KATE THOMPSON DAVY: GameStop saga says Wall Street is entering a new world disorder
A fundamental shift is taking place in the balance of power in US financial markets
Have you been following the GameStop stock saga? Of course you have. The bricks-and-mortar gaming retailer’s share price rose from $10 or so in September to a high of more than $400 last week, squeezing some established investors and making overnight millionaires of a handful of day traders. It’s been a wild ride worthy of the reams of e-newsprint already generated, and will probably make great fodder for a Michael Lewisesque book in the near future.
I will not attempt to parse the factors that prompted some to short the stock in the first place, or whether the company has been fundamentally undervalued by those taking the short position, as the dissenting voices claim. I am a risk-averse investor who probably would have been thrilled with the early 50% gains and likely have jumped ship when the stock price hit $15 back in December. So, do not look to me for stock tips. Much smarter finance minds than mine have waded into those waters...