Reddit Users Fuel Gamestop Stock Battle with Wall Street


Picture by Brandon Kim

By Preslee Adams, Staff Writer

GameStop shares were up almost 2,000% during the first month of the new year. Led by an Indianan real estate agent, a New York line cook, a pastor, and his wife in California, and a high school student in Milwaukee, these people are believed to be a collective of social media users from Reddit and Twitter who started the GameStop battle with Wall Street.


Boredom triggered by COVID-19 and greed launched an enormous boom for GameStop, as investors have saturated many companies’ trades, therefore pushing their stock prices to sky-high levels. 


A popular subreddit thread under the name of “WallStreetBets” has more than 2 million members reading and publishing “stonks” tips and current events. Its most significant objective in January was to raise GameStop’s stock price, the notorious video game retailer.


There was word going around for weeks encouraging the WallStreetBets members to invest in the GameStop (GME) stock. Ryan Cohen, CEO of pet brand Chewy, had allegedly been encouraging the GameStop investment for months. Many suspected the company was planning to convert their services more digitally, as Cohen owns about 13% of its stock and is on their board.


Eventually, the Wall Street Hedge Funds shorted the stock, meaning that they wagered against it, causing it to drop in price and allow their investments to become more successful.


When purchasing stock in a company, you bet on something that will hopefully lead the enterprise’s inventory to increase its value. However, if you fear that a company might sink, you can sell shares in hopes that you can eventually repurchase shares later for a reduced cost, give those shares back, and pocket the remaining equity. 


Andrew Left, a hedge fund investor, predicted that the share price of GameStop would soon drop back down, but this was far from correct. The GameStop stock price rocketed due to Redditors calling for investors to put the most amount of money in the company as they could. Some people even mentioned investing their life savings accounts and retirement money into the establishment.


Other investors and company owners saw this as a moment of young internet users having a significant impact on Wall Street firms. Most notably, the CEO of Tesla, Elon Musk, was impacted by the battle, having many investors short his company. This did not stop him from getting involved in the GME madness, as he tweeted a WallStreetBets link captioned, “Stonks!”


While many of the “investors” involved in the GameStop action are experienced with the stock market, the mayhem is likely captivating people who are willing to put everything on the line without being sure of what they are doing and possibly too slow to react to a stock crash. The game on GameStop is not, in fact, a game—and it is not only Wall Street experts who could end up losing.