And these folks on WallStreetBets looked at that, some people say they took offense to it, but really they saw it as an opportunity because there’s this thing about short selling. We’re going to heavily short sell it.” So they made a big bet that the price was going to go down. So you had a stock that was trading for a few dollars a share and some big hedge funds decided, “You know what? This company is going to fail. There’s been efforts to try to revive it and move it online and so forth. So GameStop, not one of America’s fastest growing companies. So having a physical store to sell cartridges that don’t exist anymore turns out not that great a business model even before the pandemic. And of course, it’s kind of like the old Blockbuster Video, something which was a big thing because people did buy and sell used game cartridges. I have bought used Pokemon cartridges for my daughter in the past. GameStop is a retail store where you buy and sell video games and video game cartridges.
So through a subreddit called WallStreetBets, folks there decided to try to drive up the stock of GameStop and they took advantage of. So for folks in our audience who did not follow the GameStop thing, why don’t you tell us sort of what happened, Goldie? And there’s really no better example of that than GameStop. And then there’s the GameStop debacle, which is about Wall Street, and what’s essentially the fake economy, the financialized speculative economy that really, as we’ve seen over the past year, has no connection whatsoever to the real world. There’s the COVID stimulus package, which is about the real economy.
Which is interesting, because they’re kind of two separate conversations. And hopefully we’ll also get to connect that conversation with what’s happening in Congress, with the stimulus generally with economic policy. Today, we get to have a really fun conversation with our friend Ro Khanna, who is a US representative from California’s 17th district, which is Silicon Valley, to talk about the GameStop debacle and what it means for financial regulation. I’m David Goldstein, senior fellow at Civic Ventures. I’m Nick Hanauer, founder of Civic Ventures. Hedge funds manipulate stocks for a living, professionally.įrom the home offices of Civic Ventures in downtown Seattle, this is Pitchfork Economics with Nick Hanauer, the best place to get the truth about who gets what and why. I think the thing that antagonized people so much is for once, the little guys had the big guys on the run and powers that be stepped in to stop that.Īnd you wonder why they stopped them and the clearinghouses still allowed the head funds to trade.Īs usual, it’s just not fair. Lawmakers call for regulation after Robinhood halts trading: Ī subreddit called WallStreetBets decided to try to drive up the stock of GameStop. Twitter: us some love by leaving a rating or a review! /pitchforkeconomicsĪ leading progressive Democrat slams Robinhood’s move to restrict trading on some stocks after Reddit-fueled surge: He is the Deputy Whip of the Congressional Progressive Caucus serves as an Assistant Whip for the Democratic Caucus and is the Democratic Vice Chair of the House Caucus on India and Indian Americans. Khanna sits on the House Committees on Agriculture, Armed Services, and Oversight and Reform.
GAMESTOP POWER TO THE PEOPLE PROFESSIONAL
A group of Redditors had manipulated the stock market-and everyone knows only professional hedge fund managers are allowed to do that! We couldn’t ignore the market news that took the world by storm, so Nick and Goldy called up CA Congressman Ro Khanna to talk about what happened with GameStop, what it means for financial regulations, and what the government’s response signals about a changing tide in our country’s leadership.Ĭongressman Ro Khanna is a Representative of California’s 17th District. When GameStop’s stock skyrocketed early this year, Wall Street was pissed.
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