132 sats \ 7 replies \ @siggy47 OP 4 Jun \ parent \ on: People who bought Berkshire cheap have their trades undone. econ
You're right about the sellers getting unfairly punished, but the situation is a little more complicated. This wasn't a "fat finger" problem. The market was going down. The only glitch was to the "circuit breakers" which artificially controls market action to begin with.
It's as if during the covid crash the lucky few would have to give back their $3000 bitcoin.
Now I see this:
https://fortune.com/2024/06/04/warren-buffett-berkshire-hathaway-discount-deals-canceled/
The sellers could only be getting unfairly punished, if they never agreed to let their shares transact at that price.
If they did agree to letting them sell at these prices, then this is completely ridiculous.
It seems like something that might fall into the realm of implicit prices. Presumably, they outsourced the management of these shares in some way and didn't put strict explicit parameters in place.
There still might be a case to be made for reversing the sale. It's a bit like if you go into a restaurant and order a cup of coffee before seeing the prices. If you find out they're asking $100 for a cup of coffee, you can reverse the transaction even after they bring you the coffee.
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Yeah. I ran out of time to edit my last reply. I was under the impression it was purely a "circuit breaker" issue. That might not be the case. In the meantime, I see this:
https://www.cnbc.com/2024/06/03/e-trade-is-debating-whether-to-ban-meme-stock-star-keith-gill-from-its-platform-the-wsj-reports.html
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I was literally just telling my wife about how the GameStop saga was happening again. We both agreed that somehow they're just going to ban this sort of activity.
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Nothing infuriates me more. Meanwhile, no ramifications for this bullshit:
https://www.marketwatch.com/story/nickel-market-tumult-continues-what-investors-need-to-know-11647620536
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Wow. I didn't even hear about that, or if I did, I forgot about it. I was so outraged by all the Covid and military insanity, I didn't pay much attention to anything else.
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I couldn't believe how this story got so little attention. I know I have mentioned it a few times here before. I thought it would be huge. I guess I shouldn't be surprised.
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The nickel market experienced significant turmoil in March 2022 due to supply concerns arising from the Russia-Ukraine war. Prices on the London Metal Exchange (LME) more than doubled, leading to the suspension of nickel trading for over a week.[1] The spike was exacerbated by a short squeeze involving Chinese producer Tsingshan Holding Group, which had a massive short position in nickel futures.[2]
The LME's decision to cancel trades executed on March 8, wiping out $3.9 billion in transactions, drew criticism from investors like hedge funds who had bet on rising nickel prices.[1][2] The exchange struggled to restore order, with prices hitting daily expanded limits for several days after reopening trading.[1]
The tumult highlighted issues with the LME's transparency and risk management, as well as the potential for market manipulation due to the concentration of positions held by a few large players.[2] It also raised concerns about the exchange's ability to function effectively during periods of extreme volatility.[1][2]
Sources
[1] The nickel market tumult: What investors need to know https://www.marketwatch.com/story/nickel-market-tumult-continues-what-investors-need-to-know-11647620536
[2] Nickel market short squeeze: Day drinking, 'Big Shot' and billions of ... https://www.cnn.com/2022/04/02/investing/nickel-short-squeeze/index.html
[3] LME Nickel - Wikipedia https://en.wikipedia.org/wiki/LME_Nickel
[4] August 2019 Commodities Performance Highlights – Tweets, Trade ... https://www.indexologyblog.com/2019/09/03/august-2019-commodities-performance-highlights-tweets-trade-and-tumult/
[5] The Boom in Battery Metals for EVs Is Turning to Bust - WSJ https://www.wsj.com/finance/commodities-futures/the-boom-in-battery-metals-for-evs-is-turning-to-bust-5630493c
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