What A Day - Subreddit And Forget It

Episode Date: January 29, 2021

The COVID strain first discovered in South Africa was found in the United States for the first time in the state of South Carolina. This strain is more contagious, and there’s some concern that it might be slightly more vaccine resistant than the strains we’ve been dealing with thus far.Robinhood and similar trading platforms restricted purchases of Gamestop stock and other companies targeted by Redditors yesterday, and the values of those stocks dropped off dramatically. We talk through the steps that brought us to this point, how lawmakers are reacting, and what's next.And in headlines: nationwide protests in Poland as the government enacts a near-total abortion ban, Austin votes to use police money to fund supportive housing, and GM will stop making gas and diesel powered cars by 2035.Show Links:"Robinhood’s Customers Are Hedge Funds Like Citadel, Its Users Are the Product"https://www.vice.com/en/article/qjpnz5/robinhoods-customers-are-hedge-funds-like-citadel-its-users-are-the-product

It's Friday, January 29th. I'm Akilah Hughes. And I'm Gideon Resnick, and this is What The Day, where we give you the tips you need to become the Wolf of Wad Street. Yeah, to be clear, the tips are bad, but the name is really good. Seriously, Wolf of Wad Street. Keep saying it to myself. Look like a lunatic. I don't even care. On today's show, an update on GameStop, then some headlines. But first, the latest. We've been tracking where various strains of the coronavirus have been detected throughout the world, and there was a significant update on Thursday. The strain first found in South Africa, aka the B.1.351 variant, was found in the United States for the first time. So Gideon,

what do we make of this? Okay, so it definitely seems not good, but not panic-inducing. That's kind of the read that I've been getting. So state officials in South Carolina said they had found this more transmissible variant in two people in the state. They noted that because the people had no known travel history and weren't connected to each other, that it could likely mean the variant had Brazil has also been recently found in the US too. So I think it's safe to say they are decidedly here. And there's no evidence right now that the B.1.3.5.1 strain is any more deadly, but it is more contagious like these other strains, which is why we've been hearing about them so much. But the reason that scientists are more worried about this one specifically is that one of its mutations has apparently helped it escape the full effect of antibodies that arise from the vaccines we have right now. That's why these companies are trying to adapt on the fly. Right. And Moderna and Pfizer said earlier this week

that their vaccines were slightly less effective against the strain based on lab tests. Then also yesterday, we heard an important update from another company. This is a name that doesn't come up that often, but it is Novavax. And they're another company that was part of the overall operation warp speed situation. So they haven't been approved yet, like the other two we mentioned. They're still in trials in the UK, South Africa, US, and Mexico. But they had something important to report on Thursday. So according to the New York Times, the vaccine from Novavax showed very good results in the UK

with an efficacy rate of about 90%, which is amazing, amazing news. But in South Africa, the story was quite different. The trial was comparatively smaller there with about 4,400 participants. So that's a big caveat to all of this. But this report said that the Novavax vaccine only showed about a 50% efficacy, which is quite a lot lower than everything else so far. So of course, glass half full, 50% is way, way better than nothing, but the company is now working on a new version of their vaccine to address variants. Then also of concern is that Novavax reportedly said that many of the trial participants were infected with

the variant after previously having COVID. That's another worrisome sign. And one of the reasons this variant data is so interesting and somewhat concerning right now to scientists is that it's the first from the field with actual people in a trial, not just run in lab samples. Yeah. And we've talked about how the variant in the UK has impacted people there. So let's take a moment to touch on how South Africa has been impacted by this other strain. Yeah, it seems pretty frightening, honestly. The Washington Post spoke to a researcher there, and they said that more than 90% of the cases that they've sequenced recently have been this new variant. So it quickly became very, very dominant.

And the country has seen an overall spike in cases and deaths recently. And this variant is now present in over 30 countries, which is causing so much of the concern. So we will, of course, keep our eyes on all of that going forward. But let's pivot to a completely different story that has been fascinating us all week, GameStomp. Yesterday, some of the major platforms that people have been using to buy shares, restricted trading of it. I guess first question then is fill us in on where things stand right now. Yeah, all right.

So here's the TLDR for the people who haven't been following this, which I actually envy you because it has absorbed my entire week. All right. Well, GameStop and other kind of sad stocks like AMC and Bed Bath & Beyond have been soaring this week after a subreddit called WallStreetBets with over 3 million members called for people to buy up shares in order to execute what's called a short squeeze on some hedge funds. These hedge funds were betting that these stocks would tank, aka shorting the stocks. But when the prices go up, the shorters can lose a lot of money, which can force those hedge funds to buy up a bunch of the stock themselves in order to hedge against their losses, which drives the stock price up even further. And then the play

for these Redditors is to sell at that point and make some money. The risk, of course, is that you could end up being the one left holding the bag. But while you're at it, you might end up screwing some hedge funds, which is part of this whole David and Goliath element that's going on, though there were some rich investors trying to cash in too,

so it looks like everybody's just trying to get the money. Yes, rocks are definitely being hurled. And some hedge funds have definitely been hurting in all of this. For sure. One hedge fund called Melvin Capital had to seek billions in rescue money from investors to cover their GameStop losses. And overall, the financial data firm Ortex estimates that short sellers are sitting on

$70 billion in losses from just this month. And again, it's the first month of the year. It's not over yet. So not great. And this has led to a lot of unsettled people punditing on places like CNBC. The reason the market is doing what it's doing is people are sitting at home getting checks from the government, okay?

And this fair share is a bullshit concept. It's just a way of attacking wealthy people. And, you know, I think it's inappropriate. We all got to work together and pull together. Oh. Okay. Read the room, dude. We're all just work together and pull together. Oh. Okay. Read the room, dude. We're all just sitting home getting checks from the government.

Who? Yeah. Where? I don't know those people. Would like to meet them. Right. Give us the link. Okay.

Well, the big update is that yesterday, platforms like Robinhood and TD Ameritrade stopped letting their users trade some stocks freely. Robinhood, for example, only allowed users to sell their shares in GameStock or AMC or others, but not buy more because of, quote, recent volatility. Meanwhile, bigger institutional investors who don't rely on these platforms were free to keep trading. Yes, and that, of course, has led to pissed off users. A class action lawsuit has already been filed, but also some pissed off lawmakers. We've seen responses now from people like Representative Alexandria Ocasio-Cortez, Senators Elizabeth Warren and Sherrod Brown. Yeah, that's right. And Brown is the head of the Senate Banking Committee and oversees financial

regulators. He said that he plans to hold a hearing and put out a statement that said, quote, people on Wall Street only care about the rules when they're the ones getting hurt. Say it again. Well, Ocasio-Cortez, who's on the Financial Services Committee, said she'd support a hearing in the House if necessary to find out why Robinhood restricted their users. She also told Ted Cruz to take a seat when he tried to jump on the bandwagon, which like, just sit there and eat your food, dude. Like, the best case scenario is no one's talking about you. You did try to, you know, have that interaction happen. Anyway, last night she did a Twitch live stream

that got over 300,000 viewers despite some technical issues in the beginning. So clearly the story is just driving intense interest. And at the end of the day, yesterday, Robinhood said that they would allow users to buy a GameStop today, but on a limited basis. They also said they would monitor and make adjustments as needed.

And of course, the big picture context I hope isn't lost on anyone is that millions of people are struggling right now to pay their rent, buy food, find a job, as we heard on just yesterday's show. And meanwhile, the stock market has been climbing this whole time. So these people are pointing to that disconnect, but also calling out unfair rules of the game. Right. So let's talk about those very rules and the game that we all love. Yeah, we love so much. Well, you have the Redditor types or retail investors that feel empowered by these new trading platforms like Robinhood. They also have social media to group together and can take advantage of all the information that's now on the Internet. So there's a lot of new tools.

You also have some people on Wall Street saying that this is dangerous and that speculative buying frenzies are bad, which, yes. But that kind of nonsense flies on Wall Street all the time. For example, Senator Warren gave an interview yesterday on CNBC where she pointed to stock buybacks where companies buy their own stocks to inflate the price for investors. It's super common. No one ever complains about it. She also talked about how Robinhood has what's called an arbitration clause for its users to protect the company from public disputes and from users coming after it. So that might actually get in the way of the class action lawsuits that we mentioned earlier. Right. And it's also worth noting that Robinhood, which is commission-free, actually makes its money by selling its users' trades to other large firms to execute them.

Well, that's part of what's raising questions about their decision to restrict users, potentially to the benefit of those big firms that Robinhood works with and makes money from. Robinhood's CEO denies that played a role. We've put a link to read more that Robinhood works with and makes money from. Robinhood's CEO denies that played a role. We've put a link to read more about Robinhood in our show notes. There's a lot more to this story, and we don't have time to cover it all today. So for now, that's the latest. It's Friday, WOD Squad, and today we're talking about a fun case of on-the-go immunizing. In southwestern Oregon this week, a group of workers from a mass vaccination clinic got stranded in a snowstorm on the way home. And rather than let the six vaccine doses they had with them go unused, they went from car to car asking other people stuck on the road if they wanted their shot. The pictures from this day are great. Just drivers in the middle

of a blizzard hanging one arm out the door for their injection. So Giddy, off this story. My question for you is what's your ideal destination or setting to get vaxxed? It's got to be like a birthday, right? Like you're at your... Needles near a cake? Well, hold on, hold on, hold on. You're at your birthday. Everybody else is vaxxed. You're like the last one.

You get your shot. Then you're good to go immediately. And you can immediately celebrate. There's no like waiting around. There's no, oh, maybe there'll be an event later that I could go to. You're at the bar already. You're, you're ready to have the time of your life. That's my first, that's my first thought. Or it could be, you know, we could, we could have the birthday in a blizzard and that would also be fun. Cause I would be vaccinated.

It wouldn't matter to me. I mean, wow. Gideon, you know, I gotta say I'm, I'm not on board for this. I feel like also all of your friends are vaccinated by the time it's your birthday. Like, you might as well do it before or after your birthday, because you're not going to get sick because they're all vaccinated, right? Probably. Like, at least their herd will be immune. Yes.

I mean, I guess I like the idea of that being like a gift. So you know what? Don't let me rain on your parade. No, rain away. My answer is insane and I should never speak again. But what do you think? What's your location? Listen, I liked your innovation, Gideon.

But I would say that, you know, I heard that they're doing vaccines at Disneyland. That's going to be the plan whenever California gets its act together. And I'm like, it would be great to get like a vaccine on your way into Disneyland. You get a fast pass to the new Star Wars rides and all the other rides they finished while no one was allowed to be there. And it's just like, you know, you get welcome back to the happiest place on earth. I dig it. I think that that would be ideal. But, you know, I would want it in the parking lot, not like around kids, all the teacups in the open air, people breathing or spitting or like getting wet on Splash Mountain. Like it has to be at a very specific parking space in the parking lot.

Right. It's like a church state separation. Like you want your health thing going on in its own bubble before we start on the Star Wars rides and all this other stuff. Because like if we're if we're blending the two, it could, could lead to some mixed results. Totally. And you know, all of your family memories, you want those together in the park, not about all of the horrible illness and terrible shit that's been happening

for the past little while. You want it to be about like, wow, we all got together. So I'll just get a little poke and then I'll meet you near space mountain. That's how I feel. I think that's great. Let me throw a crazy idea out there.

Birthday party at Disneyland plus the vaccination. I think that that is a perfect solution to this. And just like that, we've checked our temps. Stay safe. Mickey Mouse, if you got the vaccine and you want to throw a rager birthday party, we would love to be invited. And we'll be back after some ads. Let's wrap up with some headlines.

Nationwide protests in Poland erupted Wednesday night after the government announced that a near total ban on abortion had suddenly gone into effect. Under these new rules, almost all types of abortion are now banned except in few extreme circumstances. The ban officially passed back in October, but the government held off on implementing it due to widespread outrage and weeks of some of the largest protests the country has seen. Poland's ruling Law and Justice Party, which aligns itself with the Roman Catholic Church, is responsible for packing the courts in order to pass a ruling that was deeply unpopular with the general public. This week's protests are part of a movement called the Women's Strike, and they're expected to go on throughout the weekend. Austin City Council voted on Wednesday to use money from its police budget to fund permanent housing for people experiencing

homelessness. Under a new measure, the city will spend $6.7 million from its housing department to buy a hotel, which will be converted into 60 units for supportive housing. Maintaining that property and providing services to residents will cost over a million dollars per year, and that money will come from a recurring $6.5 million fund the city created when they cut police budgets in 2020. One council member claimed the only reason this project could even be done was because of that recurring fund from the PD.

So when we talk about defunding the police, these are the kinds of things we're prioritizing over Boston dynamic dogs and modded out Tesla Cybertrucks for law enforcement. At the start of last year, over a thousand people in Austin were unsheltered while experiencing homelessness. The city is in talks to acquire a second hotel, which could provide an additional 80 units of permanent housing. And the leftover money can be used to potentially target and eliminate the dynamics dogs. Not a fan. Sorry to say. Scary, scary dogs. Our highways are one step closer to smelling like glorious battery juice instead of hot fossil smoke, with the announcement yesterday that General Motors

will phase out gas and diesel-powered vehicles and sell only electric cars by 2035. GM is the country's largest automaker by sales and this pledge is one of the most ambitious we've heard and we have heard them all. Volkswagen and Mercedes have promised to make green versions of all their cars by 2030 and 2022 respectively, but no one else has set a date yet for a total transition to electric. This decision by GM was in service of their larger goal of going carbon neutral by 2040. And it comes at a time when federal and state governments are offering tax credits and other incentives on zero emission vehicles, which help consumers to look out for Mother Nature without angering father credit card

debt. You don't want to get him mad. President Biden has also pledged to spend billions to build charging stations and wants to enact stricter fuel efficiency standards, tilting the scales further towards an electric future. GM stock rose sharply following its announcement, reflecting a faith in electric vehicles among investors or some kind of pump and dump scheme involving fired up millennials who want a class war. At this point, I have absolutely no way to tell.

Truly. Yeah, everything is that now. But also, electric future is a great name for a band. Oh, yeah. Somebody make that band. Well, we all know McRibs are made of whatever can get swept off the factory floor. McNuggets come from a distant chicken relative that's illegal to own or photograph. But a new lawsuit makes a bombshell fast food allegation few will have heard before,

that Subway tuna doesn't contain any tuna fish at all. I know I said I like the tuna fish sandwiches there, so please just respect my privacy at this time. Two plaintiffs filed the lawsuit in California, claiming that they ran lab tests on multiple tuna samples from multiple locations and found only, quote, a mixture of various concoctions that do not constitute tuna, yet have been blended together by defendants to imitate the appearance of tuna. Listen, Subway, there are only two concoctions that should be mixed together to make tuna, yet have been blended together by defendants to imitate the appearance of tuna. Listen, Subway, there are only two concoctions that should be mixed together to make tuna, and their names are Tuna Mommy and Tuna Daddy.

We all agree on this. The lawyers behind the suit want to get their claim certified as a class action, which could let thousands of California Subway customers get in on the feeding frenzy. They're suing for fraud, intentional misrepresentation, unjust enrichment, and more. And they point out that tuna sandwiches cost a premium. So from their perspective, their clients were shelling out

an extra $1.50 just to manifest fish as an idea. Subway said the claims are without merit and even added their tuna is wild caught. For now, I recommend going with the veggie patty at Subway, which you can be 100% sure is made of delicious, fresh cut grass.

Vindicated on Subway tuna at last. I did it. Yeah, well, good for you. And those are the headlines. That is all for today. If you like the show, make sure you subscribe, leave a review, respect Tuna Mommy, and tell your friends to listen. And if you're into reading and not just the net worths of guys on CNBC

that say the stock market is bad now, like me, well, today is also a nightly newsletter. Check it out and subscribe at crooked.com slash subscribe. I'm Akilah Hughes. I'm Gideon Resnick. And enjoy your Subway veggie patties. I'm sure that, you know, no one's going to tell you that that's also made out of concoctions either.

Yeah, definitely could not happen. Definitely not an outcome that's even possible. What a Day is a production of Crooked Media. It's recorded and mixed by Charlotte Landis. Sonia Tan is our assistant producer. Our head writer is John Milstein and our executive producers are Katie Long, Akilah Hughes, and me. Our theme music is by Colin Gilliard and Kshaka.