Earlier this week, The New York Times described how Goldman Sachs was artificially raising the the price of aluminum. Some people believe Goldman, some people believe The Times, and some people are really, really confused by the whole thing. How confused? Charles Gasparino, a Fox Business News reporter, read the article three times and still had no idea what the big deal was, so The Daily Show brought in an elementary school to break it down. For your convenience, here's a rundown on the confusion. Hopefully, that means your prepubescent niece won't need to explain it to you.
The Times argues that Goldman hoards aluminum, raising the global price and increasing their profits
In 2010, Goldman Sachs purchased Metro International in Detroit, where the huge bank currently stores 1.5 billion tons of aluminum. According to The Times's Dan Kocieniewski, since the law requires that 3,000 tons of aluminum leave the warehouse each day, workers spend most of their time driving the aluminum from one warehouse to another.
The back-and-forth lengthens the storage time. And that adds many millions a year to the coffers of Goldman, which owns the warehouses and charges rent to store the metal. It also increases prices paid by manufacturers and consumers across the country.
Seems pretty straight forward, right? Wrong.
A lot of people who write about finance don't understand this story. Like, not even a little.
No one was more confused than Charles Gasparino, a Fox Business Network reporter who appeared on Fox's Market's Now earlier this week to say as much. "I want to tell you that I did not understand that story. I read it three times, I had my producer, who's very financially literate read it," Gasparino said. "I don't quite get the scam." Later in the video, he repeats how many times he read it, and expresses concerns about the reading comprehension levels of our Senators. "I can't imagine that the senators who are going to hold these hearings are going to understand this if I can't get it," he said. The Daily Show, which covered the Goldman news extensively last night, aired clips from the Gasparino segment, then brought out an eight-and-a -half year old girl to explain the situation. Skip to the 3:42 mark:
He took it pretty well, all things considered.
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And here he is explaining the Goldman situation to another Daily Show viewer:
Here he is responding to an admittedly troll-y Twitter mention:
And there you have it. Address further questions to Charles Gasparino. He understands everything now, thanks to that little girl.