Electric Bills Are a Gamble Too

Last month there was a brief surprising spike in the price of GameStop Corp. stock. The stock traded at ridiculous levels, and individual investors proudly bought at those levels. Now GameStop is down about 90% from its high, and a lot of people have lost money. I have been looking, for a while now, for examples of people who lost money that they needed, people who lost their houses or couldn’t pay their bills because they bet on GameStop and lost. I haven’t really found any. GameStop was the main financial news story for weeks; there was a congressional hearing about it last Thursday. If there were tragic GameStop stories, you’d expect to have heard of them. It seems like there weren’t. People were making self-conscious dumb gambles; they knew what was happening, and mostly had fun.

Last week there was a brief surprising spike in the spot price of electricity in Texas. There was a big snowstorm, increasing demand for power, and many generators went offline as equipment froze, reducing supply. Prices went from something like $20 per megawatt-hour in early February to something like $9,000 last week.1 Some individual retail customers had plans that put the risk of variable wholesale electricity prices wholly on them, largely through a company called Griddy Energy; those customers were billed thousands of dollars for electricity last week.