GameStop Takes Wall Street

     Through the first few weeks of February of this year, many short sellers of Wall Street were taken by surprise. Many of their hedge funds invested into dying companies such as GameStop, Blackberry and Nokia, which were found to be increasingly rising in value. Who was it that outplayed the highest of businessmen on Wall Street? Well, it was no one more than a bunch of redditors on a community named “r/wallstreetbets.” 

     Before we get to why these people decided to invest millions of dollars into dying companies, we should go over the history of how we got to this point. For years now, GameStop has been a dying company, due to suffer the same fate as Blockbuster and Toys R Us. All of these companies went bankrupt due to all their tough competition, such as the rise of streaming services and online retailers. With the age of online shopping in play, GameStop has lost its usefulness. Now, the only real selling point that GameStop has left is its collectibles such as used games, consoles, and action figures. However, collectibles can only take them so far. According to, 28 percent of Americans bought a share of GameStop within the time it was gaining exponential value. 

     How could this happen? How could a company that has shown rapid decline for some time all of a sudden be worth ten times more than it was originally worth within a few nights? The answer is fairly straightforward. There were two main reasons why these people from “r/wallstreetbets” decided to increase these companies’ value. One reason was that many of these people grew up with GameStop. It was very prominent in their childhood. I, for one, remember the certain sadness of millions, including myself, when Toys R Us went bankrupt, and I know people felt the same when Blockbuster shut down. This being the case, many of these people feel the same way toward GameStop, and they viewed their investments more as donations to help a business rather than as opportunities to make money. The other reason was a more vengeful one. Some of the investors used this opportunity to raise the stock to the point where the short sellers began to lose money. The whole attitude was that the higher GameStop was worth, the less value the hedge funds had.

     Unfortunately, the acts of the people from “r/wallstreetbets” did not save GameStop. The Washington Post recently published an article about GameStop’s current state and said, “The retailer reported a $19 million loss in the most recent quarter… GameStop’s sales have fallen 10 of the last 11 quarters dropping more than 30 percent per quarter.” Even now with the increase of value, the sales are still not performing as well as the stocks show. However, this event has shown us something more important than GameStop’s situation. With the sudden emergence of the company’s value, what followed was the rapid decline of hedge funds’ values. Many short sellers lost billions of dollars due to the surprising increase and they wanted it to end. The most popular app used for buying these stocks, Robinhood, eventually made a shutdown on trading for GameStop’s stock and made it impossible to buy anymore shares. Within a day after the incident, the app’s rating was dropped all the way to 1.1 stars. 

     In the end, these events have really shown the greed and corruption present in Wall Street. Already there has been a class action lawsuit against RobinHood. America runs on a free market, it depends on supply and demand to determine its prices and has few regulations from the government. Anybody can become rich and make big earnings, and anyone can lose just as much. It is how the stock market works.