It’s More Than Just Memes And Bad Jokes
“If Wall Street is occupying President Obama’s State Department and the halls of Congress, it’s time for the people to occupy Wall Street.” – Phil Aroneanu, 350.org
The GameStop saga, I believe, will come to be not only a wonderful Netflix original film (as long as they cast Ryan Gosling as Deep Fucking Value), it could quite possibly go down as a defining moment in history. It could trigger the largest top-down wealth transfers ever seen, it could break our financial system, or prove how woefully corrupt it is as well. But most of all, it has given many the opportunity to strike back at the people who broke the world economy in 2008 and the opportunity for people to give back. It has laid bare the anger and resentment at the financial ruling class and Wall Street, one that people thought had faded after the anger of the Occupy movement.
During the wait for the second short squeeze, there were numerous posts across r/wallstreetbets, r/wallstreetbetsnew, r/GME, and other subreddits, discussing what would be done if the price per share hit $1000, $10,000, and even $100,000. $100K is not a meme was spreading like wildfire across the internet (almost as if it in itself had become a meme…).
There was some talk of shorting the Robinhood IPO (Initial Product Offering) – in other words they would make bets that Robinhood would go down in price, which can in turn push the price down. Robinhood is a retail trading platform, which allows anyone to sign up to trade both stocks and stonks. They halted trading in the midst of the first meteoric rise of GameStop – allegedly to stop the price continuing to rise but more officially due to liquidity issues with the volume of stocks being traded. There is even a theory floating around that they were margin called due to their massive exposure on GameStop and CFD (Contract for Difference) trading practices.
There was also talk of mansions, speed boats, tendies, early retirements, and buying a house big enough for them, their wife, and her boyfriend. But for every post I saw about owning a Tesla or a Lamborghini, I saw one about giving something back. There were people giving to charity, buying GameStop items for underprivileged children, paying off parents debts or mortgages, or people looking for ideas about how they could give something back with their potential windfall.
What The Media Are Missing
Here is where we get to what the media failed to understand. Dan Dixon wrote a piece for The Guardian on 28th Jan 2021 in which he declared, “The redditors logic is one I recognised from my teens: intentionally senseless, a joke rather than a philosophy. And nobody wants a joke explained”.
He declares that the most mainstream media outlets won’t get it, that it’s “for the lulz”. “It cannot, however, be read aloud by a serious newsreader when explaining the motivation of a political or social movement. It is intentionally senseless, taking the form of a joke rather than a philosophy”.
Neil Irwin the senior economics correspondent for the New York Times tweeted “trying to make sense of the GameStop thing as a 42 year-old who has covered econ And markets for years, I feel like Don Draper I’m trying to listen to The Beatles, then giving up after a short while confused and discomfited”.
At The Ringer, journalist Katie Baker was kind enough to describe the tussle as “Beavis and Butthead-like redditors chuckling over the numbers 420 and 69 against a $13 billion hedge fund on the brink of total collapse”. Whilst in the New York Times, Matthew Goldstein explained that “inspired in part by Mr Gill’s cheerleading, thousands of small investors push stock in GameStop to as high as $483”. There was almost no mention of the short sellers or the theories and DD (due diligence) that redditors were spreading and researching in their thousands.
There were figures who recognised that this hive mind that had been created online might actually be as powerful (or at least as smart) as the hedge funds that they were taking on.
For example, George Calhoun of Forbes.com wrote a fantastic piece entitled, “GameStop/GameStonk Has Nothing To Do With The Madness Of Crowds”. People believe that this is irrational and stupid gambling, Calhoun explains that “Observers are misled by the fact that the market is obviously not ‘rational’ in the financial theoretic sense of the term”.
“The GME event is in fact the result of a process that is hyper-rational. It is based on highly accurate calculations of specific outcomes which posses a much higher degree of certainty than is the case for normal investment decisions. There is no ‘madness of crowds’ here. It is a premeditated, predatory take-down of a cornered and defenseless counterpart”.
The cornered and defenceless counterpart in this case just happens to be a handful of reckless hedge funds, not a harmless animal.
What Is The GameStop Movement About?
At some point this became more than a chance to get rich quick, it became something more. It was some people’s ticket out of backwoods nowhere, out of poverty, away from the paycheque to paycheque lifestyle that has become all too familiar for many in the 21st century and only been exacerbated by covid and the lockdowns. As a millennial, it was a safety net (or potentially a way to pay off the crippling student debt we were told we needed) after 10 years of lost wage growth and record highs of the housing market.
Some people ventured into economics, proposing that we use our newfound wealth to help shape the world in a positive way, investing in renewable energy, decentralised finance, crypto-currency, and anything we believed would make the future a better place.
This was about so much more than getting rich quick; that was simply a cherry on top. For many apes this was simply about the possibility to stick it to the hedgefunds and had transformed into a way to remake the world in a better image. The redditors that I encountered genuinely thought about more than greed and themselves – it’s a beautiful thing to see really. Confronted with the possibility that they may have more money in their bank account than ever before, they consider what they can do to use their new found prosperity to become a force for good in the world. Anyone who says this generation is doomed isn’t paying attention.
For many it became a positive community to be a part of during a difficult time. We’ve all felt more isolated and lonely during the past year and the warmth and camaraderie of the GameStop community has been a rare ray of light in the darkness of a pandemic. I’ve seen more positive comments and encouragement on reddit discussing GME than I have across all of social media in the last year.
The media couldn’t be more wrong. This is not about memes and childish wasting of our money. It’s a chance to expose the frauds of modern financial markets, it’s about screwing the hedge funds that were a part of bankrupting the world in 2008, it’s about people coming together to find hope in a dark time, it’s about the evolution of the internet hive mind and its challenge to the status quo. Sure the memes are wonderful, but this is about so much more.