# Meme Stocks: How One Subreddit is Taking on Wall Street

- Link: https://chatterblast.com/blog/meme-stocks-how-one-subreddit-is-taking-on-wall-street/
- Published: 2021-02-02T21:22:09-05:00
- Author: Kyle Krajewski

Something fascinating has unfolded on **Reddit** over the last couple of weeks and
it speaks volumes about the power of social media. In order to fully understand 
what’s going on, we’ll need a bit of background on the stock market.

Going back before the pandemic, **GameStop ($GME)** had been a struggling chain 
of retail stores. Their outlook didn’t look great. And when a company’s outlook 
doesn’t look great, investors on Wall Street can take advantage by “_shorting_” 
that stock.

> Times Square go brrr
> Courtesy of /u/SomeGuyInDeutschland [pic.twitter.com/glvOWYL4sY](https://t.co/glvOWYL4sY)
> — Mod (@wsbmod) [January 30, 2021](https://twitter.com/wsbmod/status/1355617591587430405?ref_src=twsrc%5Etfw)

## **What does “shorting a stock” mean?**

When investors short a stock, they’re betting against it. Essentially what they 
do is borrow that stock at its current value and sell it to other investors at that
price. When their prediction is correct and the value of that stock drops, they’ve
sold the stock at a higher price than it will cost to cover their borrowing from
the original owner. **_Profit!_**

Shorting stocks is a fairly common practice at hedge funds like **Melvin Capital**,
which bet heavily against GameStop.

> Here come the shorty apologists
> Give them no respectGet Shorty
> — Elon Musk (@elonmusk) [January 28, 2021](https://twitter.com/elonmusk/status/1354891972406865922?ref_src=twsrc%5Etfw)

## **What is a “short squeeze?”**

A short squeeze is what happened with GameStop. Think of it as a perfect storm of
factors that cause the price of that stock to surge – contrary to the predictions
of the hedge funds that shorted it.

When demand for a stock is increased – in this case by an army of individual investors
with Robinhood accounts on Reddit – the price goes up. Short sellers have to buy
the stock at the higher price to cover their losses. Long buyers are buying the 
stock for future gains. Everyone is buying and no one is selling.

It’s then, as they say on **r/wallstreetbets**, that we go “_TO THE F**KING MOON!”_

> The best performing assets of 2021 are:
> – A failing video game retailer
> – A cinema chain close to bankruptcy– A dog-themed
> cryptocurrency
> — Dr. Parik Patel, BA, CFA, ACCA Esq. (@ParikPatelCFA) [January 31, 2021](https://twitter.com/ParikPatelCFA/status/1355954124290981897?ref_src=twsrc%5Etfw)

## **What is r/wallstreetbets?**

Reddit is “_a network of communities based on people’s interests._” These communities
are called “_subreddits,_” which are basically discussion forums. With over **2 
million subreddits**, there is one for just about anything you can imagine.

[r/wallstreetbets](https://www.reddit.com/r/wallstreetbets/) is self-described as“
_Like 4chan with a Bloomberg terminal._” It’s a politically-incorrect space where
dank memes meet aggressive and absurd stock trading theories and discussion. A common
theme includes treating the stock market like a casino and finding ways to win big–
fast. Hence the name r/wallstreet**bets**. The subreddit currently has over 7 million
members or, as they call themselves, **degenerates**.

> r/wallstreetbets is now the largest hedge fund in the world.
> Excepts it’s completely decentralized and entirely democratic.
> — Chamath Palihapitiya (@chamath) [January 30, 2021](https://twitter.com/chamath/status/1355580731980869637?ref_src=twsrc%5Etfw)

## **A Quick Guide to r/wallstreetbets Vocabulary**

In order to understand the nature of this community and the concept of stocks as
memes, it’s important to understand some of the vocabulary frequented in r/wallstreetbets.
A lot of this vocabulary is just a series of emojis with memetic value.

** : **The rocket ship emoji is short for _“TO THE MOON!” _This implies that an 
investment is soon to take off/skyrocket.

** : **This set of emojis is otherwise referred to as “diamond hands.” A person 
with diamond hands is prepared to be patient and hold onto their stocks until they
see a large profit.

[[

** : **The opposite of diamond hands, this set of emojis refers to “paper hands.”
A person with paper hands is too eager or nervous and sells their stock too early–
before they see max profits. Those with paper hands are commonly shamed in r/wallstreetbets.

**Tendies : **Short for chicken tenders, tendies are profits/gains. Because what
else would a bunch of self-proclaimed degenerate stock market gamblers do with their
earnings other than feast on tendies? When profits are imminent, “_soon may the 
Tendieman come._”

**We like the stock: **This commonly-used phrase is a meme for a currently trending
stock. People who use this are bullish on a specific stock and are part of “_Bull
Gang._”

**Apes strong together: **In the battle of the common man against the Wall Street
elite, the common man is referred to as “ape.” Apes must stick together in targeting
stocks, holding their shares, and going to the moon.

**Hold the line: **Otherwise a phrase used in battle, this phrase is a r/wallstreetbets
warcry that urges investors to be strong and hold onto their shares – even if it
goes down in value. Don’t get paper hands!

> [It’s treason then](https://www.reddit.com/r/wallstreetbets/comments/l881ia/its_treason_then/)
> 
> by[u/keenfeed](https://www.reddit.com/user/keenfeed/) in[wallstreetbets](https://www.reddit.com/r/wallstreetbets/)

##### _“I am the one who holds.”_

**YOLO: **Short for “_you only live once,_” the term YOLO was popularized by recording
artist Drake nearly a decade ago. The term has found new life in r/wallstreetbets
as a verb, meaning to take a wild financial risk. A person YOLOs their entire paycheck
on GameStop stock.

**u/DeepF\*ckingValue: **Recently revealed to be YouTuber “[Roaring Kitty](https://www.youtube.com/c/RoaringKitty/videos),”
Keith Gill – known by his Reddit profile u/DeepF*ckingValue – is the newly-minted
kind of the subreddit and the person who predicted and led the GameStop short squeeze.
Gill regularly posts screenshots of his gains, which reveal that he YOLOed hundred
of thousands of dollars into $GME months ago, which – last week – turned into just
under $50 million.

> This is the picture of the man who started the whole [#GME](https://twitter.com/hashtag/GME?src=hash&ref_src=twsrc%5Etfw),
> Gamestop craziness. Keith Gill aka /u/DeepFuckingValue on Reddit
> Look closely at the picture and it's exactly how you imagine a Reddit investor.
> Uno cards, old school calculator, t-shirt, bandana, gaming chair.
> Love it. [pic.twitter.com/FTXOaDf8eg](https://t.co/FTXOaDf8eg)
> — Simon Sundén (@joinsimon) [January 29, 2021](https://twitter.com/joinsimon/status/1355253748793290754?ref_src=twsrc%5Etfw)

**Stonks : **This is an intentional misspelling of “stocks.” This term is used ironically
because what it really boils down to is that all of this is just one big meme. The
stonks culture of r/wallstreetbets is a meme and the stonks being targeted by the
7-million member subreddit for short squeezes are memes.

[[

## **What in the world is a “meme stock?”**

One month in and you can check “_stocks are now memes_” off on your 2021 bingo card.
In hindsight, it was really only a matter of time before internet culture met and
targeted Wall Street.

A meme is defined as “_an element of a culture or system of behavior that may be
considered to be passed from one individual to another_.” We typically think of 
them as the funny and relatable images like [**Cozy Bernie**](https://www.instagram.com/p/CKWk2cBjvix/)
or [**Doge**](https://en.wikipedia.org/wiki/Doge_(meme)) that we see on the internet
and share with our friends.

But as a concept, memes transcend that. Memes can be intangible ideas or courses
of action that explode and spread like wildfire through a culture or subculture.
In this case, that idea is the conversation around and targeting of these highly-
volatile stocks by a new, young culture of investors on Reddit.

GameStop isn’t the only meme stock out there, nor is it the first. Companies like
AMC, Nokia, and Blackberry are all being targeted.

And it’s not even just in stocks that we’re seeing this trend.

**Dogecoin **– yes, inspired by _THAT_ Doge – is now the most-mentioned cryptocurrency
EVER on Twitter. It literally has a meme in its name and logo and could potentially
end up making some people very rich. Heck, even the richest man in the world has
[tweeted about it](https://twitter.com/elonmusk/status/1340590280848908288?s=20)
[multiple](https://twitter.com/elonmusk/status/1284291528328790016?s=20) [times](https://twitter.com/elonmusk/status/1354924057825837060?s=20).

> [#Dogecoin](https://twitter.com/hashtag/Dogecoin?src=hash&ref_src=twsrc%5Etfw)
> Billboard. 📍Hanover, Pennsylvania. 🌎🚀🌕 [pic.twitter.com/SikU5Xyjwr](https://t.co/SikU5Xyjwr)
> — Dogecoin Rise 🌎🚀🌕 (@DogecoinRise) [February 2, 2021](https://twitter.com/DogecoinRise/status/1356688891747598337?ref_src=twsrc%5Etfw)

So what happens next? Who knows! It will be an interesting situation to monitor 
in the coming weeks.

*Maybe your Dogecoin investment will take you to the moon!!!!

![](https://chatterblast.com/wp-content/uploads/2021/10/giphy.gif)

**\*FOR LEGAL PURPOSES, THIS IS NOT FINANCIAL ADVICE!**