Who could have predicted this would happen?
Oh, right. Everybody. Literally everybody predicted this would happen.
As GameStop’s stock plunged 60 percent Tuesday, the online horde that had raced to invest in the “meme stock” scrambled to reckon with the financial bloodshed, wavering between a desire to sell and settle for heavy losses or stick with their online peers who had admonished them to “hold the line.”
In interviews Tuesday with novice traders on r/WallStreetBets, the gleefully reckless Reddit forum that helped fuel the onslaught, several said they were holding out hope that the hyperinflated stock would turn around.
But others expressed deep turmoil, posting screenshots from their online banks and brokerages to the forum that, in some cases, showed hundreds of thousands of dollars vanishing in a matter of hours.
[…]
Evan Oosterink, a 19-year-old college student in the Netherlands, knew almost nothing about GameStop when in December he chose the company for one of his first big stock-market bets, calling it some kind of “American games shop where you can get all your games,” he said.
But his favorite Reddit forum, WallStreetBets, was increasingly obsessed with it, casting it as a way to crush billionaires, move the market and profit heavily in the process. Energized by its rising price, Oosterink said he invested another 8,000 euros last month — nearly $10,000, mostly from years of savings from his parents and some government college loans — leaving only about 30 euros in his personal account.
Had he sold last week, he could have pocketed a typical American’s annual salary. But as the stock has crumbled, he has turned to the forum for reassurance, posting a screenshot from his online-banking app showing the day’s losses, totaling about $9,000. He said he was “deep in losses but holding will prevail,” and included the emoji for a rocket and “diamond hands,” the forum’s lingo for not selling when a stock nose-dives.
As I’m writing this, the price of GME has rollercoastered between $85.30 and $113.40 per share. God knows what the stock will be worth by the time you’re reading this.
Confession time: I was swept along by WallStreetBets mania, and did use a commission-free trading app to put a small amount of money into some of the other meme stocks - AMC, Nokia, BlackBerry - which have been heavily promoted online. I figured it was like buying a lottery ticket. Needless to say, it hasn’t paid off - they’re all down substantially. (My AMC shares have lost almost half of their value.)
This is basically gambling, and I treated it like a trip to Vegas: only put in as much money as you’re prepared to lose, and no more. And for God’s sake, don’t invest in something you don’t understand.
If you mortgaged your house or put your life’s savings into Gamestop and lost 80% of it, that’s on you, not “the rigged financial system”
If you know the risks and want to proceed anyway, or if you’re so dedicated to sending a message that you don’t care about losing your money, have at it. But if there was an absolutely guaranteed way to make millions of dollars overnight, that loophole wouldn’t be open very long.
I’m sticking with safe investments, like this Nigerian fellow who emailed me to say he needs help getting his money out of the country. He seems trustworthy.
It’s rare for my beloved but isolated home province to go viral, but a new election ad by PC Party leader Ches Crosbie is being shared by people who’ve never even heard of Newfoundland and Labrador.
John Krasinski himself couldn’t have done a fourth-wall break better than Ches’ young daughter at 0:50.
Crosbie, scion of a Newfoundland political and business dynasty, is trying to lead the Tories to victory in the upcoming provincial election. All I can say is, be careful what you wish for, Ches:
Newfoundland and Labrador is on the brink of insolvency, with a net debt of $16.4 billion. The province spends more on debt servicing than on any government service other than health care.
"It is going to hurt a lot," [economics professor Jason] Childs said, about the sacrifices the province will have to make to course correct. "Is it doable? Yes. Is it pleasant? Absolutely not." The government should begin by shoring up mental health services because people are going to need them, Childs added.
[…]
[Political scientist Russell] Williams said he likens Newfoundland and Labrador's situation to a kind of receivership, where the lenders are the ones with the real power to make decisions. And with voting day on Feb. 13, only Progressive Conservative Leader Ches Crosbie has brought up in any significant way the possibility the province is going bankrupt, he added.
Though Williams doesn't agree with Crosbie's claims he'd be able to strong-arm Ottawa into an arrangement that suits the province, he said he's glad at least someone is talking about it.
Williams said he doesn't think Ottawa would let the province go bankrupt. Instead, he said, the province will have to ask the federal government to pay off its creditors. "What kind of system is going to be in place to help give Newfoundland and Labrador some debt relief? What requirements is the federal government going to attach to that debt relief? And how much debt relief is coming?"
Newfoundland’s economy is heavily reliant on offshore oil, so it’s been ravaged by the fall in oil prices. That would be bad enough, but the disastrously over-budget Muskrat Falls hydro project in Labrador has made things even worse. And then there’s the COVID-19 pandemic, playing havoc with the provinces
I don’t think the province will be allowed to go bankrupt, but the 2020s are going to be an absolutely brutal decade for Newfoundland and Labrador, likely marked by tax increases, spending cuts and clashes with strong public-sector unions. It’s gonna get ugly.
Things may turn around eventually - the disastrous nineties, when the province was pummeled by the fishery shutdown, were followed by the oil-fueled boom years of the 2000s - but until then, whoever makes these tough decisions will become the most hated person in Newfoundland.
If you want to know what it’s like giving legal advice to drunk drivers at 2AM, here you go:
The comments on the Crosbie ad are more entertaining than the ad itself. Anything from “brilliant” to “ballsy” to “plagiarism”. It’s just an unoriginal but funny little play on kids vs. parents...not something to get THAT excited about...lol. Sigh.
Anyway, I guess it’s achieving its purpose :p ...
I feel for that 19 year old. Talk about a crash course in finances. Didn’t his parents ever give him 5 dollars for the week when he was a kid, and explain that he could spend it all at once or save some for later? Or let him buy a a lottery ticket to see what happened? Yikes.
MyPillow...well, facts just don’t exist for some people. They’d rather make their own. Your analogy fits precisely. (remembering what it’s like to get up and drive a drunk home at 2am in the snow in a dying pickup with bald tires while they intermittently sag over onto the steering wheel with remarkable liquidity and you have to scoop them off and ladle them back into their seat with one hand while driving with the other. There are no printable words to sum that up adequately.)
After that, driving with multiple warring toddlers in the vehicle whilst maintaining an iron focus on the road is a breeze!