or those of us who are as intimate with the inner workings of the stock market as we are with the circuitry of the Large Hadron Collider, the brouhaha over GameStop has been illuminating. While the story may seem esoteric, it is highly revealing of the way economic and political power operates today, laying bare both the irrationality of the market and the reach of corporate privilege.
For those who don’t know, GameStop is a US video game retailer that has lost much of its market share to online trade and whose stock plummeted from $56 (£40) a share in 2013 to about $5 in 2019. It is set to close 450 shops this year. Some big hedge funds decided that they would cash in on GameStop’s misery by shorting its shares. A short is a bet that an asset, such as a share, will decline in price. It’s a manoeuvre that can generate huge profits. But if the asset price doesn’t fall, investors can also lose a lot of money.
As speculation rather than productive investment has become the fuel of the stock market, so big investors have come to spend more time playing games such as shorting. Last week, though, having been outgamed by a bunch of nerds, the titans of Wall Street did what all entitled people do. They whined. How dare people manipulate the market! Only those with Manhattan penthouses who attend dinner parties with presidents and Federal Reserve governors should be able do that, not people with online handles such as DeepFuckingValue. As Severus Snape exclaims in Harry Potter and the Half-Blood Prince: “You dare use my own spells against me, Potter? It was I who invented them.”
Read more at:
An uprising against Wall Street? Hardly. GameStop was about the absurdity of the stock market | GameStop | The Guardian
