LogFAQs > #980389439

whitelytning posted...

This is the failure in the whole plan. Its not even about the economy, just the idea that a hedge fund or major financial institution is going to go bankrupt to buy shares, with money they likely dont have, at insane prices to comply with a contract is crazy. They will just not buy the shares and deal with a lawsuit and fines after the fact. Its much more rational and doesnt involve bankrupting the company.

Lets say I enter into a bunch of contracts that says I will buy millions of shares of GME on some random date. And I dont expect the price to be above $10 on that date.

If suddenly there are games being played in the market to make the price $400/share when the due date comes Im not going to spend 40x the amount to buy the shares, especially when I dont have the money. Im just going to breach the contract.

The legitimacy of the entire market is based on contracts being strictly enforced. If anyone can just skip out on obligations then it'll be a hit to the reputation of the market.