Watch: Trevor Noah explains GameStop saga [video]
The ongoings of Wall Street and the stock market are topics regular folks, like you and I, usually don’t give two rats about. However, developments in the GameStop stock explosion saga has exposed the 1%ers for what they truly are: a bunch of gluttonous wealth hoggers who run the world like an uppity book club.
What is the GameStop saga all about?
If your head was buried in the sand this week, then even the moles that crawl beneath the surface must have muttered the injustices GameStop faced on the stock market this week.
A summarised version of the events that transpired in Wall Street told in the simplest form of English goes a little something like this:
GameStop, a US gaming outlet that has been around for decades, was tipped to close its doors after its stock value plummeted in the markets recently.
So, get-rich-quick schemers and hedge funds pulled off what’s commonly known as a short trade. This is the oldest trick in the stock trading book.
As The Balance puts it, a short trade is “initiated by selling, before buying, with the intent to repurchase the stock at a lower price and realize a profit.”
If it was not for Reddit (yeah, hilarious, right?), hedge funds who attempted short trades on GameStop would have earned a quick buck with great ease, a Wall Street calculus that has always worked.
Except, this time around, GameStop capers who run the subreddit r/WallStreetBets would not allow 1ers% to cash in on a relic that is dear to their hearts.
So what did they do? – Well, members of the subreddit encouraged hundreds of users to buy GameStop stock, raising the gaming store’s stock value to record heights.
Wall Street exposed for abusing powers to block trades
Consequently, the rise in GameStop’s stock fumbled with the short trade formula, resulting in hedge funds losing billions of dollars.
Wall Street higher-ups who, since the inception of the stock market have championed free trading, used authoritative means to block GameStop trades, something that has never been witnessed before.
The revolt against trading platforms like Robinhood and Wells Fargo have faced a heap of backlash for abusing their powers.
Watch: Trevor Noah breaks down GameStop saga
The Daily Show host Trevor Noah has been covering this topic at length. Here’s his take on the debacle that’s made global headlines.