The past week saw another cultural war unfold across the country between small-time day traders on Robinhood and the almighty hedge funds over a company no one has spent much time talking about in at least 10 years: GameStop stock.
Last Thursday, after stock traders, mostly talking to each other via Reddit, decided to drive the GameStop stock up from under $100 to nearly $500, trading was halted by Robinhood, the app that many smaller, day traders use thanks to their “no fees” and fractional share trading capabilities.
Right away, the talking point became that Robinhood colluded with hedge funds, big banks and big tech to screw the little guy over, who had caused the hedge funds to lose billions because they had shorts on the GameStop stock that the Robinhood and Reddit users were driving to the moon.
Sure, it’s complicated, but it made for a helluva story and perfectively fit the narrative of the populist left and right. Ted Cruz was agreeing with AOC! Wow! Bipartisanship!
The problem is no one was actually trying to find out the truth of what was going on. Cable news and talk radio became a joke. While my finance degree from Villanova provides limited value to my day job hosting a talk show, once in a while it comes in handy, like in this case. And while I had initial concerns over what was going on with Robinhood and GameStop stock, I knew there were still more questions than answers.
But on cable news, one of the faces and voices of this entire movement became Barstool Sports founder Dave Portnoy. Portnoy is a brilliant entrepreneur who built up Barstool from an uber-local newspaper he would hand out himself on street corners in Boston to a digital media powerhouse that is known globally.
Portnoy has been day trading as a hobby since COVID hit. It replaced his knack for sports betting and he became a cult figure of sorts as a day trader. It’s fun content and certainly filled the void for a sports-based outlet when there were no sports in the spring of 2020. It was a brilliant business move. And as the stock market ride has continued through recent months, Portnoy has continued to strut his stuff as a trader. Heck, much like his pizza reviews, if it remains popular with the audience, keep hitting it.
But last week, we needed people who understood what exactly was going on with Robinhood.
That was never going to be Dave Portnoy. And putting him on to rant and rave may have been entertaining, but it wasn’t doing anything to educate the audience outside of confirm their believes from someone who wouldn’t know where to start on understanding SEC rules and regulations, margin calls, how trades get cleared between brokers and clearinghouses, and what exactly was going on behind the scenes with the story.
From a ratings perspective, I suppose it made sense, but from the perspective of informing the audience, trying to find the facts and the truth, and getting the information out there that was needed, media mostly failed.
They went for the cheap ratings ploy over trying to educate the audience. They fed the frenzy instead of sharing with the audience what it needed to hear.
It’s one of the biggest problems in media today, and I say that as a talk show host whose job it is to share my opinion. But it’s important to be able to understand where reporting ends and opinion starts, and that has fallen by the wayside in favor of feeding the latest social media mob. Dave Portnoy was giving his opinion on many shows, but he was treated as an expert on the issue, which he was not. One of the biggest mistakes we make in today’s media landscape, is assuming someone who is an expert in one field is one in another field. It can be true. But it’s not a guarantee. Far from it.
The other problem is that when the dust settled and it became clear that this was not some big conspiracy theory, the story had lost its steam. No one cared that what they believed last week wasn’t really true. Oh, and in typical 2021 fashion, the facts got a fraction of the attention that the hype, falsehoods and incorrect information ultimately received.
Pete Mundo is a weekly columnist for Barrett Media, and the morning show host and program director for KCMO in Kansas City. Previously, he was a fill-in host nationally on FOX News Radio and CBS Sports Radio, while anchoring for WFAN, WCBS News Radio 880, and Bloomberg Radio. Pete was also the sports and news director for Omni Media Group at K-1O1/Z-92 in Woodward, Oklahoma. He’s also the owner of the Big 12-focused digital media outlet Heartland College Sports. To interact, find him on Twitter @PeteMundo.
