WallStreetBets, GameStop, and the “Swirl of Distrust” That’s Electrifying the Stock Market

Jun 11, 2024

One of the things I learned was that Robinhood just had crisis after crisis. Every year when they were recruiting in 2015, their backend systems would just break down. But each crisis seemed to only make the app more popular, and give them more customers. It meant, to me, that Robinhood could turn a crisis into an opportunity for growth.

It made me realize that there’s this new law of attention on the internet, in which it doesn’t matter whether the attention is bad or good; it just matters that you get attention. So the crises for Robinhood would make people more aware that Robinhood existed and make people and would draw in a new wave of customers that would make the app even bigger. This is another place where it feels like the parallels with Donald Trump are so obvious: Donald Trump has managed to figure out this system in which every scandal only makes him more popular because the internet just feeds on attention.

Jaime Rogozinski had an interesting quote in the book. He wrote, “Serious onlookers might feel indignation by what happens on WallStreeBets, but millennials are treating Wall Street for what it is—a huge casino made for them to play in.” Do you think that that perception has lasted about Wall Street—that it is just this system of legalized gambling and guesswork as opposed to sober professional adults doing financial analysis?

It’s a great question. Let’s put it this way: I think a lot of people have gotten drawn in by the way in which the markets feel like a casino or a game. That’s the first thing that had pulled in a lot of the characters in my book and made it seem fun. The markets were not fun before. The markets were not viewed as entertainment before the last few years, and now they have become a source of entertainment.

But then they realize, like, Oh, this is very interesting. When you’re betting on a stock, you’re making these decisions about how the economy works and how companies work. And people dive in, and it becomes this very engaging pursuit in a way that offers a real education. All of a sudden, you’re learning math and you’re learning how interest rates work.

I think the two-sided nature of this is part of what makes it so interesting, and is also very much a part of how the internet works now. I feel like we’ve entered his age of trolling, this form of interaction in which everything is a total joke and very serious at the same time.

And that’s an insane duality to rest upon for a community that’s putting millions and millions of dollars at stake. You don’t know if anyone who’s posting anything is being serious or just or just having a laugh, right?

Yeah, that is what’s so destabilizing about all of this is.

How do you think WallStreetBets changed the culture around short-selling in the industry? Do you think that institutional investors are a little more cautious these days when it comes to taking out short positions because of what happened with GameStop?

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