Written by: Shrey N.
AMC to the moon! Gamestop to the moon! What is going in the stock market? Should you invest? If you don’t understand what’s going on because news articles use stock market lingo and can’t explain it well, I am here to save the day. Stocks can go up and down and are unpredictable. Over the past months, Gamestop has shown an overall declining trend. It could be concluded that they would go out of business in some time, they just haven’t been getting enough sales like they used to.
The most “elite” group of individuals have a surplus amount of money. Some of them don’t know what to do with their money, so they give them to hedge funds. Hedge Funds are companies that study the stock market and will invest the money they are given by those individuals. Some people in hedge funds are called “Shorters”. They bet on stocks falling, and if the stocks do fall, they make money. The shorters make money, the hedge funds make money, and the elite individuals make money.
You might be asking, “why do I need to know about this?” Because we the people of America are powerful when we work together. Americans on a communication page named Reddit found out that a hedge fund was betting on the fall of Gamestop stock. Those people came together and bought Gamestop stock. This raised the stock price for Gamestop, made Gamestop money, made people who owned Gamestop stock make money. And of course, the hedge fund lost a lot of money! Regular everyday citizens showed the world how they can control the stock market, not the hedge funds, not the elite group. Us, regular everyday people.
Like all good things, they must come to an end. The people on Wall Street, the people in hedge funds, were panicking. How could something like this happen?! The hedge funds were furious they were losing money to the “little guy”. Remember that the “little guy” was buying Gamestop stock, and they were doing so on an app called Robinhood. Robinhood is a popular platform that people invest their money into stocks. This is where the controversy begins. You see, Robinhood suspended the Gamestop stock, disallowing the “little guy” to buy more stock, sell, do anything with the Gamestop stock. Essentially stopping the everyday people from making money. Let’s recall who was losing money when this was happening. The hedge funds! They were the ones taking a toll on this event. And it wasn’t long until speculations and media questioned the hedge fund’s influence on Robinhood’s decision. What went on behind the scenes? Are there relations between the hedge funds and Robinhood? If Robinhood wanted to slow down the investors, the little guys, they could have raised the price of the stock. Making it expensive to buy the stock and also more difficult. But we know that wasn’t the case.
Understand that how the Gamestop stock rose is frowned upon, because it is technically manipulating the stock market, especially if there is one person behind the scenes, orchestrating the mass investments. Regardless, this is not safe for the economy or investors. But having the freedom stripped from you when it comes to what stocks you can invest in is not acceptable. So what happens when this happens again? Will this happen again? What you should know is to be careful! Research about the stocks you want to invest in. If you plan to put money into a stock and take it out in a short period, put money that you can afford to lose. This Gamestop stock was not a safe way to make money, but it exposed how quickly the stock market can become manipulated. Will you invest in the stock market? Do you think another Gamestop event will occur? How do you feel about hedge funds and wall street?
Works Cited
“Gamestop: The real Wolf of Wall Street’s advice.” YouTube, uploaded by Sky News, 30 Jan.
2021, https://youtu.be/On4g1uj71zc.
Phillips, Matt. “4 Things to Know About the GameStop Insanity.” The New York Times, The New York Times, 28 Jan. 2021, www.nytimes.com/2021/01/28/business/gamestop-stock-market.html.
I find this to be so interesting because what they are doing is so weird because technically, it is not illegal at all. That is why I find it to be so weird, because it is also taking money from the rich and giving it the "poor". I think that you provided some very good and interesting information in this piece. Good job!
ReplyDeleteI really liked your article because it used no stock lingo which, fun fact, was actually created to push the normal people out of the stock market. I was really surprised to see game stop go from 200 dollars a share, go to 500 dollars a share which made many people mad.
ReplyDeleteI find the whole event interesting that people bet money on others losing money therefore they win money. Its also surprising that what there doing isn't illegal but overall its interesting to know more information on whats going on.
ReplyDeleteWhat's something that seems illegal but isn't? This. I never knew people were capable of manipulating the stock market, so this article grabbed my attention. I also found it interesting that they are taking money from the rich and giving it to the poor. Overall, great information and great article.
ReplyDeleteGreat Blog! I felt like this was a really interesting blog to read as I thought the whole situation on Wall Street was ridiculous. I thought it was funny how a group of people are capable of manipulating the stock market within hours through an app that they're using obviously from home. The media made it seem like these people were committing a crime, but in reality it actually isn't even illegal. It's ironic how the people of Wall Street have been doing this for years now, and it only took a group of people a few hours to replicate it pretty much.
ReplyDeleteI thought that this blog was very interesting. I had no idea that hedge funds were even a thing. As well as that the economy could be manipulated by people. To what extent can people manipulate the economy? Your tone was also very clear in your blog.
ReplyDeleteLove the casualness of your blog as well as the information. It was a blast to read. But I do think it is a little bias with the information. From what I perceived from the title, I would think I would be given just information about the Gamestop stock raise. I know everyone is allowed an opinion, and I also can tell your passionate about the situation, there was even an uproar to the stairs of Congress about the situation. I would just love to see both sides of the equation being done rather than just one side so reader can grasp the full spectrum of the situation. I digress, still love the blog.
ReplyDeleteNice blog! You did a great job of recapping the events as well as keeping the blog interesting. However I think your blog really shines in its use of tone, and understanding your audience. There was no stock market jargon or lingo which means even students who follow the stock market less can read and understand your blog. I think you did a good job of using the natural humor that the situation provides to make your blog more exciting. lastly I wish you did less when it came to picking a side. In a blog you have a better opportunity to share a belief or a well articulated argument, however in this case I worry you picking sides may have hindered the information you can share about the events.
ReplyDeleteIt was very interesting to see how lots of people coming together can lead a stock price to skyrocket and ultimately affect the economy. It will be interesting to see if laws come into place to deal with this sort of situation. There are laws right now that regulate the stock market, but those are mainly focused on individual people or businesses. Technically, everyone that participated in the Gamestop situation was manipulating the stock market which is illegal, but at the same time it’s hard for people to find evidence and punish so many people.
ReplyDeleteI though this blog was really interesting because this is a very recent event. Also it used language that was understandable and not words from the stock market, and you seemed to actually like to topic making it more enjoyable to read.
ReplyDeleteI thought this was a great piece! This topic ever since it's started reaching media companies has interested me heavily. It's like the hedge funds owners had some sort of thing to hold over Robinhood which ruined our economic freedom. There was lot's of truth shown to the public, and it's undeniable now that the billionaires who make up the hedge funds have serious control.
ReplyDeleteI chose to read this article because I barely know anything about stocks due to the wording most articles use. By using a vocabulary everyone can understand, it helped me learn about stocks and made the article more interesting to read. I was unaware that the GameStop stock situation was so controversial. I also enjoyed the visuals, made the blog post fun to read.
ReplyDeleteBut why was the gamestop stock frowned upon? Wasn't it legal and technically ok to do? Anyway what's your opinion on that? Other than that thought, it was very beneficial and very knowledgeable to read about.
ReplyDeleteI find it funny how a group of people came together, on Reddit, and followed through with this plan. Not only did they buy Gamestop stock, they bought stock from multiple other businesses that were failing. I think this shows not only the power that people can do when they come together, but also how easily the stock markets can me manipulated, and how corrupt it is behind the scenes. I think it was illegal for Robinhood to restrict users from buying stock, and I think they were in the wrong to do so. How do Hedge Funds make money off stock failing?
ReplyDeleteI loved the blog, Shrey! Stocks are super interesting but also quite confusing to me. I might have to do more research on my own, but how exactly do hedge funds make money off of failing stocks? I thought the idea was to invest in stocks that will grow your money. Regardless of my confusion, I loved reading about the Gamestock situation. It’s crazy and kind of scary how big of an influence social media can have on our economy. Great work!!
ReplyDeleteThis blog was very interesting. I knew about what was going on but I didn't know to the full extent, what was going on. I really liked how you incorporated memes into the blog also because this whole thing was a big meme but many people were making a lot of money off of it at the same time. I thought you did a great job explaining it also, because whenever I would watch a video or read something it was very confusing and used a lot of stock market terms. Overall, I thought you did a great job on explaining the situation and it is crazy how a group of redditors can get together and expose billionares and make them lose money.
ReplyDeleteI enjoyed reading your topic about the stock market. I have always found stocks somewhat confusing because of all the “stock lingo”. I liked that you simplified the stock terminology to something that any person could understand. I also found it crazy how easily the stock market can be manipulated and that there are no laws against it. This makes me wonder how many times this will happen again. This is obviously not good for the economy or investors, so if this continues to occur I wonder how this will impact those parties. Great work!(Ally Longden)
ReplyDeleteShrey, I lost $30 investing in gamestop. I saw the trend and put a decent amount of money into it. The next morning robinhood basically took my money. I wish you went into the legality a little bit more because I was very upset when I found out this information. Other than that your blog was very informative.
ReplyDeleteSorry to hear about that Cole.
DeleteIt’s crazy to see how we decided to screw over the elite because we wanted them to lose money. But then because they were losing money they tried to prevent us from buying more game stop stock.
ReplyDeleteThe tone of your blog was amazing, it was super casual and easy to understand yet was very informative as well. The topic has been a big discussion and I sort of understood the whole scenario, but now I got everything for sure, so that was really helpful. I found it funny yet crazy how easily a reddit page was able to manipulate the stock market, but also the response by Robinhood preventing purchase of Gamestop’s stocks, and the retaliation there. I love how you ended your blog with questions as well, it’s really got me thinking about if this can/will happen again and what the legality behind prohibiting a certain stock is.
ReplyDeleteI thought that the Gamestop stock incident was pretty nice. I think I will invest in the stock market. If I do, other that just investing regularly, I will probably take some unorthodox routes, though not very similar, maybe do things weird like that, but on a much smaller basis. I think the hedge funds had too much power, so disrupting them seems like a good idea to me. This also shows that the market is a bit more fragile than some thought.
ReplyDeleteI liked your clear overview over some of the more difficult to understand parts of the game stop situation, such as the actual shorting process. I don't think there will be any significant changes in the strategy of hedge funds, because no regulation against shorting was introduced. While independent investors could continue to heavily invest into shorted stocks, I think Robinhood and other apps limiting trading at certain times shows that large, coordinated, public investments will be more difficult to organize in the future.
ReplyDeleteI do wonder what AMC's and Gamestop's reaction is to all of this, I don't think that either have given any statements about what's happening or their reactions. I also wonder how long this will go on for, and if this will become a regular thing for internet short sellers to do.
ReplyDelete