Today I made my second post on the red hot subreddit r/wallstreetbets about my new position in Cash App parent company Square, Inc ($SQ). And just like my first post, it was taken down and deleted after 15 minutes. Having had my first post immediately deleted, this time I made sure to follow all of the subreddit’s community guidelines etc. However, the post was still taken down even though it followed all of the guidelines. Then I had a realization: The people who run WallStreetBets don’t want people posting about good companies with strong prospects. WallStreetBets is simply a vehicle for a select few to pump and dump garbage stocks like GameStop ($GME) and Blackberry ($BB) which are going to $0.
So here’s how the scheme works: The moderators on r/wallstreetbets identify bad companies with poor prospects, purchase options for cheap on these companies, then relentlessly pump these companies on their r/wallstreetbets subreddit. Think about it, you can’t buy options for cheap on good companies with strong prospects such as Square. You can only buy options on the cheap for trash companies like GameStop and Blackberry.
Anyway, that’s my rant for the day. Maybe everyone already knew this, but this was sort-of a big awakening moment for myself. I was experiencing quite a bit of FOMO recently about wallstreetbets and really wanted to get in on the action. But now I know the truth: r/wallstreetbets is just a pump and dump scheme, and their moderators only want suckers piling into shit. It is not a place for legitimate investors making legitimate investments.
UPDATE (June 11th, 2021, 1:56PM): I could be wrong about WallStreetBets. I posted a similar post on r/investing and it was immediately removed as well. It could be that Reddit in general is highly manipulated by moderators who decide who is allowed to post and which posts will be pushed to the top. I know that r/bitcoin was notorious for censoring people back in 2017/2018 during the great block size wars, so maybe Reddit in general kind of sucks.
UPDATE (June 11th, 2021, 4:07PM): Maybe disregard my last update. Check out this Hacker News post I stumbled upon this afternoon. According to user PragmaticPulp, “/r/WallStreetBets has devolved into a pump-and-dump echo chamber…” and that “[WallStreetBets is] heavily moderating the sub to only allow posts and comments that glorify $GME. The only allowable content is that which insinuates anyone who buys $GME is about to get extremely wealthy, or that everyone buying $GME is sticking it to Wall Street.“