Leaving the Matrix: Gamestop, The Stock Market, and Bitcoin

I started to write a piece on Game (GME) when it was selling a $347. Today, Gamestop sits at $49.00. When it was a $347 a share, the company was valued at $22 Billion. Now, at $49, it is more like 3.5 Billion. That is a loss of 18 Billion dollars.

Where did the money go?

Here’s the lesson for today. Like the matrix, when there was no spoon, there never was any 22 Billion dollars. It was fiction, the appearance of money created out of ether. All the trading accounts all over the word that went up, all of the stonk memes with people posting they were now “worth” five million dollars — it isn’t that the money is suddenly gone. Instead, it was an illusion all along.

This could be a real screen capture from a real trading platform. Yet the money might not be.

I will explain, using an example for a real economy.

Friday Night Lights

Imagine you live in Dylan Texas, home of the Dylan Panthers football team. Over the past twenty years, Dylan has been to the state championship football game at their level five times — and won four. That is an incredible track record.

Players who go to the game pay about a hundred dollars for a championship ring. These rings are unheard of for a hundred miles in every direction. To the one-hundred players who have these rings, they are incredibly valuable, the kind of thing…