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The Populist Revolt: Gamestop, Wallstreetbets, and Everything Else

America’s Populist Revolt Progresses Onward

If you’ve been following the news recently, you might have noticed that something is happening, something that is building force yet isn’t quite out in the open. Restaurants are reopening despite lockdown orders, increasing numbers of people refuse to wear masks or follow lockdown orders, right-wingers (probably instigated and prodded on by Antifa types) stormed the Capitol. People mock our officials constantly. No one trusts the lying mainstream media, Congress, or institutions like the FBI. And now, people joking around on a forum called r/wallstreetbets, have brought hedge funds to their knees. We are witnessing a populist revolt.

the populist revolt
The hedge funds are going under. The populist revolt is starting.

Why is a populist revolt finally breaking to the surface? Because, for far too long, America’s elites sold the country out without there being any repercussion.

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Corporate raiders like Mitt Romney traipsed around the country, buying companies and ripping them apart to earn a few percentage points in profit. The result was that they enriched themselves while millions of Americans were put out of work and companies that generations had worked to build were torn apart forever.

Managerial elites have offshored jobs to China, Vietnam, India, and other companies, eliminating millions of jobs held by hard-working Americans to squeeze out yet another percentage point of profit. Rather than doing the hard, but wise in the long-term, thing and working to train Americans and make them more productive, companies have offshored the well-paying manufacturing job of the sort that built the American middle class.

But the worst of all are the hedge fund managers, the financiers. They add nothing to the economy. The Jordan Belfort-like stock jabbers that effectively steal from the unwitting common man. They don’t build things. They rarely provide the capital needed for new businesses to form. In fact, many of the New York “masters of the universe have found ways to profit by unnecessarily destroying companies.

In the words of the New York Post, those elitist hedge fund managers have taken to “shorting stocks, a trading technique where you make money when stock prices go down. Companies often go belly up amid short-selling ‘bear raids.”‘ Defenders of them claim that short-selling is an important part of the stock market. Populists see it as yet another way that the elites are destroying companies and jobs.

To be clear, those are companies that would not otherwise collapse. Their stock prices might go down as their fortunes fall, but it is only when the greedy money managers build massive short positions that they go belly up entirely because of the stock market. Those short-sellers don’t just add nothing to the real economy, they actively detract from it.

In the case of GameStop, the short-sellers shorted over 140% of the stock. They shorted more than of it than is on the market, hoping to drive it to $0 and destroy a decaying, but still fighting, company

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The Janus-faced elites claimed with a straight face to be strengthening the American economy whereas, in reality, they have been working to constantly weaken it. The GDP might have gone up, but opportunities for the average American have plummeted. What’s the point of good GDP numbers if the average American can’t survive thanks to the policies of the elites?

Well, now they’re no longer getting away with it. A populist revolt is in the offing and it’s not going away.

populist revolt
The Populist Revolt is Beginning

The most recent example of that populist revolt is what happened with r/wallstreetbets and GameStop stock, known as GME on the stock exchange. Redditors discovered that a few major hedge funds, such as Melvin Capital, had taken out major short positions on GameStop. Those funds and financiers were hoping that a major American corporation would collapse and thousands of jobs would disappear. They tried to short Tesla into death. Musk came out on top. They tried to short GameStop to death. The populist revolt came out on top.

The r/wallstreetbets crowd wasn’t having it. They decided to, as a joke, give Melvin Capital and the other raiders of American industry a heart attack. Through a series of memes and half-serious post, they bid up the price of a share of GME from ~$8 to ~$300. By constantly buying, and instructing their brokers not to “loan” their shares to short-sellers, which further reduced the supply of shares of the stock and squeezed the shorts even further, they brought Melvin Capital to its knees. Over the course of two weeks, it lost $13 billion. Short sellers are overall down $91 billion this year.

And those aren’t just paper losses. Short-sellers often have to buy stock to cover their positions, and then sell that stock at a steep loss, if the price of the stock they have shorted shoots upward. Melvin and others had to do so. They lost billions.

Good. They deserve it. They deserve what the populist revolt is serving them. They have more than earned our scorn and derision.

That’s not to say that investing is bad. It’s an incredibly important part of the average American’s long term financial health. Similarly, most investment professionals are good people. By bringing new companies to market, or, in the case of VC and private equity, helping private companies grow and establish themselves, they provide an invaluable service. What they do has made the economy grow for both Main Street and Wall Street.

But they are not to whom I am referring. They are not against whom the populist revolt is directed.

What I’m talking about is the type of person who recklessly gambles on risky stocks, often shorting stocks they shouldn’t, and then relies on a government bailout when their fund goes belly up. The populist revolt is directed against the type of person who buys orchidaceous clothing, vehicular transportation, and jewelry when prosperous and then relies on the taxpayer to heal their self-inflicted wounds when their short positions plummet.

It’s a fight against Nancy Pelosi buying a million dollars of Tesla stock shortly before a green energy initiative is announced, against Kelly Loeffler selling her stocks after receiving a Covid briefing, against the SEC regulators, politicians, and hedge fund managers that are okay with New York firms and hedge funds rigging the market in their favor, but not with individual investors buying a few shares of stock as part of an internet joke.

The populist revolt is happening because the people who are “at the barricades,” so to speak, know that the elites view them with utter condescension. It’s a budding struggle against the sort of elitist who has the gall to adumbrate policies they claim will help the average American, such as “green energy” policies, yet are really meant to destroy the jobs upon which they rely.

It’s what’s behind the popularity of ideas such as boycotting Big Tech. Twitter is okay with child porn and Iranian calls for genocide, yet it banned Trump for calling his supporters patriots. Why should Joe Sixpack use it? He knows Jack Dorsey views him with derision and wants him to shut up, he knows the managers of Melvin Capital couldn’t care less about him, why should he not do what he can to strike back at them? The average Joe’s position is already almost hopeless thanks to the policies of the elite, why not use what little money or freedom he has left to spit in their eye?

Charles Murray excellently described the rift in American society in his book Coming Apart. Since he wrote it, that rift has grown into a cavern. On one side is the managerial class and the financial elite. The Zuckerbergs, Dorseys, Pelosis, and Melvin Capitals of the world. The people who add nothing at all of value to society yet subtract much. On the other side is the type of man and woman who built America. The entrepreneurs like Elon Musk, the soldiers who fight the endless wars the politicians send them to fight, the oil pipeline builders whose jobs Joe Biden just destroyed, and the small business owners who have been crushed by lockdowns that benefitted crony capitalist corporate behemoths.

The populist revolt is finally starting because those on the American side of the chasm are tired of being oppressed and tyrannized by those on the oligarchic side.

Theirs is not an anti-capitalist view of the world. If you read Atlas Shrugged, for example, not a single hero in it is a stock market financier. Dagny builds railroads, Rearden pours steel, Ellis Wyatt pumps oil, and Ken Danagger mines coal. The closest anyone comes is Midas Mulligan, who was a banker. Yet he made his fortune by providing capital to good businesses. The antagonists, however, are constantly looking for ways to play the stock market in a corrupt manner. What happens when D’Anconia pretends something is wrong with his copper mines, for example, is the same sort of fearful stampede that happened when r/wallstreetbets bested Melvin Capital.

Nor is this populist revolt a jealousy of wealth issue. Yes, many of the people who are finally fighting back have been impoverished by the policies of the elite. But many wealthy people are on their side. Elon Musk and Donald Trump, for example, are the most prominent defenders of real America.

What this populist revolt is is a fight between the productive and the leeches. Elon Musk builds cars and rockets. Trump created massive buildings that have created immense value for their occupants and communities. Melvin Capital does nothing of the sort.

In a capitalist system such as ours, the “good guys” are supposed to be the producers, who grow wealthy by adding value to society. Thanks to the likes of Mitt Romney, Nancy Pelosi, and Melvin Capital, the producers have been decimated and those who leech off the value the producers created in a not-so-distant past are rewarded. That’s why the populist revolt is happening.

Until the system returns to where it should be, where the average man can better his financial position by working hard, the populist revolt will continue. If you love America, side with Trump and the populists over Melvin Capital and the unproductive.

By: Gen Z Conservative

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