馃攳
The Gamestop Short Squeeze in 4 Minutes - YouTube
Channel: vlogbrothers
[0]
good morning john i wasn't gonna do this
[2]
but then i saw a former head of the sec
[5]
on cnbc comparing the freaking gamestop
[8]
short squeeze to the siege on the
[9]
capitol and i got too mad
[11]
and so now i'm here i think it's fairly
[13]
easy to pull back the curtain here and
[14]
talk about
[15]
why this happened why doesn't mean you
[17]
shouldn't have faith in the stock market
[19]
and why it is
[20]
nothing like the siege on the capitol
[22]
gamestop is a mall retailer that sells
[24]
video games and so
[26]
it's been struggling its current
[28]
business model is not well suited
[30]
to a pandemic or the future in general a
[33]
bunch of finance people notice this not
[34]
a complicated thing to notice
[36]
and they want to make money off of that
[37]
now they may not own gamestop stock they
[39]
didn't buy it when it was high so they
[41]
can't really sell it
[42]
when it's low they could buy it low and
[43]
sell it lower but the way to really make
[45]
money off this
[46]
is to make a bet to bet that it will go
[47]
down a certain amount in a certain
[49]
amount of time and just like in vegas
[50]
when your bet gets more specific your
[52]
payout if you win will be higher they
[54]
then make these bets public
[55]
the rest of the market sees it and
[56]
actually drives the price of the stock
[58]
down
[58]
but then someone notices that gamestop
[60]
isn't actually doing that poorly they're
[61]
sitting on a fair amount of cash people
[63]
are coming in and buying ps5s they're
[64]
not doing well but they're not going
[66]
bankrupt so those people
[67]
start to buy gamestop stock and then it
[70]
stops crashing the people who made the
[71]
bets
[72]
get worried so they make more bets so
[74]
that the market will see that and they
[75]
will lower the price again and this
[77]
works
[77]
for an amount of time they do it so much
[80]
that they actually it turns out
[82]
have made promises to buy more gamestop
[85]
stock than exists on the market someone
[88]
notices this and they say a fairly
[89]
simple sentence
[90]
the finance guys have promised to buy so
[92]
much gamestop stock
[94]
that if it doesn't go bankrupt or get
[95]
purchased by a private equity fund
[97]
in the next like three months they're
[99]
going to have to buy gamestop stock
[102]
at whatever the price is and we can be
[104]
the ones selling it to them
[106]
at whatever the price is other people
[109]
hear that and they're like you know what
[111]
you're right so they do that they start
[112]
to push the price of the stock up
[114]
probably closer to what it actually
[115]
should be worth considering that the
[117]
company's not going bankrupt and then
[118]
the stock starts to increase in value
[120]
a lot and that becomes news and that
[122]
brings more people in whether they
[123]
understand what's going on or not and at
[125]
some point here this starts to
[126]
transition from squeezing value out of
[127]
hedge funds
[128]
to just a little mini pyramid scheme
[130]
buying the stock because people are
[131]
buying the stock and then trying to get
[132]
more people to buy the stock so you can
[134]
sell the stock when it's higher because
[135]
eventually the price of gamestop is
[137]
going to go back down to a rational
[139]
number from even the most optimistic
[140]
perspective gamestop is worth
[142]
10 times less what it's trading at right
[144]
now as long as you're still squeezing
[145]
the hedge funds it's about that not
[146]
about the price but eventually those
[148]
squeezes run out and it has to go back
[149]
down to a normal price that is
[151]
eventually going to happen and on the
[152]
way down
[153]
people are gonna lose a lot of money now
[154]
for everyone involved in this this was a
[156]
gamble this was not
[158]
investment if you go into the discords
[159]
where these things are organized it's
[160]
just a bunch of people bullying each
[162]
other not to sell while slowly selling
[164]
in the background to make sure they've
[165]
locked their profits
[166]
also it's very exciting and for certain
[168]
brains mine included
[170]
that kind of feedback is dangerous and
[173]
addictive
[173]
and we've seen the exuberance of this
[175]
sort of like explode out into other
[176]
places like there wasn't a
[178]
like fundamental weird reason why
[180]
dogecoin
[181]
was suddenly worth more the important
[183]
thing here is that this instability was
[184]
not created by reddit
[185]
it was created by hedge funds who
[188]
promised to buy more stock than existed
[190]
there are some real terrible arcane
[193]
systems for manipulating our world
[195]
for the benefit of like the worst people
[198]
and it's just
[199]
people it's not magic it's decipherable
[202]
and none of it has much to do with how
[204]
the market actually works which is that
[206]
people buy shares in companies that they
[207]
think are doing well and will do better
[209]
and
[209]
sell shares in companies that they think
[211]
will not do well now these
[212]
manipulating agencies should be
[215]
regulated out of existence they
[216]
shouldn't be able to do what they do but
[218]
instead
[219]
at least in this one way they got memed
[222]
out of existence that door has been
[223]
slammed in their face by a few hundred
[225]
people
[225]
who figured something out and a few
[227]
million people who were mobilized in a
[228]
financial action unlike anyone has ever
[231]
seen
[231]
ever in the world eventually people are
[233]
going to figure out how powerful they
[234]
are
[235]
it'll be interesting to see what we do
[236]
with that john i'll see you on tuesday
Most Recent Videos:
You can go back to the homepage right here: Homepage