|Adam Ford has a helpful 12-minute video summary of what went down with GameStop (GME) and the financial markets last week. Although a lot of the carnage inflicted on huge hedge funds was at the [diamond] hand of “retail” investors (mostly everyday people), the battle began quietly a few weeks prior. |
The Reddit user known as DFV felt GameStop was undervalued and deliberately being squeezed into oblivion by short sellers (those who make money when a company loses value.) After his investment in the company, others followed suit, including billionaire Ryan Cohen, sending the value of the video game retailer “to the moon.”
Some have framed this as a class war, with perennially unpopular hedge funds as the apparent target of this mob action. The volatility produced by hedge funds was blamed by some for the financial meltdown of 2008-2009, and it was not only financiers who lost their livelihoods during that time.
Big confusion, much questions, such cryptic, many happiness… A spoof crypto currency has also seen its value jump in this crazy week on Wall Street. Thanks in part to interest from communities of investors on Reddit, Dogecoin rose in value by 142%.