Monday , April 12 2021

Priced at nearly $ 92: Gamestop shares are firing unexpectedly from the ceiling again


The traffic around the Gamestop quota seems to be endless. After a brief period of rest, the price jumped again. Experts watch the development with concern.

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Gamestop shares are once again the subject of discussion and speculation.

Gamestop shares are once again the subject of discussion and speculation.

20min / Matthias Spicher

  • Gamestop stock trading is not resting.

  • The price went up again little by little in a short time.

  • Experts can barely explain it and are watching the latest developments with concern.

After the spectacular speculative battle between amateur investors and hedge funds, Gamestop’s air seemed to have run out. Now, again, stocks are going through the ceiling again. Warren Buffett MP Charlie Munger sees an “irritating bubble” in the financial market.

The excitement surrounding the sick video game retailer Gamestop never ends in the U.S. financial market. After the heavy losses of previous weeks, the stock price of the American company, which had become a pawn for speculators, almost doubled on Wednesday without a clear reason immediately becoming apparent. . In view of the conditions of the American stock exchanges, the long-time partner of the legendary star investor Warren Buffett, Charlie Munger, warned of the excesses.

Negotiation has been suspended for a short period of time

Buffett’s vice president of investment firm Berkshire Hathaway seems to be concerned about the recent turmoil in the US financial market. The 90-year-old journalist said Wednesday at the annual general meeting of the American media group Daily Journal Corporation, at the annual general meeting of the American media group Daily Journal Corporation, that price limits such as Gamestop shares they are signs of an “irritating” bubble ”that must reach a bad end at some point.

Gamestop shares were temporarily suspended from trading in the middle of the week and eventually closed at about $ 92, up 104%. After business hours, it continued with violent fluctuations, sometimes the price increased by about 100 percent. The day before, Gamestop had announced the departure of CFO Jim Bell for no reason.

Gamestop stock race critique

U.S. media later reported that the manager had to resign under pressure from influential shareholders because there had been disagreements over the strategy. Investor Ryan Cohen, who held a board position in January, is said to have played a key role. Many speculators consider him the bearer of the hope of a return, as he had already successfully turned the pet supplies retailer Chewy.

The old bag master, Munger, thinks nothing of the hype of the game. According to his critics, the frenzy of speculation reveals a new and dangerous culture in which people are encouraged by cheap runners like Robinhood to play with stocks, as they do in horse betting. In fact, Gamestop has been in crisis for a long time, but driven by organized investors organized on the Internet, the company’s shares had been impressively concentrated last month.

U.S. authorities are investigating

In turn, this broke several hedge funds that had opted for a price drop, with losses of billions. By the end of January, stocks had hit a record high of more than $ 483, but the comeback ended quickly. The price turmoil around Gamestop and some other US stock market companies has already had consequences that continue. U.S. authorities are investigating the incidents and investigating possible market manipulation.

With its easy-to-use app, discount agent Robinhood, which is particularly popular with younger investors, has also been criticized. In particular, the fact that Robinhood restricted the trading of hot stocks like those of Gamestop during the price explosion last month so that they could only be sold caused many problems. Robinhood strongly denied any suspicion of collusion with hedge funds.

Now Charlie Munger has also strongly criticized Robinhood, but not because of trade restrictions, but because he believes the app is more of a kind of game provider than a reputable broker. Robinhood runs a “dirty” business, in which users are attracted for free, while the company receives money from Wall Street players to mediate their transactions and therefore encourages trade to the fullest. and risky.

Bitcoin is currently similarly volatile

Buffett’s vice president can’t take anything from the heights of electric car maker Tesla and the digital currency Bitcoin. He doesn’t know what price concentration he thinks is worse, Munger said. Bitcoin is not suitable as a means of payment due to its sharp price fluctuations. The head of Tesla, Elon Musk, is a big fan of cryptocurrencies, the company had recently bought bitcoins for $ 1.5 billion and therefore fed the rate of the most famous digital currency.

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