There better be a test about the GameStop saga. When it burst into the news, I dutifully dropped my other studies — of coronavirus mutations, budget reconciliation, Kellyanne Conway, her teenage daughter, and the nude picture — and applied myself to the stock market frenzy.
The short. The short squeeze. Margin call. Payment for order flow. The CBOE Volatility Index. Go ahead, ask me anything.
Wait, hold on a moment: I swear I understood it like a second ago. Let me just re-watch that video on Twitter in which a normal person, Avalon Penrose, of LA, explains the stock market frenzy:
“ . . . There are these people who are, they have lots of money, and they have hedges around their house, and they go to the market, but it’s not like a real market, it’s metaphorical, but it’s real, and they um, they go, uh, ‘Uh-oh, that company’s not doing well, so I’m going to make it do worse . . . ’ "
The video has more than 16 million views, and it’s by a comedian, which pretty much right there tells you that we’re dealing with a Category 3 story. Category 3? Yeah. That’s a story that’s simultaneously complicated and simple, compelling but somehow boring, and can only truly be explained by John Oliver or a kindergarten teacher.
Before we go further, let’s look at the other story categories:
Category 1: These are stories that are so easy that any civilian could go on CNN with no notice and comment authoritatively. Meghan and Harry leaving the Royal family. Murder hornets. Anything Peloton.
Category 2: Stories you will never understand, no matter how hard you try so you can skip right over them. Physicists finding a way to test superstring theory. The new AI tool that cracks the code of protein structures. Why Gwyneth Paltrow wants to sell a candle that smells like a lady’s private parts.
But then there’s the third category, which is when facts you should be able to grasp — if the Wall Street bros can, why not you? We’re not talking Stephen Hawking here — briefly seem within reach, but then slip away.
Shamus Moynihan, a municipal employee from Jamaica Plain who can parrot talking points but worries he doesn’t fully understand them is at the stage where each explanation seems only to deepen the confusion.
Talking to a Globe reporter, he let loose a string of questions in a plaintive voice: “They never own the stock but they borrow it, and bet it will lose value and sell it back at a lower price? How do you do that?” he wailed. “Sometimes they call it a ‘naked short.’ They’re betting against it, but they don’t even borrow it???”
Here’s a thought: Maybe you don’t need to understand GameStop. Thanks to social distancing, it’s not like you’re not going to have to bluff your way through a cocktail party.
You could hope it blows over, with no one the wiser about your ignorance. Alas, the story seems to be expanding — Elon Musk has inserted himself, Senator Elizabeth Warren has sent a letter to the chair of the Securities and Exchange Commission, Representative Alexandria Ocasio-Cortez says she’d support a hearing.
At the rate the story’s moving, it won’t be long until Dunkin’ introduces a coffee flavor. Trying to ride it out may be risky.
As the writer and humorist Patricia Marx once observed: “When a story breaks in the news — say, a junta seizes power in a country you can’t find on a map — you have to make a snap decision about whether it will have legs or whether you will never see a report on that subject again,” she told The New York Times.
“If it is a story that will become major, you must get in on the ground floor, or otherwise there will be too many political factions and similar-sounding names, and you will never catch up enough to know what’s going on.”
The challenge is that there’s so much news now. Mary Burchenal, a retired chair of the Brookline High School English Department, is not sure where her time is best spent.
Should she read more about how mutations in the coronavirus may have occurred? The history of the filibuster? Or the stock market, where, by her own description, she’s got a long way to go.
“I only vaguely know what GameStop [the brick-and-mortar store] is,” she said on Thursday.
By Friday, after watching the news on PBS — and not seeing a story — she had made her GameStop decision. “That ship has saiIed,” she said, sounding almost relieved.
But not everyone has the confidence to opt out. And so we beg anyone who seems knowledgeable and nonjudgmental.
“Explain it like I’m 5 years old,” Kristen Gallant, an administrator at a local university, texted a kindly student when the story broke.
Post-tutorial, she was asked by a Globe reporter to explain it.
“Oh boy, um, OK,” she said. “If I had to explain what is going on right now . . . ” She stalled for time but eventually took the plunge.
“There are a lot of people on the Internet who managed to game the situation, and now the people at the hedge funds are upset,” she said. “The people in the financial institutions were going to project the stock would be worth very little, but regular people started to get wind of it . . . ”
She was going strong, but as is so often the case with a Category 3 story, if you actually do manage to master it, your current self can’t believe your former self was so confused, so you doubt that your current self knows what it’s talking about.
Or, as Gallant put it: “I don’t know if this is correct.”