Clipping the Hedge Fund
Jan. 29th, 2021 08:58 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
ysabetwordsmithHere is a rare story about rich people losing. :D Now for the important points...
1) Hedge funds do a lot of harm. We would be better off without them, because it is a gambling problem that hurts everyone, not just the people with a gambling problem.
2) This backlash happened because a bunch of ordinary people objected to a few rich fucks artificially manipulating the system in ways that hurt companies they cared about. So they did something about it. This touches on the original reason why investment was invented: it allows people to pool resources so they can have things nobody could afford individually. Build a marketplace. Buy shares in a trading ship. That sort of thing. Today it can be used to salvage businesses that sell stuff we want or need. This is related to Community Supported Enterprise, just discontiguous rather than local, which is apt for far-flung businesses.
3) We are many, they are few. The inherent flaw of inequality is that it's unstable and vulnerable to attack. By definition, the lower layers must be much larger than the upper layers. Previously, it was difficult to mobilize this mass of potential outside of, say, a revolution. But now we have social media: that makes it much easier.
Congratulations, r/WallStreetBets. You put a new tool in the box. Now it's up to everyone else to notice this and use it again, to block rich fucks from jerking the economy around like an abused dog, so we can defend the businesses that we use.
The economy is just a thing that some people made up. It is what we make of it. As a construct, it has no life of its own. So if you don't like it, do something about that. You have a shiny new tool to stick in it, and gods know there are struggling businesses everywhere. Go tell your friends. This tool only works if enough people apply it together. Kind of like democracy.
1) Hedge funds do a lot of harm. We would be better off without them, because it is a gambling problem that hurts everyone, not just the people with a gambling problem.
2) This backlash happened because a bunch of ordinary people objected to a few rich fucks artificially manipulating the system in ways that hurt companies they cared about. So they did something about it. This touches on the original reason why investment was invented: it allows people to pool resources so they can have things nobody could afford individually. Build a marketplace. Buy shares in a trading ship. That sort of thing. Today it can be used to salvage businesses that sell stuff we want or need. This is related to Community Supported Enterprise, just discontiguous rather than local, which is apt for far-flung businesses.
3) We are many, they are few. The inherent flaw of inequality is that it's unstable and vulnerable to attack. By definition, the lower layers must be much larger than the upper layers. Previously, it was difficult to mobilize this mass of potential outside of, say, a revolution. But now we have social media: that makes it much easier.
Congratulations, r/WallStreetBets. You put a new tool in the box. Now it's up to everyone else to notice this and use it again, to block rich fucks from jerking the economy around like an abused dog, so we can defend the businesses that we use.
The economy is just a thing that some people made up. It is what we make of it. As a construct, it has no life of its own. So if you don't like it, do something about that. You have a shiny new tool to stick in it, and gods know there are struggling businesses everywhere. Go tell your friends. This tool only works if enough people apply it together. Kind of like democracy.
(no subject)
Date: 2021-01-30 06:41 pm (UTC)But Game Stop is fundamentally doomed and this is probably not going to save them for one big reason: the CEO and board really don't want to save it. They want to milk what little is left out of it then pop their golden parachutes.
They closed 460 locations last year. They're highly leveraged in malls, and malls are dying. And there's the basic problem of so much game content is being distributed online, so what's the point of going into a brick and mortar store? You're not going to buy State of Decay 2 or 3 or whatever in a store because you have to download it.
Their purchase of the Think Geek stores was widely viewed as a bad idea. They were beautiful stores, but they carried material that needed to be seen in person. The stores were wonderful to wander through and admire, and I spent some fair coin in them. But if there's one thing you can say about every Game Stop store that I've seen, it's that they are SMALL. There's just no way you can carry Think Geek merchandise in them, and you can't afford to expand the stores. So you move Think Geek online, and now you're competing against the entire internet of geek merchandise. You're going to fail to distinguish yourself against that crowded universe, guaranteed failure.
Absolute waste of money.
So all this stock manipulation is going to achieve is prolong the death of Game Stop and give more money to the board and stockholders.
In the end, the chain is still going to die an unpleasant death. No more money is going to go to the employees, they're still going to make $12-15 an hour. No more merchandise is going to go into the stores, they've been slow to stock new titles for years.
The board and the CEO want it to die.
Total kudos to the people demonstrating that Wall Street is nothing to respect. But Game Stop is moribund, and what they are doing is not going to change that unless they can somehow manage a total board takeover, and then we'll see if they're up to the challenge of running a nation-wide multi-million dollar company that is tipping over the precipice.