There was pandemonium on the US stock market when shares in a chain of video game shops went through the roof. At one point GameStop’s stock, which averaged just seven dollars last year, was valued at more than 480 dollars. The frenzy was fuelled by cheerleaders on Reddit.
Investors were being encouraged to buy the stock even as it became clear that they would probably lose most of their investment. There was a mood of rebellion online and clear hostility to millionaire hedge fund managers.
Then one of the platforms that offered small investors free access to the market said it would temporarily no longer allow new purchases of GameStop stock. This prompted furious claims of unfairness; accusations that Wall Street had shut out the little guy; that there was one rule for the big investor and another for the amateur.
So what did actually happen?
Was this truly a battle between the Davids and the Goliaths of the financial world? What will happen next? And why does it matter?
Contributors:
Elizabeth Lopatto, The Verge
Sebastian Mallaby, The Council on Foreign Relations and Washington Post
Philip Coggan, The Economist
Susannah Streeter, Hargreaves Lansdown
Producers: Tim Mansel, Sally Abrahams, Kirsteen Knight Editor: Jasper Corbett