To anyone who's seen the new 007 Casino Royale... (1 Viewer)

[seremify007]

... can you please explain to me the whole "stock manipulation" thing with Le Chiffre?

WARNING: THREAD CONTAINS SPOILERS

I wasn't paying enough attention and I think I missed something... I didn't quite make the connection between how the insider knowledge of selling just before the attacks, but instead of the share price falling, it rose... means that he needed money to repay something? Am I missing something? Or is there some financial instrument/product here?

(Note: I haven't studied finance before!)

Thanks!

 

[kunny funt]

dunno if u need to know too much about finance to understand whats going on. if u did then id say a shit load of ppl wud be very confused. (click spoiler)

Spoiler

basically, le chiffre is a terrorst and he organised for the bomb blasts on the plane so that airline stocks wud fall very low. As u mentioned, he sold his stocks beforehand. This means he planned to buy wen they fell and sell in order to make a profit when they eventually rose.

bond fucked this up

so le chiffre he lost his money and organised the poker game with rich dumbasses (which he knew he wud beat coz he's a mathematical genius) in order to get his money back to repay his investors or watever

i think thats the gist of it =/

all in all. great movie i thought.

 

[bukwow]

oh... is that what they were doing, i completely avoided that lol

i was practically engrossed onto the poker game (mind me i love texas holdem poker)

straight flush my ass

 

[iBanesto]

Hahaha .... Bond got owned by Le Chiffre with 4 jacks ... then Bond owns Le Chiffre with a straight flush .... LMAO....

Is short selling necessarily illegal?

 

[turtleface]

short selling is not illegal per se, its usually controlled cause its highly risky

 

[Rorix]

From a technical point of view, for him to lose that much money he probably bought a lot of short term out of the money put options as mere short selling wouldn't allow him to lose that much...since the stock didn't seem to have a reason to go up.

 

[seremify007]

Thanks guys.

Just to confirm my understanding is correct... short selling is where you sell something before you have it right..? and that you make your money from the difference between what you sold it for initially, and the amount that you buy that stock for after it drops in price?

 

[Rorix]

Yeah. If he was short selling, he sold a shitload of the airline company's stock and was aiming to buy it back at a lower price after the attack with the profit per share being sale price - buy price.

 

[seremify007]

Hypothetically... what would happen if he couldn't afford to buy the stock because it had risen exponentially (instead of dropping)? Wouldn't that mean people bought shares which he could not sell as he did not ever have them?

 

[ND]

From a technical point of view, for him to lose that much money he probably bought a lot of short term out of the money put options as mere short selling wouldn't allow him to lose that much...since the stock didn't seem to have a reason to go up.

That would be a shitload of theta.

Hypothetically... what would happen if he couldn't afford to buy the stock because it had risen exponentially (instead of dropping)? Wouldn't that mean people bought shares which he could not sell as he did not ever have them?

When you short sell, you need to borrow the stock from somebody (usually the broker).

 

[ObjectsInSpace]

I know a lot of people who complained about this in the film. They thought it was over when Bond stopped Carlos at Miami International and then couldn't figure out why Le Chiffre was sponsoring the poker tournament. They seemed to think he was trying to make them more money, but he was simply trying to cover his arse, all of which was explained in the Bahamas scenes with M.