Power to the People. 5 Recent Scenarios Prove that America As We Know It Is Changing

The economic fallout from COVID-19 set the stage for the public to fight back against traditional social and financial frameworks.

America is changing.

The past 12 months have shown a marked change in our social order and what the everyday citizen is willing to accept. Instead of accepting things as they are, people are rising up en masse to voice their opinions. Niche groups are also encouraging behavioral and financial action.

Of course people don't just change behavior overnight, catalysts instigate action.

The perfect confluence of events made this possible:

COVID-19

COVID is obviously the biggest tailwind. People have time to observe, think and take strategic action. Ironically, a virus that requires us to socially distance has made it easier to organize via social media and other grass roots outlets.

Economy

With COVID-19 came widespread unemployment for service industry and blue collar workers. Unemployment is a known irritant.

Increasing the money supply

The subtle erosion of buying power that hasn't yet hit Main Street. However anyone with basic knowledge of supply and demand understands that if you increase the amount of something, the items already in existence become more commonplace and less valuable. The same is true for money.

As governments print more, currency already in circulation gets devalued.

You have a population feeling financially strapped and helpless in the COVID economy; meanwhile the dollars they do have are not as valuable.

History is repeating itself in the modern era. It's as if everyone read the Sovereign Individual simultaneously. Unrest became inevitable.

Here are 5 recent events that prove that people are frustrated and taking action accordingly:

The Summer 2020 Police Brutality Protests

Nearly every major city in America and globally saw people take to the streets to protest police brutality in summer 2020. It was a widespread coordinated effort of individuals desperate to get their voices heard.

The protestors' plea what somewhat stifled by mass looting and social disorder. Nevertheless, their message became center stage for weeks and could not be ignored.

GameStop short squeeze

The GameStop short squeeze is about more than a niche Reddit group taking over financial media. What started as deep value investing play morphed into a David v Goliath story of retail investors versus large hedge funds.

Disclaimer: I'm a member of r/WallStreetBets. I don't think the squeeze was ever supposed to become a cultural and financial movement. Of course, when there's money to be made more people tend to hop on the bandwagon. Like the police brutality riots, these things can take on a life of their own when the storyline can be framed in a way that resonates.

The GameStop short squeeze is an example of the public majority wanting "fight back" against the financial elite. People want to feel in control their financial destiny. When Robinhood interfered with trading, that only added to the momentum of needing to stand up against powerful financial forces.

At the time of this writing, we don't know how the largest short squeeze will end. This history is still being written.

Cryptocurrency rally

The past year has also brought significant rallies in cryptocurrency. Bitcoin had a notable serge in November 2020 and again in January 2021.

Cryptocurrency attracts a person looking to opt-out of the current financial system and hedge against devaluing fiat currency. In some ways, flocking to crypto can be seen as a financial protest on its own.

As more people are converted to believe in a decentralized monetary system, the more valuable it will be.

It's important to note that individuals are not the only ones choosing to buck the current social order and financial system. Companies are bypassing big banks and going directly to the public to finance their growth:

Companies Raising Money with Crowdfunding

Typically a company would only be able to raise from accredited investors or use a big bank to complete an IPO. Thanks to the JOBS Act of 2012, companies can crowdfund their growth with a "mini IPO" using tools like Reg A+.

This changes the entire landscape of opportunity for both investors and the company.

Companies can raise from literally anyone with financial capacity so long as they follow the regulations. RegA+ and other crowdfunding vehicles open up investing opportunities that have been off limits for Main Street investors.

Companies Raising Money with SPACs

Another popular way companies can bypass the intermediary and raise money directly from the people is using a special purpose acquisition company (SPAC). Basically, SPACs allow retail investors to invest in private equity type transactions. It works like a merger instead of an IPO and allows increased transparency on the company's growth trajectory.

SPACs have gained national attention as some notable investors have repeatedly chosen this fundraising vehicle.

Growing discontent in America which has already lead to everyday citizens using their platforms and dollars to voice their opinions. More and more the major players are starting to take note. What's interesting is that the trend suggests that each uprising is less and less about the vehicle and more about the point the people are trying head to make.

What's left unknown is how this will change the current social order and financial system as more people circumvent traditional methods.

Disclaimer: The author may have holdings in the securities and vehicles mentioned in this article.