You’ve heard the hype. The raving, the prophecies, the theorizing about those three letters and, to use their parlance, the “apes” who took it to the moon and back. It is none other than GME (known in Canada as EB Games) and the now infamous subreddit r/WallStreetBets. On the surface, things can appear quite complicated. People are throwing around terms like “shorts”, “Citadel” and “Daddy Elon”. Allow me to explain just exactly who these people are, what they did, why they did it, and why it’s important.

In essence, large hedge funds like Citadel Capital bet that Game Stop’s share price would go down, but Redditors made the price go up instead. The hedge funds opened what you call a “short” against Game Stop; they borrowed shares of Game Stop from people and sold those shares, on the condition that the people would get the same number of shares back before a set period of time. Typically, the hedge funds would wait for the share price to become lower than what they sold the share price for, buy the shares from the market at that lower price, and then give the shares back to whoever they borrowed them from.

There are several things that could turn this profitable endeavour into a financial hemorrhage, especially if the share price doesn’t go down before they have to give the shares back. Potentially the share price could just keep climbing, and since they have to find the shares from somewhere, they could be forced to buy the shares for much more than they sold them for.

Hedges funds were incredibly confident that GME would go down, so they opened a ton of shorts on it. They bet so much that they owed more stocks of GME than actually existed. This is what made them so vulnerable. Some Redditors caught on to this, started buying up shares, and encouraged others to do the same. This sent the stock price “to the moon” as Redditors bought the stock up, and sent hedge funds into a frenzy as they were dragged deeper into the red.

Some might say the Redditors squeezed the stocks to get rich, and for a large part of users, you would be right. But people are trying to get rich every hour of every day, so what made this time so special? It was because they weren’t just trying to get rich the rational way, collectively they did something that was more than rational.

If you look at the top posts on the subreddit when GME was peaking, they all said one thing: “Hold”. If you were true to the cause, you were going to ignore the mantra “What goes up, must come down” and stick it to the man. You could see screenshots of people turning their life savings into millions of dollars, but still holding. The more you held, they said, the more the hedge funds would suffer, and the hedge funds would know exactly who did it, a bunch of self-described degenerates.

Most levers of the economy, the one ticket to wealth, have been controlled by financiers in suits, who buy expensive cars and work within blocks of each other. It’s a boys’ club and the door is locked at the top of a mountain. So when a guy, known as u/deepf***ingvalue, wearing a bandana sitting in a gaming chair is the standard-bearer for a charge that sends these hedge funds to their knees, anything could be possible. You too could be kicking your feet on top of the desk, smoking a Cuban cigar, and making it rain. You too could achieve the only real superpower: unimaginable wealth.

It’s important to understand the culture of the subreddit to see just how this could happen. It is a far cry from r/PersonalFinanceCanada; nobody is linking Statistics Canada articles about market conditions. You’re likely to see profane scenes from “Moneyball” and “The Wolf of Wall Street” with stock tickers superimposed on characters. Couple this with tantalizing pictures of investment gains, and memes of spectacular losses, and advice that ranges from zany to absurd, you have as they have put it “4chan in a Bloomberg terminal”.

Of course, the hedge funds of Wall Street weren’t going to subject themselves to the whims of these masses. Robinhood, the app most of the Redditors used to trade stocks, prohibited the purchase of GME stocks, among others, purportedly to “protect investors”. They did continue to let users sell GME stocks though. This helped reduce the stock price and allowed hedge funds to cut some of their losses. Further, many parts of the financial establishment accused the subreddit of illegal market manipulation.

This event has exposed issues in the financial industry. Expect the fix to be guided by those who push the levers of power, those with the money. Memes have a best-before date, money never does.