bit.
• Allow targeting of ulimate by holding the ultimate button.
• If baron bunny is present in the ultimate radius, it will absorb all pyro damage and deal it as bonus damage when it blows up.
• If baron bunny was "charged" with pyro rain and hit with a C2 charged shot, it will trigger a micheal bay explosion animation.

Barbara

• Restored Barbara's Energetic Voice Lines
• New Lines sold seperately as Dark Barbara™ , comes with a Dark Dress
• C6 Revive indicator is now visible as a buff.
• C4 now generates flying energy particles instead of instantly regaining energy. Mind you that this is a fucking nerf to this piece of shit healer that freezes you. It's just that there's no flying particles when you use this hero.

Beidou

• Casting the elemental skill applies a strong taunt and re-initializes enemies attack loop.
• Bullet Time effect added when triggering a perfect counter, when playing in single player mode.
• The ultimate's chain lightning deals tiny spark damage if it didn't jump.
• C2 chain lightning has a different color.
• C4 buff is triggered when you do a perfect counter (Taking damage to activate a skill promotes bad gameplay)
• C4 perfect counter grants the maximum damage bonus
• C4 shield has a different color.
• C6 has aura on the ground (inspired by Dota 2's Necrophos , but purple)

Bennet

• C6 Ultimate pyro infusion just adds pyro damage to your attacks, and won't convert them fully into pyro.
• C6 Ultimate restores up to 100% hp.

Childe

• Improved manly posture when in aiming mode
• C4 Riptide slash and flash uses different coloparticles/animation
• C6 has an indicator when it works and when it is available

Chongyun

• Cryo Field's Cryo infusion just adds cryo damage to your attacks, and won't convert them fully into cryo.

Diluc

• What seriously? You really want more?
• Fuck this guy in particular
• Elemental Sword Duration Indicator added
• C6 his flames has some bluish tint

Diona

• Fixed shield duration bug and increased by additional 1.1 seconds per claw.
• Shield ratio based off max hp increased by 10%
• C2 reduces skill cooldown by -2 seonds (press) and -4 (hold). The coop shield is added by default out of the box. Anything coop should not be locked behind a paywall because it will hurt the game and fanbase.
• C4 has been reworked to grant normal and aimed uncharged shots 25% chance to deal charged attack shots.
• C6 radius is increased and uses a different color.

Fischl

• Ultimate now deals tiny bit of damage per 0.2 seconds tick when making contact with enemies (aside from getting hit by lightning once)
• Ultimate can fly/pass through thorn walls. I'm looking at you Dendro Samachurl.
• Shadow Raven Let Night F---!!!
• C4 Ultimate hp restored now scales off damage dealt by the ult.

Ganyu

• holding the elemental skill allows you to aim and won't make you backdash
• C4 Freezing Field changes color intensity per damage increase
• C6 free frost charged arrow now works with normal unaimed attacks.
• C6 uses a different particle color. Sometime it turns into a bazooka.

Jean

• Reduced Increased swaying of boobs by a tiny amount while holding the skill. You can kinda feel them slapping against your face. You can almost describe their softness and warmth in a minimum of 10 pages apart from you going sommelier describing how deep her sweat tastes like.
• Jean's Charged Attack Launch Height is too damn high that you cant even hit the enemy, so - Reworked Jean's Charged Attack : Holding the attack button launches the enemy in the air. If you keep holding it down you will perform 3 slashes in the air. If you let go early you will stay on the ground.
• Base Attack Increased by +5
• Jean can now pick up the slimes dropped by enemies and use it against them for a bighead move
• Ultimate radius is increased
• Ultimate Wall Mechanic Reversed. Enemies are now trapped inside. When you use your skill (usually to regain energy) you can air-wall slam them. Block Projectiles from outside.
• If any of you actually played jean support, a normal person would use ult to heal, cast skill to regain energy, then switch back to other characters. It doesn't make fucking sense to push them outside your wind arena because you want to fight inside the swirl/healing zone.
• Ultimate swirls every 0.2 seconds , depending on what elements are inside. Field Changes Color Each Time Like a Disco Ball
• Ultimate now slowly succs enemies to the center(without lifting them up)
• Ultimate Damage is consequently reduced.
• C1 Uses a different colored windblast
• C2 Buff Indicator
• C4 uses a different color wind field
• C6 Ultimate is now an aura and moves with you. To break away from "buffed area" convention.
• C6 Ultimate will get you to keep the windsaber for the ult's duration
• C6 Shield Buff Indicator via Particle and Status Icon

Kaeya

• Base attack incresed by 5
• Elemental Skill (Hold) Sprays Ice , think of Igni but Ice in Witcher 3 or DND's Burning Hands
• C2 Icicles light up when you defeat an enemy indicating that it really works
• C4 Barrier is of different shape
• C6 uses a different icicle particle for bling purposes

Keqing

• Aiming mode feels a lot smoother. You can aim while moving and cursor immediately shows and the kungfu pose is only done when throwing the stilleto.
• When in single player mode, casting your ultimate produces a bullet time effect.
• C4 Buff Indicator
• C6 Description is confusing as fuck.
• C6 Buff indicator
• C6 Makes your sword light up like a lightsaber.

Klee

• Imroved Torch/Bonfire/Campfire and the likes Lockon (if there's any to begin with)
• Throwing Jumpty Dumpty provides 0.1s iframe during her spin
• Ult is now no longer greedy. Pyro satellites remain when you switch characters, making our lovable klee open up for support options. Child support.
• C4 is now manually triggered, Pressing q again will make her explode, bigger damage based off remaining duration. less duration left, less damage.
• C6 klee uses different bombs

Lisa

• A lingerie shop is opened in Mondstadt to change her pantsu, socks and garter belt style and colors. Black Leather Tight Suit™ Sold Seperately.
• Option to wear glasses as a Librarian added.
• Climbing voice volume is re-mastered in asmr microphone, in all languages.
• Requires "i am of legal age" consent in the user center
• Elemental skill (press) aoe slightly increased.
• Base attack increased by 15.

Mona

• Alternate dash is now binded to alt key.
• Hydro Puppet now deals half damage upon cast and half damage upon explosion.
• C6 normal attacks use a different attack animation.

MC (Anemo)

• Palm vortex can be casted in midair to break your fall (but not propel you up)

MC (Geo)

• When you overlap geo boulders (aimed mode) it will trigger the geo explosion of the older rock, then replace it with a new one

Ningguang

• Holding the skill button surrounds her in mini jade screens , unable to perform any action until it is released or ends. Useful for cinematic stuff. Imagine tanking childe's whale attack. Or someone wants to recreate triple rashomon scene.
• C6 has a chance to use different attack animation.
• C6 star jade now resembles a primo gem.

Noelle

• Elemental Sword Duration Indicator added
• C1 heals have a special effect and voice line when conditions are met.
• C2 upgrade uses a different charged attack animation.
• C4 uses a different barrier color
• C6 upgrade uses different ult (possibly red with the same hue as her skirt) color.

Qiqi

• C2 reworked as -15% attack debuff
• C4 reworked as -20% elemental resistance debuff
• C6 cooldown/availability indicator.
• C6 has a different bling/color

Razor

• Transformation Duration Indicator added
• C1 increased damage now really works
• C1 now has a buff indicator that it really works
• C2 now has a special crit indicator
• C4 armor shred now has a (claw mark) armor shred indicator that it really works
• C4 (hold) has increased damage so it doesn't feel left out. It also has electro explosions similar to when you mine an electric ore as a special effect to indicate that you are C4 and have a big PP.
• C6 covers your sword with electricity (like diluc) when it is charged and ready
• Yes I play razor a lot.

Sucrose

• Fixed crafting bug not producing any bonus when using large quantities (say 100+)
• Improved lock on when blowing off dandelion flowers. Idk how she keeps missing them even at point blank range, Hell , at any given range.
• C1 if you overlap the wind nukes the second one will be a 0.1s delay then it will go off with a slightly bigger radius
• C2 ult has a different color
• C4 has an indicator that it works
• C6 buff indicator

Venti

• Wind current generated by skill (hold) allows him to fall slower without gliding, and allows him to shoot wind lasers. Ehe
• C2 Charged Shot produces a bullet time effect when shot at point blank or if all 3 arrows hit a single enemy. Sometimes he draws the holy lyre and it transforms into a primitive shotgun.
• C4 buff indicator.
• C6 uses different vacuum color

Xiangling

• Ultimate deals additional damage when cast at point blank because you get stab and bonk while she is twirling her spear.
• C2 last attack leaves a flaming trail special effect (inspired by kyo or iori from king of fighters)
• C6 upon cast, Xianling automatically does a speed-up full normal attack combo and then releases the pyronado normally (while covered in flames or some shit). If you are in single player mode and there are no other enemies within 150 radius the ult will cause the screen to black out, like in legend of legaia.
• C6 during the ultimate if it contacts with gouba's flames it produces micheal bay effects while raining carpet bombs and shit.
• Yes flat is justice.

Xingqiu

• Floating Swords Duration added
• Fixed crafting bug not producing any bonus when using large quantities (say 100+)
• C4 Allows you to hold the elemental skill for double backflips (inspired by law from tekken) cooldown is 1 month.
• C4 Elem Skill leaves a faint rainbow (when ulted)
• C6 Swords emit faint rainbow color. Rainbow power motherf-

Xinyan

• Hitting large enemies counts as 2 enemies.
• C1 buff indicator
• C2's level 3 shield has some bluish flames
• C6 charged attack uses a diffent attack animation or has an indicator that it works

Xiao

• Transformation Duration Indicator added
• C2 now leaves a trail of anemo energy that deals tiny bit of damage , trail lasts for 1 second and deals at 0.2s intervals.
• C6 plunge attack counts large enemies as 2.
• C6 plunge-attack-no-cooldown-empowered-dashes uses a different particle color and produces a bullet time effect when used for the 3rd time onwards. useful for cinematic purposes
• C6 during the bullet time you can sneak in a normal attack once per dash
• Bullet time is always disabled in multiplayer

Zhongli

• Increased pillar aoe by a tiny bit
• Generates energy particles per pulse, maximum of 1 enemy per pillar
• Base attack increased by 5
• Travelers can redeem promo code "WHOSYOURDADDY" for additional +5 damage, regardless if they have the hero or not.
• Attack ratios increased by 3% per attack category.
• C1 has a slightly bigger dong eherm statue
• C4 Chaos Meteor errrr I mean Order Meteor has a different rock color
• C6 shield uses a different color , come on you get the drift already.
• C6 Meteor is affected by the element of the barrier you are wearing. The element is dealt as secondary damage, primary damage is still geo. (flaming space rock?)

Why different coloparticles/animation when you have C1-C6 upgrade?

It makes whales feels special, and it gives F2P players something to aspire for. It makes you want to spend with all the bling. Particle recolor is easy peasy and can be deployed within minutes. Attack animations on the other hand are time consuming. It almost always put smile in people's faces when a whale shows up in a ferrari. "Dude check this out a C6 GeoDaddy joined my domain run. Look at the size of his statue. Oh my what a BIG meteor."

Why are you doing this?

It's just for my amusement. I'm still adding random thoughts now that 1.3 has launched. I don't care if nothing gets implemented. I would nut hard in my shorts with QoL and alleged bug/bugfixes mentioned in this post more than anything.

Afterword

Leave your thoughts below. Sorry and not sorry for the broken engrish , feel free to copy and paste whatever, use it wherever idc as long as it doesn't annoy or harm someone. Translate it in your language etc. No credits needed etc. Let your mind flow

After-Afterword

• Thanks for the awards and all kinds of reception
• You guys are awesome and insane that's a shit load of awards thank you.