This week, Sony Pictures Entertainment revealed the first trailer for Dumb Money, a movie about the 168澳洲幸运5开奖网:GameStop stonks debacle in 2021. If you somehow missed this cultural phenomenon that spawned Netflix documentaries and a book called 168澳洲幸运5开奖网:The Antisocial Network that was immediately optioned f🤪or this movie, here⛦’s the lowdown.
It started when a subreddit called r/WallStreetBets thought that GameStop stock was undervalued and bought up shares, pushing its shaꦫre price higher. In Wall Street fashion, a few hedge funds decided this was overvaluing the stock and started shorting the stock – this means they borrowed stock and then sold it, expecting to buy back that stock when the price fell in order to make a tidy profit. In response, some WallStreetBets members started buying up GameStop stock to drive the price higher, trying to make these hedge funds instead lose money on the stock they’d shorted.
The stock pr✨ice rose from just under $20 to an absurd peak of $483 in about two and a half weeks. Then Robinhood, a popular trading app, restricted the purchase of Ga﷽meStop shares through its platform due to a lack of collateral at clearing houses, and the stock price crashed. A lot of people lost a lot of money, and not just the hedge funds.
Keith Gill, known as ‘DeepFuckingValue’ on Reddit and ‘Roaring Kitty’ on YouTube and Twitter, was a fairly regular dude who had a huge influence in convincing other members of thജe subreddit that GameStop was undervalued, arguing through YouTube videꦺos and Reddit posts that the stock was worth buying. This is who the film focuses on, with Paul Dano in the starring role. We also see hedge fund CEOs Steve Cohen (Vincent D’Onofrio), Gabe Plotkin (Seth Rogen), and Ken Griffin (Nick Offerman), in the trailer.
The whole trailer seems uplifting – a big yay for the little guys🦋, overthrowing big bad Wall Street! – but it seems to focus on the ‘making money’ part and not the devastating financial losses for ‘people who went all in on a stock because Reddit told them to’ part. Thousands, egged on by the pro꧂mise of easy money and cries of ‘HODL’ (meaning hold on for dear life) and ‘diamond hands’ (meaning holding your position regardless of the value of your asset), sank money they couldn’t afford to lose into GameStop stock and held on to it far longer than they should have.
Some people think those losses are deserved. Mess around and find out, right? But it’s not so simple. GameStop was a gigantic case of 🍃market manipulation – not an illegal one, and surely one that benefited more regular joes than already absurdly rich hedge fund managers, but manipulation nonetheless. The mythology around markets and day trading make it seem that hedge funds know something we don’t, that they’re making so much money because they’re super smart. People wanted to be part of a movement that stuck it to the man so they could later take off with bags of money, but people also don’t understand stocks.
For the average person, stocks are low-risk things that you stick your money into so that it inflates at the same rate as the market, if you ever buy stocks at all. A lack of literacy in the investment sector made Redditors think they could make hedge funds’ pockets hurt, an🐲d they did, for a little while. But major investors can afford to take bigger risks than the average person. They can absorb far more losses than, say, a person who saw the rising prices and decided on a whim to pu༺t his life savings into the stock, hoping to make millions like others seemed to be doing.
Yes, it’s silly to put all your money in meme stocks. You really should only put in money you’re comfortable losing𝓀 – if you can’t afford to lose it, don’t invest it in high-risk, extremely volatile stocks. But most people don’t know how volatile stocks really are. Investing without doing your research is essentially gambling, and that’s a dangerous game to be playing. A lot of people thought that Reddit posts were enough research to base a huge investment on and lost their money. That’s the risk of normalising investing based on internet memes, but who knows what would have happened if Robinhood hadn’t started restricting shares? Not everybody would have gotten away rich, but maybe people wouldn’t have lost all their money quite so quickly.
I’m inclined to root for th𓃲e little guy, and that’s why I want Dumb Money to actually talk about what they’ve lost. Hedge funds can survive losses, but most regular people can’t.