This Is the Way: Reddit Traders Changing Economics

Introduction

The article “This is the way’: the Reddit traders who took on Wall Street’s elite” is of particular importance because an event is observed there that happened recently. The described situation is an example of social forces’ influence on the financial industry. According to Parnell (2014), shifts in public opinions and attitudes result in thorough modifications of an industry’s strategy and configuration. Platt et al. (2021) reveal in detail the motifs of modern traders and their impact on the structure of the endured financial center of the USA, as well as analyze the consequences of such an undertaking. Several newly emerged social trends led to this occurrence: the development of web commerce, the information bubble where all the Internet users abide, and the chasm between specialist investors and ordinary people. As a result, a new force is getting involved in traditional shareholders’ dominance over the economic system as the young generation of educated and politically engaged people arises.

Main body

The whole situation seems to have started as a joke but somehow gained interest and enthusiastic Redditors, provoking unrest among the professionals in the financial community. Notably, a few subscribers of the WallStreetBets section consciously began to influence the share price of the nearly closed retailer company (Platt et al., 2021). Consequently, the efforts achieved success and numerous participants while intervening in the regular interaction between business executives and administrators. Nevertheless, the actors are primarily inexperienced in the investment sphere. Thus, according to Platt et al. (2021), the effect caused might not be prolonged and incredibly profitable. In brief, the occurrence has involved various populations and presents a case of mindful incursion into funding enterprises’ structure.

The Reddit sharers may not have attained a lasting triumph but have challenged the dominance of pension investors and shareholders because of several premises. First of all, the Internet allows a broad range of people to acquire professional skills applicable but not profoundly mastered (Slavomír, 2017). A stratum of average-level specialists that can partake in such activity as commerce, widening it and taking some part of control previously owned by competent managers. Another critical factor is the information bubble that restrains Internet users from critiquing the knowledge they prefer to obtain. Similarly, social media imprison individuals in the communities that share their interests. Therefore, people become entirely convinced in their beliefs, radicalized, and ready to act accordingly. Hence, the subscribers of WallStreetBets have occurred to receive enough insight into commerce and motivation for action to influence a whole economic domain.

Subsequently, a new segment of the population has achieved a place in the financial world that alters its arrangement severely. Firstly, governance over the enterprises or even industries can be divided further to include this novel fraction. In turn, ordinary people are to influence economics subconsciously and with an understanding of the processes involved and with limited forethought. In addition, these attempts of protesting turned out to be politically biased, which means a probable future increase in political presence in business (Platt et al., 2021). Thereby, such social phenomena as an immersion into publicly available information and strengthening a single person’s views through social media can lead to economic changes.

Conclusion

To conclude, social trends and transformations are precursors of economic adaptations or disruptions. The case of GameStop shows how a relatively insignificant group of people may become influential and dictate the possible future direction of the funds’ composition. Thus, it illustrates the concept of social pressure on the industry, which Parnell (2014) observes in his book. The capabilities of ordinary enthusiasts have been widened enough to raise the concerns of elite financiers. The economic world is constantly changing. Thus, corporations’ leaders should remain observant of such fluctuations in order to respond to them appropriately.

References

Ćurković, M., & Košec, A. (2018). Bubble effect: Including internet search engines in systematic reviews introduces selection bias and impedes scientific reproducibility. BMC Medical Research Methodology, 18(1), 1–3. Web.

Parnell, J. A. (2014). The external environment: Social and technological forces. In Strategic Management: Theory and Practice (pp. 78–115). SAGE Publications.

Platt, E., Smith, C., Darbyshire, M., Kantor, A., & Wigglesworth, R. (2021, January 31). ‘This is the way’: the Reddit traders who took on Wall Street’s elite. Australian Financial Review. Web.

Slavomír, G. (2017). Influence of cyberspace on changes in contemporary education. Communication Today, 8(1), 30–39.