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‘We elected a meme!’: How the meme president became a meme stock

We’ve seen meme stocks before. But with Trump’s Truth Social, believers are using their retirement funds to bankroll one obscenely wealthy individual to even greater riches

'A bet on Truth Social is not just about taking a position in the market. 'I like the stock' comes to mean 'I like Trump'.' Photograph: Will Oliver/EPA

Rachel O'Dwyer
Thu Apr 4 2024 - 06:00

In November 2016 we tipped into an alternate reality where Donald Trump – president of the United States – was no longer a joke. Plenty of people were shocked and dismayed. But 4chan, the anonymous online community known for politically incorrect memes were not. As Florida turned red and Hilary supporters were filmed ugly-crying in the streets, they took to the message boards to celebrate. We were living in their reality now. “I’m f***ing trembling with excitement…” one member wrote, “We actually elected a meme as president”.

What does it mean to say that Trump was a meme? Just as a “meme” is an idea or piece of information that rips through the public consciousness, Trump was an empty signifier for whatever his voters wanted him to be. For older supporters, he was the way back to the American Dream. But for downwardly mobile millennials on 4chan, his rise to power revealed what they already knew – the dream was dead. Trump was a farce. And yet here he was, at the top of the food chain. His win made success and failure and politics all meaningless. It only made sense of systemic failure. Trump stoked their nihilism. Trump was a meme. He was their meme. And now the meme was president of the most economically powerful country in the world. What else than for a meme president to shill a meme stock?

[ Trump’s net worth falls by $1bn as social media firm sinks ]

Trump founded Truth Social after his Twitter ban in January 2021. A modest two million MAGA devotees gather there to talk conspiracies, God and guns. Despite its poor performance in recent months, when the company went public last Tuesday under the ticker DJT, shares rose to $9 billion in the first two days of trading, before falling by 20 per cent on Monday, when the company revealed “greater profitability challenges” (or “jargon for ‘we don’t make sh*t’” as one Reddit user put it). Social media has called it: Truth Social is the latest meme stock.

By purchasing call options during the GameStop saga, investors hoped, somewhat misguidedly, that their actions could ‘stick it to the man’

But what exactly is a meme stock? Meme stocks became popular during the Covid-19 pandemic. New zero-fees apps like Robinhood blending gambling, social media and investing came to the fore and scooped up “investors” who might have otherwise passed the lockdown playing video games or betting on football. Around the same time, a new brand of “finfluencer” emerged on social media, dispensing bite-sized investment advice (Mrs Dow Jones on Instagram, TheStockGuy on Twitch – even, arguably, Elon Musk on Twitter), stoking up hype around the latest cryptocurrency or volatile stock in ways more connected to online sentiment than underlying asset value.

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In 2021, members of the Reddit community r/WallStreetBets (“Like 4chan found a Bloomberg terminal”) began a co-ordinated action to buy and hold call options for the second-hand game retailer GameStop, despite clear indications that the company was going out of business. GameStop stock went from less than $3 in 2020 to $483 in late January 2021. A bet on GameStop meant potential riches if you could hold your nerve, but it also meant sticking it to Wall Street and allegiance with Keith Gill aka Roaring Kitty, the finfluencer who supposedly instigated the action. Suddenly it was possible to hedge memes like oil or real estate. And it was possible for social media apps to make markets.

[ Trump Media valuation is insane ]

Meme stocks are money, then, but they are also social media. And in true social media style, they conflate market activity (paying/investing) with online communication (posting/liking/trolling). Bets hedge real money, but they also connect members to their tribe. A bet on Truth Social is not just about taking a position in the market. “I like the stock” comes to mean “I like Trump”, even if expressing that sentiment can win or lose you a house. Money talks.

Transactions in Dogecoin were small enough their social value outweighed their role as currency; they were a payment in kind, a joke for another joke. When Elon Musk invested in Dogecoin for his children in 2021, it seemed like the joke was on us. Photograph: iStock

The first and arguably most famous meme currency was Dogecoin, an offshoot of Bitcoin that built upon the online doge meme. The meme – you probably know it – features an anxious Shiba Inu dog surrounded by fragmented thoughts that are, presumably, a Comic Sans manifestation of its own internal monologue (much introspection). The jokey nature of the doge shaped how it was spent – users sent small amounts of Dogecoin to others to “tip” or “thank” them for their contributions on Twitter or Reddit. As journalist Sarah Jeong described it, Dogecoin was a token earmarked to reward “socially valuable content” online. Transactions were small enough that their social value outweighed their role as currency; they were a payment in kind, a joke for another joke. When Elon Musk invested in Dogecoin for his children in 2021, it seemed like the joke was on us.

Trump founded Truth Social after his Twitter ban in January 2021. A modest two million MAGA devotees gather there to talk conspiracies, God and guns

But meme stocks aren’t really supposed to make sense or be sensible. Leave that to your boomer elders. These are desperate bets on the future by generations with nothing gained and nothing to lose, who don’t believe that help is coming from the state or that things will get better. They have little faith in democracy or incremental politics. If you have no assets or equity, if you’re saddled with student debt with no prospect of owning your own home, then why not shill a meme and hope to win big? Trump is the ideal meme for all that desperation.

[ Truth Social valued on virtual hot air, not fundamentals ]

Truth Social is the latest meme stock, drawing comparisons to GameStop and AMC. Like GameStop before it, the company has little going for it on paper. Trump’s answer to Twitter lost $60 million last year, while bringing in only $4 million in revenue. It is still worth $7 billion at current prices. But in many ways the story of Truth Social runs counter to GameStop. By purchasing call options during the GameStop saga, investors hoped, somewhat misguidedly, that their actions could “stick it to the man”. (I say “misguidedly” because those who ultimately made money were the company’s chief executive and Citadel Services, Robinhood’s market maker). Truth Social is the exact opposite. Instead of the nihilistic 99 per cent lampooning the 1 per cent, earnest Truth Sayers are using their retirement funds to bankroll one obscenely wealthy individual to even greater riches.

[ If he thought the maths were right, convicted fraudster Sam Bankman-Fried ‘would do it again’ ]

Outside the Truth Social echo chamber, retail traders on sites like WallStreetsBets are unconvinced by DJT. As early as last Tuesday, regulars on the r/WallStreetBets forum identified that put options (a derivative used to speculate on downside price action) for the stock were skyrocketing. The market does not expect the value of Truth Social to hold.

“Did we really need to wait for any official filings to ‘suddenly discover’ a grift is under way?” one Reddit user posted in response to downturns on Monday, April 1st. “The only thing that would make this sweeter is if some [investor] went on social media and cried cuz they yolo’d into this stock and lost their life savings and now they aren’t voting for Trump anymore”.

Rachel O’Dwyer is a writer and a lecturer in digital cultures in the National College of Art and Design, Dublin, and the author of Tokens: The Future of Money in the Age of the Platform

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