Wall Street Bets & The GameStop Short Squeeze - What Is Going On?

Patrick Boyle On Finance

Patrick Boyle

Investing, Business

4.9 • 320 Ratings

🗓️ 30 January 2021

⏱️ 28 minutes

🔗️ Recording | iTunes | RSS

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Summary

Send us a textFinancial markets have been thrown into turmoil over the last week by retail investors using social media chat groups such as the Reddit forum Wall Street Bets and low-cost investment platforms to drive up shares in GameStop, a US video game retailer. In what is called a “short squeeze”, the share buyers are putting intense pressure on hedge funds such as Melvin Capital and other institutional investors, who bet that these equities would fall. GameStop is a struggling bric...

Transcript

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0:00.0	Hello and welcome. You are listening to Patrick Boyle on Finance, a podcast exploring ideas from quantitative finance, examining events occurring in markets right now and financial history to see what lessons can be taken away, including interviews with some of the most interesting people in the world of finance. To learn more about the podcast, visit onfinance.org.
0:27.1	Welcome to the Patrick Boyle on finance podcast. Today's podcast is from a video that I uploaded to
0:33.7	YouTube on Wednesday the 27th of January. It explains the short squeeze in GameStop that was
0:39.9	going on in the market at the time. As I upload this audio version, the story is still developing,
0:47.1	so we'll have to wait to see how everything works out over the next week or so. I uploaded a follow-up
0:53.5	video to YouTube on Thursday the 28th of January,
0:57.6	answering a number of questions that people asked me after the first video, and so you'll hear
1:02.8	that content, which includes some fresher news towards the end of the podcast. This podcast is much
1:09.6	more off-the-cuff than my regular content, but hopefully
1:13.2	you'll find it interesting and entertaining. I recorded it quickly to keep up with the breaking
1:18.5	news. Anyhow, onto the podcast. All right, well, I wasn't going to make this. I got all these
1:24.6	messages. People said to me, will you talk about GameStop? And I thought
1:28.3	everyone's spoken about GameStop. And more people said, tell me about GameStop. Explain the GameStop story.
1:34.0	And I just thought, nah, there's 100 videos on this. Not going to do it. But anyhow, I taught my first class at the
1:40.3	university today. And the students all said to me, Patrick, tell me about GameStop. and I thought, I'll make a video on GameStop. So I guess to talk about GameStop, we have to start with Wall Street Betts. Who are Wall Street Betts? If you don't know, they're a group on Reddit. They've been all over the news for, I don't know, most of the pandemic, for piling into stocks. That's what they do.
2:02.0	And Wall Street Betts, they're basically a group of people.
2:04.5	They're on Reddit.
2:05.3	They talk about stocks or stonks, and they pile into them.
2:09.8	And they don't like to buy the stocks.
2:11.7	They like to buy the options.
2:13.2	They're my kind of person.
2:14.5	They trade the options, you know.
	...

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