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CHARBONNEAU – Revenge of social media traders shakes Wall Street

USERS OF THE SOCIAL MEDIA FORUM REDDIT organized last Wednesday to save the game retailer GameStop from being driven into bankruptcy by hedge fund managers.

Wealthy hedge funds targeted GameStop in a tactic called ‘short and distort.’ They trigger a selling frenzy by selling large volumes of stock and profit when they fall.

It’s a classic struggle between the Fat Cats and the Downtrodden.

The Reddit users, called redditors, were incensed. They responded with a “short squeeze,” forcing the price of the stock up. The subreddit group /r/WallStreetBets came to the rescue. Following the lead of an influential redditor with the handle /u/deepf**kingvalue, they bought shares in GameStop. That drove the price of shares up, thus thwarting the plans of the evil hedge fund managers.

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David Charbonneau is a retired TRU electronics instructor who hosts a blog at http://www.eyeviewkamloops.wordpress.com.

About Mel Rothenburger (8164 Articles)
ArmchairMayor.ca is a forum about Kamloops and the world. It has more than one million views. Mel Rothenburger is the former Editor of The Daily News in Kamloops, B.C. (retiring in 2012), and past mayor of Kamloops (1999-2005). At ArmchairMayor.ca he is the publisher, editor, news editor, city editor, reporter, webmaster, and just about anything else you can think of. He is grateful for the contributions of several local columnists. This blog doesn't require a subscription but gratefully accepts donations to help defray costs.

2 Comments on CHARBONNEAU – Revenge of social media traders shakes Wall Street

  1. Ian MacKenzie // February 8, 2021 at 7:03 AM // Reply

    Being one of the very old original poor who hadn’t the extra to play these games – – – and even though I’ve read this piece twice, I’ve no idea what he’s talking about. Oh well.

  2. Short selling itself does not drive a company into bankruptcy. Short selling is a financial market strategy used when a company either with poor management or a bad business plan or an outdated product or some other worrisome underlying issues is likely to go under. Short sellers are not part of the management of a company. This is not to excuse fraudulent market manipulation by insiders, which does occur and it does in a number of ways. Similarly to the 8-track, GameStop will go under not because short sellers but because technology and business models change.

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