The Aftermath of the Wall Street GameStop Saga

Behind GameStop’s stock surge is the grim reality of its prospects: The video game retailer is floundering even as the industry around it is booming.

GameStop has been swept up in a battle between big-moneyed hedge funds betting against it and small investors trying to prop it up. That has caused GameStop’s share price to soar despite the shaky financials underneath.

Flailing companies like AMC Entertainment and American Airlines have likewise enjoyed a stock surge, but GameStop has been the primary battleground between the Davids and the Goliaths. Shares rocketed...

Long before an army of small investors buying shares of GameStop shocked Wall Street, regulators saw the need for a clearer, real-time view of the trillions of dollars that sloshed through the markets each day.

In May 2010, a trader in London using an algorithm to manipulate a futures market helped trigger a chain reaction that wiped 9 percent off the Dow Jones industrial average in minutes. The market quickly recovered. But that “flash crash” underscored regulators’ urgent need for a tool that would allow them to pinpoint who was...