WallStreetBets: How Boomers Made the World’s Biggest Casino for Millennials
by Jaime Rogozinski
Timeline Unknown
Los Angeles, CA
Recommended by Reddit users on r/wallstreetbeets (WSB)
I was one of the people who invested in GME and other meme stocks and woke up to a loss of tens of thousands of dollars, experiencing a personal black swan event; all because I went against the educated and experienced-based advice of my financial advisory, didn’t read the finance journals or reports, and didn’t listen to my friends who trade. Instead, I told the chief financial advisor (based on our texts) that I was a now a “cowboy astronaut” and that I was “unleashing the North African bull’ and riding it “to the moon” while making it clear that I wanted to invest in “the Holy Shit” stocks. Within 24 hours, I found myself still on earth and staring at the screen that presented a plunge in assets and a text message that read “I told you so.” As a result, I’ve taken a break from personally trading and I’m letting the professionals do their job. It is important to keep in mind that I was willing to lose the amount I invested from the start, a concept I will touch upon later as I summarize the story of u/TheTriviaTribe and u/SUPER4MAN (doesn’t mean I’m not angry at RobinHood and other platforms for manipulating the market). I’ve been on Reddit since November 2020, following r/wallstreetbets (WSB) before it turned into what it is now and r/Egypt (where one of my posts went viral). After my crash I wanted to learn more about the subreddit, it turns out the founder of the subreddit wrote this book, he’s a polarizing figure that is disliked by many users because he tried selling them out; that being said the book he wrote is worth reading. It’s a simple and short book that’s highly illustrated with screenshots of discussions and users win/loss charts and summarizes everything about wallstreetbets’s history and how it came to be, the trading mentality and subreddit culture, an overview of popular users with their wins/losses as examples, and general financial and stock market education. Had I read it in the past, I would’ve been more diligent and knew what I was getting myself into, I consider myself to be aggressive-calculated risk, most WSB users are maniacs for risk. I want to put a big emphasis on the fact that most of the old-timers on the subreddit did not invest as much into GME and the other recent meme stocks as the newcomers, maybe it’s because they experienced the recent historical events featured in the book first-hand.
The book presents how the subreddit came to be through an interesting combination of the evolving capitalist and ambitious mindset, the advancement of technology that provides accessibility, and the growing pains of the millennial age. It is now harder to become wealthier or to remain above water than it was during our parent’s and grandparent’s time, millennials are looking for side hustles and different ways to get “big money.” Furthemore, the user CrystalBaller going on reddit for advice presents the reality of more millennials turning to the internet for help (which we all do). The creation of new platforms that have given more people accessibility, with less obstacles to face, has brought in a more diverse set of new traders; if you have access to a phone, tablet, or laptop: you can now trade with ease, with a small amount. The dreams of fast and big wealth from small amounts has always been idolized, with many people dreaming about hitting the jackpot in the casino or winning the lottery. All this combined has led to the stock market being treated like an online casino. What made the subreddit so attractive was that it was a place for the unfiltered and very-high risk-taking individuals, who could discuss the market and present their wins and losses. The rise to ultimate fame of the subreddit was due to the (rare) extreme examples of wins due to options trading from teenagers who had initially invested a couple of thousands of dollars through their phone from their bedroom and gained millions overnight (I’m exaggerating here), they basically won the stock market’s jackpot/lottery and they were playing in the same arena as trained professionals using Bloomberg Terminals at Goldman Sachs. They’re But what most people are unaware of, there’s more losses on WSB than these extreme wins. What I found interesting is the perspective that a lot of the traders are tech savvy with an affinity for video games, they view the stock market in the same way: a game that can be beat, optimal strategies can be used, and cheat codes can be found. They’re right though, and it’s not like institutions haven’t been finessing their own system for decades.
To touch upon the advice I give to others while investing in very-high risk stocks, is to only invest what you are willing to lose AND invest if you understand what you’re doing. In other words, don’t stab yourself and don’t be an blind idiot. I was willing to lose the amount I invested and I knew I was going to be fine if I lost it all. What was sad to see was several users posting about how they maxed out their credit cards, took out loans or borrowed big money, drained their life savings, etc. to invest into GME, just to wake up to a loss that will heavily penalize them. When it comes to options trading, yes it’s high risk and high reward, but study the practice first. I avoid options because I want to have a 100% understanding of it before doing it (I’m at 90%). Even though I’ve read into it and have had hour long zoom calls with my friend Paris Hajali explaining it to me, I’m still not 100% in my understanding, so I won’t do it. Another mistake I made is I didn’t read heavily into what was going on, which is unusual. I saw the media craze, the price of a stock shooting up, and the flood of posts about it on Reddit; then blindly invested. I will state though, that the market was both manipulated by institutions and that communities were deceived by teenagers posting on reddit that they were holding when they weren’t just to go viral. I lived it and I learned from it, and walked away with a important conclusion; as Paris puts it, “If you have FOMO, you’re already probably too late.”