WallStreetBets GameStop, Dogecoin, Bitcoin Pumping Nothing New

2021-02-10 08:00:00

Photographer: Spencer Platt/Getty Images North America

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Today’s Agenda

Thing Behaving Much As It Did in 1999

When Prince wrote “1999” back in 1982, he could hardly have imagined the song-reference-industrial complex it would spawn, the decade upon decade of deadline-harried writers using it as the go-to descriptor for “[THING] behaving like it’s [YEAR].” It’s beyond cliche.

And yet you can’t avoid the observation, here in the Year of Our Lord 2021, that there is a thing, namely the stock market, behaving these days just as it did in, wait for it, 1999. Some of us born not long before or after that year may be shocked that day traders can gather on r/WallStreetBets and inflate things like GameStop and Dogecoin. But Footnoted.com’s Michelle Leder is not one of them. She wrote a New York Times piece about stock-pumping message boards back in, wait for it, 1999. But more than two decades later, regulators are still no closer to figuring out how to balance free, democratized markets against the risks of internet-assisted pump-and-dump schemes.

All of this 1999 talk can make one nervous there’s another 2000 zero zero on the way for the stock market. Valuations, particularly tech ones, are at least as delirious as they were back then. Right now, though, the outlook for corporate profits seems to actually justify some optimism, writes John Authers. Why, even GameStop has genuinely bright prospects, writes Tae Kim, thanks partly to an injection of the Bezosian protomolecule that helped Amazon.com not only survive but thrive after 1999. Brace for more Prince references.

Trump Just About Ready to Hire Cat Lawyer

You might think yesterday’s most embarrassing lawyer was Cat Lawyer. You would be wrong. The man who Zoomed as a cat at least made everybody smile (until he was, naturally, Milkshake Ducked). No, Tuesday’s worst-lawyering laurel belongs to Bruce Castor, who did such a bad job of representing Donald Trump in his impeachment trial that the former president reportedly hit an 8 out of 10 on his personal Scoville Scale of Outrage. Little matter, writes Jonathan Bernstein: Trump could probably hire Cat Lawyer to read “Green Eggs and Ham” for four hours in the well of the Senate and still get Republicans to acquit him. 

But as pointless as this whole endeavor may seem, it is holding Trump to account for inciting the Jan. 6 Capitol riot, writes Noah Feldman. Even Trump’s hapless lawyers are doing the country a favor, by stipulating that storming the Capitol and murdering people is bad for democracy. That’s a guardrail the next authoritarian-curious president will have to at least acknowledge.

Inflationopalypse Now, or Maybe Later

A while back there was a to-do about a scarcity of bucatini pasta. Well, good news: Bucatini is now plentiful, at least on certain retail websites. But it was the poster pasta for the rolling dry-goods shortages that have afflicted the country for the past year. And these shortages still haven’t been entirely resolved, writes Sarah Halzack.     

Not Quite Normal

Imagine the pricing power of a bucatini pusher a couple of months ago, and then apply that to the consumer-goods industry more broadly: If people feel desperate for tube-shaped pasta or toilet paper or whatever, they’re usually willing to pay up for it. And big companies, at least, have taken advantage, Sarah notes. And yet consumer price inflation is still meek, and you wonder what will happen to it when things finally get back to normal. 

Bill Dudley, for one, says there’s a real risk inflation will get out of control this year, forcing the Federal Reserve to tighten more quickly than markets expect. In January he spelled out five warning signs, and now he sees four more, including rising inflation expectations in the bond market. Better stock up on bucatini now.

Telltale Charts

The pandemic has awakened in Americans an appreciation for a big, simple social safety net, after decades of shrinking and shredding it, writes Noah Smith. A stronger baseline of government support could have kept the U.S. from spending so much on emergency relief.

Making Up the Gap

Further Reading

The G-7 should coordinate a global ramp-up in vaccine production to get developing nations vaccinated. — Bloomberg’s editorial board 

Boris Johnson is right to be careful about reopening the U.K. too quickly; variants make Covid a tricky enemy. — Therese Raphael 

London badly trails New York in the hunt for tech IPOs. It must become more welcoming. — Chris Hughes 

Paying farms to store carbon isn’t a workable climate fix yet. — Adam Minter 

ICYMI

The WHO recommended AstraZeneca’s Covid vaccine for all adults.

Mitch McConnell signaled openness to convicting Trump.

A Georgia DA opened a criminal probe of efforts to overturn election results.

Kominers’s Conundrums Hint

Still stuck on our Groundhog Day conundrum? You might look for our darkness fans in the shadows — or at least partially covered by them. And then to figure out the puzzle answer, you’ll have to bring their full names to light. — Scott Duke Kominers

Kickers

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