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Exhibit 24
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Robert Williams
BlackBerry stock continues to rise amid ‘pushback
against the establishment’
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WATERLOO — It’s a situation that will soon be taught in finance classes around the world.
A David and Goliath tale where a group of Reddit users took on Wall Street, sending a select
number of stocks skyrocketing to unprecedented levels this week.
And right in the middle of it is a former tech juggernaut housed in Waterloo.
Stock prices for BlackBerry have more than quadrupled since the beginning of January,
jumping from just over $8/share to as high as $35/share on Wednesday.
And even BlackBerry doesn’t know why.
It was asked by the Investment Industry Regulatory Organization of Canada to comment on
the recent trading activity of its stock and had little to offer.
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“The Company is not aware of any material, undisclosed corporate developments and has
no material change in its business or affairs that has not been publicly disclosed that would
account for the recent increase in the market price or trading volume of its common shares,”
it said in a statement.
On Tuesday, a BlackBerry spokesperson told the Waterloo Region Record none of its
executives were available to discuss the direction of the company or the recent market price
jump.
The company announced in December it was partnering with Amazon Web Services Inc. to
develop and market IVY, an intelligent vehicle data platform.
And in early January, it announced it had sold 90 patents to the Chinese technology
company Huawei, cashing in on some of its intellectual property.
But while both were promising announcements, neither had an immediate impact on the
company’s stock price. That is until users on the popular Reddit forum “r/wallstreetbets”
started touting BlackBerry as the next GameStop.
GameStop, an American video game retailer, has seen its market shares rise from $20/share
to over $300/share this month, with new retail investors piling onto free trading sites like
Robinhood to get in on the action.
Subsequent forums have been created for companies like BlackBerry, AMC, Nokia and Bed
Bath & Beyond — each has seen its share price skyrocket this past week.
“A lot of retail investors, especially in the United States, have been using platforms like
Robinhood to get into a style of investing that really wasn’t as popular before,” said David
Cimon, a finance professor at Wilfrid Laurier University. “And we’re seeing a lot of
coordination around these online platforms like Reddit or Twitter where you have co-
ordinated retail speculation.”
It’s a little bit different than a typical pump and dump where stock prices are artificially
inflated through misleading or outright false statements, explained Cimon.
In this case, the online communities are very open about what they’re doing and they’re
roping in people who know why they’re being roped.
Billionaires like Chamath Palihapitiya — a University of Waterloo graduate — and Tesla
founder Elon Musk have since jumped in on the craze.
Palihapitiya told CNBC on Wednesday that “essentially what you’re seeing is a pushback
against the establishment in a really important way … instead of having idea dinners or quiet,
whispered conversations among hedge funds in the Hamptons, these kids have the courage
to do it transparently in a forum.”
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In response, calls for regulation have been heard on various American news broadcasters
over the last week, largely from investors who have made a living short selling — borrowing
shares and selling them with the hope of buying them later at a lower price, returning them to
the lender, and profiting on the difference.
When the stock goes up — as has been the case with Game Stop and BlackBerry — short
sellers can lose everything.
Cimon is not the type of person to speculate where this is all headed. Instead, he just said
that he’s “concerned” about what happens next.
That’s in large part because retail investing is virtually unrecognizable today. In the past,
investors would physically have to call up their bank and pay anywhere from $10 to $100 per
trade.
Now, with platforms like Robinhood and Wealthsimple offering retail investments for free on a
phone app, it has never been easier to invest.
And it’s never been easier to access others trading opinions on social media, either.
But just because it is effortless to go on Reddit or Twitter to look up what various influencers
say about finance, said Cimon, there are far more legitimate ways to get reliable information.
He cautions people not to get caught up in the fear of missing out. Online posts rarely tell the
whole story, he said, and many are only talking about the wins, not the losses.
“People have to realize that a lot of what we see on social media is very streamed to make
others look successful,” he said. “We have to be aware of what reality is.”
RW
Robert Williams is a Waterloo Region-based reporter for The Record. Reach him via email:
robertwilliams@torstar.ca
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