Back To The Big Short
All the glee over the GameStop short squeeze in the past several days actually reminds me of a very good recent film, The Big Short (2015), We have it on DVD and watch it at least once a year. It's a fictionalized version of a true story about various contrarians and outsiders who foresee the 2008 housing crisis and in effect short the US economy via the housing market.
The 2021 short squeeze actually reverses the circumstances of The Big Short, since in the current case, the forces of dark financial consensus are looking to clean up by shorting GameStop, expecting its price to go down, while the contrarians and outsiders see an opportunity to confound the establishment by buying up GameStop stock, forcing the big boys to buy it back at inflated prices.
In The Big Short, the outsiders and contrarians realize the housing economy is a bubble and find a way to short the market, expecting it to go down when the establishment expects prices to rise forever. But the message is the same. A sympathetic group of not-quite little guys outsmarts a monolithic consensus supported by backroom cronyism and old-boy loyality.
Unfortunately. the ultimate message of the film is that the little guy suffers. The outcome of the 2008 crisis, played out during the election, was that Democrats and Republicans worked in concert to make sure this would happen. In 2021, I don't see much difference.
White House press secretary Jen Psaki said Thursday it “shouldn’t be a surprise” that Treasury Secretary Janet Yellen was paid to speak to Wall Street, including a hedge fund involved in the GameStop populist investing struggle.
Yellen, a former Federal Reserve chairman, was paid $810,000 by hedge fund Citadel for three events in 2019 and 2020, according to disclosure forms.
The firm reportedly infused $2 billion into Melvin Capital Management, a hedge fund hammered by losses in the GameStop struggle waged by smaller investors.
2021 isn't the Great Reset. 2021 is return to business as usual, or maybe an attempt to do so, The COVID lockdowns figure into things this time -- they didn't have to work this hard at enforcement in 2008.