Grigory Lukin.com

Monday night.

The CPR/first-aid training people got in touch today and said that it’s actually a two-day course, but the theory can be knocked out if I take an online class. It’s a bit tedious, but it’ll keep my potential exposure to fellow students from two days to just one. Huzzay, I guess?

Gamestop’s stock is pretty much in death throes at this point: it briefly jumped by 13.8% earlier today, only to close 5.9% down for the day, at measly $60 a share. It’ll likely keep circling the drain, which will make the redditors on r/wallstreetbets that much more desperate. The whole place is crawling with wild conspiracy theories about the coming short squeeze that will save them all. (A lot are in the red because they bought in early…) At this point, doing the exact opposite of their advice seems like the right thing to do. To that end, I bought a single put option (aka a bet that the stock price will go down) for Redfin (RDFN), which just hit its all-time-high of $89.29. It was trading for $9.63 less than a year ago, and I’m pretty sure it’ll come back down. (My put is for January 2022.) The spike in its valuation was at least partially fueled by people working from home (and from fun new locations) during the pandemic. Take away the pandemic and, well… It’ll be interesting to see if my small bet will be correct 11 months from now.

…for the record, I don’t mean to dunk on the wallstreetbets crowd. They ensured their place in financial history, and I’m much closer to early retirement because of them. I just think they’ve gotten a little carried away with rationalizing their choices after Gamestop’s stock price started falling. In honour of that subreddit, this week I’m eating chicken tenders (aka “tendies,” their favourite food), cooked to perfection in my awesome instapot. (Hey, at least it’ll make this week mildly more memorable.)

In covid news, New York’s governor Andrew Cuomo is trying to forge his own path in defiance of all the world-class experts available to help him. About a week ago, he announced that he’s lifting the restriction on large weddings. As of mid-March, New Yorkers will be allowed to have weddings of up to 150 people, or up to 50% of the venue, whichever is smaller. His strange guidance relies on having people test themselves for covid before the wedding: that’s not something one can really enforce, and when you account for false negatives that will sneak in… No one is quite sure why he’s doing that: there is no political capital in appeasing a few Bridezillas, and creating new covid super-clusters when New York is just months away from vaccinating everyone is, well, suicidal. I know I dunked an awful lot on Trump’s many covid-related failures over the past 11 months, but this case just shows that stupidity is universal. Cuomo won’t be able to do nearly as much damage as Trump did, but certainly not for lack of trying.

Good night, y’all, and stay away from those weddings, eh?

Friday night.

I find it funny how many Friday nights I’d stay home, just enjoying some alone time, and how much I want to go out and party it up now that the option is not available. Some think there’ll be a huge economic boom from all the pent-up demand when everyone finally gets vaccinated – whenever that may be.

Meme stonks took a break from being slaughtered and had a mostly fine day. Gamestop jumped from $51 to $95 before settling on $63.77. Heh. Perfectly normal behavior, eh? If and when it finally returns to its previous sub-$20 level, I’ll buy exactly one share, and ask my broker to send me a paper stock certificate thingy (whatever it’s officially called) that I can frame and hang on the wall. I want to look at it every day and laugh at the sheer randomness of that ridiculous week. (And yes, I recognize that luck was definitely a factor in my money-making trade. It always is.) Meanwhile, I decided to do a small experiment with stock options: I tried it once about four years ago, and I never lost so much money so quickly. Heh. I bought one small call for Blackberry for January 2022, with a $12.50 strike price, and it’s already gone up in price by 26% in the last 24 hours. It’ll go even higher if Blackberry’s price goes up. Just a small side-bet…

It still blows my mind how successful this investing hobby of mine has been. My hand-picked little portfolio has gone up by 164.5% since May. So wild. Combined with the pandemic, this makes my reality feel ever more surreal: two incredibly unlikely developments transpiring at the same time, side by side. How weird is that?

I plan to spend this weekend reading everything I can find online by Michael Burry (the guy behind the Big Short) and a fellow who goes by DeepFuckingValue on Reddit (aka TheRoaringKitty on Twitter). His name is Keith Gill, and just like Burry, he’d recognized Gamestop’s potential months ago, when everyone else thought it was a joke. (One could say that Gill was the prime mover for the Gamestop saga. Then again, if not him, it would’ve been someone else. The target was simply too big.) I want to learn how exactly they saw all that using nothing more than publicly available information. The two of them were the only ones to recognize the stock’s potential. (Efficient Market Hypothesis is a lie, kids.) I want to understand how their brains work – not unlike Sylar from the TV show Heroes, but mildly less creepy. I figure setting myself little weekend research projects on varying subjects (since it’s still below freezing outside) will help keep things interesting. Who knows, I might actually learn a thing or two, eh?

In covid news, the Biden administration is ramping up the vaccination campaign: the goal is to set up 100 mass vaccination centers around the US, and get up to 10,000 troops to assist. It’s remarkable what can be done when a baseline-competent person is in charge… Also pretty remarkable how many options a country can have when they have their own Pfizer factory. Must be nice. Here in Canada, there are still more delays. The exact numbers are unclear, but it sure looks like Moderna will send fewer vaccines than expected in the coming weeks. What’s worse is that this time there isn’t even any explanation from their side. Justin Trudeau keeps assuring everyone that all shall be well, that all the vaccines for this quarter will arrive by the end of March. It’s not like he has any other choice, though: put on a happy face and smile and nod. There’s nothing he himself can do: you can’t exactly bribe or threaten European companies with maple syrup and cute animals. Just gotta sit back and wait… Waiting isn’t even the hardest part. Not knowing is.

There are passionate debates about vaccine delays and timelines on social media. No one knows anything, so naturally we speculate on everything. (Gotta have a hobby.) I’ve made two bets with random online strangers: a $100 bet with one who thinks the phase 3 (aka free-for-all) vaccination will begin in June; a $20 bet with one who thinks it’ll begin in August. The loser(s) will donate the money to the homeless: there’s no way to enforce it, so it’s just virtual funny-money, but it’ll be interesting to get that automated reminder a few months from now and check to see how much has changed. As always, I would love nothing more than to be proven wrong…

Good night, y’all. I hope your weekend is fun and free of covid.

Thursday night.

I think the meme-stonk saga is officially over. Today, Gamestop crashed by 42%, and then fell by 8% on top of that in the afterhours, down at $49 a share. When I first saw it, on Friday 1/22, it closed at $65: it’s come full circle. It’s been less than two weeks, and so much changed in that short timeframe… On the r/wallstreetbets subreddit, people are starting to post the suicide hotline number more and more often as their fellow redditors write that they’ve lost everything. Some had invested their entire bank accounts, or their entire retirement fund, or even took out a loan specifically to get rich quick on Gamestop. It’s terrifying.

I still think a huge share of the blame belongs to Robinhood: if that shoddy trading platform had been more stable, they wouldn’t have run out of funds, and wouldn’t have triggered a massive selloff exactly a week ago when they literally disabled the “buy” button. At the same time, though… Most of this Gamestop saga took place in the US. When your government sends out a single $2,000 check in April 2020, and then refuses to do anything else and finally, ever so graciously, sends a $600 check in January, what else is there left to do but jump at a desperate “get rich quick” scheme promoted in the news? By starving its own people, the United States had ensured that some perfect storm, some tulip mania – call it whatever you want – would eventually take place. Gamestop just happened to be the spark that started the inevitable wildfire. And unless more aid is coming, there will be more desperate financial shenanigans to come. Even those mythical responsible citizens who had saved six months of living expenses would’ve gone broke by now if they’d lost their jobs in March.

When you have almost nothing left, you’re game for anything.

The gloom and doom on wallstreetbets (that is, when they’re not encouraging each other with increasingly wilder what-if scenarios) reminds me of the subreddit for oil and gas workers a year ago, when oil futures became negative for the first time ever. They literally couldn’t pay people to take oil off their hands, and a whole lot of folks in that sector lost everything. That was the only other time I saw a suicide hotline number being shared around. None of this had to happen. All of this was avoidable.

In other news… Today is February 4th. If not for the pandemic, today would’ve been the day I would’ve received my Canadian permanent residency. The final application was submitted exactly six months ago, and that’s their standard processing period. Because of the pandemic, they’ve probably got a huge backlog of cases and applications to process. Like many other things right now, this also got delayed… It’s unclear whether I’ll get my PR weeks or months from now. Presumably soon. I have a hunch that it’ll happen later this month, so I suppose we’ll see. There’s absolutely nothing I can do to affect the outcome or speed them up, so it’s more wu wei – action through inaction, a beautiful Taoist concept.

I got some mighty good news at work, or at least I was told there’s a 98% chance the mighty good prediction will pan out. I should know (and be able to share) more in the next few weeks. Here and now, I’ve decided to celebrate with an unscheduled Tim Hortons lunch. It’s laughable that with all the death and self-induced gambling bankruptcies and military coups around the world, my biggest fear was when I realized I’d dropped my credit card and rushed back to pick it up. (It was still there.) That just highlights once more how insulated and, well, privileged my life is.

In covid news, there’s a video that’s going viral. (No terrible pun intended.) It shows a grocery store in Florida, with dozens of customers and cashiers who are mostly maskless, chatting and laughing up close as if the pandemic had never happened. A lot of the customers in that video are elderly. Before the plague, it would’ve been a perfectly unremarkable video: now, it looks horrifying – or at the very least anxiety-inducing. The store’s owner had posted a sign at the entrance that said people without masks will be assumed to have a valid medical condition and will not be questioned – or forced to mask up. The store’s owner also said the pandemic is “hogwash” and shared a lot of other bizarre views when he got interviewed. Promoting your business by luring anti-maskers and helping spread the virus (after you charge them for their purchase, that is) is a very unusual business model. This being Florida, I doubt the local authorities will do anything about it – but just like always, I’d love it if I’m proven wrong. (But if there are no consequences, how many other store owners around the world will get inspired to do the same?)

Good night, y’all.

Tuesday night.

The battle of meme stonks continues. Today, in combination with alarmist media coverage, continued (though improving) limits on buying, and synchronized sell-offs (likely algorithms, possibly short ladders, maybe both), Gamestop fell by exactly 60%, as did other hyped-up stocks. Looks like I made the right decision to sell and take my profits six days ago. (I had some serious doubts, but my innate cynicism won in the end. Huzzay!) Those who joined the party late and invested the money they didn’t have… Well, the so-called “loss porn” stories are already coming in. Washington Post already ran an article about someone who lost $400,000 of unrealized profits. Incidentally, the article makes no mentions of trading limits that cut off the oxygen supply last Thursday. Heh.

And now… I took the opportunity to average down for my Blackberry position: they have a very bright future ahead of them. It’s unclear whether the meme stonks (BANG: BB, AMC, NOK, and GME) will recover. Incidentally, the highly-pumped SLV ETF I mentioned yesterday fell by 8.3% today: as pump-and-dumps schemes go, that one was very short-lived. (And of course the newbies who lost money on it will blame the r/wallstreetbets community. What a perfect setup, eh.) One silver lining of that mushroom cloud was that we collectively managed to – hopefully – bring down an entire hedge fund. It might have been a relatively small one, but still – we shot an elephant with a slingshot. A T-Rex would’ve been more impressive, sure, but most people never even get close to getting an elephant. Netflix has already announced that they’ve started working on a movie about this whole saga. Entertainment aside, there’ll be decades of research and thousands of PhDs about this entire Gamestop affair. I can’t wait to read them all – after I find my next great investment, that is.

Made a new friend today: a rare treat, a voice chat with a new person in my life. At work, someone on the investing-related mailing list finally noticed my references to lean-FIRE. (Financial Independence, Retire Early; the “lean” part means a cheap lifestyle in retirement.) Just had a 40-minute conversation with her, and it felt great to bounce ideas off a fellow young person passionate about leaving the rat race. Her approach deals with options, not stocks, and her plans for 300% annual growth are a little far out, but kudos for the huge ambition. Alas, since she’s in Chicago, there won’t be any quarantine coffee plans, but still… This could be the beginning of a beautiful friendship.

Just a few hours ago, Jeff Bezos announced that he’ll be stepping down as Amazon’s CEO in the third quarter. He’ll still be the executive chair and play part in key decisions, but he’ll be able to spend most of his time and energy on other things. I can’t wait to see what he’ll do with his Blue Origin company. In the end, the space race may come down to a race between Bezos and Musk (whose prototype rocket just blew up earlier today) – like with many other innovations, progress in this venture will come from a dick-measuring contest. Anyway, Bezos has spent 27 years of his life building up Amazon from a small start-up (he did have seed money; it wasn’t a cardboard box enterprise) to a behemoth with $119.7 billion in quarterly sales. I was seven years old when Amazon was created… The idea of an enterprise that consumes 27 years of one’s life is unimaginable to me. This will be an interesting year.

In covid news, this is really interesting. A new study by the University of California, San Francisco has found that line cooks are the most likely occupation to die of covid. Their mortality risk has gone up by 60% during the pandemic. The four runner-up occupations are line workers in warehouses, agricultural workers, bakers, and construction workers. That’s so very counterintuitive (you’d think it’d be nurses, wouldn’t you?) but it makes sense in retrospect, and also goes some way toward explaining why the death toll, at least in the US, had such disproportionately high minority representation. I’ll be very curious to see if this study’s findings will be used to reshuffle the vaccination order for critical population, to make the distribution more equitable. (As a 34-year-old hermit who works from home, I’ll be the very last one to get it, I know.) They probably won’t be, but here is hoping, eh?

Buenas noches, mis amigos.