Reddit's Shares Plummet Almost 25% in Two Days, Dropping Below Its First Day's Close (cnbc.com) 96
Last Monday shares of Reddit's stock soared 30%, reports CNBC — and then another 8.8% on Tuesday.
But the moves happened "even after New Street Research issued a neutral rating on the company" — and by the end of the week, CNBC was reporting that "Reddit shares are plummeting..." Shares closed at $49.32, ending the week below their closing price on Reddit's first day of trading on the New York Stock Exchange [on March 21st, when they closed at $50.44 ]... Stock markets are closed on Good Friday.
Reddit shares began their downward spiral on Wednesday, when they sank about 11% to $57.75 at market close. That day, Hedgeye Risk Management described Reddit's stock as "grossly overvalued" in a report cited by Bloomberg News, adding the company was on the firm's "short bench."
The article notes Reddit's CEO sold 500,000 shares in the company — nearly 40% of his holdings — which Ben Silverman, vice president of research at Verity, told CNBC was expected — while Reddit's COO sold another 514,000 shares.
"There's always a bit of a disconnect," Silverman said in the interview, because bringing a company public "is not just to generate liquidity for the company itself so that it can expand and grow. In these situations, it often allows insiders to cash out to generate liquidity.
"And that's something investors have to consider here. If the prospects are so bright, why are insiders selling?"
But the moves happened "even after New Street Research issued a neutral rating on the company" — and by the end of the week, CNBC was reporting that "Reddit shares are plummeting..." Shares closed at $49.32, ending the week below their closing price on Reddit's first day of trading on the New York Stock Exchange [on March 21st, when they closed at $50.44 ]... Stock markets are closed on Good Friday.
Reddit shares began their downward spiral on Wednesday, when they sank about 11% to $57.75 at market close. That day, Hedgeye Risk Management described Reddit's stock as "grossly overvalued" in a report cited by Bloomberg News, adding the company was on the firm's "short bench."
The article notes Reddit's CEO sold 500,000 shares in the company — nearly 40% of his holdings — which Ben Silverman, vice president of research at Verity, told CNBC was expected — while Reddit's COO sold another 514,000 shares.
"There's always a bit of a disconnect," Silverman said in the interview, because bringing a company public "is not just to generate liquidity for the company itself so that it can expand and grow. In these situations, it often allows insiders to cash out to generate liquidity.
"And that's something investors have to consider here. If the prospects are so bright, why are insiders selling?"
They found bagholders (Score:5, Insightful)
Good for them.
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Now they should sell NFTs commemorating the, ah, "lost" money.
It is possible there is value in Reddit (Score:4, Interesting)
I think it's a little early to tell one way or the other but then again insider information is a thing so this could be a sign that somebody knows how some of the lawsuits currently working their way through the courts are going to go.
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Yes, training AI on Nazis at Truth Social will be much more effective.
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Plus the modern day "Progressives" are full-on anti-Semetic with their pro-Palestine Nazism.
Re:It is possible there is value in Reddit (Score:5, Informative)
Reddit is for karma whoring and shitposting in the various "jerk" subs. You can't really have a genuine discussion in the serious subs, because the moment you put one toe over the groupthink line, your karma ignites like a stormwater flooded Tesla.
Seriously. I got banned from /r/politics for relating a story of how I've been called a "faggot" for, get this, ambiguous use of hate speech. When an actual gay man isn't allowed to describe the sort of homophobia he's experienced, you know that forum has jumped the shark. Prior to that, I butted heads with some folks in there because I wasn't drinking the Bernie Kool-Aid, and pretty much if you're right of Bernie you may as well be marching the streets dressed as a Neo Nazi, at least as far as the folks in that subreddit were concerned.
If I was writing a Yelp review for them, it would read something like: Worst place to discuss politics ever, zero stars.
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Re:It is possible there is value in Reddit (Score:5, Insightful)
/r/politics isn't for discussing politics, it's for gathering everyone who can be influenced in one place under the false impression it's for discussion, and then creating a false sense of consensus by vigorously censoring whatever the mods don't want you to be exposed to.
In other words, it's a propaganda op. Whether it's run by well-intentioned nuts or part of a paid social media influencing campaign I don't know, but in terms of the end result from a poster's perspective there is no difference.
Re: It is possible there is value in Reddit (Score:2)
Kind of like how PoliticalCompassMemes is a psyop under the guitar if free speech sub. Conservative. WorkersStrikeBack. Antiwork. Libertarian (got banned there for asking their stance on funding law enforcement, no feedback from mods).
Almost every Reddit sub is an ideological front.
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”Hush now, baby, baby, don't you cry Mama's gonna make all of your nightmares come true Mama's gonna put all of her fears into you Mama's gonna keep you right here under her wing She won't let you fly but she might let you sing Mama's gonna keep baby cozy and warm Ooh, babe, ooh, babe, ooh, babe Of course mama's gonna help build the wall”
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This is a braindead take where you let downvotes control your opinion.
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Equating all of Reddit to r/politics is like equating all Slashdot posters to the shitty racist, sexist, ... fuck it use wildcards *ist, *phobic, Anonymous Cowards.
You most definitely can have sensible discussion on Reddit. You just seem to be seeking out subs which are actual shitholes.
So I had a bad meal in NYC & their food sucks? (Score:4, Insightful)
Seriously. I got banned from /r/politics for relating a story of how I've been called a "faggot" for, get this, ambiguous use of hate speech. When an actual gay man isn't allowed to describe the sort of homophobia he's experienced, you know that forum has jumped the shark.
This is like saying...well, I went to a pizzeria in Times Square and they sucked...so the food in New York sucks!!!! Reddit is MASSIVE and I've had about an equal mix of good and bad experiences regarding posting. Yeah, the most popular subreddits can get pretty toxic, but being a moderator is a shitty and thankless job. They can either read every post in depth and try to figure out that you are a homosexual and describing your personal past experience, not hating on gay men...or they can just auto ban a keyword since they're getting 1000 posts and hour, minimum. Popular subreddits are not for nuance, especially ones that deal with controversy.
I've had great experiences in most of my hobby subreddits. I've had terrible experiences asking questions in popular subreddits as they moderators usually ban questions.
For as shitty as Reddit can be, you can't deny, they handle spam better than any site that popular....at least as far as I've seen. So I get honest reviews, more knowledge than any other site for my interests, free highly specialized porn, and discussions go in greater depth than I've ever seen (I focus on hobbies and technology, not politics)...but some subreddits are full of assholes.
Going back to the NYC analogy, to me, it's like a city that has the greatest experiences in some neighborhoods and some outright horrible ones in others. You can't judge NYC by it's worst neighborhoods unless you factor in its best as well...the same applies to Reddit.
If all you see are "karma whoring and shitposting in the various "jerk" subs. "...you need to expand your interests.
You're thinking about the political subs (Score:1)
The political subs have trolls that make a game of baiting you into saying shit that'll get you banned along with bots and overworked mods. But they're also completely worthless except for a handful of specialty left wing subs used to organize on (the right wing subs are so locked down to avoid violating reddit TOS with hate speech/doxing/violence that they're hilariously useless even for organizing).
But if you're just looking for knitting sub reddits they're fine, thoug
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Seriously. I got banned from /r/politics for relating a story of how I've been called a "faggot" for, get this, ambiguous use of hate speech. When an actual gay man isn't allowed to describe the sort of homophobia he's experienced, you know that forum has jumped the shark. Prior to that, I butted heads with some folks in there because I wasn't drinking the Bernie Kool-Aid, and pretty much if you're right of Bernie you may as well be marching the streets dressed as a Neo Nazi, at least as far as the folks in that subreddit were concerned.
If I was writing a Yelp review for them, it would read something like: Worst place to discuss politics ever, zero stars.
It's a forum with 8.5 million members, there's like 8000 online right at this moment. Of course there are dumb one size fits all rules in place.
What do you expect? A packed NFL stadium is something like 70,000 people. Why in the actual FUCK would you go to a generic event in one called "politics", and for fun we wired one hundred of those together into one big mega forum, for ... "politics".
Think about how dumb that whole concept is right out of the gate, and you're threatening to write a yelp review becaus
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As a social media company, Reddit's value in training AI models is limited to that where engagement is valued above truth.
But I wish them luck anyway.
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They should be wildly successful then.
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It helps that OpenAI CEO Sam Altman owns 8% of Reddit. Is there a shareholder discount for training I wonder?
Re:They found bagholders (Score:5, Informative)
why are insiders selling?
Because that's the whole point of the scam. CEO and COO each sell shares and each walks away with $25 million. At that point it doesn't matter if the stock tanks or the company goes out of business. A few insiders collected their millions and that is all that matters.
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why are insiders selling?
A few insiders collected their millions and that is all that matters.
That certainly is all that matters to those with the options.
It hilarious how "insider trading" is illegal, unless its the Chief Executives in a highly publicized massive sell-off that negatively impacts everyone that now owns stock.
Ain't capitalism great how it incentivizes unethical behaviors that look almost like inside trading, but without Martha Stewart?
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What these people have done, is gone public.
Taking your corporation public is a great way to cash out.
You seem to be making the argument that selling your property isn't ethical. I'm having trouble buying it.
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There can't be one post without some nutjob with TDS inserting their 2 degrees of separation of Donald Trump into whatever they say. Can't say it is not hilarious. Really looking forward to the end of this year.
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You'd have to be pretty braindead to not see the crazy difference in valuation of the stock of both of these companies. The only deranged people here are the people like you who seem to find merit in not paying attention.
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truth social stock crashed 21% so far today. They're both social media companies which lose money and which had an IPO in the same month and were insanely overvalued meme stocks but mr. Anonymous Coward is like "Oh libs just HAVE to talk about trump even if its not relevant".
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I there's a lot more value in Reddit and you have to look beyond the few days after it's gone public. Right now, their name and the attention got them up and the lack of a profitable business model is what has caused them to sink right away. 19 years without a profit ever, C levels selling 40% of their shares and naive mods trading the stock doesn't show a great starting point. The IPO reaction model on display here is one where the stock spikes immediately, then crashes shortly thereafter and I've just sta
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Yep. I got the emails to set up an account and buy shares but passed. To be fair, I predicted a great than 25% drop by now, so they've managed to do better than my low expectations.
Crash, burn, and fucking die already. (Score:4, Insightful)
NT
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I find Reddit's tech channels to be surprisingly good, so it does have value. I don't know if the value coincides with its share price, though.
I was thinking about all the tech companies I didn't invest in because I had some personal grudge against them. Most of those companies became highly priced, and I regretted not investing in them early. I was tempted to not miss out on yet another one, but I resisted the urge. Only time will tell whether it was a good decision.
I can easily see the possibility a large
Re:Crash, burn, and fucking die already. (Score:4, Insightful)
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...generally helpful ... and usually wrong.
I've repeatedly been modded down as on there for correcting someone in a thread about my own work.
"He did it by doing X"
"No, it was by doing Z, it's impossible to get the result doing X"
-1
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Re:Crash, burn, and fucking die already. (Score:4, Informative)
If you want to find a human talking about or fixing a problem then reddit is about the only place left. Websites are useless for that now with content designed to get better search results. Some forums might exist but they have a tendency to come and go. They aren’t indexed deeply by Internet Archive and google purged all their cached copies.
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Re: Crash, burn, and fucking die already. (Score:2)
And it's a hell of a lot more useful than reddit. The site has no use for moderators aside from the occasional admin deleting spam, let alone having its business model built around them providing their services for free. Others can also find out pretty quickly whether the solution provided actually works and the solutions generally get updated, whereas with reddit this is rarely the case. Reddit is also far more likely to lead you to questions that were never answered and had the thread closed because nobod
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If you want to find a human talking about or fixing a problem then reddit is about the only place left
You should try Lemmy.
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You should try Lemmy.
Um, Lemmy is dead, but he had this to say [imgur.com] about fixing a problem.
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You can expect that the results will be about half as accurate as whatever random result you find on stackoverflow or elsewhere. Honestly, my experience is that they're more often or not wrong and superstitious, especially when talking about anything not highly precise and technical. Lots of hand waving.
We no longer live in the rational post-enlightenment era, we're well into the emotive age of Aquarius.
Re:Crash, burn, and fucking die already. (Score:4, Interesting)
I preferred the old days of individual separately run forums, rather than Reddit's "flea market" approach. It's especially bad when you join a new sub and people crawl through your post history. I still remember seeing someone asking for help about a turntable on /r/vinyl and he got grilled for the nudes he was posting elsewhere on the site (because you don't ask for turntable advice on /r/vinyl, you're supposed to use /r/turntables, and if you didn't know that, well, too bad, people are going to have fun at your expense anyway).
What a truly wonderful way to run a forum community. /s
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he got grilled for the nudes he was posting elsewhere on the site
Don't post your nudes for the entire world to see. Simple as that.
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Despire the whining of a few terminally online posters, Reddit will not be going anywhere.
wording (Score:5, Informative)
"it often allows insiders to cash out to generate liquidity", id est "Take the money and run".
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Well, darn. My moderator points ran out. Someone mod parent up. '
That being said, moving founders out (with their proceeds from going public) is often the best thing for a newly public company. People good at startups are not necessarily good at operating (public) companies over the long run. I observed that in the small company I was in. The problem was that the venture capital people who had the plan to cash out (either going public or through a sale) were assholes, and a majority of the employee sh
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"it often allows insiders to cash out to generate liquidity", id est "Take the money and run".
I should have listened to this rando [slashdot.org] and rode the bear bets in the casino section of my brokers website.
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eleven plus two / twelve plus one
Anagrams of each other.
My brother is a bum (Score:2)
He's never made any money in his entire life. He means well, but he's a bit of a hippy, he doesn't like to work much and he has two left hands.
One day he bought an old minivan and told us - my sisters and I - that he'd start a small business delivering groceries to old people in remote villages, and would we like to invest in his company.
Can you guess how much we gave him?
We love our brother, but we'll never see our money back. Been there, done that. So we passed up this investment opportunity.
Well guess wh
Re:My brother is a bum (Score:4, Funny)
I was half expecting you to say he's the founder of Instacart.
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I was half expecting you to say he's the founder of Instacart.
Funny, I was thinking WebVan.
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Expected him to say his brother was a long-time Redditor, received an invitation to purchase shares, and is now sitting pretty after selling his lot for a van-load of cash.
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A Site Easily Described (Score:4)
Soulless hissing evil.
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Selling to diversify isn't wrong (Score:5, Insightful)
When I worked in tech, I always sold *every* share of stock as soon as I could.
Not because I didn't believe in the companies I worked for (and some I was with for 14 years).
But I already depended on the company for my salary, and all my currently-unvested stock. So keeping all my vested stock would have way overconcentrated my investments. I figured if the company did well, my remaining stock would sell better when it vested, and they'd give me more (and they did). If the company did poorly, I'd be glad I sold it when I could.
It turns out I would have made more money keeping the stock they gave me... but they could have just as well Yahoo'd, and my stock would have bought me a very nice bicycle instead of paying off my mortgage.
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In other words, good ol' not putting all your eggs in one basket.
I had the same policy during my career, and I'm glad I didn't invest in my own company, because I would have been hosed. There's nothing better than a diversified portfolio... which is why I'm only middle-aged yet retired. 8)
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There's nothing better than a diversified portfolio...
Having enough surplus cash to spare that diverse portfolios don't actually impact ones lifestyle is pretty good, in and of itself.
Its like getting to play roulette all day with the house's money...because you are the house.
Reddit is bigger than a company (Score:3)
When Reddit and Twitter come up I think those are the two platforms that really exemplify, for better or worse, what a "digital town square" is today, not by design but just how things have ended up. Whatever we think about happens on these sites they are gigantic bastions of human interaction and shared knowledge. These places are "real life" as it were, they should be something cultivated more than squeezed for dollars.
It makes me think bout the texts Dorsey and Musk shared before he bought Twitter and for all his hippie nonsense I think Jack Dorsey is 100% right about this. For a second I thought maybe Musk was enough of an actual altruist to actually do this with Twitter, which would have been a true baller move.
https://twitter.com/TechEmails... [twitter.com]
------
Jack Dorsey: Yes, a new platform is needed. It can't be a company. This is why | left.
Elon Musk: Ok
Elon Musk: What should it look like?
Jack Dorsey: | believe it must be an open source protocol, funded by a foundation of sorts that doesn't own the protocol, only advances it. A bit like what Signal has done. It can't have an advertising model. Otherwise you have surface area that governments and advertisers will try to influence and control. If it has a centralized entity behind it, it will be attacked. This isn't complicated work, it just has to be done right so it's resilient to what has happened to twitter.
Elon Musk: Super interesting idea
Re:Reddit is bigger than a company (Score:5, Insightful)
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We had a protocol that wasn't controlled by any company: Usenet.
And it still exists, if you want to use it.
The problem is that a vanishingly small number of people do, because NNTP is a protocol reflective of its era, starting with the need for a dedicated client. Most clients avoid the worst elements of recent UI design (flat icons, ribbons, excessive whitespace, etc.), but go to the other extreme of all looking right at home in Windows 95. Usenet readers aren't the sort of things that are going to need frequent updates, but even so, more than half the GUI newsreaders
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You also have an open sewer instead of a forum.
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Moderation is necessary though so transparency in moderation I think is the key. Plenty of people absolutely deserve to get banned from platforms for one reason or another but that process can't be so opaque and without recourse. There's no growth for a person kicked from a forum if they don't know why or cannot be given the opportunity to be given a second chance.
On places like Reddit and Slashdot though with an upvote/downvote system though people have to be able to accept that sometimes while you have
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Also, let's not forget that usenet was a _massive_ bandwidth hog.
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We had a protocol that wasn't controlled by any company: Usenet.
Being independent isn't the only requirement. The world is full of useless shit not controlled by companies. Usenet fails modern use cases, which is why it is not widely used despite it still being very much a thing that exists and which you could use right now.
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Pretty much, building the platform is actually the easy part, getting the critical mass of active users is exceedingly difficult, maybe impossible without commercial support?
That's why if Musk had actually done something like what Dorsey was proposing it really could have up-eneded the entire social media space as it would have the giant existing Twitter userbase but also have that stability that being backed by a billionaire who doesn't actually care about the platform earning profits immediately.
Instead w
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IIRC, BlueSky owns Dorsey's AT protocol: For the consumer base to increase, and not be captured by BlueSky , BlueSky will need to publish the protocol.
The public release of the (less-featured) ActivityPub protocol allows Meta and X/Twitter to support it, no strings attached. Less features also makes it cheaper to support.
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Yeah Bluesky is definitely closer to what Dorsey is talking about here but there is no doubt it is fighting an uphill battle versus the massive network effect Twitter has.
I would hope everyone here would agree that social media would be better served under a Bluesky style open(ish) protocol rather than whatever Twitter and Facebook are doing.
Thing is just doesn't matter all that much if the users don't switch over and for all the prognosticating over Twitters soon-to-be demise it just hasn't happened and do
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Those platforms are also volatile. I go to Reddit about daily because one community I follow is there, if that one community moves elsewhere, I have no reason to go there any more, except after a random Google search. Twitter... I do have an old account and may open it a handful times a year (probably even less) because nobody I care about is there.
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if that one community moves elsewhere
Yeah for sure I think this is key but think if Reddit is a "platform" rather than a commercial entity it severely reduces the reasons for this to happen, probably comes more likely to splinter due to community in-fighting than issues of where the community is hosted.
Wouldnt spend a nickle (Score:3)
Navel gazing for fun and ... (Score:3)
But of course since Reddit fills in for slashdot for a lot of tech people, here on slashdot we must celebrate when Reddit falters. Because of course bad news for the competition can only be good news for this site, right?
Yes I know I'll be down modded into oblivion on this one, if anyone with mod points is even reading this thread to look for something like this. Go ahead, I can take it. Don't bother trying to convince anyone that I'm somehow not right on this though.
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Both slashdot and reddit are circling the drain. There, feel better?
Don't ignore the big gains. (Score:2)
Gomer Pyle (Score:2)
A deep thought... (Score:2)
A deep thought is simply: "Who cares?" Unless this is a quaint scam of its own to generate free publicity and notice. ?? *head scratch*
JoshK.
perfectly priced IPO (Score:2)
You sell shares in order to raise money. The ideal is there is a lot of excitement before you go public so that you can ask for the highest price. Then company backing your IPO hopes the value goes up quickly and they can turn over every share onto the public exchange for money than what they paid. But extreme rises in share price means your business left a lot of money on the table, and someone like Schwab makes a fortune on handle yoyr undervalued IPO.
Silly Millennials (Score:1)
The pump-and-dump scam has been around forever -- even since before stock markets existed. It's a really simple formula. One would think people like yourselves who are so much betterer and smarterer than all the stoopie people would be able to spot it.
But, apparently, you can't spot a hype-cycle so let me outline the basic s