Levine, Matt

Folks like Melvin Capital and Citron Research think that GameStop is a dying business. The general public is optimistic though, be it for fundamental reasons (e.g. Ryan Cohen (chewy.com) will help GameStop can re-invent itself in the online space ), or for personal amusement, or FOMO. In particular, /r/wallstreetbets members are buying lots of call options . Or maybe it’s rage against the financial machine.

Maximizing the Value for Shareholders

Suing a company for not following its code of ethics and therefore misleading investors doesn’t fly, but Signet Jewelers settled for $240m . Signet’s 70k female employees sued for discrimination, but the class action is yet to be resolved.

Protectionism vs. Globalization

Prestige Ameritech is America’s #1 maker of surgical masks. In outbreaks, demand peaks, but when it’s all over, hospitals go back to exclusively buying cheaper masks from China. Reduced demand makes Ameritech lay off workers. Ameritech is pushing for a federal contract to stabilize demand over time.

India’s Foreign Exchange Act of 1973 gave Coca-Cola an ultimatum: hand over 60% of the local subsidiary to Indian partners and the syrup recipe. Coca-Cola left in 1977. With the fall of the Soviet Union, socialist India’s primary sponsor, India embraced the free market to fully finance its debts. Coca-Cola and Pepsi came back, but Indians kept drinking Thums Up (goes well with spicy food) and Limca (appeals to national love for lemonade). Coca-Cola bought both brands but still produces them.

Short Selling

Say $A shares are selling at $100, but I think they’re overpriced. So I borrow 10 shares, pay my brokerage interest and post some collateral. I then sell the shares for $1,000.