I have been following the action in GameStop this week with great interest because mania is a fascinating thing and watches a hedge fund who thought they were onto a sure thing getting their nuts squeezed is hilarious as is the bleating of Wall Street traditionalists to make the nasty young people stop. If you are unfamiliar with this little sideshow this Twitter thread gives a fairly blunt and accurate account of a very different side of the investing world.
I have as usual a few observations – to me, this is a sideshow – a fascinating sideshow much like a train wreck but it is still a sideshow. If you have taken this as evidence of the end of the financial world then you have been spending too much time on social media and listening to the news. It is, however, evidence of how utterly stupid people can be and into this basket, I lump the hedge funds who get reamed by this sort of thing – how can you possibly manage billions of dollars and have no understanding of how stop losses work. My second observation of how stupid people can be is that local investors have been buying GME Resources because…..wait for it….it has GME in the name so it must be the same….
If ever you wonder why the world looks like it does and we cannot have nice things just remember that some morons cant distinguish between and US-listed second-rate games retailer whose share price has gone ballistic under the assault of a new wave of traders and a local dirt digger.