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A bizarre and bitter battle is raging these days on the world's stock exchanges: Here a global crowd of mostly younger small investors, there two New York hedge funds and with them the financial establishment.
What began as an adventurous and funny idea from a shrill Internet forum and turned into hype, turned into a power struggle by Thursday at the latest, when the hedge funds struck out in an organized counterstrike.
For the small investors, who are also called Robinhood Traders after a broker popular in the USA, it is now not just about breakneck stock market speculation, but about fundamental, even existential questions.
On the other hand, the hedge funds Melvin Capital and Citron Research are not only fighting for their profits, but against the impending bankruptcy.
But let's start with those who gave this drama its name, but who have so far appeared as extras: Gamestop, a chain of stores for video games with 14,000 full-time employees in 5,500 branches worldwide.
In view of its outdated business model, the chain was already in crisis before the corona pandemic.
While trying to reinvent itself in the online age, the company came under the spotlight of some hedge funds.
This "shorted" Gamestop.
That is, they borrowed large amounts of Gamestop shares from other dealers and fund companies, sold them, and speculated on being able to buy them back later at a cheaper price.
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The Wirecard case has once again shown that short sellers can act as a corrective on the financial markets.
But at the same time they have a reputation for causing problems for individual companies or entire economies with their bets.
In August, a user of the Reddit forum "r / wallstreetbets", a kind of collective central organ of Robinhood traders with almost five million members, discovered the immense extent of the bets against Gamestop.
His idea: we round up as many people as possible to buy these stocks.
A kind of counter-bet.
Daring, but not completely hopeless, stock trading is much more widespread among the US population than in Germany, for example.
Trading apps like Robinhood, with which one can make transactions with the swipe of a thumb and which offer their members credits for stock market transactions as soon as they open a securities account, have further popularized stock trading.
And in the Corona crisis, numerous new people were added - as a result of unemployment, boredom or both.
According to the Bloomberg news agency, Robinhood traders make up one-fifth of US stock market trading today.
The madness started in August
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When the coordinated buying (and holding!) Of Gamestop stock began in August, it stood at around four dollars.
At the turn of the year it was already 18.8 dollars, on Monday 76.8 dollars, before the preliminary high was reached on Wednesday: 347.5 dollars, madness!
The thing had outgrown Reddit forums.
Gamestop has become the most traded share not only in the USA and Germany, but worldwide.
In addition to a crowd of private investors, institutional investors such as Blackrock jumped on the bandwagon, and the shortsellers had to close their first positions, i.e. buy Gamestop shares, and contributed to the price increase.
The two hedge funds posted losses worth billions, Melvin Capital had to be saved by an investor.
At the same time, the wave spilled over to a lesser extent to a handful of other stocks such as Blackberry and Nokia.
On Thursday the last turning point so far occurred: some brokers suspended the purchase, but surprisingly not the sale of the contested stocks - including Robinhood and Trade Republic in this country - while the hedge funds tried every possible way to depress prices and trigger panic selling.
Some small investors sold.
But most of them showed a reaction of defiance: “Hold on!
Buy more! ”They called to each other.
The result: a rapid roller coaster ride in which the price jumped between 112 and 483 dollars.
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At this point at the latest, it becomes political.
Because if the guys from Wallstreetbets and their comrades-in-arms - there are clearly more men than women at the start of the stock market guerrilla - it would be sensible to save as much of their profits as possible in view of the impending total loss.
But even in German-speaking forums, a different mood, which runs counter to all stock market logic, has prevailed so far: "I don't sell shit, I even buy more, even if I lose everything!"
With their perseverance slogans they are pursuing a magical goal: the "short squeeze".
Like at Volkswagen in 2008.
At that time, shortsellers had bet on a large scale against the VW share.
But the price rose.
When their deadline expired and they had to buy back the shares, they couldn't find any.
There was a “short squeeze”, ie the supply shortage - and bang!
-, the price exploded from 200 to over 1000 euros.
This goal alone shows: A bunch of blind amateurs and ruthless gamblers are not just raging here.
The whole thing should not end as a pyramid scheme, in which those who came last or who missed the jump fall by the wayside.
Instead, the plan is: We'll go out together and take maximum profit with us.
And the hedge funds, which small investors like to laugh at as “stupid money”, get punched in the face on behalf of Wall Street.
Redistribution is part of everyday life
Whether that works or not - this strategy alone turns this bet into a political action.
And a redistribution campaign.
Now the redistribution of assets is part of the daily bread on the stock exchange: That was the case before the financial crisis of 2007/08, when banks turned on unsuspecting small investors with bad credit derivatives at the “people's share” Telekom, at Wirecard.
But this time it should be redistributed the other way round: from big to small.
Robin Hood.
In view of the dimensions that the whole thing reaches, Wallstreetbets seems garish and strange at first glance.
Because what otherwise characterizes stock market debates - price / earnings ratios, growth figures, esoteric charts - only plays a subordinate role here.
One has only contempt for a diversified portfolio, especially dividends.
What boomers.
Instead, it is teeming with deposit statements, with which users brag about their considerable profits or - even that - equally large losses (of course many of them trade with the same high-risk warrants as the hated shortsellers).
Martial slogans alternate with snappy insider gags, and strategy contributions sound like gamer portals: “Endgame, part 4: The saga continues.” In addition, emojis: sparkling diamonds, tense biceps and, again and again: igniting rockets.
Millions, oh what: zillions igniting rockets.
Even if the whole thing seems as if a horde of children in rollerblades had attacked the trading floor, the half piqued, half amused look that runs through much of the reporting, the talk of the unsuspecting young gamblers, is unfair and inapplicable.
Many may be inexperienced in the stock market, but the expertise of the swarm should not be underestimated.
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Because the daring action was preceded by a precise data analysis.
And as early as 2019, Martin Burry had pointed out that the shortsellers at Gamestop could have been wrong - the Burry who, as the manager of a hedge fund, had recognized before the real estate bubble burst, which garbage papers were being traded dearly, the one on the floor against the whole Wall Street made a bet - and to which Hollywood would later set a monument with “The Big Short”.
Burry says he has Asperger's Syndrome.
At Wallstreetbets, the biggest compliment is “Autistic Trader”.
Someone who doesn't give a damn about textbooks and analysts, does his thing and is successful with it.
The glowing blueprint: Tesla.
What Tesla shredded
Since last year, Tesla stock has soared almost as breathtakingly, tearing up tons of short positions in the process.
The electric car manufacturer currently has a proud market value of $ 820 billion - as much as the 15 largest automakers in the world put together.
Last year they sold 75 million cars, Tesla half a million.
The rush that the future is being traded on the stock exchange cannot explain this course, all the more so with the Robinhood traders.
For them, Gamestop is a hot flirt, but Tesla is a great love.
And a mutual.
Tesla boss Elon Musk also got involved in the gamestop hunt on Twitter.
Alexandria Ocasio-Cortez from the left wing of the Democrats and the California risk investor Chamath Palihapitiya have also expressed sympathy.
But professional investors are horrified at the “internet kids” who would think it would be fun to destabilize the stock markets.
And that's really fun.
People whose business model is big gambling and who consider any regulation of the financial markets to be the work of the devil, accuse the Robinhood traders of the casino mentality and demand that the stock exchange authorities end the spook.
The accusation of “market manipulation” is equally curious.
Because you can hold some things up to the internet crowd, but they are certainly not insiders.
And since the big backlash, retail investors have turned this accusation around.
Their suspicion: The hedge funds would have used their influence that brokers withhold buy orders or even suspend them entirely while they themselves set new short positions, bought each other's shares and depressed the price with a manipulatively reduced trading volume.
This cannot be proven.
What is certain, however, is that small investors have neither the influence nor the financial resources of the hedge funds.
If they agree, make it public.
They are loud, sometimes rough and shrill, but also: democratic.
A “multitude” in the sense of Antonio Negri and Michael Hard - a diffuse and diverse, but networked crowd that fights against the “Empire” for their political and economic participation.
Occupy Wall Street by Wall Street Funds.
The dark side of the multitude
Certainly there are also dark lines of tradition here: For example, on the “Gamergate” conflict from which the right-wing extremist Alt-Right movement emerged.
Or to the obscurantist forum 4chan, where the QAnon conspiracy theory originated - the motto before Wallstreetbets is: "As if 4chan had invented a Bloomberg terminal."
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But for now, other subcultural strategies of self-empowerment prevail.
There's something punk about it: we don't care that we can only play three chords, we're young, we're angry and we shout it out.
(“Kick out the jam, Motherfucker!”) The rave beckons with its lusty but ambiguous occupation of public spaces (“Tschaka tschaka, töff töff”).
And hip-hop says hello: I want to get out of this damned poverty, rich is cool.
("I, I get money, money I got.") It all adds up: If we get together, we can grill a billion dollar hedge fund.
Your loss = our gain.
A promise that was believed to be lost shimmers up again: social media as a place where ordinary citizens can express themselves and organize themselves in a democratic sense - past the censorship in authoritarian regimes and beyond the narrow-mindedness of the establishment that often prevails in democracies .
This promise was at the beginning of social media before it degenerated into a hoard of disinformation and self-sufficiency, abused by Trump, manipulated by Putin's trolls, inundated with rubbish of all kinds.
The gamestop hunt has little in common with the indignation debates on Twitter.
The requirements (share portfolio) and the personal risk (money) are much higher, it is not about identity politics, and social media is not an end in itself, but a place of retreat.
The actual battle is also raging on the Internet, but on the stock exchanges.
And if you dig through the many slogans, tirades and rocket emojis and look behind the serenity on display, you can see a deep social current in the statements at wall street bets or other forums.
It is mostly members of the "Generation Z" or Millennials who express themselves here.
They are poorer than previous generations their age, have higher student loans, poorer prospects and know that the welfare promises of yesteryear no longer apply to them.
In addition to the oldest employees, they are hardest hit by the Corona crisis.
The Gamestop action may be crazy, a financial market chasing from one record to the next in the midst of an economic and social crisis is even more insane.
The role of childhood memories
These young people associate personal childhood or youth memories with the competitive stocks like Gamestop or Nokia.
Another formative experience that played a role in this campaign: Many of them saw how their parents lost their jobs and sometimes their houses in the course of the financial crisis in 2007/08, while the banking system was saved with taxpayers' money after the Lehman bankruptcy.
One user writes: “Gamestop is about more than just money.
It's also about sending a message: for all the recessions that caused it.
For all the jobs and homes that people have lost.
For all of the people who can't pay for college because the minimum wage stagnated while Wall Street got rich. "
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The often cited split in US society has not disappeared, but it is taking place here along different lines.
Since the forum rules of Wallstreetbets forbid political statements, it's not about red versus blue, white versus black, but: bottom versus top.
It wasn't just racism and national chauvinism that brought Donald Trump to power and ultimately still brought him a brilliant result.
And it wasn't just experiences of racism and police violence that exploded in the Black Lives Matter protests.
The whole country a Bruce Springsteen song.
A cry for help
But the campaign hit a nerve outside of the USA as well.
So writes, no: someone shouts in a German-speaking forum: “You are not giving us a fair opportunity for retirement, you are not giving the many young people fair support in a crisis of the century.
And then you wankers are still angry when we invest in Gamestop because your old friends have become too greedy and we could win now. "
Of course, a diffuse mood against the establishment can turn into resentment, and the Trump troops that stormed the Capitol were also inspired by an anti-elite mood.
The gamestop hunt is latent in the highly dangerous distinction between “creating” (good) and “collecting” (bad) capital.
The defaults against individual hedge fund managers are also ugly.
But something else counts for the moment: the action is, as a commentator for the Washington Post put it, nothing less than a cry for help.
This chase will end one way or another.
But a power has flashed up that the financial markets and politics will have to reckon with in the future.
Measured against the challenge of whether and what the boys do with it, the thing with Gamestop was really just that: a piece of cake (with a lot of rockets).