Defiant Reddit investors behind a dizzying surge in GameStop shares have used billboards and banners to mercilessly mock the Wall Street hedge funds losing billions in the frenzy.
“$GME GO BRR,” read a digital billboard in New York’s Times Square for an hour on Friday, referencing a popular internet meme describing the sound a money-printer makes, and the stock ticker for GameStop.
According to the New York Post, the ad was created by digital billboard maker Matei Psatta and cost him just $US18 as he purchased the time from his own company.
“Did it purely to support the movement and make some people smile,” he said. “I’m considering running another but want to see how the sentiment is on Monday.”
Shares in the bricks-and-mortar video game retailer have surged by more than 1700 per cent since the start of the year, from $US17.25 to $US325 at close on Friday, as amateur investors from the WallStreetBets Reddit forum banded together to punish the hedge funds who had made huge financial bets that the company’s stock price would collapse, known as short selling.
As the price rises, short sellers are forced to “cover” their positions by buying back the stock at a huge loss.
GameStop’s stock price, which at times last year was as low as $US2.57, peaked last Thursday at an astronomical high of $US483, sparking chaos on Wall Street as hedge funds were brought to their knees with billions in losses.
As of Friday, institutions shorting GameStop shares were sitting on $US19 billion in losses in 2021, according figures from data provider Ortex reported by Business Insider.
“For the first time, it is almost as if God gave a reason for all us to band together to battle corruption and stand for what is clearly right,” wrote one Reddit user. “I have never experienced unity like this before, regardless of where you belong in the political spectrum, everyone is unified in what needs to be done.”
One of the biggest losers, hedge fund Melvin Capital, required an emergency $US2 billion bailout from fellow hedge fund boss Steve Cohen, owner of the New York Mets baseball team.
Another digital billboard ad was spotted in Oklahoma that read, “We’re not leaving! $GME”, with emojis for diamonds, hands and rockets.
On the Reddit forum, users resisting pressure to sell say they have “diamond hands”, while the rocket signifies the price going “to the moon”.
“We drove by it and took the picture,” Tess Jenkins, who took the picture of the billboard which made its way to the Reddit group, told the New York Post.
“I think it’s great. I think more power to the people. I am excited. I am very happy this is happening. This last year has been kind of crazy. I’ve enjoyed it. My husband has been dancing.”
In another stunt, a plane was hired to fly over San Francisco with a banner reading, “Suck my nuts Robinhood.”
Kaspar Povilanskas, founder of Nowadays Media, said on Twitter that he had paid the pilot extra to “circle right above Robinhood’s HQ for a while”.
On Thursday last week, the Robinhood app, a retail investing platform that many of the amateur investors were using, placed trading restrictions on a number of the volatile stocks including GameStop and AMC Entertainment.
Users were able to sell the shares but not buy, in a move that sparked outrage from both sides of the aisle and calls for an investigation into potential market manipulation.
Critics have highlighted the close relationship between Robinhood and hedge fund Citadel, which is a major investor in Melvin Capital.
But Robinhood chief executive Vlad Tenev has denied any wrongdoing, saying it is a “conspiracy theory” that Citadel or any other firm pressured him to restrict trading.
“On that conspiracy theory, I think I’ve over and over again said it’s not true,” he told Yahoo Finance.
“Our decision to temporarily restrict customers from buying certain securities had nothing to do with a market maker or a market participant or anyone like that putting pressure on us or asking us to do that. It was entirely about market dynamics and clearing house deposit requirements as per regulations.”
As both sides anxiously await the market reopening on Monday, politicians have called on regulators to intervene.
The US Securities and Exchange Commission has said it is investigating the actions of all “regulated participants” involved.
“The commission is closely monitoring and evaluating the extreme price volatility of certain stocks’ trading prices over the past several days,” the SEC said in a statement on Friday. “We will act to protect retail investors when the facts demonstrate abusive or manipulative trading activity that is prohibited by the federal securities laws.”