To cut a long story short, Reddit is trying to bankrupt hedge fund managers for the lols.
Basically, a bunch of investors bet on GameStop stock crashing - which it probably would have done, considering how the chain has been suffering during the pandemic and, in the longer term, due to increased digital game sales. They did something called a "short call option", which is, to put it way more simply than it actually is, agreeing to sell your shares at a fixed price within a given time frame.
It's a gamble, but usually an informed one - if you agree to sell your shares at, say, $100 each, but you expect the value of those shares to go down, you'll likely turn a nice profit. If the shares go above $100, you're losing out on the potential profit you could have made. Essentially, you want the stocks to drop, if you want to make money. (If you want a more in-depth explanation, but don't want to read a really long financial article, check out this series of TikToks.)
Following so far? Well, it turns out that the members of a specific investing subreddit called r/wallstreetbets saw this as an opportunity to mess with the investors that were taking the short call option. GameStop was the most shorted stock on Wall Street, at around 30% of the shares being used for this get-rich-quick scheme, so it made the perfect target.
Reddit evidently didn't like seeing a bunch of rich people making more money than they needed, and so they decided to take things into their own hands, vigilante-style. They started buying up these cheap shares, rapidly inflating the value well beyond what those hedge fund managers were hoping for. Some of these Redditors have been paying thousands of dollars to get in on something that's part meme, part money-making scheme, and part stick-it-to-the-big-guy.
The best part is that a lot of this trading took place on an app called Robinhood, where trades are free (unlike a lot of similar services). It's literally robbing the rich to feed the poor.
At the beginning of 2021, GameStop shares were worth about $20 each. Now, they're worth around $300 each, although that price is fluctuating wildly.
It's worth noting that Reddit's strategy is a dangerous one that could mean massive profits of up to 3,000 times what you bought in for, but the share price won't stay artificially inflated forever. Some people will make millions of dollars. Other people might lose everything they have if they don't sell at the right time.
It seems like Reddit isn't done with the market yet, though. Reports have been trickling in about AMC and BlackBerry, an American cinema chain and a Canadian tech company, being their next targets.
Phew. If you have any extra insights to add - this story is truly stranger than fiction, and we missed out tidbits like Elon Musk tweeting "Gamestonk!!" and the new President of the US, Joe Biden, apparently "monitoring the situation" - then feel free to discuss in the comments. We're going to take a long nap.
[source wsj.com, via bbc.com, bloomberg.com, kotaku.com]
So basically: Reddit
I had to learn so much about finance for this article and I still don't understand any of it
@KateGray you got the gist. This is just them driving up shares and taking a massive bet that the other investors they are betting against will keep buying shares and such.
In other words, both sides are playing chicken, with the companies betting reddit will stop first but reddit won't stop and the companies won't back down either.
Oh look, it’s almost as if the stock exchange is complete nonsense used to keep the rich on top. When you can inflate the stock price of a company that makes colossal losses every year because of a meme then the system is broken.
I am Confusion
Wow this is bizarre. Then again it's Reddit so it was bound to be anyways
@Kalmaro I actually saw the people on wallstreetbets talking about this a few days before it hit the news... I should have listened. I could have made a thousand times the money I currently have! I would have had £10!!
I respect you
Basically, rich people wanted to knock the stock down, but people on Reddit clapped back and sent those people into bankruptcy. I love the Internet for these kind of events.
Of course, they're now SCREAMING for a monitoring system since it cost influential billionaires money. When regular people are affected, well that's the way of the world.
@AggressiveCucco Number go down. But then... number go up!
This is an awesome story. Although going after Gamestop feels a bit like hunting a limping deer at this point in time.
@KateGray Yeah part of me wished I got in on it, but I try not to gamble and this is a big gamble. They just got lucky since the companies they are betting against are too greedy to stop.
@Dezzy good analogy
@progx Basically. No such protections against potential monopolies in the States but god forbid you buy up stock without inheriting your money from Daddy!
I don't know why it's so hyper inflated, but what I do know is that anyone who buys into it at this point is going to lose a ton of money when everyone wakes up and realize they're invested in Gamestop.
@KateGray Try watching The Big Short, it's a movie about the finanical crisis of 2008. They decided the best way to explain the techincal finance things was with unusual methods like Margot Robbie (who's not actually a charcter in the film) popping up to tell you whilst she takes a bath to make sure you're not bored whilst hearing it.
I had some shares I sold when it got to 90 dollars, made 2 grand. Now it’s 4 times that much. Cant say I’m disappointed though. I was fully ready to lose the 125 I put in. Thanks Reddit 🙂
@jump I did! I also forgot all of it.
BUT, it turns out that one of the guys in The Big Short - the one played by Christian Bale - is really grumpy about this whole thing because he doesn't seem to want non-rich people making money. He made money off the housing crash, though, so I don't feel too sorry for him.
@nessisonett Pretty much. We live under monopoly's ugly cousin: monosopy. Money hoarders want the name scrubbed from the dictionary. My spell-check claims it isn't a word... but Google begs to differ with its definition.
n. pl. mo·nop·so·nies
A market situation in which the product or service of several sellers is sought by only one buyer.
@KateGray Typical...they don't like it when the system doesn't conform to their wants and beliefs...good movie btw👍
This is a funny story!! Well done Reddit. I only use Reddit for my repsneakers. Love that place!
@KateGray Ah Yes... Thank you
SELL. Sell like mad, cause it ain't staying anywhere near those numbers!
Game Stop isn't just suffering because of the pandemic or sales trending toward more digital. For years they've offered worse and worse service. Their trade in service gives you next to nothing for what you are giving them, then they flip those games for nearly the same price as new.
And the fact is, they don't do much special anymore. You can get all the same games, anywhere else. Why would I ever go to a store to buy a game I can have shipped to my door for the same price? And it's not 2008 and earlier anymore. If I want to look for new games, every game has online playthroughs, reviews, reddit pages, etc etc. The days of deciding which games we buy by the back of the box are long gone. We can make much more informed decisions now.
And it's not like a book store, where you can actually pick up an start reading a book in a book store to get a taste of it. Game Stops might have a tiny handful of demo stands, maybe, but they'll only have a few games on each.
Thinking about this, it is actaully illegal as it counts as deliberate stock manipulation. I wonder if they will investigate this because the poor masses are doing it rather than Wallstreet guys.
Didn't think my GME shares would be worth more then my Tesla shares. Bought quite a bit of shares at their lows, in hope that the next gen consoles would help boost their price up in 2021. I'll be happy to sell early.
I love a good story about screwing over rich people.
Now: Sell all shares!
For some weird reason many people on twitter are defending the people that bet against gamestop because apparently the action done by reddit was done by “gamergaters” and that makes the rich folks loosing money the lesser evil apparently.
Elon Musk also helped by tweeting "Gamestonk" My friend whos really into stocks has been telling me about this, and apparently the same thing has been happening to AMC and Nokia. Very interesting
@KateGray Now thats what I'm talking about Doing your job and doing it well keep it up.
@Snatcher aw, thanks!
Probably relatively easy to do as volume on GameStop shares is likely low and low liquidity means big spreads...
I don’t do stocks. I have a minimalistic understanding of how any stock works. I wish I knew finance better. The best I can do is understand the supply and demand charts.
Your life savings go brrrr...
Hedge funds losing money to gamers, you love to see it
Alternative title: Gamestop trade ins are finally good value.
This story is amazing all around. It helps to draw public attention to poorly understood but common and incredibly predatory tactics on the stock market, and it's super satisfying to see some reverse class warfare finally happening.
I tossed a few bucks toward the stock the other day myself.
I don't really disagree with the description of events in this article, other than to say they don't really do justice to how predatory these hedge funds are. Pick a company, make their stock tank, normal investors panic and dump their stock at a loss, hedge funds buy the depressed stocks and make money as they recover once the engineered crisis is over. It's really scummy and probably the only reason that it's not a crime is you'd need to read minds to know it was done on purpose rather than lucky timing.
@jump Sounds like a great movie:)
As funny as this is, I doubt it is of any real help to anyone. Some rich people will lose a lot of money, a lot of normal people's retirement will take a hit, and ultimately the majority of these redditors will lose their money for a meme.
Rich people! They’re the worst. Taking advantage of so many less fortunate. Well I’m off. Gotta use my iPhone to order a couple pairs of Nikes off Amazon.
Maybe.. called Reggie machine....
People are talking about this like it's Wallstreet vs Reddit, and there's definitely some truth in that, but I don't think they realize that the Redditors will be eating each other alive in the coming days.
The stock's value skyrocketed because the Redditors invested, but there's not much real value there, i.e. the value drops as individuals sell: GameStop ain't making money. At the end of the day, the people who cash out earlier get the money, and everyone else gets screwed, Redditors included.
Seeing corrupt billionaire Wall Street short sellers getting screwed over makes me smile
It's not really screwing a bunch of rich people. Also regular folks thought that Gamestop will go bankrupt and bought for example put options which is a safer way of shorting. It's a distortion to the market to have something like this, and in the long term, the stock will crash again, and those rich people will cover their losses. Rich people are also not the enemy.
Rich people is a good thing. We want Nintendo to be rich for example. Rich people mean they did something useful with their money and provided value to the rest.
The phenomena of short selling failing is known and happens a lot. It's called a short squeeze. Right now it's happening to a bunch of companies that have fans like Blackberry, AMC and others, not just Gamestop. It happens to every stock that has a large short interest and at some point they can't cover it, there aren't enough shares.
@KateGray he (and others) also made millions off the Brexit referendum: if you need more reasons to dislike him. Which ever way you wanted the result to go. Rich men betting (effectively) and making money off it is not cool. Not when it’s actually not doing anything for the money.
Nintendo may be "rich" because they're producing something valuable that people want, but then to then say "Rich people mean they did something useful with their money and provided value to the rest" is a joke, right? "Some people got rich by being useful, therefore all rich people are useful." lol
@nimnio How do you think people get money? by creating money. The only other options are stealing or inheritance. That's in the margin. Almost all of the billionaires you see have created value for others and got rich. That's capitalism 101. I get it that it's trendy to be a socialist or communist and hate all the rich people. But that's simply ignorance.
I love that these lazy good for nothin conspiring rich people of Melvin Capital gambled one way and got egg on their face so badly they needed a bailout of $2,800,000,000 because some non-rich people on reddit banded together and gave them a taste of their own medicine. It's a good example of how skill has little to do with becoming rich.
@dumedum there ain't a way in the world to ethically be rich especially if you're among the billionaire class. If someone made $1 a second and they spent none of it and none of it was taxed it'd take 31.69 years to make just one billion. So rich people most defiantly are the enemy of anyone outside their class.
@GrandScribe that's communism, and it's fine, but I prefer capitalism. I admire the billionaires. And no poor person has ever given me a job. Bailouts is cronyism, to use it as an excuse to hate rich people is asinine.
@KateGray he was in on that
He made tons of money on this jump in GME
And earning from a crisis is not an evil thing to do, every crisis is an opportunity
Great article btw!
@dumedum you admire people who coerce the financially disadvantaged and thus disempowered into giving them the vast majority of the value their labor produces? You admire people who horde more money than they could ever need or use which hurts the economy because its stagnant instead of flowing? You admire people who could end world hunger for just $40,000,000,000 annually (that's assuming there's no net positive economic affects because of it driving the cost down) and choose to let people go hungry and even starve to death?
@dumedum "How do you think people get money? by creating money. The only other options are stealing or inheritance. That's in the margin. Almost all of the billionaires you see have created value for others and got rich."
That's an incredibly simplistic take on things. So billionaire Jim Walton gives you a job at Walmart, but you're grateful. Sure you can't afford healthcare, but that's not his fault: he doesn't make the rules! And when his kids, and his kids' kids, go to Princeton and start businesses of their own, well that's just the privilege of success.
You don't need to "admire billionaires". Go ahead and admire individual accomplishments, but if you're admiring money for its own sake, you're an idiot.
All praise to hedge fund managers! Blessed be their names!
@nimnio Yes I admire him for giving me a job. It's not his fault if I have healthcare or not, that's my responsibility. If the job doesn't give me the benefits I want, a true capitalistic market will create a competitor that will offer me the benefits I want (if I deserve it and provide enough value). And he has a right to give his money to whoever he wants. His kids might not deserve it but certainly the government doesn't. That's also in the margin. If the kids are awful they will probably squander the money. If they're good they will make more money. That's how capitalism works. Money is a wonderful thing. And yes, making money out of money (using the capital market) is the most efficient way to make money. Those people that are good at it should be admired. I wouldn't tax them at all. I would reward them. They know what they're doing and proved they could use more money to make more value.
@GrandScribe Yes, i admire those people, but everything you said is wrong. They invest money, it's the best thing they can do with it. They don't horde. And we have no rights to take their money away. They made it. it's theirs. Sounds like you are jealous and want to steal their success.
@GrandScribe this is not how it’s work
Rich people don’t hurt the economy, they create it, they create jobs, they and create value for people
Why would it be their job to end world hunger? This is the countries job, not individuals who worked their buts off, world hunger is an artificial problem
Do you know what will happen if all their money will flow out? Inflation, rapid one, the dollar will instantly crash into nothingness and the stock market will vanish
@KateGray Nice piece, especially if you had to research a lot of it. The only thing I'd disagree w/ is the use of the phrase "vigilante-style" b/c it tends to have a negative connotation attached to it, and we really don't know if they are doing anything illegal, which "vigilante-style" kind of implies. If they were, SEC likely would have shut it down by now.
Not sure what a perfect replacement would be, something along the lines of "flash mob" maybe? Or "band of brothers"? Just spitballing.
Since that was kind of negative, here have a positive. Who doesn't love a Tootsie pop?
@dumedum Talking about "real capitalism" is just about as useless as talking about "real communism". Also, let's hop onto Wikipedia and check out the top ten billionaires of 2020. Three of them are Walmart heirs, and a different three went to Harvard and Princeton. These people had opportunities that you will never have, and your children will never have, but no, their money is proof enough that they're worthy of anything and everything they can manage to obtain, no matter how they get it.
@GrandScribe bro, it means nothing about their skills
Some smart Reddit users convince many idiots to gamble
The funds were right, GameStop is at a really bad shape, they had the skills, but when a stock is worth so little like GameStop was, it is easy to manipulate it
In few weeks they will back down and many of the idiot gamblers will lose everything, the smart people who drove them there will be out way before
@nimnio idk about the specific people
But going to Harvard won’t make you rich
Opportunity don’t fall from the sky, you need to create them
@Tantani Going to Harvard obviously won't make you rich, but it helps.
@nimnio which article is that? Top ten billonaires right now are Bill Gates (Microsoft), Musk (Tesla), Zuckerberg (Facebook), the guy that owns Louis Vuitton, the guy that owns Oracle, Larry Page (Google), Warren Buffet, Ballmer (Microsoft)... so not sure what you are talking about. I don't actually like all of them. Musk took a lot of government money (not pure capitalism), Facebook went political and I hate what they did now, but you know, personal feelings don't matter, they all provided value. That's how it works. We are all richer because we used their services one way or another.
@Tantani the only thing wrong with Harvard is if they don't accept purely on merit, but for "diversity reasons" etc.
@Stocksy what do you mean did nothing for the money? He used it to make more
Just because it was during a crash doesn’t make him evil, just smart
Market goes up? Good! Use it to make money!
Market goes down? Good! Use it to make money!
@dumedum Right here https://en.wikipedia.org/wiki/The_World%27s_Billionaires#2020. Zuckerberg, Gates, and Bezos all went ivy league.
And when you say "diversity reasons etc.", does the "etc." mean "rich enough to go to Harvard in the first place"? And as for "merit", it's a little hard demonstrate merit when your family can't even afford healthcare, let alone tutors.
@dumedum I didn’t say there is anything wrong with them
But university doesn’t make you successful
Many people end up losing time and money and stuck with student loans
@dumedum if they weren't hoarding trillions of dollars collectively they wouldn't be worth so much. That concentrated money is concentrated power without direct democratic accountability therefore it dangerous to allow that to exist. Furthermore all people deserve to live decent and comfortable lives because they are human, with some many of our brothers and sister suffering there is a moral justification to take what they don't need for those who need it through taxation. They didn't do the work to produce the value they now enjoy other people did.
@Tantani Don't threaten me with a good time! End of the stock market oh gosh that sounds like real fun time, a reason to get all dolled up and party!
The working class through their labor which actually contributes to society create the economy the rich don't do that. If the rich just vanished society wouldn't shatter into dust but it would if the working class did.
If money isn't flowing through an economy if its static say in an off shore bank account its of no benefit. Inflation is easily countered by price controls to prevent unethical business practices.
World hunger is an artificial problem because of rich people. Nothing meaningful is done about it because that threatens rich people's ability to profit off of it and the conditions such hunger creates and exacerbates.
@Tantani wasn't criticizing you . You're definitely right there.
@nimnio yeah nothing wrong with that. A good education is a good thing. And life's not fair, but there are enough people that managed to go from slums to riches, and the less government in their way, the more mobility there can be. A guy that is smart enough to come up with something amazing in silicon valley, no venture capital firm is going to ask the guy if he grew up rich or poor or what his background is. People came with less than $100 to Ellis Island and became billionaires. Since then government grew bigger and put more and more hurdles for people to innovate and succeed.
Thanks for that. So the 8-10 spots are walmart heirs, nice to know, but they seem to be doing a good job helming different branches and banks. Good for them. Sadly their family money is probably taxed like crazy and then taxed again double tax for estate tax. Taxation is theft.
[Interesting that they were in the top 10 for 2020, but not for 2016-2019]
@GrandScribe No, no one deserves to live from someone's else money. That's not a right. They did the work. It's their money. Their work just had much more market value than what you personally think is fair. But the market decided who had more value. The person that comes up with the idea of the pencil and how to create factories making pencils gets richer than the person who puts the pencil in the little machine. Because the first person is not easily replaceable and the second person is.
@westman98 It really is heartwarming.
@dumedum even if your claim that the rich earn their wealth was true that doesn't negate the reality power is inherently corruptive and dangerous especially when it concentrates and there's no democratic accountability of it. History is full of examples of rich people becoming monsters in human skin towards nature and the rest of humankind. So there is a strong moral justification independent of economic justice for workers for a society to disperse the power of the rich.
But your claim isn't right the rich didn't do the work other people did, so those people didn't get to enjoy the maximum of the value they produced. The only reason working class people agree to such predatory arrangements is because oligarchical societies don't allow working class people to even dream of a dignified life otherwise.
all my friends have bought into GameStop saying they are going to make 10 thousand plus bucks.
@dumedum you have an idealistic view of capitalism. In our world the capitalist does everything to increase profit and reduce expenses. So when that Walmart job becomes too expensive, they offshore it somewhere else (or automate it with a machine). They benefit from infrastructure paid by taxes, but offshore profits to avoid putting back into the system. They pay for lobbyists to make it all legal. Look at the opioid epidemic and the billionaire owners that pocketed all the money and bankrupted the company to avoid paying for the damages their direct actions caused.
People are selfish, and capitalist are supremely so. It is only because of blood soaked workers fighting against armed corporate thugs for unions that we have what rights we do (and yes, unions can be their own societal problem usually from the same selfish tendencies). The last tax cut we “got” was nothing but a 1%’ers wish list, while we suffer from broken infrastructure and failing public institutions. But hey, Jeff Bezos has more money than most countries.
Not all billionaires created value for people. Warren Buffett never did, he never created any product or service. He just got rich with the stock market.
Ah yes. The designs I have planned for the Robinhood app. Very good indeed.
@KateGray the Christian Bale guy deleted his grumpy tweet after he found out he had some shares he forgot about and sold for a huge profit
@Darknyht if you see the pencil analogy they’re baby steps Libertarian and can’t be convinced
@dumedum Wow, you really know absolutely nothing about the world, do you?
The cause is more than a "meme," and shares of GME, AMC, etc. are not being pumped "for the lols." Much if not all of the information in this article is incorrect or misinformed. That extra run-on sentence at the end in italics fitting in every possible traffic magnet buzzword is entirely unnecessary and inaccurate, as well (Treasury Secretary Janet Yellen, and more realistically the Treasury employees who report to her, are the ones reported to be "monitoring" the stock's activity, for what that is worth. Not the fraudulently-elected US President Biden).
The article misses something. It can't simply be about losing out on the profits you would have gotten if the price goes up. That wouldn't cause hedge funds to lose any money. The thing about short selling is that you can actually sell more stock than you currently own. If you start the day by selling a million shares of a stock that you don't have, by the end of the day you have to purchase those million shares back at whatever price they are currently being sold for. So, if I sell 1 million shares at $100 per share, I'll have $100 million. If, by closing bell, the stock drops to $50 per share, I buy 1 million shares back at $50 million and pocket the other $50 million as profit. What happened here was like, I sell 1 million shares at $100 per share. Instead of dropping, the stock price shoots up to $300 per share. I now have to buy 1 million shares at $300 per share, and lose $200 million on the deal.
I don’t have time to read the “why” I am arranging a meeting to takeout a $50,000 loan at Wells Fargo to invest into Sears.
Dead companies are making a come back is the story.
@Darknyht yeah these are the known arguments but they are all factually wrong. First of all, the claim that the tax cuts were for the rich (or even a worse lie, that it was just for the 1%). Completely false. Check the table. Every bracket benefited from it. I personally benefited from it greatly. It was literally a tax cut for everyone. But that was a very good lie used politically. The truth is that the uber rich actually benefited less from it, relatively speaking.
Second, the idea that I have an idealistic view of capitalism. Yes I do. It is a virtuous moral ideal. Capitalism is the only moral economic system. It is not just the most efficient and useful system, it is moral.
Capitalism allows a person to enjoy the fruit of his labors , frees his mind to do whatever he wants in life and bases everything on the equal idea of free voluntary trade without any government coercion. The only real coercion is government coercion because government has a monopoly on the use of force, legally.
Third, the idea that "you didn't build that" meaning that because someone paved the roads or trimmed the trees or taught you at school then you owe them half of your income or something. No, someone paid the people that built the roads. In fact the rich probably paid them already from the taxes. The top 10% already pay almost all the taxes. And it doesn't matter. They did a job with the road and were paid a salary. There is no logic in asking you to chip more for some odd reason just because you became richer than them by doing something completely unrelated but you drove on those roads.
Lastly, the very idea that business people or rich people are inherently dishonest and all of them are selfish and bad is a sad perception that has nothing to do with reality. It is used a lot by politicians unfortunately but it simply doesn't make sense.
Yes, there are bad people that will defraud you but it's not the norm. When Bill Gates made Microsoft he didn't think how to rip people off and he didn't even think how much money he could make. He just had a vision and wanted to make a really cool innovative product and so did Bezos or Page or Zuckerberg or the guys in Apple or whatever. Otherwise let's say that Miyamoto was here just to rip us off and he doesn't care about Mario or the IP he created. Right ? It doesn't work that way. Companies don't want to kill their customers or make them sad. They want you to enjoy their products. That's the norm.
It is people that don't create any money that you need to be wary off. Government takes money from people that created it, redistributes it and in between takes a huge undeserved commission.
@Don like I said, that's actually the biggest value there is. Products are enjoyable and everything but if you invest correctly you help the businesses thrive. The amount of value Buffet created is too big to even comprehend. Every reputable economist will.explain to you how the best thing one can do with his money is to invest it, not spend it.
@GrandScribe go and learn some economics
do you think billionaires have their money in a bank? Lol why would they do that? Make no sense
Their money is in assets: stock, bonds, real-estate and others
Most billionaires became rich by giving something to the world and being smart, don’t hate someone who do better than you, use them as a drive to become better
I am almost willing to bet that your money is sitting in a bank collecting dust, mine is working for me in several different ways
If you ever want to stop living paycheck to paycheck, your money must work, and those billionaires are helping my money work for me
And everything you use was visioned and created by those billionaires, your phone, modern computer and anything else, and they did it before becoming billionaires
What I am trying to say here is, don’t hate someone just because he is better or richer, they had nothing but their brain, talent and unbreakable spirit to fail again and again until they succeeded
I bought a few of the stocks in question, like GME and BlackBerry. Hoping for the best.
@dumedum That's where you're wrong, and it's a unique mindset that only some Americans have. In Canada and other thriving social democracies, we take things like healthcare off the table. No one is more or less deserving than another to receive help when they desperately need it. I have much more freedom than Americans do to change jobs, and my benefits are still there. This is the public way of investing; you invest in your people. Your workforce. You're not merely "spending", its an investment in your citizens. Also news flash; US politicians receive government healthcare. chump got the finest universal care at Walter Reed, a public facility, which you paid for. "Benefits for me, not for thee".
When I see the FED pumping 5 Trillion into the markets after covid began, or the huge corporate bailouts after the 2008 financial crash happening, that isn't the free market. That isn't capitalism. That's corporate socialism. That's corporatism. Multiple huge corporations relying on public handouts for salvation. A truly free market would let all these airlines, cruise lines, financial companies, banks, etc... for example, go bankrupt. But that largely doesn't happen.
Your views are very extreme right wing, a lot of it is just opinion, and it doesn't have to be one or the other. Finding the balance in a mixed-market economy, that benefits the most amount of people, without exploiting workers with garbage wages and benefits like we do now. The Nordic, much of Europe and the UK have gotten it more correct then even Canada has. If wages were tied to productivity, which has boomed in the last 4 decades, poverty would be shattered, and a garbage job like Walmart or a grocery store would actually pay a living wage. That is the more moderate and balanced approach, not this sycophantic extremism. o_O
Without capitalism, innovative products like the smartphone would have taken a lot longer to enter the market. Capitalism drives innovation and competition through the roof.
@Tantani This guy gets it.
@Heavyarms55 But event Pokemon!
Moreso than robbing the rich and feeding the poor, this is similar to a mob pushing up against the fence around a VIP party. A few of them eventually make it over, and get to ruin the party while shoveling caviar into their faceholes. Everyone else in the mob just get shoved and trampled.
This guy explained in a way that totally clarified everything for me and hit the nail right on the head: https://www.youtube.com/watch?v=4EUbJcGoYQ4&ab_channel=LouisRossmann
*To cut a long story short, Reddit is trying to bankrupt hedge fund managers because they deserve it.
@dumedum https://www.politifact.com/article/2017/dec/19/who-wins-and-who-loses-tax-bill/ as they point out, it is people making $100k and above that benefit from the cuts. As for the amount of taxes they pay, the honest rich like Gates point out they should be paying more taxes. Even Warren Buffet pointed out it was wrong that he paid less in taxes than his secretary. The system has been rigged and their talking heads have convinced you that what is raining down on you from them is lemonade.
Progressive liberal policies are broken, but so are ultra conservative ones. Look at history and there has always been a social contract between the rich and non-rich. For the benefit of their status they deal with the problems of society. When they fail to do that society fails. We worship GDP as if that is the only measure of success and ignore the mom that stays at home and raises successful children. There is a philosophy called the donut theory. Too many people in the hole means too many failing at basic life essentials, too many outside the donut is consuming too much. The US primarily exists with people in the hole, a dwindling number headed for the hole and a fraction off the donut. As a country we exist off the donut consuming everything like locusts.
Go visit West Virginia where your capitalism has ran the state for years. They have the best government a coal baron could buy. Their governor makes a living from extracting wealth from the ground people live on, destroying the environment and then bankrupting the company to avoid taxes and paying the workers. Their dependence on a single industry has led to everyone skilled fleeing if they could and their workforce being drained. Now it is the land of dollar stores and poor people trapped with a few exceptions for old retired people and a few counties near better managed areas. Moral capitalism isn’t a problem (just like moral communism isn’t bad, in fact it is the biblical model for Christians in Acts), but we don’t live in a moral society.
Reddit is not doing anything.
This is a immense false statement (and a huge dissapointment to see such thing here in NintendoLife)
A GROUP OF USERS inside a reddit community did that, not Reddit. They could have done it within any other service or social media.
And they did nothing illegal. They obviously did that just to show how broken market manipulation and speculation is.
@shining_nexus what exactly is the proof that without capitalism people won’t improve things at the same rate or faster? How does totalitarian control of businesses and the working class not getting the majority value of their labor in wages and benefits drive innovation?
@Tantani I’m not rich and I know economics that is why I’m opposed to the rich. A just society would be organized in such a way that workers own, structure and democratically operate their work place for their benefit instead of totalitarianism of capitalism.
@Darknyht here is the link to the tax brackets. As you can see every bracket benefited. From those that pay 10% income tax and onwards. If is just a fact. There is an issue with the rich in some states who couldn't deduct like they used to but that's it. The rest is the brackets. To this you need to add the DOUBLING of the child tax credit and you will see how the idea that the tax cuts benefited the rich only is completely made up.
I don't like the mixed economy because it makes people like @EVIL-C blame cronyism and other things on capitalism. With actual pure capitalism we could unlock unimaginable innovations. Most of the innovations in the world even on healthcare come from the US. Most medical articles are written in US universities. Most patents in the US. The US subsidizes most of the healthcare vaccines etc in Europe and Canada and then they try to lecture people about freedom. Countries with kings and queens 😁 anyway , capitalism is the unknown ideal. We will never know until we actually try. But we do know that every country that had even a small taste of capitalism completely became better. People literally died trying to come to America from Cuba or to Hong Kong from East Asia. Because of a taste of capitalism.
@Darknyht This is from your article btw: "the good news for taxpayers is that every income group would pay less in taxes in 2019." Period. The rest is just what the White House talked about as the beer analogy 🍻 . And they say what they think will happen in 2027.
Btw, it's a tragedy that Bill Gates needs to keep donating his money so that he doesn't feel guilty of being rich and being attacked by socialists. But he paid tons in taxes. Buffet too. What they talk about is the fact that capital gains taxes is smaller and if they don't sell the stock the gain is theoretic so they shouldn't pay anything obviously. Capital gains has to have a lower tax rate because you also have the risk of losing the entire investment.
@BreathingMiit Been a while since the last one of those too. Even Pokemon has moved on.
@dumedum Wow, so much wrong with this. I can't find anything about the USA "subsidizing" vaccines.
False equivalency on the fact that while we have connections to the British monarchy, we're a constitutional monarchy, with a parliamentary system of government. We are fully self-governing.
And according to freedom house, we rank 98% in freedom. The US is 86%.
Parliamentary systems are also generally more democratic, since it encourages coalition building, and elections can be triggered via no-confidence votes should the party head be unpopular.
People (Americans) also literally die without coming up to Canada to buy our cheaper insulin. In other words, Canada Subsidizes healthcare to Americans.
The fact that you just keep saying "Oh it's just cronyism" that causes this problem; Yeah, duh, of course. And that is one obvious, glaring flaw that demonstrates how capitalism is not 100% perfect, flawless and miraculous.
People also died escaping the USA to Canada to evade slavery, which had nothing to do with capitalism.
And a picture of some tax brackets for married people... Cool. 👍
@EVIL-C it's not capitalism, it's cronyism. You still have a queen. She's half way across the pond too lol. At least in the US people fought for their freedom and won. It's embarrassing to even compare the countries in any terms, it's not the same ballpark, it's like a bug and a giant. And you are totally ignorant about healthcare. In fact it's Canadians who come to the U.S.
and some more facts for you:
"Of almost 3,000 articles published in biomedical research in one year, 1,169, or 40%, came from the United States." How much do you think came from Canada. Just stop. Canada has the biggest oil reserves and other minerals in the world but the U.S. innovates constantly, billion times more than other countries. It's because it historically has more capitalism. Do you even know what the industrial revolution is. You can only dream of what the founding fathers in the US have achieved, and what the US has done for the world.
The subsidies fact:
You also seem totally ignorant about tax brackets and filing (what filing jointly etc means). Probably you don't even file taxes.
@GrandScribe basically, incentive. When someone has a great idea for a product, they need money to create and develop said product. That's where investors come in. Investors risk their own money in belief that the product will sell well and make them money, or lose it all. It can be a win win for both parties and without this incentive to make money, the product would have taken much longer to materialize. Money is needed to advance and innovate technology. There are many creative and intelligent people out there that has ideas and visions that can help the world, but can't do it alone. Investors and entrepreneurs can help bring their visions to life.
As for the second question, I see your point, and I agree, the working class are a part of the team that drives the company to succeed and should be compensated fairly. If not, there would be no incentive to push people to be better, which would result in slow growth and less innovation. In my opinion, this would be more the fault of leadership and individual selfish principles, rather then the ideals of capitalism. Maybe investing in quality workers would probably be better for the business at that point.
The role of investors and especially banks could be handled by governments who's purpose isn't to extract as much money as possible from the arrangement but to encourage development of technology and the formation of new businesses.
In capitalism fair compensation and benefits cuts into profits so for workers to get anything close to it capitalists have to be forced to provide it by either government intervention or militant unions. The resulting fighting wastes time, energy and money that could be better used. Workers owning, structuring and democratically operating their work place applies a structural fix to the compensation/benefit problem and makes workers more emotionally invested because they're co-owners and have a say in their work life e.g. an annual vote in who the head of a department is, a vote in whether to pour money into R&D, a vote whether to expand paid vacation days. It's not a perfect system but dispersing power like that is better than what we have.
@dumedum It's obvious that you have drank the kool-aid so argument isn't going to persuade you to change your mind. But here is some facts to dispute your rose-colored views. https://www.usnews.com/news/elections/articles/2019-11-14/wealth-in-america-inequality-persists-in-household-wealth#:~:text=The%20bottom%2050%25%20of%20wealth%20holders%20saw%20their,about%2032%25%20of%20all%20household%20wealth%20in%202019.
"Due to the increase in value of investment assets commonly held by higher income groups, the top 20% of income earners have seen their net worth grow 78% since the recession. Their share of the nation's wealth grew from 64% to 72% during that period. At the same time, the bottom 20% of income earners have seen their wealth drop by 30%."
Basically in America, 32% of the total wealth is held by 1% and roughly 70% is held by the top 20%. Meanwhile the rest of the country is left to fight over decreasing scraps.
"When looked at as a group, American households are worth more than they were during the Great Recession. However, with growth strongest in investments held by higher income groups, like mutual funds, and weaker for investments held by lower income groups, like mortgages, this growth has not benefited households equally. While the wealth of the top 40% of income earners has increased, the bottom 60% has stagnated, with wealth falling for the lowest 20% of income-earners."
So you might have more dollars in your paycheck, but those dollars do less than they did. The pity tax cuts we got were basically breadcrumbs to trick you while they walked away with the entire banquet. It benefitted the 100k earners and above way more than those at the bottom (and they got our pity breaks just the same as us too).
But enjoy your delusions of prosperity, while a lot of our fellow citizens are struggling to put food on the table ( https://www.washingtonpost.com/business/2020/10/02/food-bank-shortage-feeding-america/ ), and affordable housing is becoming a crisis ( https://archive.curbed.com/2019/5/15/18617763/affordable-housing-policy-rent-real-estate-apartment#:~:text=The%20United%20States%20is%20facing%20an%20affordable%20housing,not%20be%20cost-burdened%29%20in%20exactly%20zero%20counties%20nationwide ).
@GrandScribe you make a lot of fair points, but I feel that having a government control where money is invested in destroys the idea of a free market. This would break businesses that would be deemed non essential by the government. The free market allows anyone with a business idea an opportunity to thrive if it meets the demands of the people. Governments should not have the power to dictate which businesses deserve more money, the people should.
@Tantani if you think rich people should be able to fund one side of a democratic process so they can use the result to make millions..... then you don’t realise what is happening.
I’m sure you are ok with Russians interfering too then as it’s the self same thing.
@Darknyht your mistake is that you think a wealth gap is a bad thing or that there is one pie and if someone gets more then someone else gets less. It is common place nonsense. It leads to ridiculous comments like someone else here saying government needs to own businesses and you don't need investors. As if we don't know already that communism is horrible and always leads to genocide.
Capitalism has lifted billions of people out of poverty. I can also link you to better articles. Without capitalism we would all still be dead at 35 in farms and with feudalism.
@Stocksy ahhh did I say anything that points to me being ok with rich people involvement in politics?
And if the Russians would have intervene we will at least have a us president that will benefit my country better, instead we got what seems to be Chinese interference and gave us someone who is far more dangerous at least to my part of the world in term of hurting USA friends and helping foes
Anyway any interference in political process is bad and every country should do anything in their power to block attempts of doing so
@KateGray It's basically like if you listed a copy of Mario World on eBay that you didn't actually own, and then the internet found out and bought all the copies of it in existence. You've agreed to sell it, or you'll get bad feedback, so have to pay whatever it costs to get it. I guess In this case bad feedback is like jail or bankruptcy or something.
I'm not gonna pretend to understand all the economic arguments above, but I will say this. If people were perfect then any form of government or economy would work, but unfortunately people are very much NOT perfect. As such, I prefer whatever works longer, and capitalism, despite all its evils, seems to make people happier for the time being. I personally can't fully agree with either the left or right side of things politically, so. Perhaps ignore me XD
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