Penn Wealth Publishing

2021.01.10 Penn Wealth Report Vol 9 Issue 01

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Penn Wealth Publishing Subscription Information Penn Wealth Publishing 9393 West 110th Street 51 Corporate Woods Suite 500 Overland Park, KS 66210 4 penn wealth Report volume 9 issue 01 10 Jan 2021 Penn Wealth Report Copyright 2021. All Rights Reserved. From the Editor/ If the spectacle that is GameStop GME trading doesn't bring the message home, nothing will. In a bizarre—but fascinat- ing—lesson in behavioral finance, a group of social media stock buyers have made it their mission to seek out and destroy short sellers by buying shares of the companies being most shorted. GameStop and AMC Entertainment AMC are two poster children of the movement. We are no fans of short sellers (who lost tons of money betting against some of our favorite companies, like Tesla TSLA and Beyond Meat BYND ), but buying a company with real money to screw someone else over seems like a rather odd endeavor. According to Citron's Andrew Left, a short seller we love to loathe, the animosity didn't stop with the long buying; Left claims he and his family have received a number of physical threats. It is estimated that short sellers have lost roughly $100 billion getting "squeezed" out of their positions since this new social media movement began, but they aren't the only ones who will get squeezed like a grapefruit in the end. We have nothing against GameStop, except for the simple fact that it has a dying business model, but how is a company that was selling for $4 per share now worth $328 per share? e answer, of course, is that it isn't. Another nail in the coffin of EMH (Efficient Market Hypothesis). Furthermore, in some odd way we are rooting for the retail investors who drove the shares up 1,200% in the mat- ter of a week. Ultimately, however, the shares will settle back down to where they belong. And when that happens a lot of ordinary people will have lost a lot of money. And, right on cue, smarmy government officials will step in with their bull-in-a-china-shop mentality and begin their need- less regulation. Maybe a 50% short-term capital gains tax rate to prevent abhorrent trading behavior? ey have dreamed of that move, and this might just be the straw man they have been waiting for to make us all "pay our fair share." —MSH Michael S. Hazell editor-in-chief The Spectacle that is GameStop Trading While fascinating to watch, this movement might just give the government cover to raise our taxes.

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