Why GameStop Stock Soared As Part Of A Reddit Forum's Quest To Take Down Hedge Funds
A David and Goliath fight is being waged in the stock prices of seemingly failing businesses like GameStop and BlackBerry.
In this case, Goliath is a group of Wall Street hedge fund investors and David is an online community of individual investors who frequent Reddit and TikTok looking to stick it to the man.
Stocks for previously floundering companies like video game retailer GameStop, movie theatre company AMC and original smartphone company BlackBerry have skyrocketed exponentially this week after being bought up en masse, largely by users of the Reddit forum r/WallStreetBets. This has thrown the stock market into chaos, hedge funds are pulling out their investments and really, GameStop hasn’t received this kind of attention since the Nintendo Wii came out.
According to his spokespeople, even U.S. President Joe Biden is monitoring the “GameStop situation” — a funny phrase for the U.S. president to say — closely.
But what is actually going on with the stock market and how did a ragtag bunch of meme-lovers on the Internet cause so much drama? Many people, including myself, might meet most stock market news with confusion, ignorance or an ironic declaration of “STONKS.” But stocks do have an impact on our day-to-day lives, and we’re seeing that in real time right now — all thanks to Reddit.
Here’s what you need to know.
What is r/WallStreetBets?
It’s a Reddit forum where small-scale investors gather and speculate on stocks. The group describes themselves as “Like 4chan found a Bloomberg Terminal” and currently boasts over 4.2 million users. They also had an accompanying server on voice-messaging service Discord, which for a while this week sounded like the honest-to-goodness stock market.
the wallstreetbets discord needs to be heard to be believed.
it’s the modern day version of being on floor of NYSE. pic.twitter.com/QqKIz94yvU— jpa (@josephpalbanese) January 26, 2021
The Reddit forum briefly went private Wednesday night...
