Reddit vs. Wall Street
Recently there has been a lot of debate within the finance community about the issues surrounding the Reddit page Wall Street Bets. An online community of retail investors was able to come together and collectively bring the prices of certain stocks up, confusing all the big shots on wall street along the way.¹ This whole situation shows the power that the internet has given to these newer generations in recent years.
This has become an issue of power similar to that described in Manuel Castells paper: Communication, Power and Counter-power in the Network Society. These retail investors have used their influence on social media platforms such as reddit and twitter to come together and raise a few specific stocks. Castells states, “power relations, that is the relations that constitute the foundation of all societies, as well as the processes challenging institutionalized power relations are increasingly shaped and decided in the communication field.” Wall Street, a traditionally old-school system, is typically controlled by the mega-wealthy behind closed doors, however this coalition of retail investors was able to use social media to shift the power in their favor and manipulate the market.
One company that has become intertwined in the debate is Robinhood, a financial services app that allows retail investors to trade securities commission free. They restricted trading on these certain stocks causing a social media frenzy. Many people from different walks of life and both sides of the political spectrum have used social media to criticize Robinhood’s actions.²
This situation has garnered so much attention and support from social media that AOC and Donald Trump Jr. are in agreement. Another large part of Castell’s paper is about the internet’s control over politics, and in his paper he states, “Politics is based on socialized communication, on the capacity to influence people’s minds. The main channel of communication between the political system and citizens is the mass media system.” This whole thing started as a social media campaign, which lead to rebellion against wall street, and then an ensuing political debate online.
This shows the importance of social media and the internet, as none of this would have happened without the powers of Reddit and other social media platforms. The power dynamics in our society are changing rapidly, and this situation is a perfect example of how individuals are using social media and the internet to enact these changes.
1: Reginer, Pat. “Stonks Are Bonkers, and Other Lessons From the Reddit Rebellion.” Bloomberg Businesseeek, 4 Feb. 2021, www.bloomberg.com/news/features/2021-02-04/gamestop-gme-how-wallstreetbets-and-robinhood-created-bonkers-stock-market.
2: Fernando Alfonso III, CNN Business. “Class-Action Lawsuit Filed against Robinhood Following Outrage over GameStop Stock Restriction.” CNN, 29 Jan. 2021, https://www.cnn.com/2021/01/28/investing/lawsuit-robinhood-gamestop-wallstreetbets/index.html
