this post was submitted on 28 Dec 2023
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I vividly remember how, in the days of Gamestop, even normally reasonable people on the left bought into that "Sticking it to Wall Street" narrative. Sadly, I'm not surprised at how things turned out.
I'll be one of the resident communists.
I think it's important to not forget the positive facts (pardon the pun!) in the GameStop situation. The event really did contain a short squeeze, and one Manhattan hedge fund really did take it in the shorts (pardon me again!), nearly becoming insolvent in front of their friends and eventually closing up shop. (One London hedge fund also was taken to the cleaners. Robinhood was embarrassed in front of Congress, and worse, in front of their clearinghouse.) Additionally, GameStop has continued to restructure its management and operations, and the local GameStop (in the local dying mall) is doing about as well as the Claire's next door in terms of customers.
This was a victory, but only in a specific sense: Wall Street was wrong about GameStop's failure, and collective action forced specific firms to admit their wrongness and even fail as ongoing concerns. The meme-stock cult can't understand this, because they imagine that there must be more. More wrongness, more collective action, more FAFO. They can't be proud enough to have destroyed two hedge funds and caused a Congressional inquiry; it's gotta involve literally melting the bull and throwing traders out of skyscrapers. (Not that I'll stop anybody from melting the bull!)
For all the talk about "sticking it to Wall Street", it's quite likely that most of the biggest "winners" in the GameStop mess were Wall Street types. Either trading for their employers or trading in their personal accounts.
IIRC, some people pointed out at the time that this particular trade was quite sophisticated - probably orchestrated by people who knew what they were doing and who understood that the hedge fund they wrecked had acted in a particularly dumb/risky way. I guess with this kind of information, another hedge fund could have pulled that off just as easily as the people from WSB on Reddit.