Was the GameStop Incident a Vengeance?

Was the GameStop incident a vengeance? What message did small investors want to convey with this move?

Fırat Karadeniz, from Hürriyet, discussed small investors' defiance of Wall Street through GameStop shares, which had a great impact in the markets last week. Although these small investors later turned out to be harmful, they attracted attention. At this point, Karadeniz poses the following question: "Well, what was the deal with this young people's; just nihilism, or will nothing ever be the same again?" Big funds thought that the retail company GameStop, which sold very badly sales of video games and equipment, would drop even more in the US stock market. This thinking prompted large funds to resort to a method called "short-selling". Even if they did not own GameStop shares, they borrowed from brokerage houses and put this share up for sale, thus reducing its price even more. Their purpose was to sell at $ 100, for example, to make a profit when the value fell below $ 50, collecting back the borrowed shares and returning them to brokerage firms. But it was not what they thought ... Big funds think about that, those who gathered on Reddit under the WallStreetBets topic also had their own plans. According to the information provided by Fırat Karadeniz, the first article about the company called GameStop was published in September. In the words of Barış Soydan, Reddit user who posted the title, "He had a very good financial analysis." "Well, isn't this manipulation?" Barış Soydan answers his question as follows: "Couldn’t say. There is also Telegram groups in Turkey ... there manipulators are enticing small investors. They say, ‘These shares will rise’. All are men of speculators ... They are telling the same thing for a long time stating that they make analysis on Reddit. An investment thesis are revealed. A law professor from Harvard said this couldn't be banned. "   Is This A Beginning? Fırat Karadeniz says that the collective action of small investors (and the participation of large funds), financial markets, which have survived many crises so far, have suffered a great deal of damage against "small fish organized on the internet" for the first time. He even adds that there are those who claim the damage was about $ 19 million. So how does this happen? One of Turkey's well-known economist Prof. Özgür Demirtaş stated in his YouTube video titled "Anarchy in Financial Markets" that this event could happen with the combination of many factors. According to Demirtaş's statements, small investors had good luck, but financial facts also increased the impact. The large funds that were short-selling GameStop stocks panicked as the value rose and rushed into the same stocks to close their positions without further loss. Because they borrowed money and wanted to pay. When the panickers attacked the paper, the value of the bill, which was $ 3 at the beginning of the process, saw 450 and dropped to 347. Karadeniz shares the thoughts of Barış Soydan and Hürriyet BigPara author and fund manager Eral Karayazıcı about whether this phenomenon will continue or not. Regarding the subject, Karayazıcı states the following: "I think the development that will refute the arguments of those who think 'Nothing will be the same from now on' is the following: These small investors tried their luck in silver for the second time. They took a heavy blow. Their sudden entry into the market and the drunkenness of victory… There is no happy ending in GameStop. If they bought it for $ 250, now it's $ 90. There is no guarantee that it won't be $ 30 in six months. "   "Almost Like Roulette ..." Barış Soydan said, "There is a new generation." and continued as follows: "Organizing through a social media and acting jointly like this has never been experienced before. They are also trying the same thing for Nokia and AMC. This is like a beginning. I think the real story is the generation difference ... The new generation has different investment approaches than the old ones. I saw articles explaining: 'They don't think 30-40 years ahead. Because they also witnessed the crisis in 2008 and saw that long-term planning did not produce guaranteed results.' A kind of nihilism. … What they do is almost like roulette… " "The Whale suffered great damage, of course, but the little fish were also destroyed ..." Stating that Soydan's emphasis on 2008 is not in vain, Karadeniz points out that the definition of the Occupy Wall Street actions in 2011 is based on the global economic crisis that started 3 years ago. Pointing out that this event is the turning point of quinine for big funds, Karadeniz quotes Soydan's statements: "The funds have been declared 'bad', but this is not the enmity of wealth. They like Elon Musk for example ... A sense of revenge against institutions that are not identified with individuals ... These are men in ties, steering behind closed doors and causing harm to the public." Eral Karayazıcı shares the same opinion with Soydan: "The biggest motivation is the Wall Street anger ... The little fish said, let's unite and eat the big whale, but they obviously don't know the sea conditions ... Or they wouldn't dare. The whale got great damage, of course, but the small fish also perished." Stating that it is easy to organize and act together on social media, Karadeniz says that the question to be asked after this incident is: "Can small investors use their economic power politically?" Karayazıcı said, "3 million people who believe each other will not unite again. Maybe on a small scale." Soydan thinks: "They saw that they could shake the system." Karadeniz ends his words as follows: "But everyone also has this question in mind: 'Can they meet on a single denominator?' "       Source: Hurriyet