Reddit says it's down amid a stock-market frenzy caused by subredditors and skyrocketing GameStop shares
- Reddit said it's down on Wednesday afternoon amid stock market changes drummed up by a subreddit's buying up of GameStop shares.
- The company tweeted "yes we're down right now, I'll share updates here as we have them. pls don't yell at me."
- The 2 million members in the forum r/WallStreetBets drove the price of GameStop stock up after buying shares.
Reddit said it's down on Wednesday amid a stock-market frenzy surrounding a group of Redditors and GameStop shares.
The company tweeted "yes we're down right now, I'll share updates here as we have them. pls don't yell at me."
—Reddit (@reddit) January 27, 2021
Reddit did not immediately respond to Insider's request for comment.
A forum on Reddit is at the center of the current fluctuations that we're seeing in the stock market. Nearly 2 million members in the r/WallStreetBets subreddit collectively opted to buy more of GameStop's shares starting on January 11.
The forum members' so-called bidding up of GameStop's shares has sent them skyrocketing by more than 1,200%, driving the company's value up in the process. However, the value won't necessarily hold, and this doesn't mean GameStop is worth what the stock value is reflecting.
The subredditors' share purchases have prompted new investors to join in on the buzzy opportunity. But in short-selling, some investors have lost billions of dollars as a result. The hedge fund Melvin Capital, for example, is receiving a $2.75 billion investment to compensate for a 30% loss, as The Wall Street Journal reported.
The White House said Wednesday that the Treasury and others are "monitoring the situation."
"It's a good reminder though that the stock market isn't the only measure of the health of our economy," Press Secretary Jen Psaki said.
Vanguard, TD Ameritrade, and Charles Schwab's online trading platforms also experienced interruptions on Wednesday, with thousands of users reporting issues on DownDetector. TD Ameritrade told Insider that the issues were "due to heavy volume" but have since been resolved. Vanguard told Insider that its issues have also been resolved.
- Microsoft's ChatGPT-powered Bing browser now available publicly
- Don't be in a hurry to prepay but plan EMIs better, say experts as home loan burden set to rise
- RBI continues to ‘watch inflation’ closely even as industry hopes for a pause
- PM Modi endorses Indian Oil's 'Surya Nutan' solar cooker at India Energy Week! Should you switch?
- Adani Power's Q3 profit plunges 96% to Rs 9 cr as expenses rise
- CCTV camera for home with mobile connectivity for 2023