How Meme Culture is changing the global financial system

Reddit is pumping sphere the share price of GameStop in the stratosphere and turns against Wall Street. Thereby, also Parallels to bitcoin Meme Culture can discover.

Who thought that things in 2021 to return to normal, which was wrong. Because in spite of the economic crisis, the financial turn free markets completely. Its provisional climax of this from many ways, wild financial-January in the fight David against Goliath. Of course, the talk of a co-ordinated Short is Reddit Squeeze by users of the Image Board. What happened there, and why the process of investors is also for Bitcoin interesting.

Short sales, with GameStop shares

In the centre of the Causa Reddit Short Squeeze, a rather nondescript company: GameStop is. The computer games retailer has it already for quite some time conceivable. Finally, cloud-based Gaming is threatening to make the business model to the end. The corona-related lock downs associated with store closures meet the seller thus doubly hard and so hovering for some time, the sword of Damocles of insolvency on GameStop.

This is a Trend that Wall Street is, or better said, not escaped the attention of Melvin Capital, a well-known asset managers in the United States. The financial Manager short went – but really. Basically, bet Melvin Capital to the complete Ruin of GameStop (NYSE: GME), and intended the bags up fully.

Possible called make this short sales. Behind it is the practice to throw the borrowed shares to the market and buy at a later date, and to the Broker who lent the shares originally, return plugged. The price falls between these two actions, make short institutional Profit.

Was driven the Short-Orgy, however, of Citron Research, a well-known stock exchange sheet of the United States, as well as Andrew Left, one of its authors, is one of the most famous short eller of the country. Left had only taken care of last week with a “sell” recommendation for the GameStop share a stir. Probably because he would have benefited as a short seller of a fall in price massively.

Robbin Hood Trader vs. Wall Street: David against Goliath

But Citron Research, Left, and Melvin Capital had made the bill without a new Generation of hungry stockbrokers. So the Swan song of GameStop had been on Reddit for a violent Furore, and dated to hand over Trading Apps like Robinhood Long and to make the manipulative machinations of the Wall Street conglomerate, a dash through the bill. What happened then, is likely to exchange-write history. Because instead of going into a bottomless GME shot through the ceiling. The price of the share was at 21. In January, 43 United States Dollar (USD). A week later, on may 28. In January, there were already 347 USD.

The Big Short

The reason for the extraordinary rise was not, of course, just the sheer volume of Long positions, but also a so-called Short Squeeze. Because if share prices increase within a short time of value, is empty, sellers are forced to liquidate their positions. In General, this means that Shorter close their positions with losses. You can do this but only if you buy shares on the market, they can be returned to the Broker from whom they had borrowed originally. The revived demand in turn more buying pressure on the market and once again rising prices: A Short Squeeze and a huge green candles as the GME of the stock market are the result.

In the co-ordination of the action of some of the already speaks of the manipulation of the market, played all the advance u/deep-fucking value a role. The Reddit User went back in October of last year, with more than 10,000 shares of GameStop long and bet to for some time against the giants of Wall Street. In his latest Update, the User shares his profit margin with the Community. And you can see: