John Maynard Keynes once said that “the markets can remain irrational longer than you can remain solvent.” That is, bubbles do not automatically correct themselves. Looking at the progression of the stock market during the Covid-19 pandemic makes this reality clear enough. In April 2020, as 20.5 million people lost their jobs in the United States, the S&P 500 index had its best month in 33 years. The decoupling of stock market growth from real economic growth is not a new phenomenon, as the seemingly endless rally since the 2008 global financial crisis has shown.

The surprising performance of the stock market has driven an increase in retail investment through easily accessible online trading platforms such as Robinhood. This surge in retail investment has driven the rise of communities such as Reddit’s r/wallstreetbets which now has an astonishing 9.1 million subscribers. This community has not only fueled a recent craze in the trading of the GameStop stock, but has also highlighted the systemic flaws that have been building up in the financial system. The market price and the real value of stocks have diverged so significantly that this hurts common retail investors, and online trading platforms such as Robinhood only exacerbate this issue.

So what happened with GameStop? Utilizing these platforms, groups of people collaborated to orchestrate a mass buying wave of the GameStop stock (GME) along with others including AMC and Nokia. The stock rose meteorically to a peak of 347.51 U.S. dollars from 19.95 U.S. dollars on Jan 8. Anyone with the foresight to invest from the beginning could have made themselves rich. But who loses from this bubble? Short-selling hedge funds, who had bet heavily on GameStop’s failure lost almost 20 billion U.S. dollars from this frenzy. This seeming redistribution of wealth from parasitic financial firms to the working class generated claims of a “GameStop revolution”, and hopes that the event would show the working classes what they can accomplish through collective action.

However, Robinhood and other trading outlets began restricting trading of these stocks as the bubble grew larger, indicating that these platforms serve institutional investors. The restrictions were lifted after a few days, but they arguably diminished GME’s momentum and the damage to the app’s reputation — 56% of account holders are still considering leaving the platform — was already done.

Alex Kirshner argues that when it comes to e-trading apps, the true customers are the products, not retail investors. Robinhood is yet another free app where the adage “if you’re not paying, you’re the product” should be considered by prospective users — the app may be benefitting from you, not vice versa. Robinhood makes 19,000 U.S. dollars per U.S. dollar in the average user’s account compared to 1,881 U.S. dollars for TD Ameritrade and 195 U.S. dollars for Charles Schwab. Robinhood already has free reign over this money and your data; it is far from a fair trade when you cannot profit from all possible investments. A 19,000:1 ratio is far higher than what you’ll be getting out of just about any possible trade.

Watching billionaire investors over the last several weeks decry this bizarre stock market bubble as an exploitation of the rich or as a perversion of the market’s true function of “raising capital to do useful things” has provided a strange sense of schadenfreude. The detachment of a stock’s market price from its fundamental value — based on real economic indicators — is far from new, having defined the market since the Great Recession. But the situation has become even more bizarre as Covid-19 directed trillions of U.S. dollars of government spending into speculative assets, though this has been building for many years. The only aspect of the bubble that has changed is its visibility to the general public, and in this regard perhaps GameStop will have a lasting impact on our social consciousness.

The stocks that soared last month are now falling back down, so this individual disruption is likely to remain just a blip as the Dow Jones and other stock indices clearly remain vastly overvalued and inflated. But the question for society and Wall Street is whether this is the last publicly driven market spike we will see. Redditors have already driven spikes in the value of silver, the Elon Musk-fueled Dogecoin and other stocks and commodities since the GameStop craze. On its current trajectory, this will lead to further decreased faith in the market among not only big businesses but the general public who have seen it as a crucial economic indicator that they all have a stake in.

It is likely that more regulations will follow for Wall Street, but the question is whether this will curtail large-scale hedge funds or further illustrate the rigged game by hurting retail investors. The cat has been let out of the bag: ordinary people can now see for themselves how unambiguously detached the stock market is from everyday economic reality. And our financial system is so broken that disruption might perhaps be the only path forward.