Social media has its pros and cons. One of the pros is that it unveiled the mystique of the stock market and we’re seeing more young people trade.
Wednesday was an interesting day for the stock market because AMC (AMC), BlackBerry (BB), Bed Bath and Beyond (BBBY), Express (EXPR), Koss (KOSS), Naked Brand Corp (NAKD), and Nokia (NOK) all skyrocketed because of a Reddit forum called Wall Street Bets.
A Wall Street bet user noticed that a hedge fund was selling the stocks short and placing put options (betting that the stock will go down) and convinced his community to buy those shares. For example, the Reddit users bought shares of Game Stop, and this caused Game Stop shares to shoot up from $17 to $270 as of Wednesday afternoon. This put the hedge fund in financial distress because the stock was moving in the opposite direction of their bet for no reason other than people forming a union.
Money Talks, Bullsh*t Walks
Robinhood, TD Ameritrade, and other “free” trading apps shut down the option to buy the hot stocks. People are speculating that the hedge fund put pressure on the companies to prohibit the ability to buy the aforementioned shares after losing billions.
“We continuously monitor the markets and make changes where necessary. In light of recent volatility, we are restricting transactions for certain securities to position closing only,” Robinhood wrote in a blog post.
This move did not sit well with many people. “Yo this is a fucking CRIME what @RobinhoodApp is doing DO NOT SELL!!! HOLD THE LINE… WTF,” Ja Rule tweeted.”
Meanwhile, ‘Do Not Sell’ trends as others who had a chance to buy the stocks fight to stay where the money reside.
The hedge fund was already bailed out less than a day after a 30% loss totaling about $2.75 billion.
It’s upsetting me and my homegirls because we’re almost a year into the pandemic and we’re still waiting for a second $1,400 that was originally supposed to be $2,000.
America has always been a tale of two cities but this entire movement is the digital, more effective version of the 2008 Occupy Wall Street.
It’s truly difficult to predict what’s next, but this is a symbol of the strength of the people when we join forces.