Midrange Weekly February 1
Your Weekly Round Up On What’s Got The Midrange Staff’s Attention
Midrange Staff @midrangeyvr
Welcome back to Midrange Weekly, and is it just us or is 2021 starting to seem a little strange? When the world isn’t gripped by the seditionist season finale of America, it’s pouring over dialogue from Wall Street or Boiler Room to have some pop culture reference point for whatever is happening with the stock market. None of this was in the brochure. Since we’re about two weeks away from Trump’s senate impeachment trial in which all of the internet reverts back to their 2020 archetype of being arm chair constitutional scholars, we spend this week trying to unravel the GameStop stock situation. Like you, we are furious to have to learn what Robinhood is outside of the contexts of the underrated 1991 movie with Kevin Costner. Look it up!
Here We Go, We’re Gonna Talk About GameStop
It’s funny how just a week ago no one on our Twitter timelines were stock market experts, but now we’re all posting explainers on market fluctuations and debating the implications of stock manipulation in the social media age. While all the financial edification from everyone is a little pretentious, this whole GameStop stock fiasco is absolutely hilarious. My favourite new past time is watching hedge fund billionaires realize in real time they can be cyber bullied into financial oblivion by a bunch of shit posters on Reddit. Don’t let any self-aggrandizing day trader with a proper acumen on the matter insist this is actually quite concerning; it’s so funny. Brokers will shriek that 2 billion dollars of wealth was disappeared in the blink of an eye and therefore none of this is a laughing matter, but it was money that the average person would never have any hope of accessing so excuse me very much but yes it is. That being said, there’s no way to take a holistic overview of this mess and not come away perturbed by one aspect or another. A few factors of the whole debacle seem particularly salient and egregious to me, as I’m sure they do to many of us.
Just a quick little refresher on what’s got everyone so riled up- to those that struggle to parse through the insider baseball lexicon of market analysis, good lord do I ever sympathize with you. I’ve seen The Big Short like ten times and I still had to have all of this explained to me a dozen times like I was a little kid. No… littler than that. Anyways. A bunch of hedge fund managers were shorting GameStop stocks. Shorting something does not mean they own the stock but rather are buying insurance on it essentially, under the presumption the stock will fall precipitously. At the end of every iteration of market trading if the stock remains static, they wouldn’t make any money (and may even owe a little, hence the inherent risk). However should the stock in question plummet they would net themselves a huge profit, just like when insurance is supposed to pay out when your house burns down.
If this seems like purely wild and irresponsible speculation, at least the inherent chaos of such manoeuvring would imply a sort of institutional fairness to the whole thing, but that’s far from the case. Once taking a position on a stock, such as shorting it, individuals with access to these kinds of resources and capital have a wealth of measures to manipulate outcomes to satisfy their financial adventurism, and many of these tools are mired in corruption. Insider trading, taking a position on a stock based on knowledge of news that will effect it positively or negatively is one of them- and a preferred tool of many members of Congress and our Judicial system. For example, when the Senate was briefed on the dangers of Covid back in February 2020, some senators publicly said it was no big deal while privately buying stocks in body bags. in 2017 a Texas judge approved a massive boarder wide raid to deport large swaths of undocumented immigrants, but not before she gave her husband a heads up who used the head start to buy stocks in privately owned detention centers.
There are even more explicit forms of manipulation and morally onerous conduct in this field. Once shorting a stock, traders can rely and lean on sympathetic and sycophantic publications such as Business Insider to plant stories within the media ecosystem, or even just make stuff up, regarding the alleged health or lack thereof of any stock in question. They can do this because there is little to no regulation on Wall Street. Even after such cynical capriciousness regarding the housing market broke the world in 2008, very little was done to reign in this criminally negligent behaviour. Nothing was done because Wall Street has a very powerful lobby, and they want a free market above all.
Except maybe not really it turns out? At least not when average people figure out how to game the system and do it better. This is where the folks from Reddit come in. Be it due to a financial hypothetical they wanted to test, due to resentment and disdain for an out of touch elite class just begging for a financial French Revolution, or due to being bored and it seemed like a lark, they decided to mess with Wall Street. Essentially, after seemingly at random picking GameStop, a whole bunch of them bought modest amounts of stock in the company all at once over a concentrated period of time. That anomalous activity in trading generated attention in the stock, which led to positive interest, which due to the ephemeral hand of market currents metastasized into the stock going up. In fact it went up a lot, enough to ruin the financial position of the all the hedge fund managers that had shorted the stock.
You don’t have to take a side in this fight, I assure you. One side is populated by rich assholes that are absolutely getting what they deserve. The other is a toxic bubble of racism, misogyny, and shit posting just for the alleged fun of it. Who did take a side however is the trading app Robinhood. As the market fluctuated so volatilely away from firm standings on the part of the affected hedge funds, Robinhood stopped all trading of the GameStop stock in the GME market where the company was listed. A bit audacious sure, but not unprecedented when such nerve racking market tremors occur. Then they delisted GameStop stock on the platform. This is akin to unplugging the Nintendo when you’re loosing, except an ostensibly impartial third party is the one that pulled the plug. Those that owned the stock could still cash out at their discretion, except not really, as then Robinhood made the astonishing move to automatically- and without consent- close out share holder positions on the stock.
There’s a lot to unpack in these decisions. Firstly- the actions taken by those on Reddit were exactly the same thing stock traders do on the regular: manipulating a stock to fit their own ends. Is it corrupt? Should it be illegal? Yes and yes, but it’s not because of their own interventions and machinations. They wanted an unruly and cannibalistic version of free markets, and they got it. The extent to which they are whining and complaining that average people figured out how to beat them at their own game is astounding. Secondly- it’s wild that an app that elected to call itself Robinhood would prove to be so cowardly obsequies to the Wall Street robber barons the moment poor people learned how to steal their money back for themselves. That they haven’t changed their name yet due to sheer abject embarrassment is nuts.
The administrators over at Robinhood will likely get their asses dragged in front of congress to explain their fragrantly anti free market decisions. This is completely antithetical to how the markets are supposed to work and heads will likely roll. Indeed members of Congress have already intimated they are swiftly looking into this, but let’s hold on for a minute. This is what’s lighting a fire under Congress? Not months of pleading from the American people for stimulus checks, or resources to health care works, or infrastructure for a proper vaccine rollout? A once in century global health crisis couldn’t muster much collective action- especially under Trump- but once the rich people’s money gets fucked with they spring in to bipartisan action? Not ok.
If the pandemic didn’t affect the collective mood in Congress much, it didn’t move the needle at all on Wall Street and that should tell you everything you need to know about the stock market. Millions lost their jobs, businesses closed all over the country and the world. Prospective profits were downgraded for companies large and small, and the Stock Market didn’t even shrug. But screwing around with short positions has them sweating almost as much as when their hijinks in the 2000s almost ended them. The stock market is not real. It is not the economy. It does not matter. None of what actually happens in the real economy- to us- has any affect. I did a bit of light reading (the bare minimum to be somewhat adequately well versed in the proceedings) and found a passage in a Vox article striking. Emily Stewart, in elucidating on the background of GameStop stock said this (emphasis mine).
a bull case for GameStop (basically, an argument that its stock is good) started showing up on WallStreetBets about two years ago and has, off and on, been bubbling up. Scion Asset Management, the hedge fund run by Michael Burry, who you might know from The Big Short, revealed he had a position in the company, which inspired some confidence
All it took was a well-known individual to be seated to the board, and people felt better about the health of the stock. That’s all this is. The stock market is nothing more than a barometer for rich people’s feelings. This is what we were told to sacrifice loved ones for during the pandemic. Elected officials said it was worth old people dying to keep the market healthy. We should die so rich people can feel good about the numbers on the computer screens and phones. As I can feel my anger boiling to the surface at this point, I’ll leave it to a much more accomplished writer to articulate some kind of conclusion to this shit show. -Tristan
Once I learn what a stock is, it’s over for you bitches.
— Olivia Nuzzi (@Olivianuzzi) January 27, 2021
Screw Wall Street, Main Street Needs To Cut Bait And Stop Playing In The System
Back on September 13th, 1970 famed economist Milton Friedman wrote one of the most influential economic columns of the 20th Century for the New York Times. It was called A Friedman doctrine‐- The Social Responsibility Of Business Is to Increase Its Profits. You can read it here. In it he lays out in explicit detail the role of a corporate executive.
“IN a free‐enterprise, private‐property system, a corporate executive is an employe of the owners of the business. He has direct responsibility to his employers. That responsibility is to conduct the business in accordance with their desires, which generally will be to make as much money as possible while conforming to the basic rules of the society, both those embodied in law and those embodied in ethical custom.”
Put in laymen's terms, shareholders are all that matter. Friedman’s doctrine changed the way corporations acted, as they no longer began to value the chains of good business (research and development, employees, service) and started only caring about short term profits, bonuses and gaining their percentage. Author David Korten detailed the differences between Wall Street and Main Street in this lecture he gave to the University of Oregon in 2011. His talk was titled: Capitalism and the Common Good.
“The differences between these two economies trace directly to their contrasting ownership models. The Wall Street economy features the absentee ownership of global publicly-traded, limited-liability corporations for which short-term financial profit is the sole measure of performance. It is a system designed to distribute wealth upward and risks downward and to facilitate reckless speculation and rampant fraud. Economic and political failure starts with Wall Street.
The Main Street economy features the responsible living ownership of locally rooted businesses by people who care about the health and vitality of their community and its natural environment. Real prosperity starts with Main Street.
The distinction between Wall Street and Main Street holds the key to understanding why our economic system is failing and what we can do about it.”
The distinction that needs understanding here is this. When we invest in Wall Street, we are unwittingly undermining our own way of life. The companies we buy into don’t care about us. We saw this in 2008 with the great recession. Wall Street banks knowingly took on bad debt just to collect their percentage and bonuses. When those investments started to fail, they were bailed out. Everyone else was not. Regular people lost everything. How is this system working for us? Why do we continue to invest in it?
What happened this week with Gamestop was astounding and maddening. Sticking it to hedge funds for shorting a stock is wonderful in theory. But eventually all those individual investors will want, and need, to cash out at some point. Rich bankers and investors can handle these swings. Most regular Joe’s cannot. Pain will be felt once this collapses. Good will and a moral impetus to fixing the system in one’s favour is excellent in theory, but hard to pull off when real issues surface. Like say, losing your entire savings.
Look Amazon is worth over two trillion dollars. Yet, they pay a large majority of their workforce a mere $15 per hour. This is a company which pays zero taxes. When you invest in a company like this, you are unwittingly telling them to continue operating as they currently do. That investment, the one you watch everyday on Robinhood, leads you to caring about one thing, just as these companies do — the bottom line. This vicious cycle contributes to all the ills our society now faces. A pandemic rages, yet the stock market booms. How is that even possible?
I’ll leave you with a last word from Mr. Korten once more. (Emphasis mine)
“Contrary to the Wall Street propaganda, Wall Street is a demonstrated job killer, not a job creator. Wall Street banks and corporations have no interest in creating American jobs, educating American children, or assuring that Americans have health care and retirement security. They appeal for ever more tax breaks and regulatory relief to have yet more money on hand to use as they used their taxpayer provided bailout money — to increase executive bonuses, pay dividends, buy other companies, buy back their own stock, buy political favor, create new financial bubbles, and outsource more jobs — none of which produces any benefit for America.
Increasing Wall Street taxes and regulation will actually increase jobs, by shifting power from Wall Street job killers to Main Street job creators.”
Gamestop was the topic of the week, but let’s not forget the real issue here. - Jamie
Week 2 Of The Charlie Smith Saga Of The Georgia Straight: He’s Not Sorry
In last weeks weekly I touched on the saga that was Charlie Smith. He’s the editor of the Georgia Straight. On January 21st he wrote a very tone deaf column on the restaurant industry. It’s titled, 10 service tips for B.C. restaurants in a pandemic. You can read it here. Currently it has 85 comments. The best of which is this one.
Also loving how this pair of clown shoes thinks he has the power to ‘bankrupt a restaurant’.
What a peasant-brained dildo.
Now for some context.
So Charlie felt the need to help the industry out. You see, he’s worried that if we don’t take COVID-19 seriously, we are at risk of a second shutdown. He’s not wrong to think this. However, his tone is what gets him in trouble. His lack of empathy another. For starters, this is how he opened his 10 service tips article.
“These are tough times for the restaurant industry. And this morning, I’m really not in the mood to write an eviscerating review that might contribute to a Metro Vancouver business going bankrupt in the middle of a pandemic.”
I mean, Fox Winlock said it best above. Sheesh. The level of ego here is uncanny. No food journalist has that kind of power anymore. Not even Alex Gill. Those days are gone. Poof! The internet changed everything. We have access now. Instagram. The need to revel in and worship what a so called critic has to say are long gone. If anything, a review is more comical than anything. That is it. That is all. It’s unfortunate he thinks otherwise. Moving on.
Throughout his 10 service tips column, Smith’s ego gets in the way as he comes across as a petulant child. He does this on several occasions.
First with this one:
“Don’t seat me next to the kitchen or beside where the drinks are being made when there are a bunch of empty tables elsewhere in the restaurant. If I see an empty area in the restaurant where I would like to sit for safety reasons, don’t tell me that this is impossible unless there’s a really good reason.”
and then this one:
“For goodness sakes, place a pitcher of water on the table so I don’t have to get up and go to the kitchen to ask for more. This has happened a few times during this pandemic. Don’t assume that because I order a drink, I don’t want water.”
I can see what he was trying to do, but alas, it just comes across horribly. He should have seen that with all the comments. Sadly, he did not. In this weeks Georgia Straight he penned a follow up titled, Second BC restaurant shutdown can be avoided. I’d post a link to it here, but curiously and suspiciously it is not online. I have these to photos for you instead.
Anyways…ugh…the guy just does not get it. There is no apology whatsoever here. Just a C’est la vie shrug that so many in the industry are appalled and furious at him for what he wrote the first time.
To give his original argument some backdrop, he details that he once worked in a Hotel and at a few restaurants years ago — when smoking was allowed. This experience seems to give him the proper justification for what he wrote. It does not. No amount of know-how gives anyone the right to insult an entire industry. Telling those who toil day and night to make sure that their establishments are safe is a slap in the face of every restaurant owner and employee around. Ensuring they are safe is in their best interests. They already know this.
Then he goes on to talk about his love for the industry. How he goes out a lot. That’s great! Keep it up. But in doing so, why not just highlight all the positive experiences you’ve had? Share your great memories. Give examples. Make the reader want to experience what you had. This helps restaurants. A detailed step-by-step analysis of what they’re not doing does the opposite. He acknowledges as much, but still resists the obvious.
“I know there are many people who will continue to think I’m a complete twat for highlighting the perspective of customers in the COVID-19 era in the way that I did. Some thought I was acting like a COVID cop. But let’s keep an eye on the big picture: avoiding a restaurant shutdown.
My intention was to convey that COVID-19 is a serious issue for many diners.”
News flash Charlie. The restaurant industry already knows this. (I apologize for being repetitive.)
Whether you were sorry or not, just saying so would have gone a long way. This long winded explanation doesn’t touch on the issue of what you wrote the first time. Clearly you’re not sorry and that’s a shame as it looks like you really enjoy going out to restaurants. Sadly, not sure they’re going to feel that same way about you. This could have been an easy fix. Unfortunate you missed your chance.
“But if you’re thinking about spitting in my food, I would appreciate knowing about it in advance. That’s because I don’t want to contract COVID-19 from your saliva.”
Wow! (shakes head) - Jamie
FLUX FIVE
This Week:
Lhasa “Rising” 2009 Lhasa
Haruomi Hosono “Party” 1973 Hosono House
Audision “Yellow Sunset” 2005” Spectral Face EP
Afro Cuban All-Stars “Variciones Sobre Un Tema Desconcido” 1999 Disinto Diferente
Young Marble Giants ”Ode To Booker T” 1980 Colossal
Enjoy! - Mick
Things From The Internet We Liked
One More From SOPHIE
Like most of the music community and beyond, we’re shocked and devastated to learn of the untimely death of electronic music pioneer SOPHIE. Her dismantling and reconfiguring of what pop music could be was nothing short of remarkable. We’ve touched on her impact already in light of the tragic news, but we want to highlight one more track of hers before moving on, the riveting cut Infatuation.
The Best Of Stock Market Twitter
The GameStop stock debacle has inspired a library’s worth of hot takes on twitter and much of the snarky comments are the platform at its absolute best. We’ve had so much fun watching people drag the stock market elite and the self deprecation that comes with trying to understand what the hell any of this means. Some of the highlights below.
bunch of dudes on reddit joined together to raise gamestop's stock price 150% just cuz and u want me to believe the stock market isnt just straight men's astrology
— first-mate prance (@bocxtop) January 26, 2021
this is like occupy wall street but twice as stupid and twice as effective
— Garbage Ape 🦧 (@GarbageApe) January 27, 2021
looking forward to the 'Actually, Only Wall Street Is Allowed To Do What Reddit Just Did' act
— Shaun (@shaun_vids) January 27, 2021
Karl Marx failed to account for GameStop stock.
— Mrs. Dahlia Saint Knives (@saintknives) January 27, 2021
Top 5 richest people:
— Bryce Du pont (@richassvc) January 27, 2021
-Elon Musk
-Jeff Bezos
-Bill Gates
-Bernard Arnault
-Retard6969
Rich People: wHy dOn'T tHe pOoR jUsT iNvEsT tHeIr mOnEy
— Justin McDaniel 🏳️🌈 (@JUSTINtime4aLAF) January 28, 2021
Poor People: Ok.
Rich People: ...
Rich People: wait stop
millennials will continue killing one company a day until we get $2k a month
— 🌌 bad wolf, harbinger of doom 🌚 (@_catte_) January 27, 2021
Just One More Bernie Meme Please
Like an old ornery man that flew too close to the sun, the Bernie meme burned itself out pretty quick. Still, that was a wild week. While we thought we had memefied our favourite septuagenarian in every way possible and thus were free to move, we have to admit modding him into Resident Evil 7 is pretty impressive.
STOP SOMEONE MODDED BERNIE SANDERS INTO RESIDENT EVIL 7 IM SCREAMING pic.twitter.com/ktU9daFTzB
— Ziva the Diva (@ziva_thediva) January 30, 2021