Winners and Losers of the GameStop Saga

Angry, organized online and aiming straight at Wall Street’s elite institutions.

Nearly 10 years ago, that’s how the Occupy Wall Street movement burst onto the global stage. Its sit-ins, protests and demonstrations against inequality pushed “the 1%” into the popular lexicon.

This week, a squadron of irreverent, digitally oriented traders who gather in Reddit’s WallStreetBets forum once again took on the old guard. They forced two hedge funds to back down from wagers that GameStop Corp. shares would fall. The Reddit horde’s efforts sent the video-game retailer soaring — making millionaires out of some of them along the way, while inflicting major losses on the establishment.

In April, the stock traded at $2.80. On Wednesday, GameStop hit $380.

It was a campaign months in the making, yet this victory for the group — its leadership amorphous, its politics populist in tone yet ambiguous — drew parallels with the anti-establishment campaign that rattled the financial industry a decade before.

“What’s happening right now has sort of morphed into a movement,” said Austin Hou, a designer and engineer from San Francisco who has been reading WallStreetBets for about a year. “The strongest communities come out of necessity, and what we are seeing with this GameStop chaos is just an expression of that, where people have felt so alienated from an existing system.”

Like many during the Covid-19 pandemic, Hou downloaded Robinhood, a digital brokerage app that lets people trade stocks from their phones, and bought a few shares of GameStop. He views the community of Reddit posters as being fed up after seeing “two different worlds that are not getting closer. They are more different than they’ve ever been.”

To be sure, boosting GameStop isn’t going to bring down global capitalism. The movement’s goals are not the same as those of Occupy Wall Street. In fact, the Reddit horde’s actions have added billions to the wealth of some of the world’s ultra-rich. And financial advisers warn that for most people, the shares are just too risky to buy at scale.

Still, the language floating around the forums sounds familiar to Rachel Meade, an instructor of political science at Boston University who studies populist movements. “It feels very similar to Occupy Wall Street,” she said, also drawing comparisons to left-leaning populism that surrounds Bernie Sanders and Alexandria Ocasio-Cortez.

On Thursday, Reddit co-founder Alexis Ohanian made the comparison, saying that protestors’ “figurative drum circle has gotten a LOT bigger thanks to the open internet.”

On the political left and right, a unifying theme of populism is the alleged hypocrisy of an elite treated differently from regular people.

“A Redditor is probably closer to the average citizen, and yet now they are using the stock market in a way that top hedge funders have long been using it,” Meade said. “It just hit all the right notes of that kind of hypocrisy and that moment of ‘Wow, we did it, we banded together and put these guys in their place.’”

Redditors are having their say from trading “floors” that look nothing like those on Wall Street. Nick Sweeting, a 24-year-old in Montreal, works at a desk that’s surrounded by a pegboard full of climbing gear, motorcycle wiring and lighting cords in his bedroom. As the market was opening Wednesday, Sweeting was monitoring his Robinhood account while making crepes, his phone propped up on top of the stove. Two minutes before the market opened, the app crashed and his crepes burned.

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