GameStop shenanigans

The situation is this:  a video-game retailer called GameStop is dying.  Its stock price has been plummeting, and hedge-fund managers have been hoping to "short" the failing stock shares in order to gain money.  I'm no economist, so I've had to educate myself as to what's going on, here.  Please bear with me as I provide my clumsy, left-handed explanation, which is geared to us stupid people who need to digest information in small, simple chunks.

Dictionary.com defines a hedge fund this way:  "an investment partnership that uses high-risk, speculative methods to obtain large, short-term profits."  So predators, basically.  And these folks are often very, very rich.  They swoop in like vultures when they think they can make a quick buck, especially when they see a dying company.

What, then, does it mean to "short" a stock?  Several different sources have several different ways of putting it.  One source says it's like betting on the continued downward movement of share prices, thereby making money when one's prediction of loss comes true.  Another source simply says it's a way of making money from a company's losses.  Either way, the converse must therefore be that, if the dying company suddenly comes back to life, then the people shorting the dying company's stocks will lose money, not gain it.

So apparently, a bunch of small-fry investors decided they'd had enough of the predatory behavior of the hedge-fund folks.  These small investors got together, David-versus-Goliath-style, and decided to invest heavily in GameStop, thereby driving its share prices up.  Result:  angry hedge-fund managers now losing millions of dollars because their strategy of shorting GameStop's shares has backfired.

Much of the trading is occurring via an app called Robinhood, but the movement to rescue GameStop started on a Reddit forum called r/WallStreetBets.  Result:  GameStop's share price went from around $18 to over $300 (it's still wildly fluctuating), a phenomenal gain that represents a phenomenal loss for the hedge-fund predators.  The managers of the Robinhood app have decided—unwisely—to restrict trading of GameStop shares, as well as the shares of certain other companies.  Outrage has ensued because, once again, this looks like another form of Big Tech oppression.  Big Tech, in the form of Twitter, Facebook, YouTube, etc., has been deplatforming and otherwise censoring people whose opinions are adjudged "hateful" or "bigoted" or some other made-up form of badthink.  Robinhood seems to be heading in the same direction, and the little people are furious to see Big Tech circling the wagons around the rich and overprivileged—the hedge-fund people, in this case.

The kerfuffle has produced a strange alliance of parties on both the left and the right, all of whom feel for the little guy and despise the Goliath that is the hedge-fund cronies.  Robinhood is now being sued for its restrictive actions (this is a class-action lawsuit).  A good video summary of the situation by Sky News Australia, a conservative news outlet, is here:

And here's a set of tweets shown on Instapundit:

I don't expect the sudden left-right détente to last.  For the moment, everyone hates Robinhood, and maybe this will prompt more people to pay attention to Big Tech oppression in general.  Meanwhile, the right needs to get off its lazy ass and create an entire freedom-friendly network of Big Tech options of its own—one in which intolerant deplatforming is not—is never—allowed.  I see so many commenters whingeing about how the left has taken over all of our cultural institutions, but this takeover happened because one side of the aisle was passive and indolent for years.  Fine:  blame the left for what it's done to erode the nation, but take time to look in the mirror and blame yourself, too.