(Bloomberg) If the meme-stock mayhem were a movie -- and by all accounts it will be -- we’re now at the scene where the protagonists, after pulling off their first big mission, fight about what to do next.
Emboldened by their initial success, the more daring would be anxious to ride again while the weather-worn veterans advise caution and, somewhere in between, a few characters can’t decide which side they’re on.
That scene is playing out now on the 10 million-member WallStreetBets forum, where much of the craziness that has upended markets over the last year has been galvanized. While the GameStop Corp. raid developed organically around a classic value-investing thesis, subsequent runs in the shares of everything from AMC Entertainment Holdings Inc. to ContextLogic Inc. (ticker: WISH) resemble a more coordinated campaign.
Take the discussion around ContextLogic for example. According to data compiled by Quiver Quantitative, its shares were the second-most talked about Thursday on WallStreetBets and the most mentioned stock over the last week.
Threads discussing the online retailer -- which like many other WallStreetBets favorites is both heavily shorted and a money-losing business -- featured comments such as “also buy the stock not just options help everyone out in making the price go up!” And “let’s make this fly!”
Predictably, many of the original meme-stock diehards on WSB were quick to dismiss the attempts to meme-ify WISH.
(Some of the more biting putdowns, which went beyond mere facepalm emojis, were quickly deleted by moderators.)
Yet talk of inciting short squeezes has become so rampant that one forum member proposed banning the word “squeeze” altogether. Of course, in typical WSB fashion, that same commenter also suggested more conspiratorial motives for all the hubbub about short squeezes.
“I wouldn’t be surprised if most of it came from hedge funds, trying to get people to buy in so they can drop the bag somewhere along the way,” wrote the user known as Traditional_Fee_8828.
In another thread, FOMO quickly devolved into finger-pointing, recriminations and a plea to make common cause in the name of a quick buck.
But not everyone loves the idea of using WSB to coordinate attacks. In recent days, multiple threads have been posted to discourage users from thinking as a collective or fighting among each other about what stocks to invest in.
“We are not a group. We are not on a team. And we are not an ‘organization’ (for lack of a better term) set on destroying hedge funds,” wrote Naturallycyborg7 in a post titled “I just want to reiterate that this subreddit isn’t a collective.”
Another user, aptly or ironically named TheTradingCollective depending on your perspective, tried to tamp down the infighting by urging different factions to refrain from attacking each other as they try to draw support toward their latest bet.
“All day I’ve just been reading back and forth comments from $amc holders to $clov to $wkhs and all the others just bashing each other,” the poster wrote. “So we’re rooting for other individuals downfall now? That’s not the idea behind WSB and should not be the way this is.”
The “way this is,” of course, is to revel in playing in what users saw as the stock market casino.
“Do not feel that you must invest in a stock because someone said it was a sure thing, it’s not half of the stocks are bets,” wrote Naturallycyborg7. “You are gambling in the casino when you invest in stocks, so please do your research, please invest what you can afford to lose, and please make your own decisions.”
