My quick evaluations of the Why, How, and What aspects of the GameStop stock price surge. Why: What was the intent or motive? How: What methods were used? What: What were the consequences or results?
Method: Using social media to raise funds from non-traditional sources. [Me: No problem. Rather praise for creativity and developing new tools.]
Method: Using coordinated action to drive stock’s price higher than the company’s underlying value. [Me: Coordinated action is no problem, as with mutual funds and other joint investment vehicles. But prices should reflect value, and this introduces a distortion.]
Intent: To punish short sellers. [Me: That’s a stupid motive. Short sellers do good work.]
Intent: To hurt “Wall Street.” [Me: That’s stupid. Wall Street does good work.]
Consequences: Short-term losses to shorters who did not anticipate or protect. [Me: Sorry for them, but live, fail, and learn.]
Consequences: Medium-term losses to those who bought Gamestop at a price higher than its underlying value and who don’t sell before the market correction. [Me: Sorry for them, but maybe the entertainment value to them will make up for their losses.]
Consequences: Connected investors will lobby politicians to bailout their losses. [Me: Any such investors and politicians who do so are immoral cronies.]