When I started writing this, Gamestop stock was at $347 a share. It’s now at $103, still way up from $21 a month ago. If you’ve missed this story about how Redditors pumped a video game retailer up to a $24 billion market cap during a global pandemic, here’s a recap.
Judging by the flood of explainer pieces, many people are confused about how a seemingly random stock could explode like Gamestop has over the past week. This is understandable. From a financial markets perspective, in which stocks are supposed to reflect a company’s perceived value based on past performance and projected earnings, it doesn’t make any sense. But when you consider how everything else on the internet works, it starts to look very familiar.
How do we pick shows to watch on Netflix? Often it comes down to what’s new and prominent on the homepage, that fresh Netflix Original everyone’s talking about on social media. We watch the thing that everyone’s watching, because we want to be part of the conversation. Think Tiger King. Everyone watches these shows and moves on; they’re a collective fascination that arise for no clear reason then fade away.
The Gamestop situation has worked in much the same way. There are plenty of narratives about why the people buying Gamestop are doing it — collective action to stick it to hedge funds, pandemic-fueled boredom, memes. But…
