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Reddit takes on Wall Street as elites are angry internet users can meme a stock to new heights

They're trying to maintain control.
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The internet has allowed everyday people to seize control in a way they haven’t before – and that’s why powerful entities are always looking to stop it.

Whether it’s citizen journalism or memeing a president into The White House, media, hedge funds managers, bankers and others are always trying to silence the people in an attempt to maintain control.

The US Securities and Exchange Commission (SEC), mainstream media, and hedge funds are trying to find a way to control online conversations where they concern suspected posting of information whose goal is to “hype stocks.”

This is going to open another front in the “war on misinformation” on the internet, likely equally as controversial as all the previous ones, as reports suggest the SEC will have a hard time discerning legitimate opinion about a certain stock and freely sharing that opinion, from somebody’s premeditated scheme to drive the price up.

It’s no coincidence that these musings on regulating the internet in this context come as the fascinating story of the GameStop retailer has been developing in recent weeks.

The company’s shares more than quadrupled in that time, with the buying driven and given a huge boost by commentary posted on online communities like Reddit’s WallStreetBets.

Playing the stock market game by the rules established by entities like hedge funds, a large number of retail traders have now come together to benefit from those same rules in the GameStop case.

By using market tools available to them, they realized that they can “overpower any institution or short seller in the world, outside of the Fed, of course,” Timothy Collins wrote for Real Money, commenting on the GameStop phenomenon.

But even though the brick-and-mortar business, described in reports as a “beloved meme stock” over on WallStreetBets, is enjoying success in the stock market, one group of players has been hurting, at least for the time being: those billionaire hedge funds who had decided to short GameStop’s stock.

Short selling means borrowing stock, selling it expecting its price to drop, buying it back at a lower price, returning it to lender and making profit generated by the difference.

But now those who sold GameStop’s stock a couple of weeks ago would have to pay above 250% more to buy it back.

The way internet communities who are playing the game make gains by going for “out-of-the-money call options or low-float stocks,” Collins explained, calling the realization that they can do pull all this off “an awakening.”

Now the SEC scrutiny of online speech and hints at more regulation seems to many like an attempt to protect professional speculators from everybody else who is using established tools.

“Regulation for what? Exchange of ideas? Our own Due Diligence? Winning against you in your own game? Yeah, in most cases your buddies at the SEC would gladly do so if you tell them anyway,” said a post on WallStreetBets, slamming at the same time “market manipulators who have been using dirty tactics for decades.”

If you're tired of censorship, cancel culture, and the erosion of civil liberties subscribe to Reclaim The Net.

Defend free speech and individual liberty online. 

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