On Tuesday I talked about hitting a creative wall and the need to rediscover the drawing skills I once had in my hands. Today it is all about breaking down financial walls with diamond hands! What. A. Week. To those living in a cave, there is a tremendous amount of activity going around social media about stocks and the stock market, but more specifically GME, or GameStop. Yes GameStop, a struggling retail store that sells video games is now at the center of the financial world. But honestly, this is so much more than finances.
I will give you the quick version of how we got here. This all begins with a Reddit user that goes by the username “DeepFuckingValue” who has been revealed to be 34-year-old Keith Gill from Massachusetts. In 2019 he began to invest in GameStop at $5 a share. Sometime between then to now, it was discovered that the stock was short selling. Here is the catch, the hedge fund Melvin Capital was overextended in this process at 140%, meaning they were borrowing shares that did not exist in attempts to make more money on a falling stock. Well, word started to spread organically within the community subreddit called “Wall Street Bets,” where DeepFuckingValue is a member of, and the consensus was that the community could bet against Melvin Capital’s ridiculous move and win. Their strategy is to simply buy stock and not sell, or in their lingo, "have diamond hands," as opposed to "paper hands" which means you are soft and sell the stock at the first gain.
The financial move by Melvin was risky, stupid, and fueled by greed. They are now in a situation where they must buy stocks to pay back the stocks they borrowed. The community from r/WSB has collectively refused to sell the stocks to drive the price up as high as possible. They want to bankrupt a Wall Street big dog while also making as much money as possible. News of what was happening started to spread while more and bigger players started to join the table to cash in. To make matters worse, the popular stockbroker RobinHood, and many other brokers, froze the ability to buy stocks during a dip this week. This set news and social media into a frenzy with claims of market manipulation in a supposed “Free Market.”
So here we are. What the hell is all this? Suddenly everyone wants to know what a stock is and how the stock market works. There are now cheers of retribution for the 2008 financial fallout. “#EachTheRich” was trending on Twitter this week. For god’s sake this was enough for Senator Ted Cruz and Senator Alexandria Ocasio-Cortez to agree on something (almost). Is this the little guy winning at the big guy’s game?
This event is Generational warfare and Class warfare wrapped up in a technological finance revolution. A new kind of social movement that challenges the notion of real financial change, as opposed to a group of vigilantes trying to storm the Capitol Building. Oh, and by the way, that still happened… THIS MONTH!!! What the hell is life?!! No one REALLY knows how the standoff will finally end because this financial challenge of the upper elite by the lower-class hive mind has never happened this way in the digital arena we call the internet. Well, at least I no longer feel the creative wall anymore. I got something to work with.
Cheers