“With All Games, There’s Always A Loser”: CNBC Pushes Convenient GameStop Post-Mortem Narrative

On Squawk Box Monday morning Joe Kernen interviewed financial influencer Haley Sacks (a.k.a. Mrs. Dow Jones) about the GameStop chaos that had ensued over the last couple of weeks. Providing a post-mortem of the frenzy that took place weeks ago, Sacks took the opportunity to blame those who are “gamifying” the market, while a semi-confused Joe Kernen sounded like he was still trying to make sense of the entire situation. 

“Just tell us, were you at that point thinking ‘this is great’ or ‘I’m worried about this’,” Kernen asked her.

“I think it was a really exciting time. It was great for ratings for CNBC I’m sure and great for interest in finance but in the same way there’s a lack of education, so it was a bit scary because you saw young people taking risks with their money that necessarily didn’t make sense.”

“I remember at the time on Twitter,” Kernen says. “I made one comment that ‘this was investing?’ because it didn’t look like investing at that point. And that caused a huge ruckus. Obviously, going from single digits to four or five hundred – I don’t know what that is exactly.”

“It was a really exciting time, but in the same way there’s a lack of education,” says @mrsdowjones on the GameStop saga and the retail investing boom. “It was a bit scary because you saw young people taking risks with their money that necessarily didn’t make sense.” pic.twitter.com/p4qcngqGrl

— Squawk Box (@SquawkCNBC) February 16, 2021

“I guess it’s investing,” Kernen says. “But I’m not sure that’s the way people should be exposed to Graham and Dodd type building wealth for retirement in the stock market.”

“Absolutely,” Sacks responds. “Gamification is when you apply game mechanics to non-game environments, such as the stock market. Like with all games, there’s always a loser. You saw daytrading explode during the pandemic people because were at home and they were bored.”

She continues: “In one way, it was great, because it propelled interest into the markets and into financial literacy. But it was also extremely risky. You think about a chess match – would you play chess if you didn’t know the rules? Investing is not a game.”

But perhaps what Sacks fails to understand is that the problem wasn’t that the GameStop crowd didn’t know the rules – it was that they knew them too well. As many have documented, not everybody on the r/WallStreetBets forums was just a mindless retail lemming following the crowd. Some users did the work and understood exactly what the consequences could be from many buyers piling into the stock at the same time.

And while that didn’t necessarily fit her narrative of “investing isn’t a game” that came across in her interview, it’s likely that she, Joe Kernen and many other parties still “struggling” to figure out what happened know very well that Wall Street is a game – except it’s the institutions that don’t want retail to figure that out. And that opacity is not for the greater good of the retail investor.