Tag: reddit

FU Investing

It’s important to remember the difference between capitalization through offering shares and market value. Say I have a company that I’m going to take public. Forget all the real-world stuff that goes into an IPO — I put one million shares of my company out there with a target price of 10$ a share, and initial investors purchase all of the shares at my target price. I now have ten million bucks in exchange for the investor’s interest in my company. Now you want to buy a share of my company. I had a million shares and sold them all. You aren’t buying a share from *me*. You go to someone who owns shares in my company and offer to buy one. Well, they paid 10$ yesterday, so they’re not going to sell that share for ten bucks. You offer them 11$, though, and they say ‘sure’.

My company is doing well (“the fundamentals” are good), people anticipate I’m going to start offering dividends or I’m going to start using a new manufacturing technique and reduce cost by 10%. A lot of people want shares, so they start offering to pay 20$ for a share. And plenty of people who paid 10$ a share want to bank their profits, so there are shares available to buy. Even though my company shares are selling at 20$, which makes my market capitalization twenty million dollars, I only have ten million of that. The other ten million went as profit to investors who sold shares. Same when the stock price goes down — I’m not hitting sales targets, my planned IP filing doesn’t go through, etc and shares are down to 5$ … I still got that ten mil from my IPO; investors just own their share of my company with a value of 5 mil.

A company that isn’t doing well can still be worth millions on paper. This is where short selling comes in. Think about buggy manufacturers when automobiles became “a thing” — if they were publicly traded companies, you could have anticipated that the value of the stock would go down. You borrow a share of Lisa’s Buggy Company from someone — it’s worth 10$ today. You sell it and pocket the ten bucks. A month from now, you buy a share of Lisa’s Buggy Company for 3$ and give the repurchased share back. You’ve score 7$. Now, realistically you don’t just find someone who owns a share and borrow it from them. You ‘borrow’ the share from a brokerage. You pocked 9.50$ initially because you give the brokerage 0.50$ for letting you ‘borrow’ that share for a month (like interest when you borrow money).

If you borrow a 10$ share and are going to return it in a month, no one knows how much that’s going to cost you in a month. You’re hoping it’s less than 10$. But, in a case like GameStop, that 10$ share you borrowed is worth 320$. Brokerages hold what amounts to cash collateral to cover your short — because they don’t want to be out that 320$ share when you cannot afford to repurchase it. And, as the share value goes up, they may need more collateral to cover your short. At some point, you just don’t have any more cash to throw into collateral. You’re screwed (and have to repurchase those borrowed shares at whatever the price happens to be now). Or the broker doesn’t want to keep risking it — they call in their loaned share so they can sell it and keep the 320$.

Thing is? Having shares trading at a couple hundred bucks instead of a couple bucks doesn’t change the real trajectory of in-person retail sales of physical game media and equipment (i.e. the underlying logic that led investors to short GameStop in the first place). It doesn’t give GameStop half a billion dollars they can use to move into a new, more profitable, market space. AMC are an interesting, somewhat similar, case. AMC have, to a lesser extent, gone through the same thing as GameStop. Except they also happened to have planned to issue an additional fifty million (or so) shares of stock to raise money. Had the offering gone through when the stock was trading at 2$, they’d have only raised another 100 mill. Had they hit the 20$ a share price the stock peaked at, they’d have raised a billion. IIRC, they brought in a little over 300 million — enough to wipe out a bunch of debt and probably secure operations through the pandemic (if that means summer/autumn). And, I expect, there are a LOT of people who (once vaccinated) are really eager to go do *things* like overpay for popcorn while watching movie on a big screen. This FU investing to screw over massive shorts may have saved the company.

 

Writing Prompt: Star Registries

It was a scam. I know it was a scam. I worked at the International Astronomical Union for thirty years and know how celestial bodies are named. That’s what made it such a funny gift when I retired: my team “bought” me a star. No, there’s no such thing. There are commercial entities that maintain a “star registry” – which is just a database of stars. You buy a line in the database — Right ascension 23h 13m 16.97632s, Declination +57° 10′ 06.0823″ has the “name” of TinaM. What stops someone else from creating a database, throwing a bunch of coordinates of celestial bodies into a table, and selling you a slot in their table? Absolutely nothing! It’s a scam. That star is really designated HD 219134! There are a few planets orbiting this star. At least two of which are super-Earths. I know this because I looked it up after being presented the “Star Certificate” at my retirement party last July. The certificate which hangs behind the desk in my office.

Also? The certificate toward which the amorphous lavender blob draped across my desk is frantically gesturing with a protrusion that is vaguely arm-like. High-pitched whines emanate from within its form. The blob shakes violently, and a sliver box plops onto the floor. A holograph fills my office. Hundreds of lavender blobs are swimming in a shimmering, silver ocean. They dot the rocky shore. Suddenly, a spaceship appears above beach. A hatch opens and something begins to fall from the spacecraft. The ship begins to move, and the detritus quickly covers the beach and ocean. “Tina”, a voice booms. “If you have the hubris to claim ownership of our solar system, at least tell the thwrrgs to stop shipping their rubbish to our beautiful, rocky shores.”

Writing Prompt: Zombie Grains

Story from a writing prompt on Reddit:  The zombie apocalypse has occurred and it turns out humans have been mishearing the zombies. It turns out instead of them wanting brains, they’ve actually been asking for grains. Needless to say, the humans are slightly embarrassed.

This prompt struck me because Anya has her own zombie mythos — she thought zombies might like vegetarian fake meat like we do, so she gave one an impossible whopper. It loves them, and now it’s a nice zombie who hangs out with us. Any new zombies, she’ll ask if they want to be nice zombies too and promise not to eat anyone’s brain. Just impossible whoppers. Not quite the same thing, but the idea of being able to avert the zombie apocalypse just by feeding the zombies something else appeals to me.

********************************************************************************

Apocalypse bingo! As I mark the final square in the row, I don’t really feel like I won. But people insisted on drawing up cards when the murder hornets showed up in the States back in May. It’s early autumn now, and zombies have escaped the restricted zone. I call out to my daughter — we’re heading out to the hunting cabin. Five thousand acres of wilderness, water, nut trees, fruit trees, fenced woodlands, crop lands. It’s the best place I know to survive the zombie invasion and forthcoming collapse of civilization.

We’ve been packed since the initial infection reports hit the nightly news a few weeks ago. We’ve got it under control, the government claimed. The incubation period is a few seconds, we know we’ve quarantined all the infected individuals. I knew better — statistics are nice generalizations, but outliers will bite you. And turn you into zombies, evidently. I’ve got to get the animals into the truck, but we’re driving out of town in under an hour. Before the roads are blocked with panicked drivers.

A long drive, but we’ve arrived safely. It’s a busy few days, getting everything unloaded. Checking everything to make sure it still works. The power and phone lines run underground, so they’re fine. But a windstorm damaged the barn windows. Our chickens and pigs will be fine on these crisp Autumn nights, but we’ve got to get it fixed before snow comes. News reports say the zombies have been reported in West Virginia and PA. Friends back home in Ohio think we’re over-reacting, but I think feeling silly about relocating for a few months is a best-case scenario.

****

Snow blankets the ground – it’s mid-winter. The zombies made it into Ohio. Friends tell me there are organized hunting parties trying to contain the things. Even with reinforced doors and windows, it’s frightening to hear howls of “bbbbbbbbrrrrrrrrrrraaaaaaaaaaaaaaaaaaaaiiiiiiiiiiiiinnnnnnnnnnnnnssssssssssssss” outside your house. I don’t mention how they laughed at me for heading out of town. We’re safe out here; we’ve built a wall around a quarter of our property and spend a few hours each day adding to it.

****

Spring finally arrived! Zombies have been sighted about twenty miles from here, but we completed the wall around our compound. We’re running out of food, but the fields are seeded. We’ll have enough to get by. Got an e-mail from my mom yesterday. The federal government has been wiped out — a lot of officials refused to believe the incubation period could be months, and they refused to take any precautions against virus spread. The few who aren’t zombies left town last week. She hasn’t heard from the state government in a few days and doubts they have fared better. The mechanization that contributed to mass unemployment over the past decade has saved millions of lives — no one has gone to work for months; but the power, water, Internet, mobile networks, and gas are still working. Food is a problem; hungry raiders are starting to become more dangerous than the zombies. She’s heading out to the farm — a risky drive, but staying in that densely populated area is more dangerous.

****

One year has passed since the first zombie infection. I’ve been spending my days talking friends through “that survivalist crap you’re into”, as they used to call it. Now? Foraging, hunting, making warm fabrics, and raising animals are critical skills. People tried to form enclaves in major cities, but they’ve now seen three-month incubation periods. Someone who has been living with you for a month can become a zombie overnight. A few people remain in the cities, but most have formed small camps out in the woods.

It was bound to happen eventually — three zombies were shuffling along our fence yesterday. The mass of boulders and trees keeps them outside, but we’re in constant danger until they wander away. We’re harvesting our last crops. Fresh vegetables are being preserved, beans are being dried for storage, grains are hanging in the barn to be threshed tomorrow.

****

Hiking the fence line and reinforcing any area that looks weak, I notice there are now dozens of zombies milling around downwind of our property. We’re the only people for hundreds of miles, and I think we’re attracting them. I finished building a wood-fired clay oven today. I can bake again! I’ve got a natural sourdough just about ready to cook. The scent of baked bread wafts across our yard.

****

It’s been two years since the zombie apocalypse started. We’re patrolling the fence line regularly now — hundreds of zombies have amassed around our property. If we aren’t constantly reinforcing the wall, their weight alone will breach the barrier. Communication with the ‘outside world’ is irregular. The infrastructure is still in place, but everyone is busy trying to sustain themselves. We’ve had another great harvest — the root cellar is full, my husband built a small silo to hold the wheat, and it’s just about time to start harvesting nuts in the forest. There’s a routine to life now, but we have time to play again. My daughter loves setting up scavenger hunts for me, and we’ve got hide-and-seek boundaries memorized.

****

I heard a crash as we sat down to lunch today. We left our meal on the picnic table and ran into the house. The lower level is barricaded, and we’re able to watch from the windows of the upper level to see what’s happening. There are dozens of zombies meandering around the house and barn. They seem to be looking for us — wails of “braaaaaaaiiinnnss” filter up to us. Suddenly, a zombie in a blue ball cap stops. He looks right at me through the window, and I freeze in terror. Slowly, he starts walking toward the house. He grunts, and a few other zombies turn to walk with him. He’s almost at the front porch, but he keeps walking. The whole horde has started to follow him now — headed away from the house? We’re screwed if they take out the animals! Hadn’t had time to get them into the barn. We watched in puzzled horror as the zombies trudge past flock of chickens then shove through the passel of pigs. Toward the grain silo?!? They quickly breach the silo wall — didn’t think to reinforce it; nothing’s living inside. And the zombie horde proceeds to gorge themselves on the wheat held within. My daughter yells out “Oh, they want GRAINS!”. They’ve smelled our oat and wheat fields and have been trying to get our grains. Has anyone mentioned a zombie killing someone? I think back to the conversations we’ve had in the past six years. Bitten, yes. Passed on the zombie virus in the bite. But I’d expected to hear someone’s gruesome story about watching a family member be ripped apart by a hungry zombie.

I grab my quarterstaff and venture out of the house. It’s just a hypothesis, but we cannot cower in the house forever … and I think zombies are not carnivorous. Zombies walk right past me, salivating and yelling “graaaaainnns!”. My daughter and husband emerge from the house, and my daughter grabs the loaf of bread from the table. She hands it to the nearest zombie, and he smiles before chomping into the loaf. The zombies, having finished eating, begin to wander away from the silo. They mill about our property, gazing at trees and birds. Quiet at last! I’ve been listening to the low drone of zombie voices for years. I’ve got to tell everyone — we’re not in mortal danger. There was no need for civilization to collapse. We just need to feed these zombies!

****

No one believes me. I’ve tried friends and family, the couple of ham radio operators that serve as the news media. They think I’ve been isolated too long or eating the wrong kind of mushrooms. I’ve sent videos — only to be told they know I green-screened it. Everyone’s seen a zombie bite someone, and they won’t be dissuaded from the notion that it was trying to eat them.

We’re good here — there’s now a couple of acres of grains surrounding our wall. I call it the zombie garden. They eat the oats fresh from the field during the summer and autumn, then pick wheat kernels from the ground all winter and spring. And they miss enough that it all grows again the next year. We spread compost over the ground each spring to ensure a good crop. I might put some kamut out next spring and give them a treat. And maybe I’ll be able to convince someone to take a helicopter out to the property and see the zombies in person.

********************************************************************************