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| - FACT CHECK: Does This Image Show A Real CNN Headline Related To GameStop’s Stock Price Increase?
An image shared on Facebook allegedly shows a CNN Business article with a headline that reads, “White Supremacist Internet Gamers buy Gamestop stocks to purposefully bankrupt Jewish Hedge Fund on International Holocaust Remembrance Day.”
Verdict: False
There is no record of CNN Business publishing the headline. A CNN spokesperson confirmed the image is fake.
Fact Check:
In recent days, amateur investors from the Reddit group “WallStreetBets” have fueled a surge in the value of video game retailer GameStop’s stock, which had been shorted by hedge funds such as Melvin Capital, according to NBC News.
The Facebook image claims to show a CNN Business headline related to the GameStop stock fluctuation that was allegedly written by “Moshie R. Horowitz” and updated on Jan. 27, the date International Holocaust Remembrance Day is held. The image has also circulated on Twitter and Reddit, where some users expressed doubt about its authenticity and others appeared to believe it was genuine.
There is no record of CNN publishing the supposed headline on its website. Searching social media posts from CNN and CNN Business turned up no matches for the article. Check Your Fact also didn’t find any CNN articles with bylines listing “Moshie R. Horowitz” as the author.
“Everything about this is fake,” Bridget Leininger, a senior director of communications at CNN, confirmed to Check Your Fact in an email. (RELATED: Does Nancy Pelosi Own Stock In Dominion Voting Systems?)
The fabricated CNN Business article surfaced amid amateur investors driving up GameStop’s stock price, causing hedge funds and other groups that attempted to short the stock to lose money. Short selling occurs when investors borrow shares of a stock they expect will fall to sell and later buy back to return to the lender, according to NPR.
Short sellers essentially bet that the stock price will continue to fall between when they sell the stock and when they buy it back to return to the lender, according to The Associated Press. If the stock price does fall between those two transactions, the investor keeps the profit. If the price goes up, the investor loses money when they buy back the stock to return it to the lender.
GameStop’s dramatic stock price increase has forced short sellers who bet its price would fall to buy back the stock to prevent further losses, making the price rise even higher, The Associated Press reported. This phenomenon is known as a short squeeze.
Bloomberg reported that Melvin Capital, thought to be one of the hardest-hit by the GameStop short squeeze, had lost 30 percent of its financial assets in the first few weeks of January. Melvin Capital has closed out its short position on GameStop and recently received an infusion of about $2.75 billion from the hedge funds Citadel and Point72 Asset Management, according to CNBC.
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