Weekly Link Roundup: r/wallstreetbets Edition

Source: The New Yorker

With apologies, I have spent just about every waking minute outside of work these last two weeks (both actively and subconsciously) thinking about $GME and the r/wallstreetbets community, which is why things have been slow here. The posting schedule should normalize this week.

Pandemic-Era Central Banking Is Creating Bubbles Everywhere (Bloomberg): “Cheap money, gushing in from the world’s major central banks, inflated assets and reshaped how we save, invest, and spend … The strategy is clear and deliberate: Snuff out volatility from the bond market and make debt the cheapest it’s ever been to deter saving and encourage investment. The hope: Cheap cash leads companies to invest and hire as rising asset prices make people more confident and ready to spend. The inevitable side effect: More volatility for assets (apart from bonds) as investors chase returns around the world. And, of course, the risk: Bloated asset prices pop, undermining financial stability before the real economy can benefit from all that cash.”

GameStop Stock Frenzy May Not Be So Bad for Wall Street (The Wall Street Journal): “Individual investors also aren’t alone in the ability to trade beyond fundamentals: Many quantitative funds trade on data signals and price movements … co-founder of Thinknum Alternative Data … started getting calls from quant firms last week seeking to generate sentiment measures from Reddit’s WallStreetBets forum, where much of the discussion among individual investors surrounding shares like GameStop has originated. His data firm began monitoring the forum and providing hourly updates … U.S. equity markets have logged huge volume, with a record 24.5 billion shares trading hands on Wednesday … That is roughly 10 billion more than the daily average in 2021 … stock loans across the market appear to remain in demand: The percentage of available share value that was on loan in the Americas was higher week over week on Thursday, according to DataLend.”

Should You Buy GameStop? A Guide for the Uninitiated Investor (Bloomberg): “Large financial firms … have access to information individual investors just can’t get. Because of this … investors should be wary of stock boosters promoting their own research … the focus for any individual investors should be about their long-term investment goals and not headlines.”

Gensler Faces Big Challenge in Tackling GameStop’s Wild Ride (The New York Times): “The frenzy around GameStop … presents a huge challenge for Mr. Gensler and the S.E.C., which will have to reckon with a fundamental shift in the capital markets as a new breed of investor begins trading stocks in unconventional ways and for unconventional reasons … unlike the typical type of fraud or manipulation … the current frenzy involves investors who have publicly acknowledged the risks they are taking and even boasted about losses … That dynamic poses a challenge for an agency whose primary mission is to protect investors by ensuring they have enough information when deciding whether to trade and to enforce securities laws … Those who know Mr. Gensler say his first move will probably be determining what actually caused the momentum and who benefited. While many big hedge funds got crushed by the trades, there is speculation among market participants and securities lawyers that other big funds may have been fueling — and making money off — some of the volatility.”

Bubble Fears Everywhere But All Investors Can Do Is Keep Buying (Bloomberg): “Data show stock buying rose further after the last round of pandemic-relief checks, and it isn’t just the retail crowd. A record number of investors with $561 billion overall say they think they’re taking higher-than-normal levels of risk.”

WallStreetBets Founder Reckons With Legacy Amid Stock-Market Frenzy (The Wall Street Journal): “The sober advice doled out in online communities … wasn’t cutting it for him. Neither was the commentary of investment banking analysts on cable TV … He decided to create a hub on message-board operator Reddit where like-minded people could gather to exclusively discuss the type of trades that would make a financial adviser’s skin crawl. Their approach would be more akin to gambling than spreadsheet analysis, and their motto something along the lines of ‘YOLO’ … The group counted only a few thousand subscribers in its first few years … Everything changed in 2019. Brokerage giants … eliminated trading commissions. Interest in retail trading exploded, and the number of WallStreetBets subscribers swiftly crossed 500,000—then one million during the market selloff of March 2020 and 2 million during the now-notorious campaign to drive GameStop shares higher.”

How to Find the Next Moonshot Stock, According to ‘Roaring Kitty’ (Bloomberg): “Gill embraced the use of technical analysis, using stock price charts to find good entry and exit points for his positions, a technique often dismissed as a form of financial voodoo by followers of value-investing icons like Benjamin Graham.”

Can Hedge Funds Recoup GameStop Losses By Giving Up Avocado Toast? (Finder): “Assuming hedge fund managers eat avocado toast for breakfast 364 days a year (every day except Christmas and leap days), at an average price of $22 per piece, it would take a single hedge fund manager 374,625 years, plus a few months, to make up that loss. But if they also cut down on coffee, the recovery would be much faster. Assuming a price of $6 a cup and three cups a day … that timeline drops down to only 206,043 and a half years.”

Fashion Trends Are Often Recycled. Now More Clothing Can Be, Too. (The New York Times): “The biggest problem rests with the volume of unwanted clothing that winds up in landfills … clothing production globally roughly doubled from 2000 to 2015. During the same period, the number of times a garment was worn declined by 36 percent … the equivalent of one garbage truck full of clothes is burned or dumped in a landfill every second.”

How “Promising Young Woman” Refigures the Rape-Revenge Movie (The New Yorker): “Trauma is contagious, infectious, violent. It blurs and—more importantly—it ruptures … Rape does not go away when you refuse to say it. Euphemisms are death. And so is revenge, in the end.”

Pizza Hut Launches ‘Detroit-Style’ Pizza, and America Says ‘Huh?’ (The Wall Street Journal): “A square or rectangular pan pizza with Wisconsin brick cheese spread to the rim, giving the edges of the crust a slightly charred, caramelized taste, but leaving it light and airy in the middle. Tomato sauce is dolloped on top, rather than beneath the cheese. The style is credited to immigrant Gus Guerra and his wife, Anna, who took a square, steel tray used on automotive assembly lines to create a deep-dish pizza at his east-side bar, Buddy’s Rendezvous, in 1946.”

Sézane’s February collection is now available! On my wishlist: Bahia Jumper and Victorien Jumper.

Should Fashion Break Up With Big Tech? (The Business of Fashion): “… a conundrum faced by fashion brands big and small: they need social media more than ever as the pandemic makes it harder to reach potential consumers in-person. But they are increasingly uneasy about having to talk to their customers via Facebook and Google.”

Nitrous Nation (The New York Times): “Like cannabis, nitrous oxide is responsible for almost none of the overdose or misuse drug deaths each year, but its use can lead to death … nitrous is misunderstood by many as a lighthearted party drug. ‘Hippie crack’ is almost like a term of endearment … which is ironic, because it’s such a dark, desperate thing.’ … In part because the drug seems fun, nitrous-related content now flourishes on social media.”

Meet the People Paying $55 Million Each to Fly to the Space Station (The Washington Post): “Sometime early next year, if all goes according to plan, the trio … [a] managing partner of … a real estate investment firm based in Ohio … the chief executive of … a Canadian investment firm; and … a businessman and former Israeli Air Force fighter pilot — will lift off from the Kennedy Space Center aboard a SpaceX Dragon spacecraft for what is scheduled to be an eight-day stay on the International Space Station … If it takes place as envisioned, the flight would mark a watershed moment in human space flight, one that … will eventually make space more accessible and further erode the monopoly that governments have long held on space travel … [Axiom Space] is planning two flights per year and also is developing a space station of its own that NASA hopes may one day replace the International Space Station, the orbiting lab that has been in space for 22 years.”

Who’s Making All Those Scam Calls? (The New York Times): “… the total losses reported to it by scam victims increased to $3.5 billion in 2019 from $1.4 billion in 2017. Last year … [a survey found found that] 22 percent of the respondents said they had lost money to a phone scam in the past 12 months … [it is projected] that as many as 56 million Americans may have been victimized this way, losing nearly $20 billion.”

Why Some Men Are Still Wearing Suits to Work From Home (The Wall Street Journal): “… many of these suit stalwarts are nagged by a feeling that they must maintain some level of decorum even from home … Others feel formality encourages an industrious mind-set … But on some level, the truth is tailoring traditionalists just like dressing up.”

♥ The Lunar New Year is less than two weeks away; for LNY I plan to eat dumplings and wear something new/red; as I have been shopping for new sweaters in this festive color, I wanted to share some reasonably-priced options for those of you also in the market for something similar: BLDWN April Sweater, French Connection Turtleneck Sweater, Vero Moda Diana Puff Sleeve Sweater, French Connection Balloon Sleeve Sweater, Modern Designer Mock Neck Sweater, C by Bloomingdale’s Cashmere Sweater, Rachell Parcell Puff Shoulder Sweater, Banana Republic Silk Cashmere Relaxed Sweater, and Madewell Eastbrook Cross-Back Sweater.

High School Grades Could Be Worth $100,000. Time to Tell Your Child? (The New York Times): “Have a brief but deliberate merit aid conversation two months into the summer after eighth grade. It does not have to be an extended chat if a child seems reasonably motivated already. You might simply explain that grades don’t just count for admission these days — good ones can make many expensive schools more affordable … Wait any longer than the start of high school, and the vicious math of grade point averages may not allow them to catch up if they are aiming for merit aid at more selective institutions.”

Are ‘Luxury Mystery Boxes’ the Future of Discount Shopping? (The Wall Street Journal): “Young shoppers often value a brand name even more than the item itself … The YouTube unboxing videos confirm this, documenting various streetwear influencers opening up a box from Heat or Scarce and giddily shouting out ‘Bro, it’s Saint Laurent!’ or ‘Oh, it’s Fendi!’ as they spot the label, even before it’s clear whether the item is a shirt, a pair of pants or a scarf … The success of these mystery-box companies reflects a fashion economy where consumers no longer value having the hottest, fresh-off-the-runway item the way they once did.”

Toothbrushes Might Not Be Covered in Poo After All (Gizmodo): “According to a new study, our brushes are full of bacteria found in our mouths, but they’re not full of bacteria from our guts … scientists … [have] been working on cataloguing the native bacteria from people’s toothbrushes donated through the mail. DNA was lifted from these brushes and then analyzed all at once … They compared these microbiomes to those previously sampled from people’s mouths and guts … The researchers don’t discount the possibility that aerosol plumes of poop from a toilet flush could sometimes deposit bacteria onto our toothbrushes … And some of the bacteria they found on toothbrushes is found both in our mouth and gut … But overall … their findings … should reassure people about their brushing … The findings from their microbial expedition weren’t all rosy. The team also found evidence of increased antibiotic resistance genes in the microbiomes of toothbrushes belonging to people who practiced better oral hygiene … None of the bacteria they found … are thought to pose a serious danger to human health … But one theory is that people who especially care about their oral hygiene are more likely to use other hygiene products advertised as antimicrobial. And though these products claim to be better than their standard version, they’re actually not.”

♥ Recently ordered: J. Crew Woven Bag Strap in Stripe, Uniqlo x Jason Polan Long-Sleeve Sweatshirt, Reformation Gisela Camisole & Cardigan Set, sandro Paulzy A-Line Knit Dress, Ann Taylor Mock Neck Doubleweave Sheath Dress, Sandro Tedy Quilted Tweed Jacket, and loft Mock Neck Dolman Sweater.

Have a good week, everyone!


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