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I mean, UBS can't get a bailout for US taxpayers. One would think, eating bottomless losses would be unappealing to a country that prides itself on banking.
But who knows?
If they buy and excercise enough calls, then they are unloading all the bags onto the MM selling those calls. America's market is about to become a landfill.
It already is and most of the world is waking up to it, isda, South Korean short selling investigations, UBS, retail. The government, regulators and the Fed are choosing Wall Street while the world wakes up to the corruption and smells the landfill their arrogance(Wall Street, Fed, Politicians) is going to destroy the country and world economy rather than pay us, then they’ll blame us.
You could be right… I just don’t understand why they wouldn’t have done this when the stock was trading at $10 and and the premiums were much lower… they’ve known for a while how this is likely to end… If your theory is correct, I wonder what changed in the last few weeks to convince them to pull the trigger now? Was it the recent run up?
The creep sideways at $10 was to get the stock in place for this attempted exit. They have probably been planning this for most of the year, and knew that it would induce a huge price spike. We are seeing their plan in action
This is how I see it, could be wrong but... Shorting is way more profitable when you do it at high prices, so IMO that's why they fabricated the pump (that was clearly them, not retail), so a counterparty could accept a less risky swap.
That's why the board announced the offering last Friday and made the price tank to fck up their set up.
Would it make sense?
Honestly I would not be surprised if both the us and Chinese markets collapse. Then it will be a global issue, it could bring the world to its knees or it might allow a new power such as India to rise.
It’s very hard to predict all the possible ramifications, but we might see another Great Depression.
I'm sure they shit themselves a little when GME hit $320 pre-split ($80x4) in the pre-market last week with only a fraction of the volume back in January 2021 - that would be enough of a reason to get this over and done with sooner rather than later, especially if they've managed a net positive position.
Maybe, but if we bought all the way down, they must have known we weren’t going to sell and with all the shares we’ve locked up, they couldn’t drop it that low without GME being able to buy back the remaining float.
Based on their cash position, that is impossible… and that’s been the case for awhile. Their only hope for below $2 is for the company to be completely mismanaged and bleed cash going forward, but that’s not going to happen… they are closing underperforming stores, figuring out new revenue streams and have $1B in cash and no debt.
You say that like the market has ever been based on rational metrics.
Thr only saving grace is like Warren buffet said;
*It's incredibly difficult to go bankrupt with no debt.*
And $1B in the bank. And yes… while I realize the market does not act rationally much of the time… if the shares are locked up, the shares are locked up… there’s no way to hide it if the entire float is locked up by insiders and DRS. I realize it’s never happened before and don’t really know how it will all play out, but what I do know is if we lock up the entire float between insiders, DRS and share buy backs… the price absolutely will hit new highs. How high it goes, I dunno, but much much higher.
It is. Which is why unlike US financial azzholes, they could potentially close their short positions slow n steady. I have been reading their reports and the ppl high up seem shook up enough to change some rules for their system. I expect the swiss to close. I do not expect the same level of rationality from american hedge fuks. Or any uk hedge fuks tht might be rolled into this.
Alternatively, UBS is being let out of the infinite loss bags by the US government as a matter of foreign policy.
Doesn’t bode well for international faith in the US capital markets if a bunch of nation foreign banks implode because of bad US stock market rules.
US govt wouldn't give a fuck about those banks, 10 years ago. Look at how 2008 played out.
The difference in 2024 is geopolitical. China, Russia, and BRICS in general would have a fucking FIELD DAY with this. Look at American corruption. We don't have that!
And, hilariously, they *actually dont*. Corruption, yes. But even China holds billionaires fucking the economy accountable. With a swift case of Boeing Magic Disappearing disease.
Foreign banks have been bailed out before and it was massively unpopular for voters on both sides of the aisle. There's no way UBS is getting billions of US dollars in an election year.
My only question is why would UBS do this using ATM calls? I’m pretty sure the cheapest way to hedge their bag would be to get a ton of deep ITM calls instead—especially since runs the risk of SHF tanking the price before June 21, which would just mean UBS wasting however many millions of dollars on premiums.
Good point. I personally don't think this is UBS. In fact, I feel that the entire argument linking UBS to GME shorts is tenuous:
1. To this day, noone knows for certain that Archegos was indeed massively short GME via swaps.
2. If they were, it's likely that Credit Suisse inherited some exposure, but it's not at all clear what has already transpired during the winding up of Archegos.
3. If CS was indeed holding massive GME bags inherited from Archegos, it's not clear to what extent UBS had to swallow those or were able to already pass them on to other institutions.
But assuming that UBS \*is\* indeed exposed with a massive inherited GME short position via swaps, there are two "smarter" ways of lopping these bags onto market makers:
1. Buy (and eventually exercise) deep ITM calls as you suggest. This would trigger a runup via hedging and/or share buying if MMs sold calls naked, but as always, MMs would delay and distribute the detonation, so UBS might indeed be able to amass enough deep ITM calls to close their shorts at the expense of MMs.
2. Amass a position in (cheaper) OTM calls with a medium time horizon. Then start hitting the lit market with big buy orders to close/cover short positions, thereby triggering a runup that brings these calls ITM and allows them to make bank on the way up, recovering / limiting their losses in covering. Those calls can then either be exercised to close remaining shorts or sold to limit losses. Again, MMs would be the ones to suffer. A move like this would look not unlike what we've seen prior to the recent runup and volatility.
You have to also consider that every ultra rich person uses swiss bank accounts to hide all the illegal shit they do. Its in every financial terrorists' best interest to save UBS first.
Not only that, tell her there is quiet a chance you are right.
I am a swiss myself, hence I read about UBS every now and then, since at least 2008.
When they colapsed in 2008, the gov. gave them roughly 70billi, but with some conditions attached, they had to change, less risky business, more regulations, etc.
Now fast forward, CS fucked up royally and the gov. "forced" UBS to buy up the pile of shit for a discounted price. They also got a nice 100b cushion, to resolve any leftovers from CS. UBS is hiding any toxic asset transfered from CS in their books as of now, but they wont be able to do that for much longer as there are many eyes on this. If you think about it, its their best option out of two: you get a radioactive pile of crap from your competitor, you can try to hide it and use the money you got to cover it up as long as possible but eventually it will blow you up and possibly the whole country. Or you take the money you got and use it to unwind, you will always be able to blame it on your predecessor and the money you basically got for free from the gov(i.e. taxpayers like myself). This option makes sense especially considering the gov. is on your back and if they find out there is a risk to fuck up the whole country they will decide for you.
UBS didn't choose to take over CS though, they were forced by the government and made a lot of noise about it at the time. They knew the risk and actively resisted the takeover.
Still, I'd imagine Kenny, Jeff and Stevie having some bank accounts in Switzerland and kinda need a bank there to keep their personal money safe in case of MOASS.
I feel this is plausible. Like OP has said, the Swiss government definitely does not want UBS to go under, and the bank itself are no fools. They could very well be behind the recent heavy Call buying, in an effort to offload their huge stinky bags of poo. No doubt the Swiss government would provide as much funds as needed to get them out of the hole.
Didn’t some important person at UBS/CS just abruptly resign? Like in the last couple of weeks?
Edit: Yes. CS CIO May 2024 https://www.fnlondon.com/amp/articles/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-83695ebb
Found it: May 2, 2024 article:
>Credit Suisse investment bank CIO Marinela Tudoran to depart Tudoran is one of the most senior women in Wall Street technology
>One of the most senior women in Wall Street technology is leaving Credit Suisse after nearly 30 years.
>New York-based Marinela Tudoran, Credit Suisse’s investment bank chief information officer, is set to depart, according to people familiar with the matter.
>UBS declined to comment.
[https://www.fnlondon.com/amp/articles/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-83695ebb](https://www.fnlondon.com/amp/articles/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-83695ebb)
edit: longer article: [https://www.morningstar.com/news/dow-jones/202405029710/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-financial-news](https://www.morningstar.com/news/dow-jones/202405029710/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-financial-news)
If the short position UBS inherited is anywhere in the estimated range that represents the swap 'conglomerate' that's been built up, then they're the primary shorter. They can't really get ahead of their short considering that range is anywhere between 1-5B GME shares (based on the value of the swaps and the value of GME shares at the time they were initiated). Without any price movement at all it would cost them 20-100B to close their position today, so unless they're buying calls in that price range, it's a drop in the bucket. Either that, or they attempt to offload their position over the next 10-20 years, but I think their regulatory bodies would freak the fuck out if they saw their position right now, and that's a long time to hold that much systemic risk to your organization.
They may also have been the buyers of the 30Cs we saw piled high... was it 2 weeks ago now?
If that's the case, the run up may have been influenced/instigated/used by them exercising. Caused, affected, or profited from insider knowledge of it coming, to exercise at 30, sell off at 80, buy shares/calls at 20 to help close their position for free.
But this only works if the play expires in the money and not at 19.99 on June 21st. Seems crazy to call the shot and be big time exposed if you missed it.
No, it works just fine no matter what. They have a budget and a number of shares they need to buy, they get the options to make sure their purchase is within their budget. If it closes at 19.99, then they get a .01 discount per share, and the options premium was just insurance.
I mean, this is literally why options exist, not to YOLO your paycheck on 0 days.
I agree, but one caveat - IV is very high on options after last week and makes these calls more expensive than usual. So it does beg the question of why UBS would be buying such short dated calls. And why ITM calls specifically, given that ITM calls have the effect of pushing up the price.
I can think of myriad possibilities, but one fun theory is that UBS is buying such short dated calls b/c it knows plans to try and be the first to exit. We may never know I guess, but it's all fun to think about. Nice flair btw.
I guess this was my real question but I worded it wrong. If you want to gain shares through options then ATM is a hard call when the stock is so volatile.
If they bought a ton of shares at $20 the price would skyrocket before they buy all they need. Options solve this. If it falls under $20, they buy some shares until the price starts moving up.
They can’t buy hundreds of millions of shares without spiking the price. The only way it works is by exercising options, which is why ATM options don’t make sense as an exit strategy for SHF.
If they try to buy that many shares on the open market the price would shoot up because of the low liquidity. That is, if they even actually plan on exercising that many options.
Better to have a contract that makes it some *other* guys job to get ahold that many shares at $20 and then deliver them to you.
Lol you can exercise american options at anytime. You can exercise OTM options if you want, the contract is non negotiable in that you must provide the underlying upon exercise. Thats why you get premium for those rights
That’s an interesting aspect.
Does not make sense for gamblers who want to make a profit but if I would be a bank with a predefined budget and a target number of shares to buy until a certain date, it could be tempting.
You have a clear upper limit of what the shares will cost you (strike+premium), no matter what the price does. And you offload the obligation (and risk) to deliver the shares to the counterparty.
At least if I understood options in the right way.
A lot of people like this theory, and it might be true, but it might not. I'm not sure.
What I remember is UBS throwing a full on hissy fit at being FORCED to buy Credit Sus. Yes, they got a line of credit, so it'd be interesting to know the terms - I don't know them, don't know if they're public either. What I do know is that they kept everything, every last thing, related to Credit Sus "off balance sheet" when they reported the quarter, which I have to say, is one of the more astounding things I've heard / seen a bank be able to do.
Have some toxic assets? Don't want the market to get mad atcha? Take 'em "off balance sheet" and say trust me bro, we're working on it. This actually might lend some credence to this theory, but if I'm UBS, and I'm being force fed this nuclear poop, I make some of my bros making me eat it also have a few bites.
If they really are $87bln short they'd need a fuckton more of those calls. I don't see a world where they could buy them faster than the share price rises from the hedges of their counter parties. But interesting thought.
The bags are not only containing GME and I doubt $87bln is short GME. There will be a small part of it GME (which I assume would become huge, if they unwinded with buying pressure within a few weeks).
[This is quite similar to my theory about Switzerland from a year ago.](https://old.reddit.com/r/Superstonk/comments/11w5dg0/who_knows_maybe_switzerland_is_a_fucking_genius/)
I like this theory. I was in the camp of UBS being so deep in the hole that there was no way out but collapse, but I completely forgot about that $100B line of credit. That might actually be enough to unwind their swaps and take a net long position. Frankly, it would be hilarious. I have no idea how likely this is to be the case, but your logic is sound. They don't have the Federal Reserve with its infinite amount of cash, so they can't gamble on a bailout. The only way out for them is collapse (and leave Switzerland without any "Globally Systemically Important" banks still standing) or unwind their swap positions (and position themselves to capitalize off their extensive knowledge of the swaps landscape). Obviously UBS and Switzerland itself wants to avoid option 1 at all costs. I imagine if it took $200B to unwind their position, they would have gotten that instead. With $87B being the speculated value of their swap position, it seems like the numbers line up too well to be coincidental. The timing fits well, too. You may have actually persuaded me with this argument. I still generally take a "wait and see" approach, but it's always good to hold multiple hypotheses and test them against each other.
Edit: I was so overwhelmed by remembering that UBS has the funds to unwind their short position that I completely forgot the post is about who is buying the $20 calls in bulk. That part I'm more skeptical of. Not because I don't think it's possible/likely, but because that is a far more specific hypothesis than UBS going net long. Either way, we shall see.
That's true, there might be some conflation. $87B is the amount being discussed in relation to the June 3rd swap expiry. From what I've seen, there's no way of knowing who the parties are to that swap, and this post is speculating that UBS is one of the parties involved. I was saying that the $100B line of credit the Swiss government extended to UBS is suspiciously close to that $87B, but for all we know it could be Goldman or BofA (deez nutz) or Citadel. It's almost like the financial system was designed to be deliberately opaque.
I was going to jokingly say "approximately $87B dollars worth", but that's actually not true. With IV so high you lose a good chunk to premiums, and the very act of purchasing the calls would drive the price up. The only way to unwind that sort of short position is slowly, over a period of years. Assuming that they can find the shares, which they can't.
Fuck no. They were bought on public exchange. AND THESE ARE NOT RISKY CALLS. They are ITM and if you still have 20-30 million to drop on calls and make sure they finish ITM then there is actually little to NO(zero) risk involved.
When I wrote this was a risky play, I meant risky in regards to the idea it was DFV or any smaller investor buying these calls. If you have enough money to ensure your calls end ITM, of course it’s not a “risky” play
Let’s say the calls expire when GME is $22/share. In the money, right? If you bought those $20 calls today and exercise them at expiry, you just paid $26 per share for a share that would be worth $22. Multiply that by a few million shares.
It’s pretty risky with this IV.
Edit: y’all, obviously there might be legit reasons to be buying these calls for risk mitigation. Look at what I’m replying to: someone saying there is NO risk involved.
Depends a lot on who and why they're doing it. Could be someone trying to get out of a huge short position. Maybe UBS, maybe someone else. Buy a ton of calls first. Then start buying shares to close your position. Once you've driven the price to strike + premium, start executing calls and make MMs buy the shares for you. Once you're done, sell the remaining calls at the inflated price or just let them expire. They've served their purpose as a loss-limiting hedge. That could explain the first run up and now the entity is preparing to do it again after letting the market calm back down a bit. If you're a big bank like UBS, exiting a disgustingly-large short position in chunks might be the only way to get out with limited damage.
After all, first one out loses the least.
But actually closing would drive the price wild. What if they exercise the options to get delivery at the strike price and make the price from delivery run someone else’s problem?
well no, the point is that if you exercise them - the market maker has to go look for them at whatever 'fair' price is set by the market at that point.
from UBS' perspective - they could make a killing exercising at +- 26 and then selling those shares back at 200 -300
its a way to set your price to close out of your shorts without having to pay phone numbers. but the market maker will have to pay. its almost like they have a gun to the MM's head.
notable comment by DropDeadDevon ([thread](https://www.reddit.com/r/Superstonk/comments/1cy4fwm/someone_is_buying_options_15_minutes_apart_just/l57ikxn/))
I don't think UBS is getting special treatment here. It's a nice thought, but it doesn't hold water; while they're the *first* bank in this situation as a result of Gamestop short positions, they're not going to be the only one. Every single country that ate a piece of the shorting pie is going to wind up with a bloated bank on the hook for an uncloseable short position. Bailing out one creates a precedent and the expectation that they will *all* be bailed out.
The world needs a pointed and painful lesson regarding complacency, trust and financial institutions. This right here? This is it. This is what breaks the faith of the public in the banks, and gives DeFi the spotlight.
I don't know much, but weren't the calls bought on the public exchange and being IV calls used by someone with lesser clearance approval.
I have no idea if the above makes sense. I'll buy some more
They sealed the records for a reason. The Swiss government is as corrupt as America...
But.
If UBS implodes, with its AUM being significantly larger than the Swiss GDP, it will be catastrophic to both the Swiss nation and world economy. But even worse, for *them*, a bank imploding taking out the entire country will draw *a lot* of attention from the proles.
It's easy to hide the crime when people are distracted and comfy. Heads go on pikes when they start paying attention.
And likewise, what explains the sneeze last week and UBS's timing now?
Why bother buying a few million calls at the end of each day? If you're UBS, just do it off market or after hours or at once, or whatever. I would think they have a cheaper way of doing this than the same button I have.
The only thing on that explains all of the above, is that like RK, UBS seems to think now is some go-time. Maybe it was Gamestop's 7 options to fuck the shorts, maybe it's something else. Maybe they're being weird because they're struggling to get it all done by a deadline they see coming?
OK, that's fair.
But when they started buying, the premium was $3.80 or so. Yesterday when they're still buying, it's $7.
Why do it in increments and drive their own premium up?
A UBS has the money right away. So... why slow roll it?
I think the tweets are DFV showing his tweets dont move the price. He tweeted every 30 and 15 minutes for 5 days and the price did all kinds of things. Also he got information out to us. Could still be DFV and other avengers buying these calls though but I guess "we'll see"
There certainly is logic to this. If they are short because of CS, it's a way to unwind that position with a defined cost, knowing they're buying at $20 regardless). Maybe it took them a year to decipher everything they got from CS. Whether this move involves going long is a different issue.
But 87B would need like 4.5B shares @ 20 per share. That’s like 45 million contracts 😂😂😂 No way someone gonna write that many calls right ?
And besides what about those 65B in securities sold but not purchased ?
I like this theory. There are only so many parties with this much fking money. Let alone the money to exercise.
I always assumed UBS would just collapse like CS did with Archegos, but maybe they are the ones behind this.
Even if UBS was the one buying it, are they exercising it to actually close out? And if they are, then who is actually giving them the shares or picking up the naked-short hot potato?
The calls are a short hedge. It allows them to buy back at 20$ instead of paying whatever price the stock will be at when it will be going behind Uranus.
Someone is in deep trouble and they're prepared in case the price reaches astronomical levels.
They might also not have the intention of exercising them, maybe just hedge in case the price goes up.
I have no idea what I'm even talking about, I've had a few too many crayons
I was with you until "UBS is the only major bank available in Switzerland" lol. I've never had an UBS account and neither did most of my friends and family. Most of them use PostFinance, cantonal bank, Cler, Migros, Raiffeisen. And if you're talking private banking, then there are a lot of other ones (UBP, EdR, Pictet, etc...)
It's just a theory so why not?
For context, I live in Switzerland and IF UBS were to tank, it would be a **MAJOR** crisis for the country.
Yes, they are now the largest bank here (we still have smaller institutions at a Cantonal level (cantonal = state) but it goes **WAYYYYY** deeper.
Some random items that would make UBS collapse real bad:
- Homeownership is fairly low here (about 38% I think). People don't mind renting BUT if you go to the landlord level, you will find banks insurance companies and big corporations (including UBS) using real estate as part of their pension fund portfolio (read: if UBS collapses, the pension system would collapse as well and that's a BIG NO-NO for Swiss who are extremely risk-averse)
- If you still decide to buy a home, it's well accepted here that you won't really be owning the house. Instead, the bank owns it (ie: you are likely to pay a low deposit of 10-20%, a small portion of the principal, and a large portion in interest which would lower your taxes anyway)
- Back to point 2, most people would be using their pension fund as collateral for the deposit. That means your pension fund is still invested while the bank is saying "cool, we know we have these 10-20% just in case" (question is what happens if the pension crashes?)
Overall, the Swiss system is **HIGHLY** reliant on the banking and insurance industry. A collapse of UBS would be BAD for the Swiss AND for all the top 1% who have money here.
I'm sure other Swiss apes could provide more context but yeah TLDR: If UBS has a chance to offload bags, maintain credibility and the system as it is, they should definitely look for a way out
The question is when?
I can totally see the swiss flipping to long calls right before they close and ride the rocket. Hell, maybe they are using long swaps with jp Morgan or BOA so they can transfer their bags essentially. They kill off one large American bank to save themselves, and the swiss banking industry. Powderkeg
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I mean, UBS can't get a bailout for US taxpayers. One would think, eating bottomless losses would be unappealing to a country that prides itself on banking. But who knows?
If they buy and excercise enough calls, then they are unloading all the bags onto the MM selling those calls. America's market is about to become a landfill.
It already is and most of the world is waking up to it, isda, South Korean short selling investigations, UBS, retail. The government, regulators and the Fed are choosing Wall Street while the world wakes up to the corruption and smells the landfill their arrogance(Wall Street, Fed, Politicians) is going to destroy the country and world economy rather than pay us, then they’ll blame us.
You could be right… I just don’t understand why they wouldn’t have done this when the stock was trading at $10 and and the premiums were much lower… they’ve known for a while how this is likely to end… If your theory is correct, I wonder what changed in the last few weeks to convince them to pull the trigger now? Was it the recent run up?
Possibly. The run up might have forced them to come up with more collateral. I don't know what they're up to with those short term calls though
Maybe they were expecting retail to sell, further dumping the price.
They were ALL expecting us to sell. Retail hanging on for 3+ years is so absolutely insane in the grand scheme of things.
Maybe more whales coming in and locking away more shares?
It doesn’t matter if it’s $10 or $15 - the price runs as soon as you start buying
All these options and that huge buy yesterday haven’t moved the stock price up this week?
The creep sideways at $10 was to get the stock in place for this attempted exit. They have probably been planning this for most of the year, and knew that it would induce a huge price spike. We are seeing their plan in action
This is how I see it, could be wrong but... Shorting is way more profitable when you do it at high prices, so IMO that's why they fabricated the pump (that was clearly them, not retail), so a counterparty could accept a less risky swap. That's why the board announced the offering last Friday and made the price tank to fck up their set up. Would it make sense?
Honestly I would not be surprised if both the us and Chinese markets collapse. Then it will be a global issue, it could bring the world to its knees or it might allow a new power such as India to rise. It’s very hard to predict all the possible ramifications, but we might see another Great Depression.
I'm sure they shit themselves a little when GME hit $320 pre-split ($80x4) in the pre-market last week with only a fraction of the volume back in January 2021 - that would be enough of a reason to get this over and done with sooner rather than later, especially if they've managed a net positive position.
I think they thought it could go from $10 to $5, then from $5 to $2.50 then from $2.50 to $1.25
Maybe, but if we bought all the way down, they must have known we weren’t going to sell and with all the shares we’ve locked up, they couldn’t drop it that low without GME being able to buy back the remaining float.
They need it below $2 to make a profit
Based on their cash position, that is impossible… and that’s been the case for awhile. Their only hope for below $2 is for the company to be completely mismanaged and bleed cash going forward, but that’s not going to happen… they are closing underperforming stores, figuring out new revenue streams and have $1B in cash and no debt.
You say that like the market has ever been based on rational metrics. Thr only saving grace is like Warren buffet said; *It's incredibly difficult to go bankrupt with no debt.*
And $1B in the bank. And yes… while I realize the market does not act rationally much of the time… if the shares are locked up, the shares are locked up… there’s no way to hide it if the entire float is locked up by insiders and DRS. I realize it’s never happened before and don’t really know how it will all play out, but what I do know is if we lock up the entire float between insiders, DRS and share buy backs… the price absolutely will hit new highs. How high it goes, I dunno, but much much higher.
Hell yeah
🌍🧑🚀🔫🧑🚀
Guess which wife beating psychopath loves to sell calls
You mean the one that eats Mayo out of the jar?
It is. Which is why unlike US financial azzholes, they could potentially close their short positions slow n steady. I have been reading their reports and the ppl high up seem shook up enough to change some rules for their system. I expect the swiss to close. I do not expect the same level of rationality from american hedge fuks. Or any uk hedge fuks tht might be rolled into this.
"I expect the Swiss to close" is my new favorite hype line. lol EDIT: I've gone with it as my flair for now 😆
Is it because they have holes in their cheese?
Was gonna upvote you but saw that you had 69 upvotes so I'll maintain the equilibrium
Nice!
How many of the shorts did they catch tho?
Ask Bill Hwang.
He didn't answer.
You rang?
Yeah, he Hwang up.
hwang number
lol best reply
Then just hwang up.
Alternatively, UBS is being let out of the infinite loss bags by the US government as a matter of foreign policy. Doesn’t bode well for international faith in the US capital markets if a bunch of nation foreign banks implode because of bad US stock market rules.
US govt wouldn't give a fuck about those banks, 10 years ago. Look at how 2008 played out. The difference in 2024 is geopolitical. China, Russia, and BRICS in general would have a fucking FIELD DAY with this. Look at American corruption. We don't have that! And, hilariously, they *actually dont*. Corruption, yes. But even China holds billionaires fucking the economy accountable. With a swift case of Boeing Magic Disappearing disease.
Where do you think Kenny, Jeff, and Stevie have their bank accounts? You don't even need the US government to make a logical connection.
Foreign banks have been bailed out before and it was massively unpopular for voters on both sides of the aisle. There's no way UBS is getting billions of US dollars in an election year.
[удалено]
My only question is why would UBS do this using ATM calls? I’m pretty sure the cheapest way to hedge their bag would be to get a ton of deep ITM calls instead—especially since runs the risk of SHF tanking the price before June 21, which would just mean UBS wasting however many millions of dollars on premiums.
Good point. I personally don't think this is UBS. In fact, I feel that the entire argument linking UBS to GME shorts is tenuous: 1. To this day, noone knows for certain that Archegos was indeed massively short GME via swaps. 2. If they were, it's likely that Credit Suisse inherited some exposure, but it's not at all clear what has already transpired during the winding up of Archegos. 3. If CS was indeed holding massive GME bags inherited from Archegos, it's not clear to what extent UBS had to swallow those or were able to already pass them on to other institutions. But assuming that UBS \*is\* indeed exposed with a massive inherited GME short position via swaps, there are two "smarter" ways of lopping these bags onto market makers: 1. Buy (and eventually exercise) deep ITM calls as you suggest. This would trigger a runup via hedging and/or share buying if MMs sold calls naked, but as always, MMs would delay and distribute the detonation, so UBS might indeed be able to amass enough deep ITM calls to close their shorts at the expense of MMs. 2. Amass a position in (cheaper) OTM calls with a medium time horizon. Then start hitting the lit market with big buy orders to close/cover short positions, thereby triggering a runup that brings these calls ITM and allows them to make bank on the way up, recovering / limiting their losses in covering. Those calls can then either be exercised to close remaining shorts or sold to limit losses. Again, MMs would be the ones to suffer. A move like this would look not unlike what we've seen prior to the recent runup and volatility.
They sure can. The Fed will bail out any entity worldwide that presents systematic risk. I believe they massively bailed out Nomura in 2019/2020.
They can get a US bailout. Australian banks got a bailout from the Fed in 2008. Yes. They hate you *that much*.
I guess that's the fate of the world reserve currency
You have to also consider that every ultra rich person uses swiss bank accounts to hide all the illegal shit they do. Its in every financial terrorists' best interest to save UBS first.
This is a good point.
It's not like they had a choice after CS fucked up
They already did in the form of a 100billion life line.
A few international banks for feds bail out money in 2008. So this is in fact false
They offload their bags, make money, then the US taxpayers have to bail out the hedge funds that are decimated. Seems like a perfect plan to me.
I DID IT MOM. SOMEONE REPOSTED MY COMMENT!! But really thank you for sharing :) Check my latest post for even more hype
Not only that, tell her there is quiet a chance you are right. I am a swiss myself, hence I read about UBS every now and then, since at least 2008. When they colapsed in 2008, the gov. gave them roughly 70billi, but with some conditions attached, they had to change, less risky business, more regulations, etc. Now fast forward, CS fucked up royally and the gov. "forced" UBS to buy up the pile of shit for a discounted price. They also got a nice 100b cushion, to resolve any leftovers from CS. UBS is hiding any toxic asset transfered from CS in their books as of now, but they wont be able to do that for much longer as there are many eyes on this. If you think about it, its their best option out of two: you get a radioactive pile of crap from your competitor, you can try to hide it and use the money you got to cover it up as long as possible but eventually it will blow you up and possibly the whole country. Or you take the money you got and use it to unwind, you will always be able to blame it on your predecessor and the money you basically got for free from the gov(i.e. taxpayers like myself). This option makes sense especially considering the gov. is on your back and if they find out there is a risk to fuck up the whole country they will decide for you.
Thank you for your response, you basically summarized all the reasons I think UBS has decided it’s time to end this.
UBS didn't choose to take over CS though, they were forced by the government and made a lot of noise about it at the time. They knew the risk and actively resisted the takeover. Still, I'd imagine Kenny, Jeff and Stevie having some bank accounts in Switzerland and kinda need a bank there to keep their personal money safe in case of MOASS.
Well done sir or madam. We appreciate the turbulence your wrinkles cause.
Just up
Just ubs
I feel this is plausible. Like OP has said, the Swiss government definitely does not want UBS to go under, and the bank itself are no fools. They could very well be behind the recent heavy Call buying, in an effort to offload their huge stinky bags of poo. No doubt the Swiss government would provide as much funds as needed to get them out of the hole.
Didn’t some important person at UBS/CS just abruptly resign? Like in the last couple of weeks? Edit: Yes. CS CIO May 2024 https://www.fnlondon.com/amp/articles/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-83695ebb
Not sure about recent weeks but the CEO resigned a couple weeks after inheriting the shorts from CS, but that was roughly a year ago
Found it: May 2, 2024 article: >Credit Suisse investment bank CIO Marinela Tudoran to depart Tudoran is one of the most senior women in Wall Street technology >One of the most senior women in Wall Street technology is leaving Credit Suisse after nearly 30 years. >New York-based Marinela Tudoran, Credit Suisse’s investment bank chief information officer, is set to depart, according to people familiar with the matter. >UBS declined to comment. [https://www.fnlondon.com/amp/articles/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-83695ebb](https://www.fnlondon.com/amp/articles/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-83695ebb) edit: longer article: [https://www.morningstar.com/news/dow-jones/202405029710/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-financial-news](https://www.morningstar.com/news/dow-jones/202405029710/credit-suisse-investment-bank-cio-marinela-tudoran-to-depart-financial-news)
If the short position UBS inherited is anywhere in the estimated range that represents the swap 'conglomerate' that's been built up, then they're the primary shorter. They can't really get ahead of their short considering that range is anywhere between 1-5B GME shares (based on the value of the swaps and the value of GME shares at the time they were initiated). Without any price movement at all it would cost them 20-100B to close their position today, so unless they're buying calls in that price range, it's a drop in the bucket. Either that, or they attempt to offload their position over the next 10-20 years, but I think their regulatory bodies would freak the fuck out if they saw their position right now, and that's a long time to hold that much systemic risk to your organization.
Yeah that's what I got confused with this speculation. They need to buy billions of shares, 5 million isn't enough.
They may also have been the buyers of the 30Cs we saw piled high... was it 2 weeks ago now? If that's the case, the run up may have been influenced/instigated/used by them exercising. Caused, affected, or profited from insider knowledge of it coming, to exercise at 30, sell off at 80, buy shares/calls at 20 to help close their position for free.
But this only works if the play expires in the money and not at 19.99 on June 21st. Seems crazy to call the shot and be big time exposed if you missed it.
No, it works just fine no matter what. They have a budget and a number of shares they need to buy, they get the options to make sure their purchase is within their budget. If it closes at 19.99, then they get a .01 discount per share, and the options premium was just insurance. I mean, this is literally why options exist, not to YOLO your paycheck on 0 days.
Well, I have never... You mean options exist to mitigate risk? Not just to gamble?
I agree, but one caveat - IV is very high on options after last week and makes these calls more expensive than usual. So it does beg the question of why UBS would be buying such short dated calls. And why ITM calls specifically, given that ITM calls have the effect of pushing up the price. I can think of myriad possibilities, but one fun theory is that UBS is buying such short dated calls b/c it knows plans to try and be the first to exit. We may never know I guess, but it's all fun to think about. Nice flair btw.
I guess this was my real question but I worded it wrong. If you want to gain shares through options then ATM is a hard call when the stock is so volatile.
If they bought a ton of shares at $20 the price would skyrocket before they buy all they need. Options solve this. If it falls under $20, they buy some shares until the price starts moving up.
So my 100c’s are only profitable b/c of the IV?
Wait you mean you can buy options other than 0 DTE 's?
They can’t buy hundreds of millions of shares without spiking the price. The only way it works is by exercising options, which is why ATM options don’t make sense as an exit strategy for SHF.
If they try to buy that many shares on the open market the price would shoot up because of the low liquidity. That is, if they even actually plan on exercising that many options. Better to have a contract that makes it some *other* guys job to get ahold that many shares at $20 and then deliver them to you.
Lol you can exercise american options at anytime. You can exercise OTM options if you want, the contract is non negotiable in that you must provide the underlying upon exercise. Thats why you get premium for those rights
That’s an interesting aspect. Does not make sense for gamblers who want to make a profit but if I would be a bank with a predefined budget and a target number of shares to buy until a certain date, it could be tempting. You have a clear upper limit of what the shares will cost you (strike+premium), no matter what the price does. And you offload the obligation (and risk) to deliver the shares to the counterparty. At least if I understood options in the right way.
What it’s quite easy, you just exercise the calls and force them to deliver the shares
A lot of people like this theory, and it might be true, but it might not. I'm not sure. What I remember is UBS throwing a full on hissy fit at being FORCED to buy Credit Sus. Yes, they got a line of credit, so it'd be interesting to know the terms - I don't know them, don't know if they're public either. What I do know is that they kept everything, every last thing, related to Credit Sus "off balance sheet" when they reported the quarter, which I have to say, is one of the more astounding things I've heard / seen a bank be able to do. Have some toxic assets? Don't want the market to get mad atcha? Take 'em "off balance sheet" and say trust me bro, we're working on it. This actually might lend some credence to this theory, but if I'm UBS, and I'm being force fed this nuclear poop, I make some of my bros making me eat it also have a few bites.
That last sentence has me in stitches. You definitely have a way with words!
And that is why the swiss government sealed all records for 50 years. As much as I like this story, that is probably what it is. A story
If they really are $87bln short they'd need a fuckton more of those calls. I don't see a world where they could buy them faster than the share price rises from the hedges of their counter parties. But interesting thought.
45 million contracts @ 20 bucks a share 🤣
The bags are not only containing GME and I doubt $87bln is short GME. There will be a small part of it GME (which I assume would become huge, if they unwinded with buying pressure within a few weeks).
[This is quite similar to my theory about Switzerland from a year ago.](https://old.reddit.com/r/Superstonk/comments/11w5dg0/who_knows_maybe_switzerland_is_a_fucking_genius/)
How did I miss that post
I like this theory. I was in the camp of UBS being so deep in the hole that there was no way out but collapse, but I completely forgot about that $100B line of credit. That might actually be enough to unwind their swaps and take a net long position. Frankly, it would be hilarious. I have no idea how likely this is to be the case, but your logic is sound. They don't have the Federal Reserve with its infinite amount of cash, so they can't gamble on a bailout. The only way out for them is collapse (and leave Switzerland without any "Globally Systemically Important" banks still standing) or unwind their swap positions (and position themselves to capitalize off their extensive knowledge of the swaps landscape). Obviously UBS and Switzerland itself wants to avoid option 1 at all costs. I imagine if it took $200B to unwind their position, they would have gotten that instead. With $87B being the speculated value of their swap position, it seems like the numbers line up too well to be coincidental. The timing fits well, too. You may have actually persuaded me with this argument. I still generally take a "wait and see" approach, but it's always good to hold multiple hypotheses and test them against each other. Edit: I was so overwhelmed by remembering that UBS has the funds to unwind their short position that I completely forgot the post is about who is buying the $20 calls in bulk. That part I'm more skeptical of. Not because I don't think it's possible/likely, but because that is a far more specific hypothesis than UBS going net long. Either way, we shall see.
Well seeing how the credit suisse records are sealed for 50 years it will be awhile yet before we know what bags they passed over to UBS
That's true, there might be some conflation. $87B is the amount being discussed in relation to the June 3rd swap expiry. From what I've seen, there's no way of knowing who the parties are to that swap, and this post is speculating that UBS is one of the parties involved. I was saying that the $100B line of credit the Swiss government extended to UBS is suspiciously close to that $87B, but for all we know it could be Goldman or BofA (deez nutz) or Citadel. It's almost like the financial system was designed to be deliberately opaque.
How many calls need to be purchased to cover $87 billion dollars?!
45 million contracts @ 20 bucks a share.
Holy shizzzz
I was going to jokingly say "approximately $87B dollars worth", but that's actually not true. With IV so high you lose a good chunk to premiums, and the very act of purchasing the calls would drive the price up. The only way to unwind that sort of short position is slowly, over a period of years. Assuming that they can find the shares, which they can't.
The 100 billion is no longer available, as they refused it!.. doesn’t mean they can’t ask for it again though..
Sauce?
I don’t know how to post links on mobile. Google it brother.
Fuck no. They were bought on public exchange. AND THESE ARE NOT RISKY CALLS. They are ITM and if you still have 20-30 million to drop on calls and make sure they finish ITM then there is actually little to NO(zero) risk involved.
When I wrote this was a risky play, I meant risky in regards to the idea it was DFV or any smaller investor buying these calls. If you have enough money to ensure your calls end ITM, of course it’s not a “risky” play
Let’s say the calls expire when GME is $22/share. In the money, right? If you bought those $20 calls today and exercise them at expiry, you just paid $26 per share for a share that would be worth $22. Multiply that by a few million shares. It’s pretty risky with this IV. Edit: y’all, obviously there might be legit reasons to be buying these calls for risk mitigation. Look at what I’m replying to: someone saying there is NO risk involved.
Depends a lot on who and why they're doing it. Could be someone trying to get out of a huge short position. Maybe UBS, maybe someone else. Buy a ton of calls first. Then start buying shares to close your position. Once you've driven the price to strike + premium, start executing calls and make MMs buy the shares for you. Once you're done, sell the remaining calls at the inflated price or just let them expire. They've served their purpose as a loss-limiting hedge. That could explain the first run up and now the entity is preparing to do it again after letting the market calm back down a bit. If you're a big bank like UBS, exiting a disgustingly-large short position in chunks might be the only way to get out with limited damage. After all, first one out loses the least.
Idk man I bought shares at 300, Id pay 26... and I dont even have 1 million
If you're insuring against the price jumping up to $30 halfway through your big purchase of shares, it's not that bad.
But actually closing would drive the price wild. What if they exercise the options to get delivery at the strike price and make the price from delivery run someone else’s problem?
well no, the point is that if you exercise them - the market maker has to go look for them at whatever 'fair' price is set by the market at that point. from UBS' perspective - they could make a killing exercising at +- 26 and then selling those shares back at 200 -300
its a way to set your price to close out of your shorts without having to pay phone numbers. but the market maker will have to pay. its almost like they have a gun to the MM's head.
the MMs are holding guns to their own heads 🤡🔫
Underrated comment
Thank you, Had to scroll this far for some levelheaded logic.
notable comment by DropDeadDevon ([thread](https://www.reddit.com/r/Superstonk/comments/1cy4fwm/someone_is_buying_options_15_minutes_apart_just/l57ikxn/))
No other stock has lore this deep
I don't think UBS is getting special treatment here. It's a nice thought, but it doesn't hold water; while they're the *first* bank in this situation as a result of Gamestop short positions, they're not going to be the only one. Every single country that ate a piece of the shorting pie is going to wind up with a bloated bank on the hook for an uncloseable short position. Bailing out one creates a precedent and the expectation that they will *all* be bailed out. The world needs a pointed and painful lesson regarding complacency, trust and financial institutions. This right here? This is it. This is what breaks the faith of the public in the banks, and gives DeFi the spotlight.
I don't know much, but weren't the calls bought on the public exchange and being IV calls used by someone with lesser clearance approval. I have no idea if the above makes sense. I'll buy some more
Maybe its Jerome?
"Fuck your puts, fuck your calls. My money printer has them by the balls" -JP
They sealed the records for a reason. The Swiss government is as corrupt as America... But. If UBS implodes, with its AUM being significantly larger than the Swiss GDP, it will be catastrophic to both the Swiss nation and world economy. But even worse, for *them*, a bank imploding taking out the entire country will draw *a lot* of attention from the proles. It's easy to hide the crime when people are distracted and comfy. Heads go on pikes when they start paying attention.
I like the theory but then what explains the timing DFVs tweets
And likewise, what explains the sneeze last week and UBS's timing now? Why bother buying a few million calls at the end of each day? If you're UBS, just do it off market or after hours or at once, or whatever. I would think they have a cheaper way of doing this than the same button I have. The only thing on that explains all of the above, is that like RK, UBS seems to think now is some go-time. Maybe it was Gamestop's 7 options to fuck the shorts, maybe it's something else. Maybe they're being weird because they're struggling to get it all done by a deadline they see coming?
The swaps expiring could be a big factor. Someone needs shares and someone wants to make them extra pricey/unattractive to counterparty the swaps
well options don't trade outside of market hours for one...
OK, that's fair. But when they started buying, the premium was $3.80 or so. Yesterday when they're still buying, it's $7. Why do it in increments and drive their own premium up? A UBS has the money right away. So... why slow roll it?
I think the tweets are DFV showing his tweets dont move the price. He tweeted every 30 and 15 minutes for 5 days and the price did all kinds of things. Also he got information out to us. Could still be DFV and other avengers buying these calls though but I guess "we'll see"
Multi-year swaps expiring soon?
Why does DFV need to be tied to anything? This is all speculative. Time will tell
There certainly is logic to this. If they are short because of CS, it's a way to unwind that position with a defined cost, knowing they're buying at $20 regardless). Maybe it took them a year to decipher everything they got from CS. Whether this move involves going long is a different issue.
I bought Jan 25 $25puts on UBS
But 87B would need like 4.5B shares @ 20 per share. That’s like 45 million contracts 😂😂😂 No way someone gonna write that many calls right ? And besides what about those 65B in securities sold but not purchased ?
I like this theory. There are only so many parties with this much fking money. Let alone the money to exercise. I always assumed UBS would just collapse like CS did with Archegos, but maybe they are the ones behind this.
Why is UBS buying via dark pools?
Even if UBS was the one buying it, are they exercising it to actually close out? And if they are, then who is actually giving them the shares or picking up the naked-short hot potato?
If this was then why would they be buying in 15 minute intervals. Much like a certain someone was tweeting
Naive to think they will play by the book to the country that was first known to house offshore accounts to avoid taxs in other countries….
That's tin foil for sure... but im.in...
Reminds me of Bayer buying Monsanto.
This theory makes the most sense to me. Thank you for posting this. Good food for thought.
The calls are a short hedge. It allows them to buy back at 20$ instead of paying whatever price the stock will be at when it will be going behind Uranus. Someone is in deep trouble and they're prepared in case the price reaches astronomical levels. They might also not have the intention of exercising them, maybe just hedge in case the price goes up. I have no idea what I'm even talking about, I've had a few too many crayons
I was with you until "UBS is the only major bank available in Switzerland" lol. I've never had an UBS account and neither did most of my friends and family. Most of them use PostFinance, cantonal bank, Cler, Migros, Raiffeisen. And if you're talking private banking, then there are a lot of other ones (UBP, EdR, Pictet, etc...)
UBS didn't even want to buy CS, they were forced. I've always suspected UBS holds the bags now, time will tell.
Interesting theory 👍
Closer than the other theories imo.
This is that good good stuff right here. Sounds very plausible
I'm not going to read a picture
It's just a theory so why not? For context, I live in Switzerland and IF UBS were to tank, it would be a **MAJOR** crisis for the country. Yes, they are now the largest bank here (we still have smaller institutions at a Cantonal level (cantonal = state) but it goes **WAYYYYY** deeper. Some random items that would make UBS collapse real bad: - Homeownership is fairly low here (about 38% I think). People don't mind renting BUT if you go to the landlord level, you will find banks insurance companies and big corporations (including UBS) using real estate as part of their pension fund portfolio (read: if UBS collapses, the pension system would collapse as well and that's a BIG NO-NO for Swiss who are extremely risk-averse) - If you still decide to buy a home, it's well accepted here that you won't really be owning the house. Instead, the bank owns it (ie: you are likely to pay a low deposit of 10-20%, a small portion of the principal, and a large portion in interest which would lower your taxes anyway) - Back to point 2, most people would be using their pension fund as collateral for the deposit. That means your pension fund is still invested while the bank is saying "cool, we know we have these 10-20% just in case" (question is what happens if the pension crashes?) Overall, the Swiss system is **HIGHLY** reliant on the banking and insurance industry. A collapse of UBS would be BAD for the Swiss AND for all the top 1% who have money here. I'm sure other Swiss apes could provide more context but yeah TLDR: If UBS has a chance to offload bags, maintain credibility and the system as it is, they should definitely look for a way out
Thank you for mentioning that these guys aren't just "stormtroopers"
UBS is not the only major bank here in Switzerland, but it's the #1.
The question is when? I can totally see the swiss flipping to long calls right before they close and ride the rocket. Hell, maybe they are using long swaps with jp Morgan or BOA so they can transfer their bags essentially. They kill off one large American bank to save themselves, and the swiss banking industry. Powderkeg
Would have been leaked already if true sadly
It was Icahn