The Vergecast GameStop, Reddit, and Robin Hood: How r/WallStreetBets gamed the stock of GameStop
Jan 29, 2021
The hosts dive into how the r/WallStreetBets community sparked a trading frenzy with GameStop and AMC stocks, illustrating the power of retail investors. They explore the chaos of meme trading and the impact of COVID-19 on day trading habits. Robinhood's controversial trading halts and the ethical implications of short selling take center stage. Additionally, there’s a humorous look at how internet memes unexpectedly reshaped the financial landscape, while discussions on smartphone innovations provide a tech-savvy twist.
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GameStop Takeover
- r/WallStreetBets, a subreddit, initially joked about taking over GameStop.
- This joke eventually became a reality, causing significant market disruption.
GameStop's Troubles
- GameStop, a troubled video game retailer, faces challenges due to the rise of online game sales and the pandemic's impact.
- Its stock has been consistently shorted, with many betting on its failure.
Shorting Explained
- Shorting a stock involves borrowing and selling it, hoping to buy it back at a lower price for profit.
- Elizabeth Lopatto explains this concept using an analogy of borrowing and selling an iPhone.